BP Capital Energy Equity

Fund Master II, L.P.

Fund Investment Objectives

The BP Capital Energy Equity Fund Master II, LP invests in common stocks of public companies in energy and energy-dependent industries, as well as crude oil and natural gas futures. The objective of the Fund is to achieve capital appreciation through a risk management strategy that employs diversification, managed market exposure through both long and short equity investments, and limited capital allocated to energy futures. The Fund's managers have experience in the energy markets and the oil and gas industry and are qualified to capitalize on opportunities created by the rapidly changing energy environment through insights into oil and natural gas pricing and industry fundamentals. The objective of the Fund is to achieve capital appreciation by allocating capital to the equity markets in energy-related stocks and to energy futures contracts. Diversification and risk management are achieved through a mix of long and short equity positions with restrictions on capital allocated to futures. The Fund uses margin with its equity investments and utilizes the inherent leverage in futures. In formulating a view of future prices, many factors are analyzed, including the effects of oil and natural gas inventories, productive capacity, OPEC policies, global political conditions, energy demand, weather, and general economic conditions. Oil and natural gas price forecasts are key inputs to the investment strategy of the Fund. Exploration of energy is an important factor in the valuation of the various energy sectors. Oil and gas prospect quality, the state of industry technology, the potential commerciality of non-producing reserves, reservoir decline rates and the effect of industry investment rates and drilling activity are key industry fundamentals and influence the investment strategy of the Fund.