Annual Report 2011

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CORPORATE GOVERNANCE REPORT 2011 reporting oil and gas reserves and related information as per National Instrument 51–101 (NI 51–101) issued under applicable Canadian securities regulation. The Reserves Committee reports to the Board on the Company’s procedures for disclosing oil and gas reserves and other related information, on the appointment of the independent qualified reserves auditor and on the Company’s procedures for providing information to the independent qualified reserves auditor. The Reserves Committee also meets with management and the independent qualified reserves auditor to review, and determine whether to recommend that the Board approve, the statement of reserves and other oil and gas information required to be submitted annually under NI 51–101. The CR/HSE Board Representative The Board of Directors has a leadership and supervisory role in all CR and HSE matters within the Group and appoints yearly one non-executive Director to act as the CR/HSE Board Representative. The tasks of the CR/HSE Board Representative include to liaise with Group management regarding CR and HSE related matters and to regularly report on such matters to the Board of Directors. The current CR/HSE Board Representative is Asbjørn Larsen. More information about the Company’s CR/HSE activities can be found in the Corporate Responsibility section on pages 32–39. Audit Committee 2011 Members William A. Rand, Chairman Magnus Unger Asbjørn Larsen Meeting attendance 6/6 6/6 6/6 Audit Committee work during the year – Assessment of the 2010 year end report and the 2011 half year report for completeness and accuracy and recommendation for approval to the Board. – Assessment and approval of the first and third quarter reports 2011 on behalf of the Board. – Evaluation of accounting issues in relation to the assessment of the financial reports. – Three meetings with the external auditor to discuss the financial reporting, internal controls, etc. – Evaluation of the audit performance and the independence and impartiality of the external auditor. – Follow-up and evaluation of the results of the internal audit of the Group. Other requirements – The composition of the Audit Committee fulfilled the independence requirements of the Code of Governance. – William A. Rand has chaired the Audit Committee since its inception in 2002 and all Audit Committee members have financial/legal management expertise. In addition, Asbjørn Larsen’s previous assignments include the position of CFO and CEO of a Norwegian listed upstream petroleum company and he has extensive experience in accounting and audit matters. Compensation Committee 2011 Members William A. Rand, Chairman Magnus Unger Dambisa F. Moyo Lukas H. Lundin3 Kristin Færøvik4 Meeting attendance 4/4 4/4 3/4 1/1 3/3 Compensation Committee work during the year – Review of the performance of the CEO, the other members of Executive Management and other Group management as per the Performance Management Process. – Preparing a report regarding the Board’s evaluation of remuneration of the Executive Management in 2010. – Continuous monitoring and evaluation of remuneration structures, levels, programmes and the Policy on Remuneration. – Preparing a proposal for the 2011 Policy on Remuneration for Board and AGM approval. – Preparing a proposal for remuneration and other terms of employment for the CEO for Board approval. – Review of the CEO’s proposals for remuneration and other terms of employment of the other members of Executive Management and VP level employees for Board approval. – Review and approval of the CEO’s proposals for the principles of compensation of other Group management and employees. – Review and approval of the CEO’s proposals for 2011 LTIP awards. – Approval of severance arrangements. – Undertaking a remuneration benchmark study and engaging the HayGroup to assist with the study. Other requirements – The composition of the Compensation Committee fulfilled the independence requirements of the Code of Governance. – William A. Rand has chaired the Compensation Committee since its inception in 2002 and thus possesses extensive experience in compensation matters. In addition, considering the varied backgrounds and experience of the Committee members in general, the Compensation Committee has ample knowledge and experience of management remuneration issues. Reserves Committee 2011 Members Ian H. Lundin, Chairman Asbjørn Larsen Meeting attendance 1/1 1/1 Reserves Committee work during the year – General review of the Company’s oil and gas reserves procedures and practices. – Review of the Company’s procedures for assembling and reporting other information associated with oil and gas activities. – Meeting with management and Gaffney, Cline & Associates, the independent qualified reserves auditor, to discuss the reserves reporting. – Review of reserves data. Other requirements – The composition of the Reserves Committee fulfilled the independence requirements of Canadian securities regulation as per NI 51-101. 3 4 Lukas H. Lundin was a member of the Compensation Committee until 5 May 2011. Kristin Færøvik has been a member of the Board and the Compensation Committee since 5 May 2011. 48 Lundin Petroleum ANNUAL REPORT 2011

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