b'Letter of theManaging DirectorFiscal2018wasayearofstrongfinancialresultsforStaatsolieandayearofcontinuingpreparationsforthesignificantcommercialoffshore discovery that we believe to be around the corner. As we follow the key elements of our Strategy for Success, we are well on the way to transforming Staatsolie into a world-class oil company.FINANCIAL RESULTS OVERVIEW FOLLOWING OUR STRATEGY FOR SUCCESSOverall, Staatsolies 2018 performance was up inWe continue to be guided by our Strategy for several key areas from 2017. Success,firstintroducedin2016.Thestrategy The average posting price of our crude was contains six key elements. US$ 61/bbl in 2018, compared to US$ 47/bbl 1. HSEC COMMITMENTin 2017.In 2018, we realized consolidated grossThe safety of our people is our highest priority.revenues of US$ 506 million, up 16% from theWe strive for zero harm to our people and our prior year.communities and to minimize any negativeOur 2018 EBITDA reached a near record levelimpacts upon the environment. Therefore, we have a Health, Safety and Environment (HSE) of US$ 355 million, compared to US$ 285Policy, an Environmental Policy and a Corporate million in 2017. Social Investment Policy to ensure that we Ourprofitbeforetaxin2018wasUS$149 live up to our Health, Safety, Environment and million, compared to US$ 94 million in 2017. Community (HSEC) commitment. Although there were 7 more safety incidents in 2018 than inOur 25% share of the Merian gold mine yielded2017, we stay committed to further implement131,000 oz., contributing US$ 92 million to ourour safety programs and to support behavior-EBITDA at an average gold price of US$ 1,264/ changing training and education.oz. This compares to our share of 127,000 oz. of production, EBITDA contribution of US$ 922. REFOCUS UPSTREAMmillion and average gold price of US$ 1,265/oz. in 2017. In 2018, we placed particular focus on our Staatsolies contribution to SurinamesNearshore Drilling (NSD) Project. Extensive government, consisting of taxes, dividend andpreparations were conducted to set the stage for royalties, amounted to US$ 150 million in 2018a successful 9-well exploration drilling campaign, from which US$ 10 million relates to royaltieswhich will be the focus again in 2019. of the 25% interest of Staatsolie in the goldAs for production, recognizing the continuing mine of Newmont Suriname, compared to commodificationofcrudeoil,weremainUS$ 139 million (US$ 10 million royalties) incommitted to be a low-cost producer. To compete, the previous year. we must be a lowest quartile producer, and we 6 STAATSOLIE 2018 ANNUAL REPORT'