ADMA Company Profile

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ADMA-OPCO Environmental Legacy

ADMA-OPCO

Environmental Legacy

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ADMA-OPCO Environmental Legacy

The history of ADMA-OPCO’s environmental performance It is commonly thought that concern for the environment, particularly in the oil industry, is a modern trend. Yet ADMA-OPCO can truly trace its roots back to the work one of the most famous and influential conservationists of all time. It was in the 1950s that Jacques-Yves Cousteau brought his ship, the Calypso, to the waters of Abu Dhabi in order to survey the sea bed. His work took him in particular to the pearl beds of Umm Shaif, an area that he recognized had all the signs of having great potential for oil exploration. ADMA Ltd, as it was then, took his advice seriously and, in 1958, spudded the first well in the area. This well, Umm Shaif-1, was soon producing around 4,500 barrels a day, heralding the boom that was to change Abu Dhabi forever. Since those early days AMDA’s operations have grown enormously. In 1963 oil was discovered in the Zakum field, which began production in 1967. ADMA-OPCO now produces around 700,000 barrels of oil a day and has plans to expand this further, perhaps to over a million. Yet this expansion has not come at the expense of the environment. Remarkably, in the sixty years of ADMA-OPCO’s existence there has not been a single major oil spill from its operations. Of course producing oil on such a large scale cannot be done without the construction of some massive infrastructure; production platforms, pipelines, storage tanks and export terminals. In the case of ADMA-OPCO much of this infrastructure lies many miles offshore. One island in particular, Das Island, has been ADMAOPCO’s offshore base since the very first days. In fact the first of ADMA-OPCO’s buildings, for accommodation and storage of supplies, was build there in 1955, even before the first exploration well was drilled. Once oil was discovered Das

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Island became the hub through which it was processed and shipped. This required the construction of processing and storage facilities on a huge scale. Despite this, preserving the environment has always been a priority. Perhaps the early planners had Cousteau’s words in mind; “For most of history, man has had to fight nature to survive; in this century he is beginning to realize that, in order to survive, he must protect it.� This does not mean that the development of Das Island was done without some mistakes being made. In the early days crude oil was used to stabilize the soil in some areas of the island and hydrocarbon sludge was stored in two large lagoons. Waste engine oil was burnt to provide firefighting practice and open burning was also used to dispose of some other wastes. However these practices stopped over twenty years ago and the ground contamination was cleaned up. Protection of the environment around Das Island did not just mean controlling pollution, although this was of course a vital element. ADMA-OPCO has gone out to actively improve the environment there, both on land and in the sea. Although much of what was once the arid surface of Das Island is now covered by industrial areas, there is also a contrast, with much of the remaining area green, even lush, from the plants and trees that have been planted there over the years. In fact, this green area covers 78,000 square meters of the island and includes over 1,500 palm trees and 10,000 other trees. In the sea it is a similar story. The activities on Das Island have not resulted in sea life being damaged. In fact the opposite has happened. Keen make a positive impact on the environment surrounding its operations ADMA-OPCO constructed artificial reefs just offshore of Das Island. These act like a magnate to sea life and were almost instantly colonized by a wide variety of exotic fish and other sea creatures, greatly enhancing the biodiversity of the area.

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ADMA-OPCO Environmental Legacy

Whilst enhancing biodiversity has been a major objective in ADMA-OPCO’s environmental strategy it has also had to pay attention to the more routine ways in which it can protect the environment. At its most fundamental this means preventing the contamination of the sea and air by ADMA-OPCO’s operations. So, from the very beginning ADMA-OPCO installed water processing facilities on Das Island, API separators, to treat effluent water to remove excess oil before it was released to sea. Later, in the early 1980s, a Sour Water De-oiling Plant was installed as part of the Electrostatic Treatment Precipitation Plant. This additional pollution prevention facility helped ensure that produced water met its oil-in-water specifications. ADMA-OPCO’s early programs to reduce emissions were not limited to controlling discharges to sea. Measures were also taken to ensure that atmospheric emissions were also controlled. For example, in 1984 ADMA-OPCO Process Engineers designed a waste gas recovery system for the Umm Shaif Gas Treatment Plant, enabling gas that would otherwise be flared to be recovered as valuable product. In the 1980s and 1990s the management of environmental issues was gradually being accepted as a distinct and specialist discipline, requiring specialist expertise, methods and systems. Hence in 1990 ADMA-OPCO appointed its first environmental management specialist and drew up an action plan to address its environmental impacts. The following year it went on to produce its own set of guidelines on assessing the environmental impacts of new projects. This environmental awareness was not limited to ADMA-OPCO but was encouraged by ADNOC, who had the responsibility for ensuring consistent standards throughout its group companies. Therefore in 1992 ADNOC introduced Guidelines on Environmental Protection and Occupational Health together with protocols designed to address the requirements of the Regional Organization for the Protection of the Marine Environment (ROPME), an organization set up in 1982 to protect the waters of the Arabian Gulf. In the mid 1990s the evolution of environmental management continued, with many companies adopting formal Environmental Management Systems. ADMA-OPCO took the first step along this road when in 1994 it had an environmental review of the company carried out by an external consultancy. Soon after this it set new targets to reduce flaring and improve the management of hazardous waste. This was spectacularly successful, with flaring cut back from over 25 million scfd to less than one million, and practices such as the open burning of waste becoming a thing of the past. Other initiatives included the removal and safe disposal of twenty container loads of asbestos from Das Island buildings and the start of waste recycling programmes for papers, card board, wood and metals. Despite these improvements environmental management continued to evolve, first with ADNOC introducing guidelines for Health, Safety and Environmental impact assessments and finally, in 1999 with ADMA-OPCO obtaining accreditation of its environmental management system to the coveted ISO14001 international standard.

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Having achieved considerable reductions in its emissions to the atmosphere ADMA-OPCO turned its attention to the sea, and in 1999 it installed an injection well for its produced water. This now means that none of ADMA-OPCO’s produced water reaches the sea, all of it being re-injected deep underground. In addition to enhancing its own environmental performance ADMA-OPCO has also worked to encourage improvements both in the oil and gas industry and in the community. Hence in 2002 ADMA-OPCO’s CEO, Mr. Ali Al Jarwan was the program chairman for the Abu Dhabi Oil and Gas conference on Environment, in 2012 he chaired SPE Middle East Health, Safety, Security, and Environment Conference and Exhibition (MEHSSE) and in 2008 he launched ADMA-OPCO’s book on the Marine Environment of the UAE with the title of “Pearl in The Gulf”. ADMA-OPCO’s community initiatives include environmental awareness sessions for the general public, regular support of World Environment Day and organizing clean up campaigns. A great example of the latter occurred in 2012, when 150 divers and other volunteers cleaned up 5 ports within Abu Dhabi, removing and safely disposing of over 15 tonnes of waste. In 2013 the environmental performance of ADMA-OPCO was recognized at the highest level when ADMA-OPCO won the Emirates Appreciation Award for the Environment - Industrial Enterprise Category - in recognition of its environmental excellence, and commitment to international ecological standards. This was in addition to ADMA-OPCO being presented with the Sheikh Khalifa Excellence Award (SKEA) Diamond Category in the same year. These awards were not for a single initiative or for its performance in one year. They were for a history of sustained performance over many years. They were thus a fitting culmination for all the hard work and effort of ADMA-OPCO’s management and staff who have been putting environmental conservation high in ADMA-OPCO’s priorities since Jacques Cousteau and the Calypso first sailed into Emirati waters those many years ago.

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ADMA-OPCO Environmental Legacy

ADMA-OPCO’s Recent Environmental Awards • ADNOC HSE Award 2007 (Environment) - Runner Up for “Reduction in Flaring”. • 8th Annual International Business Award 2011 (the “Stevie”) – Winner for “Environment Responsibility”. • SKEA Gold Category Award 2010 - Winner • Middle East Oil & Gas HSE Award 2010 (Best Environmental Program of the Year) – Winner. • ADIPEC CSR Award 2010 - Winner for Plastic Bag Phase Out. • Emirates Energy Award 2010 - Runner Up for “Reducing Energy Consumption in the HQ Building of ADMA-OPCO”. • ADNOC HSE Award 2012 (Sustainability) - Runner Up for “Proud Volunteers for Port Clean-Up”. • ADNOC HSE Award 2012 (HSE Performance) – Winner. • Dupont Safety and Sustainability Awards 2013 (Stakeholders Engagement for Sustainability) - Winner for “Environmental Education Program for Schools”.

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ADMA-OPCO Environmental Legacy

ADMA-OPCO’s Environmental Management Today Today ADMA-OPCO is a company of contrasts. Some of its installations are amongst the oldest offshore platforms in the world, having been built over fifty years ago, whilst its newest projects will be coming on stream over the next few years enabling ADMA-OPCO to continue to produce oil and gas at current levels or higher far into the future. The challenge for ADMA-OPCO is therefore to ensure that, despite their age, the existing production facilities can continue to operate whilst meeting the highest standards of environmental protection and at the same time ensure that the new facilities are built and operated without unduly adding to the company’s environmental impact. All this can only be done if environmental protection is given the highest priority and is managed professionally and methodically. To do this ADMA-OPCO continues to use the ISO14001 Environmental Management Standard as its benchmark.

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Air emissions The two largest sources of air emissions by far are exhaust from engines that are generating power and combustion emissions from flares. Exhaust emissions cannot be eliminated entirely; there is always a requirement for power in order to operate large equipment such as compressors and pumps. So the challenge is to minimize the emissions and ensure that they are as clean as possible. This can be extremely difficult offshore, where the fuel gas comes straight from the well and cannot be easily treated to the same extent that it can be onshore. ADMA-OPCO therefore manages this issue by obtaining the fuel gas from the cleanest sources available. That is, from wells where the associated gas contains relatively low concentrations of sulphur. In some cases it does better, by using solar panels to power equipment such as valves and pumps on wellhead towers. In the long term ADMA-OPCO plans to generate all its power onshore, with electricity being taken by cable to the offshore platforms. Whilst this will not necessarily reduce emissions it will ensure that they are as clean as is technically feasible. Until this is done, ADMA-OPCO will install equipment that will continually monitor the emissions from generating equipment. This will help to ensure that it is run as efficiently and with as few emissions as possible. Over the years flaring of excess gas has sometimes been seen as an inevitable aspect of oil production. This has not been the case in ADMA-OPCO. The installation of gas separation and compression equipment has enabled excess gas to be captured so that it can be sold as product, used to generate power or injected into the reservoir to maintain pressure. The use of this technology has enabled ADMA-OPCO to reduce flare emissions by over 90%, a remarkable achievement that places ADMA-OPCO at the forefront of upstream oil companies in terms of emissions per barrel produced. Another significant potential source of air emissions is the oil and gas produced when a well is tested. The conventional method of dealing with these is to flare them, resulting in the production of large quantities of smoky emissions. To prevent this, ADMA-OPCO diverts these well test fluids to a test vessel; a ship that has been specially designed to manage these fluids. Where practicable these vessels reinject the fluids into the well. Only if this cannot be done is the oil and gas flared using a clean burning flare to reduce emissions to as low as possible.

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ADMA-OPCO Environmental Legacy

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ADMA-OPCO Environmental Legacy

Discharges to sea Discharges to sea can come from a variety of sources. When crude oil is produced it always contains a quantity of water. Initially this may be extremely small. However as the field ages this “water cut” increases until it may exceed the volume of oil, sometimes considerably so. In some places this water is separated and dumped into the sea. Not so in ADMA-OPCO, where the separated water is disposed by injecting into wells that go deep underground. As a consequence none of the produced water from ADMA-OPCO’s operations ends up in the sea. Other sources of water emissions are those from industrial usage, such as cooling water or fire water, and sewage effluent. Fortunately most industrial water is uncontaminated, so can be returned to the sea without causing any significant impact. The small quantities of oily water that might be produced at ADMA-OPCO facilities offshore are injected into the oil export line and removed when the oil arrives at Das Island. The water is then cleaned to remove traces of oil before disposal to sea. Sewage is inevitably produced at any site that is manned. Its methods of processing and disposal will depend on the location. On production facilities that are far out to sea it is acceptable to dispose of sewage to sea after only one stage of treatment hence ADMA-OPCO has primary sewage treatment facilities at its offshore platforms. However onshore at Das Island sewage undergoes several treatment stages to ensure that it meets that highest national and international standards and does not pose any risk to the environment or human health. The final effluent, up to 1,600 m3 a day, could then be disposed to sea but in practice is normally used for irrigation, helping to keep Das Island green.

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ADMA-OPCO Environmental Legacy

Management of waste Waste can be defined as anything that is unwanted, worn out or of no further use. It ranges from the rock cuttings that are produced when a well is drilled to uneaten food from a restaurant. Some waste may have properties that makes it a hazard to health or the environment, and is therefore classified as “Hazardous waste� requiring very strict control over how it is handled and disposed. Most however is non-hazardous. This does not mean that it can be dumped in an uncontrolled manner. Nonhazardous waste must still be recorded, tracked and disposed at an approved site. The best way to manage waste is not to produce it in the first place. If this cannot be done, measures can be taken to reduce the quantity produced. Waste can sometimes be re-used or recycled. Only when none of these options are available should it be disposed, usually by burying in a landfill. ADMA-OPCO manages its wastes by ensuring that they are carefully segregated into different categories such as glass, plastic, metal and oily waste. These segregated wastes are then recycled where possible whilst the hazardous wastes are transported using a controlled chain of custody to BeAAT. This is an ADNOC Central Environment Protection Facility in Ruwais where waste undergoes final treatment and disposal. Probably the single largest waste management problem that any offshore oil company has to deal with is that of drill cuttings. Each well can produce hundreds of tonnes of cuttings, all coated with the drilling mud that is circulated through the well in order to prevent it from collapsing. As the quantities of cuttings are large they are usually disposed by being discharged overboard to sea. Whilst this is generally acceptable if the drilling mud used is based on water, and therefore of low toxicity, this is not the case if the mud is hydrocarbon based. Disposing to sea of cuttings produced using hydrocarbon based mud results in the sea floor being smothered by a layer of slurry which, for seabed dwelling creatures, is impenetrable. For this reason, all of ADMAOPCO’s cuttings from wells drilled with non-aqueous drilling muds is returned to shore for treatment to recover the drilling fluid before disposing of the dried rock pieces at an approved landfill site. In addition, ADMA-OPCO is working with its drilling contractor, the National Drilling Company, to reduce the quantity of cuttings discharged to sea by 80%.

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Accidental environmental impacts The highest priority for any oil and gas operator, and certainly the case for ADMAOPCO, is to ensure that its products remain contained, either within the well, the process plant or pipelines. Should oil escape it is obviously a serious safety risk and a hazard to the environment. For these reasons ADMA-OPCO gives high priority to maintaining the structural integrity of its plant and operations. Thanks to this, ADMA-OPCO can boast a record of only having had one oil spill from its operations in the last fifteen years. Despite this excellent performance ADMA-OPCO recognizes that it must be prepared in the unlikely event that a major spill occurs. Consequently it has in place an Incident Command System, including dedicated response centres at Das Island, offshore facilities and the headquarter building, aimed at coordinating the response to any accident. In addition, ADMA-OPCO is working to enhance its oil spill response capability still further by putting in place a dedicated oil spill response facility at Das Island. This facility, or Oil Spill Response Hub, will have sufficient equipment to contain and recover oil from all but the largest spills that could occur at Das Island or offshore. In the very unlikely event of a very large spill happening ADMA-OPCO is able to call on the additional Tier 2 resources of the ADNOC group to ensure that the spill is managed effectively.

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ADMA-OPCO Environmental Legacy

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ADMA-OPCO Environmental Legacy

Biodiversity and sustainability The many actions that ADMA-OPCO takes to reduce emissions and manage its environmental impact have one overall objective; to preserve a diverse and sustainable environment. Therefore in order to check that it is succeeding in that goal in recent years ADMA-OPCO has undertaken a programme of monitoring across all the areas in which it operates. This monitoring included measuring the number and variety of animals and plants on the sea bed, the quality of the sea water, the quality of the air and even the noise levels. The results of the monitoring indicate that ADMA-OPCO’s operations have had very little impact on the marine environment, with most of the sea bed in ADMA-OPCO’s operational areas being of flat sand or gravel and having a relatively low biodiversity. It is because of this that ADMA-OPCO has been working to increase biodiversity, for example by creating an artificial reef near Das Island in 2000.

New projects The supergiant Umm Shaif and Zakum fields have been providing most of ADMA-OPCO’s oil for over fifty years. However these fields are now beginning to lose their productivity so ADMA-OPCO is now developing several new fields in order to maintain the flow of oil long into the 21st century. These developments also involve expanding the facilities on Das Island, necessitating almost doubling the size of the island, and creating two new islands to act as drill pads and gathering stations for the SARB field wells. To ensure that these projects do not have significant adverse impacts on the environment each of them have been subject to rigorous HSE Impact Assessments conforming to ADNOC guidelines and international best practice. In several cases these assessments have concluded that the environmental impact is minimal, and can be managed through routine procedures. When this is not the case additional measures are taken to ensure that any residual environmental impacts are as small as practicable.

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Summary Operating a major offshore oil and gas exploration and production company in an environmentally responsible manner is a huge challenge. Over the years ADMA-OPCO has risen to this challenge with an enviable record of environmental performance including low levels of emissions to air, through major reductions in flaring, and to sea, achieved by re-injecting wastes deep underground. However ADMA-OPCO is never satisfied with its performance and continually seeks to improve still further. In the coming years this may happen by extending its programme of waste re-injection to include carbon dioxide from combustion emissions; a project that is currently under serious consideration. Or it may find new ways of recycling, such as by composing food waste. Or perhaps it will widen its use of solar power. The only certainty is that ADMA-OPCO management and staff will continue to put protection of the environment at the top of its agenda.

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