Q4 2017 Earnings Release

CEO CFO 8 February 2018

Kristian Johansen Sven Børre Larsen

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 forward-looking statements for any reason.

2017 Delivering above expectations – once again

2017 revenues of USD 492 million up 8% from 2016
2017 Free cash flow of USD 123 million dividend to shareholders up by 33%
Industry leading cash conversion rate of 22%
Return on Average Capital Employed of 10%
Ranked second highest when compared to all oil service companies in PHLX Oil Service Sector Index*

2017 Actuals vs Consensus*

*Source: S&P Capital IQ, Rolling 12 months to date of last report

Q4 2017 Highlights

Q4 net revenues of 157 MUSD driven by strong late sales
Net late sales of 143 MUSD, down from 145 MUSD in Q4 2016
Net pre-funding revenues of 11 MUSD, down from 17 MUSD in Q4 2016 due to lower investments, funding 41% of TGS' operational multi-client investments for the quarter
Operational multi-client investments of 28 MUSD in addition to 10 MUSD from risk sharing arrangements
Operating profit for the quarter was 52 MUSD, up 23% compared to Q4 2016
Strong free cash flow of 56 MUSD compared to 33 MUSD in Q4 2016
Cash balance of 250 MUSD in addition to undrawn 75 MUSD Revolving Credit Facility
Quarterly dividend increased to USD 0.20 per share
Improved visibility for 2018
Backlog increase to 82 MUSD, up 29% from Q3 2017
Ramp-up of US onshore activity Four new projects secured

Operational Highlights

Q4 2017 Operations

Q4 Activity – U.S. Gulf of Mexico

Fusion M-WAZ reimaging program

M-WAZ reimaging program in collaboration with Schlumberger in Mississippi Canyon, Atwater Valley and Ewing bank areas
~27,000 km² (1,166 OCS blocks ) 3D M-WAZ data previously acquired by TGS and Schlumberger between 2008 and 2012
Reimaging is >85% complete with final data delivery mid-2018

Otos multibeam and seep study

~289,000 km² multibeam acquisition completed in early Q2; acquisition of 350 cores and associated advanced geochemistry analysis completed in Q4
Designed to mirror the successful Gigante multibeam and seep study in the Mexican GOM

Q4 Activity – East Canada

Newfoundland Labrador 2D – 2017 Season

• 22,000 km multi-client 2D survey infilling and extending existing JV* data in the region; targeting 2019 and 2020 Sectors of the Scheduled Land Tenure

Newfoundland Labrador 3D

~18,000 km² multi-client 3D covering a mix of held and open acreage within the 2018 and 2019 Sectors of the Scheduled Land Tenure
Long Range 3D
East Flemish Pass 3D Phase II
Harbour Deep 3D
Cape Broyle 3D

Well positioned for future licensing rounds

• Following the most active year ever in this region, the TGS/PGS JV library will exceed 175,000 km of 2D data and 29,250 km² of 3D data in addition to 83,700 km of TGS vintage data, an expansive well log library and advanced multi-client interpretation products

Q4 Activity – Europe

AM17 Atlantic Margin 3D

40,000 km² project in the central-southern Norwegian Sea largest 3D survey carried out by any company in Northern Europe
Covers largely open blocks in a relatively under-explored area with limited drilling to date
Several underlying blocks included in the 24th licensing round
7,500 km² of the committed area remains to be acquired in 2018

Crean 3D - Ireland

~5,400 km² multi-client survey located in the South Porcupine Basin between the Porcupine High and the Irish Mainland Platform
Adding to TGS's Atlantic Margin offering building on the exploration success on the Newfoundland Labrador conjugate margin coupled with historical exploration in Atlantic Ireland
Acquisition completed in October 2017

Q4 Activity – North America Land

PERMIAN - West Kermit 3D

1,050 km²high-resolution 3D multi-client project in Delaware basin
TGS' first Permian seismic project completed acquisition in Q4 2017

PERMIAN - West Lindsey 3D

440 km²high-resolution 3D multi-client project southwest of West Kermit
Acquisition to complete in Q1 2018 with crew moving to next TGS Permian project

SCOOP/STACK - Geary 3D

200 km²high-resolution 3D multi-client project in the Anadarko Basin
Acquisition completed in Q4 2017, adding to TGS' dominant position in this play

DUVERNAY – Grayling 3D

107 km² high-resolution 3D multi-client in West Central Alberta
Acquisition completed in Q4 2017, extending TGS Duvernay library

Comprehensive Geological library

• Continued expansion of the industry's largest library of digital well log data; complimented by directional surveys, validated well headers, production data and multiple interpretive products

Financials

Net Revenues

Late sales revenues

-33% Y/Y

Prefunding revenues

Total revenues

Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017

¹⁵ ²⁷

Proprietary revenues

Net Revenue Breakdown

Operating Expenses, EBIT, Free Cash Flow

Amortization and impairment

Free cash flow *

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

EBIT *

impairments and restructuring costs

Multi-Client Library

Operational investments* and prefunding ratio

*Operational investments excluding risk-sharing arrangements

**Investments* – year of completion**

*Marine and onshore investments included. Well Data investments not included

Multi-client library - NBV

Net revenues vs net book value – year of completion

Net revenues Net book value

Q4 2017 Income Statement

USD million, except EPS		Q4 2017	Q4 2016	Change in %
Net revenues		157	165	-5%
Cost of goods sold – proprietary and other		0.1	0.1	-8%
Amortization of multi-client library	50%	7 7	9 2	-17%
Gross margin		8 0	7 2	10%
Personnel costs		1 7	1 6	9 %
Other operating expenses		9	1 1	-24%
Cost of stock options		-	0.1	-100%
Depreciation		2	3	-28%
Operating profit	33%	5 2	4 2	23%
Net financial items		1	-3	141%
Profit before taxes	34%	5 3	3 9	37%
Taxes		-2	9	-121%
Net Income	35%	5 5	2 9	88%
EPS, Undiluted		0.54	0.29	87%
EPS, Fully Diluted		0.53	0.29	86%

Q4 2017 Cash Flow Statement

USD million	Q4 2017	Q4 2016	Change in %
Received payments from customers	173	111	56%
Payments for operational expenses	(34)	(27)	-24%
Paid taxes	(1)	(5)	71%
Operational cash flow	137	7 9	75%
Investments in tangible and intangible assets	(2)	(2)	36%
Investments in multi-client library	(81)	(45)	-79%
Interest received	2	0.2	687%
Interest paid	(0.2)	(0.05)	-267%
Dividend payments	(15)	(14)	-13%
Proceeds from share issuances	4	-	N/A
Change in cash balance	4 5	1 8	154%

Balance Sheet

USD million	Q4 2017	Q3 2017	Change in %	Q4 2016
Assets
Cash and cash equivalents	250	205	22%	191
Other current assets	274	272	1 %	353
Total current assets	524	477	10%	544
Intangible assets and deferred tax asset	8 1	8 2	-1%	8 6
Other non-current assets	0.5	0.5	6 %	1 1
Multi-client library	799	838	-5%	812
Fixed assets	2 0	2 1	-4%	2 3
Total Assets	1,424	1,418	0 %	1,477
Liabilities
Current liabilities	195	223	-13%	262
Non-current liabilities	5	5	11%	6
Deferred tax liability	2 4	3 3	-27%	3 9
Total Liabilities	224	261	-14%	307
Equity	1,200	1,157	4 %	1,169
Total Liabilities and Equity	1,424	1,418	0 %	1,477

Top-end Return on Capital Employed

• 2017 ROACE of 10.1%

TGS is one of very few oil services companies delivering a return above its Cost of Capital
Ranked 2nd when compared to the 15 companies that constitutes the Philadelphia Oil Service Index

Rolling 12 months to date of last report

Industry-leading cash conversion rates

Continued strong cash conversion rates lead to robust cash flow Cash position at USD 250 million at year-end
TGS is in the top end of the range in the oil service industry when it comes to converting revenues into cash flow

Dividend at USD 0.20 per share to be paid in Q1 2018

Shareholder authorization to distribute quarterly dividend payments
Aim to keep a stable quarterly dividend through the year
Actual quarterly dividend level paid will be subject to continuous evaluation of market outlook, cash flow expectations and balance sheet development
Q1 2018: USD 0.20 per share to be paid on 1 March 2018
Shares will trade ex-dividend on 15 February 2018

Potential impact of IFRS 15

IFRS 15 Revenue from Contracts with Customers is effective from 1 January 2018
No impact on revenues from completed surveys
Implications for revenues relating to multi-client surveys in progress not yet concluded
TGS believes the current practice of recognizing revenues for surveys is superior for reflecting resource use, project progression and risk, thus being the most suited method for measuring value creation and performance
The seismic industry has been working jointly with the aim of maintaining current practice of recognizing revenues for surveys in progress (percentage of completion) or alternatively a method giving close to similar results (based on interim deliveries or milestones), and to achieve consistent application of IFRS 15 across the seismic industry
No conclusion has been reached yet, but there is a high risk that none of these methods will be deemed acceptable under IFRS 15, meaning that all revenues generated during the work in progress phase may not be recognized until delivery of the final processed data, which could be more than 12 months after acquisition
In such case TGS will continue to use the current method for internal reporting and performance measurement
TGS will provide percentage of completion information as part of external financial reporting with appropriate reconciliations to the reporting required by IFRS 15
TGS will seek to achieve consistent practice for such reporting across the industry

Outlook

Oil price trending upwards, but uncertainty persists

E&P companies experiencing improved cash flow

Base-case estimate of Brent price required to remain cash flow neutral (accumulate no additional debt) between 2017 and 2019 for more than 50 of the world's leading oil companies, as estimated by Wood Mackenzie. Includes upstream costs and pro-rated shareholder distributions. Excludes downstream cash flow
Brent average, EIA

E&P companies still cautious with exploration spending

"Unchanged capital investment range until 2020 of \$25 billion to \$30 billion with a soft floor and a hard ceiling and this holds even in a high oil price environment. This range fits our financial framework and is consistent with our growth aspirations. For 2018 you should expect us to maintain capital investment in the lower part of this range." Ben van Beurden

"Statoil expects organic capex of around \$11 billion in 2018, up from \$9.4 billion in 2017. Statoil intends to continue to mature its large portfolio of exploration assets and estimates a total exploration activity level of around \$1.5 billion for 2018, excluding signature bonuses" Eldar Sætre

"Our 2018 budget is down for the fourth consecutive year, reflecting project completions, improved efficiencies, and investment high-grading. We're fully funding our advantaged Permian Basin position and dedicating approximately threequarters of our spend to projects that are expected to realize cash flow within two years" John Watson

"We expect organic capital expenditure to be in the range of \$15-16 billion, down from \$16.5 billion in 2017, reflecting the continuing focus on disciplined spend. We will ensure we remain robust to the downside in the event oil prices were to drop below \$50 per barrel." Bob Dudley

Backlog

Historical Backlog (MUSD) 2013 - 2018

New projects announced this week

SCOOP/STACK – Canton 3D

1,170 km²high-resolution 3D multi-client project in the Anadarko Basin
Strengthens TGS' leading position in the SCOOP/STACK play fairway, providing contiguous, modern seismic data coverage from the recently announced Hackberry Complex to the north east, down to the Loyal Complex to the south
Complemented by TGS' extensive geologic products database comprising data from over 100,000 wells and multiple interpretive products in the SCOOP/STACK
Acquisition will commence in Q2 2018 with final data available to clients in Q1 2019

Mexico Well Data

Authorization received from Comisión Nacional de Hidrocarburos (CNH) to process and deliver high-quality, high-value well data products, from a library of more than 30,000 wells offshore and onshore Mexico
TGS' well data packages will provide key coverage of all basins including exploration/appraisal and development wells
Complemented by TGS' existing Gigante offshore 2D survey and TGS' recently reprocessed Mexico onshore 2D seismic dataset

2018 Projects Schedule*

D 2		Jan	Feb	Mar	Apr	May	Jun	Jul	Aug	Sep	Oct	Nov	Dec
	Dong Fang Kan Tan 1		Egyptian Red Sea JV

Polarcus Asima	U.S. GOM (Alonso)
D 3 Polarcus Asima		Norwegian Sea (Atlantic Margin)

	Permian Crew	Sanderson
d n	SCOOP / STACK Crew	Hackberry Complex
a L	Canada Crew	Dawson
	SCOOP / STACK Crew		Canton

*Acquisition schedule excludes Fusion M-WAZ Reprocessing, other processing projects and GPS investments

License Round Activity and TGS Positioning

Central & Western GOM Mar & Aug (2017-22 Plan)
Newfoundland Labrador Jeanne d'Arc & E. Newfoundland, Nov 2018 (bids due)
Nova Scotia Dec 2018 (3-Year Rolling Plan)
Canada Onshore at least monthly
Brazil 15th Round Mar 2018 (bids due)
Brazil 4th Production Sharing Round Jun 2018 (bids due)
Mexico Round 2.4 (deep water) Jan 2018 (completed)
Mexico Round 3.1 (shallow) Mar 2018 (bids due)
Mexico Round 3.2 (onshore) Jul 2018 (bids due)

Africa, Middle East, Asia Pacific

Sierra Leone 4th Round Jun 2018 (bids due)
Australia Feb & Mar 2018 (bids due), new round expected Sep 2018
New Zealand –2018 Round H1 2018 (announcement expected)
Indonesia 2018 Round H1 2018 (announcement expected)

Europe / Russia

Norway APA Q2 2018 (announcement expected)
Norway 24th Round before Summer 2018 (awards)
UK 31st Round H1 2018 (announcement expected)
Greenland Dec 2018 (bids due)

Q4 Summary

Q4 net revenues of 157 MUSD
Q4 EBIT of 52 MUSD EBIT margin of 33%
Significant improvement in free cash flow, 56 MUSD versus 33 MUSD in Q4 2016
Cash balance of 250 MUSD in addition to undrawn 75 MUSD Revolving Credit Facility
Quarterly dividend increased to USD 0.20 per share
Industry leading performance on ROACE and Cash Conversion
Improved visibility for 2018 as a result of increased backlog and ramp-up of US Onshore activity
With effect from Q1 2018 TGS will start pre-announcing quarterly revenues no later than the sixth trading at the Oslo Stock Exchange after quarter close
2018 guidance:
New multi-client investments of approximately USD 260 million
Additional multi-client investments expected from sales of existing surveys with risk sharing arrangements
Pre-funding of new multi-client investments expected to be approximately 45%-50%
Amortization expected to be approximately USD 310 million