STATOIL UON INVOICING POLICY

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STATOIL UON INVOICING POLICY

Applicability Statoil US Onshore Operations (“UON”) assets Effective

Date January 1, 2016

TABLE OF CONTENTS PAGE

1. PURPOSE & OBJECTIVES ... 2

2. EXPECTATION OF SUPPLIERS ... 2

3. INVOICING MENU ... 2

4. INVOICE REQUIREMENTS... 3

5. INVOICE DATA REQUIREMENTS ... 4

6. INVOICE FREQUENCY AND TIMING ... 4

7. INVOICE SUBMISSION GUIDELINES ... 5

8. ELECTRONIC INVOICE SUBMISSION ... 5

9. PAPER INVOICE SUBMISSION ... 6

10. COMMON DISPUTE REASONS ... 8

11. FREQUENTLY ASKED QUESTIONS & CONTACT INFORMATION ... 8

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1. PURPOSE & OBJECTIVES

1.1 PURPOSE

This Statoil UON Invoicing Policy provides both internal Statoil employees and external suppliers with pertinent information regarding Statoil’s Onshore invoicing requirements. In addition, key invoice guidelines and expectations of the supplier to support the invoicing process is highlighted.

1.2 OBJECTIVES

 Describe and outline Statoil’s UON invoicing process and policy

 Statoil UON invoicing requirements

 Simplify and reduce time spent handling invoices

 Reduce disputed invoices and increase on-time invoice payments

 Improve supplier invoicing compliance and transparency

 Increase the level of electronic invoicing across the Statoil US Onshore supplier base

2. EXPECTATION OF SUPPLIERS

As a Statoil UON supplier, it is expected that each supplier will comply with the invoice requirements outlined herein and to remain up-to-date with the latest invoice requirements in efforts to avoid returned invoices.

The following requirements are set to ensure timely payment of invoices and prevent invoices from being returned for lack of information.

3. INVOICING MENU

The Invoicing Menu is intended to outline all Statoil US Onshore acceptable invoicing structures. The Statoil operations or supply chain representative will provide the necessary guidance as to the preferred invoicing structure for their specific function/scope of work.

Statoil requests that suppliers submit one invoice per month by utilizing only one of the three invoicing structures defined below. Common invoicing requirements are ALL invoices shall only reference a single PO, shall have a single approver and need to include proof of delivery that is signed in most cases (field ticket, bill of lading or delivery ticket).

Structure #1 Invoice Per Job/Well:

Invoice must be for a single well that is associated to a single cost object. Could be across several days of work and several tickets could be consolidated in order to create one large invoice, as long as the work is in reference to the same PO with the same invoice approver. Systematic rate validation will only occur for items that have been negotiated into a PriceBook and uploaded into the electronic payment platform.

Structure #2 Invoice Multiple Jobs/Wells:

Single invoice for multiple wells that can be allocated across multiple cost objects. Example: Fuel is delivered to a location that will be allocated across 3 wells, resulting in 1 invoice that has costs allocated to 3 different WBS elements that all reference the same PO. Jobs/wells can be

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bundled as long as it is the same PO and same invoice approver for the cost objects being billed.

Structure #3 Summary Invoice:

Invoice can be for a single well or for multiple wells that can be associated to a single or multiple cost objects. Invoice will be for a lump sum with item detail with supporting documentation. Example: Production testing services take place for a single well that includes personnel time, mileage and equipment charges across 3 days (with 3 separate signed field tickets). Invoice will be one line at one lump sum (e.g. $12,500) with the 3 signed field tickets attached that outline the exact work that was performed. Systematic rate validation is not possible since summary invoices do not include detailed line item pricing.

Invoicing Menu Summary:

Job/Well: Physical location/asset that the service took place or the material was delivered to.

Cost Object: A Work Breakdown Structure (WBS), Cost Center or Work Order that is used to pay for the work. Line Item Detail: Outline each line item on the invoice (Quantity and Price) with a subtotal for all line items. Rate Validation: Systematic rate validation will take place only if an electronic PriceBook is established.

4. INVOICE REQUIREMENTS

 Only invoices will be paid

o Statements, delivery notes, pro-forma invoices or other documents will not be processed for payment

 Invoices and supporting documents must comply to Statoil’s invoice data requirements (reference Section 5 Invoice Data Requirements)

 Invoices will be documented as received in Statoil’s Accounts Payable system immediately after a successful invoice submission (with no invoice errors), triggering the start of the supplier’s payment terms

 Supplier has sixty (60) days after completion of the work or delivery of goods to invoice for all amounts due

o Failure to invoice within this period will result in Statoil being released from any obligation to pay such amounts

 Before a supplier can contract with a 3rd party to provide services for Statoil, the supplier must communicate to the Statoil Lead Engineer, in writing, their intent to hire the 3rd party

o Approval must be granted to move forward with the 3rd party prior to any work or services being provided by the 3rd party

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o Statoil will not accept invoices from the 3rd party directly (all invoices shall go through the original supplier that Statoil hired)

 Unless otherwise specified in the signed agreement between the supplier and Statoil, the invoice must itemize the following information and be shown as separate line items on the invoice:

o Charges for goods o Fees for work

o Reimbursable expenses (excluding sales tax paid) o Any additional amounts

o Any taxes payable by Statoil

o Amount of applicable sales tax payable

5. INVOICE DATA REQUIREMENTS

 Supplier's invoice number

 Invoice date (To be within 5 days of invoice submission date)

 Service/delivery date (the service date ‘From’ and ‘To’ fields must reflect the dates services were performed or goods delivered)

 10-digit Purchase Order (“PO”) number

 Accounting Information (WBS / AFE / Cost Center)

 Person who requested the service

 Well site/location

 Payment remit to address

 Total price (in the same currency as the PO)

 Unit price (in the same currency as the PO)

 Unit(s) of measurement (in the same unit(s) as the PO)

 Description of the goods or services

 Quantity of the goods or services

 Tax amount (as applicable)

 Agreement number (as applicable)

 Supporting documents

6. INVOICE FREQUENCY AND TIMING

6.1 INVOICE FREQUENCY

Unless otherwise stated in the terms and conditions of the master agreement, or detailed in the Work Order Agreement (“WOA”), a supplier shall submit one (1) monthly invoice in respect of each well, location, or scope of work.

6.2 VALID RECEIPT DATE OF INVOICES

Invoice document and supporting documents that are signed and stamped must be received in the e-commerce solution (for electronic invoices) or by Accounts Payable (for paper invoices) within 60 days of completion of the work.

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6.3 PAYMENT TERMS

Payment terms are described in the master agreement and/or in the WOA under Appendix B – Compensation. For paper invoices, payment terms start when Statoil receives and timestamps the invoice. For electronic invoices, payment terms start when the invoice is submitted via the e-commerce solution.

6.4 SUPPORTING DOCUMENTS

Necessary proof of delivery is required and must be included as attachments with the invoice. Examples include:

 Field tickets

 Timesheets

 Bills of lading

 Etc.

For electronic invoices through Oildex OpenInvoice, signed supporting documents must be attached to the invoice. For paper invoices, signed supporting documents must be included with the invoice. Invoices will not be approved if the proper supporting documents are not included.

7. INVOICE SUBMISSION GUIDELINES

 There are two methods for receiving an invoice within Statoil: electronic and paper

 The preferred method is electronic, powered via Statoil’s e-commerce solution platform

 All other suppliers will submit paper invoices, with the expectation they will work towards moving to the electronic invoicing process

 E-commerce solution-enabled suppliers shall only invoice electronically

 All paper invoices received from e-commerce solution-enabled suppliers will be rejected

8. ELECTRONIC INVOICE SUBMISSION

8.1 OVERVIEW

Statoil has adopted the Oildex OpenInvoice as the e-commerce solution for its US Onshore operations. Electronic invoicing is the preferred invoicing channel as it drives benefits and efficiencies for both Statoil and suppliers.

Statoil requests that suppliers with existing Business-to-Business (“B2B”) capabilities receive POs and submit invoices electronically through the e-commerce solution supplier network. Statoil has a dedicated team focused on assisting suppliers to onboard to the e-commerce solution and will provide guidance as appropriate. This onboarding team supports B2B integration as well as web-based e-commerce solution enablement.

It is important to note that when submitting an invoice via the e-commerce solution, all required fields are mandatory (reference Section 5Invoice Data Requirements). Invoices submitted to Statoil Accounts Payable without the proper data fields will be rejected.

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8.2 REQUIREMENTS

E-commerce solution-enabled suppliers must also:



Attach an invoice (preferred) along with supporting documentation (required) that includes a Statoil-approved field stamp



Provide Tax Jurisdiction information with each invoice line



Reference a PO and WOA (if applicable) during invoice creation. Note that part numbers/service codes and prices on the invoice must align with the WOA



Reference the correct legal entity based on one of the following: o AP – Eagle Ford - Statoil Texas Onshore Properties LLC o AP – Marcellus - Statoil USA Onshore Properties Inc. o AP – Bakken – Onshore Holdings LLC

o AP – Bakken – Statoil Oil & Gas, LP 8.3 ELECTRONIC INVOICE PROCESS DIAGRAM

Supplier

Requestor

Payment received Order called off/

sent to supplier Deliver goods/ services Verify invoice Verifier E-commerce solution

Verify delivery and sign field ticket

stamp Submit invoice / field ticket in E-commerce solution Receive invoice Verify/code invoice in E-commerce solution Approve invoice in

E-commerce solution Process invoice for payment Invoice correct

Invoice requires correction from supplier

9. PAPER INVOICE SUBMISSION

9.1 OVERVIEW

The addresses listed below are effective February 1, 2016. If you were previously submitting paper invoices and have not been converted to the e-commerce solution please continue to use the address(es) you have been using until February 1, 2016.

For suppliers that have not been enabled in the e-commerce solution, invoice and supporting documentation that includes a Statoil-approved stamp must be mailed to one of the address(es) specified in the following table:

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o NOTE: If you are unsure of where to submit your invoice please reference your Purchase Order or Call Statoil Service Desk: +1 713-878-6970 (option 7 for Finance) . Your Purchase Order will contain the correct legal entity to bill.

Legal Entity Applies to Invoice To Address

Statoil Oil & Gas LP Bakken upstream activities

Statoil Oil & Gas LP Attn: Accounts Payable

2107 City West Blvd, Suite 100 Houston, 77042

Statoil Texas Onshore Properties LLC

Eagle Ford upstream activities

Statoil Texas Onshore Properties LLC Attn: Accounts Payable

Statoil USA Onshore Properties Inc.

Marcellus upstream activities

Statoil USA Onshore Properties Inc. Attn: Accounts Payable

2107 City West Blvd, Suite 100 Houston, 77042 Onshore Holdings, LLC Rockies upstream activities Onshore Holdings LLC Attn: Accounts Payable

Statoil Gulf Services

LLC US Corporate

Statoil Gulf Services LLC Attn: Accounts Payable

Statoil Pipelines LLC

Gathering system activities for Bakken, Eagle Ford, Marcellus and Rockies (Statoil pipelines, salt water disposal wells, and oil facilities)

Statoil Pipelines LLC Attn: Accounts Payable

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9.2 PAPER INVOICE PROCESS DIAGRAM

Supplier

Requestor

Payment received Order called off/

sent to supplier

Deliver goods/ services

Verifier

Invoice handler

Verify delivery and sign field ticket

stamp

Submit paper invoice / field ticket

Receive paper invoice

Approve invoice in system

Process invoice for payment Invoice correct

Invoice requires correction from supplier

Scan invoice and

upload in system invoiceVerify

10. COMMON DISPUTE REASONS

When an invoice is disputed by Statoil, the payment terms will reset when the corrected invoice is resubmitted by the supplier. Invoices can be disputed for the following reasons:

 Incorrect PO

 Supporting document missing stamp

 Incorrect Tax

 Supporting document does not match invoice

 Attachment file too big (Limit 25MB)

 Supporting documentation missing

 Invoice is 60 days or more past work date

 Service date does not match supporting documents

 Operational issue

 Supporting document missing signature

 Incorrect WBS/Cost Center

 Incorrect pricing

 Duplicate invoice

Please reach out to a Statoil representative for further clarification regarding invoice disputes.

11. FREQUENTLY ASKED QUESTIONS & CONTACT INFORMATION

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o Email: usinvoice@statoil.com, or

o Call Statoil Service Desk: +1 713-878-6970 (option 7 for Finance)

 How do I get PO# or PO line# clarification, PO fund increase requests, and/or PO quantity updates?

o Contact a Statoil representative

 How do I get help with e-commerce solution login issues or get training for Oildex OpenInvoice?

 Email: adpinvoicesupport@adp.com, or

 Call Oildex OpenInvoice Support: +1 (866) 627 - 3287

 How do I get help regarding electronic or paper invoices?

 Email: usinvoice@statoil.com, or

 Call Statoil Service Desk: +1 713-878-6970 (option 7 for Finance)

 I was unable to get my Statoil Bakken Asset invoice supporting document stamped/signed while on location, who should I contact?

 Primary process is to get invoice supporting documentation signed at location

 Secondary process is to submit all Statoil Bakken Asset invoicing supporting documents to one of the two locations below so it can be stamped/signed:

• Williston office: 14649 Brigham Dr., Williston, ND 58801, (701) 875-3501 • Ross office: 6160 90th Ave NW, Ross, ND 58776, (701) 755-3402

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12. SAMPLE DOCUMENTS

12.1 ELECTRONIC INVOICE

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12.2 PAPER INVOICE

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12.3 FIELD TICKET

Below is a sample of a field ticket. Field tickets must be signed with all required data for invoice payment.