Pareto Oil & Offshore Conference

Kristian Johansen CEO 14th September, 2016

Forward-Looking Statements All statements in this presentation other than statements of historical fact, are forward-looking statements, which are subject to a number of risks, uncertainties, and assumptions that are difficult to predict and are based upon assumptions as to future events that may not prove accurate. These factors include TGS’ reliance on a cyclical industry and principal customers, TGS’ ability to continue to expand markets for licensing of data, and TGS’ ability to acquire and process data products at costs commensurate with profitability. Actual results may differ materially from those expected or projected in the forward-looking statements. TGS undertakes no responsibility or obligation to update or alter forwardlooking statements for any reason.

©2016 TGS-NOPEC Geophysical Company ASA. All rights reserved.

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Agenda

 Introduction  Market Overview  TGS Strategy  Q2 2016 Financial Highlights  Appendix (financial information)

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3

This is TGS The World’s largest geoscience data company   

Traded on Oslo Stock Exchange, part of OBX Index (25 most liquid shares) Headquarters in Oslo and Houston (Operational) Regional offices in London, Perth, Calgary, Mexico City and Rio de Janeiro

The Leading multi-client data library covering frontier & mature basins   

~3,000,000 km 2D data, ~500,000 sq. km 3D data and ~8,600,000 digital well logs Other data types include CSEM, multibeam, coring, gravity, magnetic, interpretive products Strategy to enter frontier regions, grow library and apply new technologies as basin matures

Asset light and multi-client business model   

Flexibility through no vessel ownership – few long-term capital commitments Investment decisions driven by financial returns rather than asset utilization Client relationships – leading global sales & marketing team; exploration partner to E&Ps

Solid balance sheet backing TGS strategy   

No debt and strong cash position allow counter-cyclical investment Average dividend yield of 4.2% over last seven years 10-year average return on capital employed of ~40%

©2016 TGS-NOPEC Geophysical Company ASA. All rights reserved.

4

Agenda

 Introduction  Market Overview  TGS Strategy  Q2 2016 Financial Highlights  Appendix (financial information)

©2016 TGS-NOPEC Geophysical Company ASA. All rights reserved.

5

Challenging Market for Exploration

Year on Year decline in spending 

Second consecutive 20%+ decline in E&P spending expected this year Impact on exploration budgets expected to be larger

23

Near-term volatility expected  

Seismic demand likely to remain weak through 2016 Near-term, greater variability of demand between quarters and across regions Seismic spend will likely be prioritized in existing program areas that have premium economics

22 19

19

16

16 8

7

15

14

6

3

2

0 -10

-8

-10

-20 -25

Source: SEB Research

Most initial E&P Spending surveys indicate further decline in spending

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26 23

11

10

-30

2017 E&P spending under pressure 

20

21

-26 -27

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016E 2017E



27

30 Change year-on-year (%)



Change in Global E&P Spending

6

Long-Term Outlook Positive Global Production / Consumption (mn b/d)

Global Oversupply Moderating  

Global oversupply is anticipated to continue to moderate through 2017 from a Q4 2015 high Market balance from Q3 2017 but supply response continuing to create volatility

2.3 2.0

2.0 1.7

1.3 0.5

0.7

1.4 0.8

0.8 0.5

0.4

0.4

0.4

-0.2 -0.6

Need to Replace / Grow Reserves  

Only 2.7bn barrels of new conventional oil supply was discovered in 2015, the lowest since 1947 (Wood Mackenzie) Combined with increasing demand, lack of new discoveries will drive increased exploration spending as oil companies look to replace/grow reserves – the key question is timing

Long-Term Demand Increasing  

Global energy demand is expected to grow about 25% by 2040 driven by non-OECD countries Oil and natural gas expected to meet ~60% of global energy demand in 2040

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Source: EIA

Key Trends in the Seismic Industry Seismic* Return on Average Capital Employed

Seismic sector has underperformed financially   

15%

ROCE below cost of capital Capital intensive and low entry barriers Critical product for end-user

10%

5%

0%

-5%

Gradual shift from proprietary to multi-client   

2009

Seismic contractors taking more risk E&Ps tendering seismic acquisition as multi-client Higher prefunding but potentially lower returns

2010

2011

2012

*Global marine seismic industry excluding TGS

2013

2014

2015

Source: S&P Capital IQ; TGS

Seismic Spending (BUSD)

Fragmented market offering consolidation opportunities  

Number of players constant since peak despite seismic spending falling by 2/3 Consolidation would provide the industry significant benefits over the course of cycles

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10.0 9.0 8.0 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0

40% 38%

38%

38%

45% 59% 63%

2010

2011 Other

2012 DP/Imaging

2013

2014 Multi-Client

2015

2016-E

Contract

Source: Fearnley Securities; TGS

2017-E

Agenda

 Introduction  Market Overview  TGS Strategy  Q2 2016 Financial Highlights  Appendix (financial information)

©2016 TGS-NOPEC Geophysical Company ASA. All rights reserved.

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Areas with Faster Payback will Likely Recover First

 First movers will be areas with the best economics, or a combination of break-even oil prices and payback period  Although initial focus will be on first mover areas, TGS will maintain a portfolio approach to investments to capture higherreturn opportunities in more frontier regions

Break-even oil price

 Chart highlights areas that are likely to see incremental seismic activity first as market conditions improve

Payback

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10

Fast & Flexible Business Model Personnel and Other Operating Costs* -40

Reacting quickly to right size the company Operating costs down 30% year-on-year Operating costs down 51% since 2014 Variable pay drives alignment with staff

-30 -20

MUSD

  

-10 0 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 * Adjusted for restructuring costs and larger impairments of operating items

Cash Outflow correlates to Cash Inflow

Strong correlation between cash inflow and cash outflow

800

Investment down 54% to MUSD 230 Large reduction in vessel rates since peak Prefunding of investments stable at 40-45%

MUSD

  

1,000

600 400 200 0

Free Cash Flow

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Cash inflow

Cash outflow

Solid Balance Sheet Backing TGS strategy

Balance sheet remains healthy through down-cycle  

Other Goodwill

66 68

Cash

162

Receivables

255

171 37

1167

Cash balance per Q2 2016 of 162 MUSD Undrawn Revolving Credit Facility of 75 MUSD

Multi-client Library

Current liabilities Non-current liabilities

Equity

823

Assets

Equity & Liability Equity and

Market Capitalization (in USD millions)

Strong share price relative to sector   

1,786

TGS market capitalization of 1.8 BUSD Represents ~57% of industry (ex-SLB) Strong currency to explore inorganic investment opportunities

26 160

17

8

3

72

510

570 TGS

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CGG

PGS

SPU

ION

PLCS EMGS MCG

SBX

Strategic library acquisitions  Dolphin library acquisition  Agreement in principle to buy the majority of the Dolphin MC library together with PGS  Enhancing TGS’ already strong position in areas such as the Barents Sea, the North Sea, NW Africa and Australia  Limited initial cash outlay  Definitive agreement expected in the near future

 TGS is actively seeking consolidation opportunities through strategic library acquisitions  Polarcus library 2015  Dolphin library 2016  Other opportunities monitored closely

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Solid Value Creation Over Time Share price development*

Long-term value creation track-record  

1,100 1,000 900 800 700 600 500 400 300 200 100 0

Annual total return of 11% since IPO in 1997 Well above both the oil service segment and the general stock market

Counter-cyclical investment 

Strong cash generation is enabling the company to both invest counter-cyclically as well as paying dividends to shareholders

Avg. annual return since TGS IPO in 1997 TGS S&P 500 Oil Services**

11.4% 7.7% 5.8%

* Values in NOK, adjusted for dividends ** Current OSX components that have traded since TGS IPO (equal weighted)

Dividend paid* (2010 – 2016) 1.6

Policy of paying dividends in line with long-term underlying cash flow 

Aim to keep a stable quarterly dividend through the year (measured in USD) Actual quarterly dividend level paid will be subject to continuous evaluation of market outlook, cash flow expectations and balance sheet development

8.5 NOK 8.5 NOK

1.2 USD per share



8 NOK

1.4 5 NOK

1.0

6 NOK

0.8 0.6

USD 0.15 per Quarter

4 NOK

0.4

Q3

0.2

Q2 Q1

0.0 2010

2012 2013 2014 2015 2016* Year of Payment * Quarterly Dividends, defined in USD from 2016 Historical NOK dividends converted to USD using FX rate on ex-dividend date

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14

2011

Q3 Investment Focus

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15

2016 Key Objectives Free cash flow generation Consistency in delivering product quality Significant cost efficiencies Intense client focus

©2016 TGS-NOPEC Geophysical Company ASA. All rights reserved.

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Agenda

 Introduction  Market Overview  TGS Strategy  Q2 2016 Financial Highlights  Appendix (financial information)

©2016 TGS-NOPEC Geophysical Company ASA. All rights reserved.

17

Q2 2016 Financial Highlights Q2 2016 Revenue Distribution

Total Revenues

Other 12%

300 250

AMEAP 9%

200 150 100

3% Y/Y

298 190

172

50

140

169

132 64

NSA 52%

114

0

Europe 27%

Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2014 2014 2015 2015 2015 2015 2016 2016

Free Cash Flow *

EBIT * 150

60%

150

100

40%

100

20%

50

50 0

111 71

37

38

46

0%

31

0

24 -19

-50

-20%

-50

-40%

63

49

15

-20 -76

-35

-100

Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2014 2014 2015 2015 2015 2015 2016 2016 EBIT EBIT Margin

Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2014 2014 2015 2015 2015 2015 2016 2016 * Defined as cash flow from operational activities minus operational cash investments in multi-client projects

* Earnings before interest and taxes and excluding larger impairments and restructuring costs

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84

18

Summary  Signs of improvement in oil companies’ willingness to invest in seismic data during Q2 2016, however, the market is expected to remain challenging and volatile in the near term  Long term fundamentals continues to be positive  Global oversupply moderating  Need to replace / grow reserves  Long-term demand increasing

 Asset-light, focused multi-client strategy continues to outperform  Cost control, disciplined counter-cyclical investment and balance sheet strength positions TGS to enhance its leading position

 Updated 2016 guidance:  New operational multi-client investments of approximately 230 MUSD  Additional multi-client investments expected from sales of existing surveys with risk sharing arrangements  Multi-client investments are expected to be prefunded 40% to 45%

©2016 TGS-NOPEC Geophysical Company ASA. All rights reserved.

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Thank you

Kristian Johansen CEO

©2016 TGS-NOPEC Geophysical Company ASA. All rights reserved.

Agenda

 Introduction  Market Overview  TGS Strategy  Q2 2016 Financial Highlights  Appendix (financial information)

©2016 TGS-NOPEC Geophysical Company ASA. All rights reserved.

21

Net Revenues Late sales revenues

Prefunding revenues

250

100

200

80

150

60 226

100 50

3% Y/Y

130 72

82

Q1 2015

Q2 2015

90

90

Q3 2014

Q4 2014

20

84 38

0 Q3 2015

Q4 2015

Q1 2016

94

40 51

74

62

37

23

26

0 Q2 2016

Q3 2014

Q4 2014

Q1 2015

Q2 2015

Q3 2015

Q4 2015

Q1 2016

Q2 2016

Total revenues

Proprietary revenues 10

300

8

250 200

6 4

-50% Y/Y

53

9

9

150

-33% Y/Y 6

2

100 5

5

5 3

3

Q1 2016

Q2 2016

298 190

-18% Y/Y 172

50

140

169

132

114 64

0

0 Q3 2014

Q4 2014

Q1 2015

Q2 2015

Q3 2015

Q4 2015

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Q3 2014

22

Q4 2014

Q1 2015

Q2 2015

Q3 2015

Q4 2015

Q1 2016

Q2 2016

Net Revenue Breakdown Q2 2016

Q2 2015

GPS 10%

GPS 10%

2D 15%

2D 48% 3D 42% 3D 75%

Q2 2016

Q2 2015 Other 14%

Other 12% AMEAP 9%

AMEAP 16% NSA 52%

NSA 51%

Europe 27%

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Europe 19% 23

Operating Expenses, EBIT, Free Cash Flow Operating expenses * 40 35 30 25 20 15 10 5 0

Amortization and impairment * 250 200 150

-30% Y/Y 32

37 25

24

28

22

230

100

62% - rate 143

18

50

17

105

81

99

62

69

0 Q3 2014

Q4 2014

Q1 2015

Q2 2015

Q3 2015

Q4 2015

Q1 2016

Q3 2014

Q2 2016

Q4 2014

Q1 2015

111 38

37

46

31

24 -19

Q3 2014

Q4 2014

Q1 2015

Q2 2015

EBIT

Q3 2015

Q3 2015

Q4 2015

Q1 2016

Q2 2016

Free cash flow *

EBIT *

71

Q2 2015

* Q1 and Q2 2016 reflects the new amortization policy effective from 1 January 2016

* Include personnel costs and other operating expenses. Adjusted for restructuring costs and larger impairments of operating items

120 100 80 60 40 20 0 -20 -40

74

Q4 2015

Q1 2016

60%

150

40%

100

20%

50

0%

0

-20%

-50

-40%

-100

63

49

15

-20

-35

-76

Q3 2014

Q2 2016

110

84

Q4 2014

Q1 2015

Q2 2015

Q3 2015

Q4 2015

Q1 2016

EBIT Margin * Defined as cash flow from operational activities minus operational cash investments in multi-client projects

* Earnings before interest and taxes and excluding larger impairments and restructuring costs

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24

Q2 2016

Multi-Client Library 200 150 100

163 50

126

135

116

93

88 53

62

0

Q3 2014

Q4 2014

Q1 2015

Q2 2015

Q3 2015

Operational investments

700

Q4 2015

Q1 2016

Multi-client library - NBV 1,000

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%

Prefunding ratio

Operational investments

Operational investments and prefunding ratio

Q2 2016

850

976

800

876

837

818

Q3 2014

Q4 2014

750

919 839

830

823

Q1 2015

Q2 2015

Q3 2015

Q4 2015

Q1 2016

Q2 2016

Prefunding ratio

Net revenues vs net book value – year of completion 60%

609

52%

600

50%

500

427

40%

70%

30%

270

200

22%

34%

14%

100

20%

19% 17%21%

17%

122 10%

52%

1%

44%

451

381

400 300

900

700

Investments – year of completion

20 %

950

0% 1% 0%

4%

9%

7% 8% 1%

0%

0 2012

2013

2014

Original investments

2015

2016 YTD

Fully amortized

WIP

2013

2014

Net revenues

Net Book Value

©2016 TGS-NOPEC Geophysical Company ASA. All rights reserved.

2012

25

2015

2016 YTD

Net book value

WIP

Q2 2016 Income Statement USD million, except EPS

Q2 2016

Net revenues

Q2 2015 Change in %

114

140

-18%

0.8

0.1

1435%

69

74

-6%

Gross margin

44

66

-33%

Personnel costs

11

17

-37%

9

9

-3%

0.3

0.9

-61%

3

3

-7%

22

36

-39%

-0.3

2

-116%

21

37

-43%

5

13

-65%

17

24

-31%

EPS, Undiluted

0.17

0.24

-29%

EPS, Fully Diluted

0.17

0.24

-29%

Cost of goods sold – proprietary and other Amortization of multi-client library

62%

Other operating expenses Cost of stock options Depreciation Operating profit

19%

Net financial items Profit before taxes

19%

Taxes Net Income

©2016 TGS-NOPEC Geophysical Company ASA. All rights reserved.

15%

26

Q2 2016 Cash Flow Statement Q2 2016

USD million

Q2 2015 Change in %

Received payments from customers

28

141

-80%

Payments for operational expenses

(19)

(25)

25%

Paid taxes

-

(29)

100%

Operational cash flow

9

86

-89%

(1)

(3)

57%

(44)

(162)

73%

0.3

2

-82%

Interest paid

(0.3)

(0.003)

-10467%

Dividend payments

(14)

(99)

86%

2

0.03

5271%

-48

-175

73%

Investments in tangible and intangible assets Investments in multi-client library Interest received

Proceeds from share issuances Change in cash balance

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27

Balance Sheet USD million

Q2 2016

Q1 2016 Change in %

Q4 2015

Assets Cash and cash equivalents

162

210

-23%

163

Other current assets

255

189

35%

308

Total current assets

417

399

5%

471

Intangible assets and deferred tax asset

92

92

0%

90

Other non-current assets

16

16

3%

25

823

830

-1%

839

26

28

-7%

30

1,375

1,364

1%

1,455

171

168

2%

218

Non-current liabilities

4

5

-9%

6

Deferred tax liability

33

29

14%

33

208

201

3%

257

Equity

1,167

1,163

0%

1,198

Total Liabilities and Equity

1,375

1,364

1%

1,455

Multi-client library Fixed assets Total Assets Liabilities Current liabilities

Total Liabilities

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