Petrofacts February 2011 by Petro Facts

February 2011 | petrofac.com

The winning image from our photography competition

February 2011

in this issue

Petrofac’s journey To mark our 30th anniversary year, those responsible for the creation of Petrofac look back on the journey so far

Petrofacts is designed and published by Petrofac on a quarterly basis. To provide comment or contributions please contact: Corporate Communications Hazel Meldrum/Claire Baxter editor@petrofac.com Engineering & Construction Engineering & Construction Ventures Engineering Services Kaye Krause-Whiteing kaye.krause-whiteing@petrofac.com Offshore Engineering & Operations Jilly Powell jilly.powell@petrofac.com Training Services

06 Picture Petrofac winners announced

Ivana Petrovich ivana.petrovich@petrofac.com Production Solutions Energy Developments Elinor Geary elinor.geary@petrofac.com Cover image ‘Bay taken from canoe, Ontario, Canada’ the winning entry in the Picture Petrofac competition taken by Peter Martin.v

glossary of abbreviations E&C

E&CV

EPC

ERSC

FEED

FDP

Engineering & Construction

Engineering & Construction Ventures

Engineering, Procurement, and Construction

Emergency Response Service Centre

Front end engineering and design

Field development planning

FPF

HSSEIA

IOC

LSTK

LTI

Floating production facility

Health, safety, security, environment and integrity assurance

International oil company

Joint venture

Lump-sum turnkey

Lost Time Incident

MOPU

NOC

OE&O

OPITO

UKCS

Mobile Offshore Production Unit

National oil company

Offshore Engineering & Operations

Offshore Petroleum Industry Training Organisation

United Kingdom Continental Shelf

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Syria: country focus We look back at our success in the country during 2010

Turkmenistan project moves into second phase Petrofac has commenced work on the next stage of the South Yoloten project

17 TEMPO roll-out success New enterprise resource planning system launched in Malaysia and India

OE&O business spotlight Contract highlights and engineering opportunities

20 Enhanced presence in Nigeria Strategic alliance formed with Nigeria’s Seven Energy

26 Board and management changes Appointments enhance senior management team and Board

Environment month Our teams celebrate third successful environmental initiative

35 Singapore training centre Awarded ‘A’ grade in quality assessment 3

February 2011

WELCOME TO OUR FIRST 2011 EDITION OF PETROFACTS. This edition co-incides with the 30th anniversary of the group and inside you will find an interview with some of Petrofac’s founders which charts the group’s history and progress so far.

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Looking back on 2010 I am delighted to say it was another exceptional year for our group. We closed the year with record backlog and we continue to see strong growth potential in 2011 and beyond. It is gratifying to continue to win business with existing customers in geographies we know well. We were recently awarded our sixth EPC project In Algeria to develop southern fields in the In Salah development on behalf of In Salah Gas. As we go to print, I have just returned from a trip to Kuala Lumpur where I attended a signing ceremony hosted by our valued customer PETRONAS for a US$800 million Risk Service Contract for the Berantai field development. Just at the close of the year we announced that Petronas Carigali Sdn Bhd had awarded Petrofac a US$280 million contract to provide EPCIC services for the SEPAT offshore early production system on the east coast of Malaysia. When taken in combination with the phase II development of the Cendor field, Petrofac is now managing projects in Malaysia worth in excess of US$2 billion. This is a remarkable achievement and further details of both of these new developments can be found inside this edition. During 2010 we were awarded a number of important contracts for new customers expanding our geographic footprint; such as our 15-year production enhancement contract in Romania with Petrom, and the second phase of the South Yoloten project in Turkmenistan worth US$3.4 billion. In line with our co-investment strategy, we took a 20% interest in Gateway Storage Company Limited and invested in Nigeria’s Seven Energy, giving us a foothold in the Nigerian oil & gas market. We have also been able to bring our EPC capability to bear in the UK and work is now underway on the development of the LagganTormore gas processing plant on the Shetland Islands for Total. The group completed four small complementary acquisitions during the year and two of these - CO2DeepStore and TNEI Limited – have enabled us to create ‘Petrofac new energy’ to service the low carbon and renewable energy sectors. Amidst this, we have continued to focus on developing and maturing our internal business processes and launched ‘TEMPO’ our tailored Oracle ERP system, in Chennai, Mumbai and Kuala Lumpur with more roll outs planned for during this year. 2010 was also the ‘year of integrity and quality’ across our engineering businesses and you can read about our progress on page 22. We have continued to recruit and grow our teams, especially at a senior and functional level and we have been joined by a number of key individuals across the business. In January we welcomed Andy Inglis to Petrofac as chief executive of Energy Developments and Production Solutions. Andy will also join our Board on 1 March 2011. Further details on Andy and our other recent Board changes can be found on pages 26 and 27. Overall 2010 has been a fantastic year for Petrofac and I am confident that we can look forward to bright prospects for 2011 and beyond.

I hope you enjoy this issue.

Ayman Asfari Group Chief Executive

February 2011

cover story

picture petrofac the winners Following a much anticipated wait, at the beginning of November we announced our overall winner and twelve runners up in this year’s Picture Petrofac competition. Speaking about the competition, Petrofac’s group marketing director, Kaye Krause-Whiteing said: “The competition is now in its third year and we have seen participation grow year on year. Whilst we have the obvious high levels of interest and comment from the amateur photographers in our midst, I have been extremely encouraged by the engagement and feedback from our ‘non photographers’.” Overall winner Peter Martin, whose amazing photograph is featured on the cover of this edition of Petrofacts said: “The image was one of quite literally hundreds I took in order to capture the serenity and mood of the early morning when this was taken. This location is very close to my heart as it is where I have spent many happy holidays. I am absolutely thrilled to have my photograph selected as the winning entry as the quality of the entries seems to keep surpassing those of the previous year.” The winning photographs, illustrated here, take pride of place in the 2011 Petrofac calendar and each of the successful entrants received Group chief operating officer, Maroun a Canon EOS 1000D digital SLR Semaan, presenting winner Peter Martin camera. with his camera prize

Bay taken from canoe, Ontario, Canada

Along with Peter, our congratulations also extend to the remaining twelve finalists: 1. 2. 3. 4.

Andrew Vaughan, Aberdeen, Scotland Jim Kelly, Kuala Lumpur, Malaysia Nasrum Mohamad, Kuala Lumpur, Malaysia Paul Fidder, Dubai, United Arab Emirates

5. Gaurav Chakraborty, Sharjah, United Arab Emirates 6. Bill Boyter, Aberdeen, Scotland 7. Nilima Sawant, Mumbai, India

8. Pankaj Vartak, Sharjah, United Arab Emirates 9. Guillaume Roux, Woking, England 10. Robert Marks, London, England 11. Jamil Boudiab, Sharjah, United Arab Emirates 12. Fanny Turcotte, Abu Dhabi, United Arab Emirates

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success in malaysia

Petrofac secures two new contracts offshore Malaysia Development of the SEPAT offshore early production system In December, Petrofac was awarded a contract by Petronas Carigali Sdn Bhd for the development of the SEPAT offshore early production system on the East coast of Peninsular Malaysia. The contract, which is valued at approximately US$280 million, was awarded following a competitive tender and first oil is expected before the end of 2011.

Maroun Semaan, chief operating officer

Key facts • Contract valued at approximately US$280 million • facilities mirror those of the Cendor phase I development, also undertaken by Petrofac • water depth of approximately 65 metres • first oil is expected before the end of 2011

Risk Service Contract to develop Berantai field Petrofac Energy Developments announced in January that it had teamed up with Malaysian companies SapuraCrest and Kencana Energy to sign a Risk Service Contract (RSC) with PETRONAS, the Malaysian National Oil Company, to lead the development of the Berantai field, located in Block PM309, offshore Peninsula Malaysia.

Petrofac will undertake the engineering, procurement, construction, installation and commissioning (EPCIC) for the full scope of the early production system in a water depth of approximately 65 metres. The EPCIC will comprise of a mobile offshore production unit (MOPU), a floating storage and offloading (FSO) facility for the early production of approximately 20,000 barrels of oil per day, and all interconnecting subsea pipelines. These facilities mirror those of the Cendor phase I development, which was also undertaken by Petrofac on behalf of Petronas in record time under a production sharing contract framework. Local partners supporting Petrofac on this project are Kencana HL, which will add all the processing equipment to the MOPU, and BumiArmada which will supply and install the FSO. The Front End Engineering and Design (FEED) work for the project was carried out in

Petrofac’s specialist FEED office in Woking, UK. Maroun Semaan, group chief operating officer, Petrofac, commented: “We are delighted to have been awarded this contract by Petronas, which is our first lump-sum offshore EPCIC contract in South East Asia. The award reinforces our commitment to the region and enables the continued growth of our local delivery capability to support our ongoing relationship with Petronas and other regional partners. Petrofac has presented a fast track delivery model using existing vessels for the FSO and MOPU conversions and we should be ready for startup by the end of 2011. Our ongoing partnership on the Cendor field development project in the region continues to flourish, and we look forward to delivering for Petronas on this project as well.”

Under the RSC the group has little exposure to oil & gas prices or production levels. The terms of the RSC are such that the Berantai partners will receive a rate of return linked to their performance against an agreed incentive structure, including project costs, timing to first gas and sustained gas delivery after project completion, with an ongoing incentive structure based on operational uptime. Berantai is an undeveloped gas field located approximately 150km offshore Peninsula Malaysia. The field was inititally discovered by Exxon in the 1970’s but has remained undeveloped until now. Petrofac, Sapura and Kencana - together the Berantai partners - will develop the field and subsequently operate it for a period of seven years after first gas production. Commenting on the partnership Rob Jewkes, managing director, Petrofac Energy Developments said: “We are looking forward to working with local partners, Kencana and Sapura, both of whom bring unique capabilities and local knowledge to this project.” The project is hoping to achieve first gas from the field before the end of 2011. The full field development, excluding delivery of the floating production storage and offloading (FPSO) vessel, is anticipated to require capital investment of approximately US$800 million (of which Petrofac’s share is 50%). Explaining how the field will be developed, Jewkes added: “The fast-track field development plan we have submitted includes the installation of a wellhead platform to support the drilling of eighteen wells, with a second wellhead platform expected to be installed in a subsequent phase. Both platforms will be connected to an FPSO vessel, which will undergo modification to ensure suitability for the development. Produced gas will be exported by subsea pipeline via the Angsi Field, while oil will be offloaded via shuttle tanker. “We are excited about this project and about working once again with PETRONAS, a customer we know well. We will be drawing on our extensive experience of fast track developments to provide a range of fully integrated services from design and construction through to subsurface capability and operations.”

Rob Jewkes, managing director, Petrofac Energy Developments

“We are excited about this project and about working once again with PETRONAS, a customer we know well.”

February 2011

SYRia country focus Together with our customers and partners, Petrofac achieved a number of successes in Syria during 2010. The Ebla gas plant was completed ahead of schedule, hydrocarbons were successfully introduced to the Jihar gas plant and we created a new national technical training centre and donated it to the country’s Government. In October, Petrofac took a group of around 50 of our investors and financial analysts to Syria in order for them to see some of these projects firsthand. Hosted by Petrofac’s senior and incountry management, the three-day investor trip required military-style timing in order to ensure the ambitious programme could be achieved. Day one started in the ancient capital, Damascus. After receiving a presentation on Petrofac’s Energy Developments business from executive VP business development and technical services, Gavin Graham, the group attended a prestigious dinner, hosted by Petrofac with guest of honour, Syria’s Prime Minister, His Excellency Mohammad Naji Ottri. A number of other senior Ministers including the Deputy Prime Minister, His Excellency Abdullah Dardari and the Minister of Petroleum, His Excellency Sufian Allao also

STOP PRESS Project awards As we are going to print we have received notification that two of our E&C projects have won awards; Ebla gas plant, Syria The Ebla gas plant project, which Petrofac executed on behalf of Petro-Canada in Syria, has secured a prestigious operational excellence award from Suncor Energy as the best project of 2010. This is further great news for the project which was delivered two months ahead of the original schedule and recently received its final completion certificate. Facilities upgrade project, Kuwait The facilities upgrade project, which Petrofac completed on behalf of Kuwait Oil Company earlier in 2010, has secured a MEED quality award for projects. Chosen by the Kuwait Society of Engineers as the winner in the ‘oil & gas project of the year’ category in Kuwait, the project now progresses to the next stage of judging to compete against other regional projects to become the overall GCC winner in its category.

attended together with representatives from our customers and in-country suppliers, including long-term in-country construction partner LEAD. Early the next day the group travelled two and a half hours north to the Homs area, to the country’s first technical training centre which has been refurbished and equipped by Petrofac. The centre, which had been open and operational for only a matter of days prior to the visit, was officially inaugurated by His Excellency Mohammad Naji Ottri, and after completing a tour of the facility, led by Petrofac Training Services’ head of strategy, Karim Osseiran, guests were given the opportunity to find out more about the Training Services business from managing director, Paul Groves. The group then departed to the nearby Jihar gas plant, arriving in time for lunch, followed by a tour and presentation led by Subramanian Sarma, managing director of Petrofac’s Engineering & Construction business. It was a great honour that the Prime Minister also chose to visit Jihar in order to see the progress being made. He was accompanied throughout his visit by Petrofac’s group chief executive, Ayman Asfari: “His Excellency was impressed with the high standard of the national training centre that Petrofac has created for the country. The first programme is well underway and I feel certain this facility is going to play a key role in helping Syria achieve an increasingly skilled and competent workforce. “While at Jihar, we were able to demonstrate the progress on a project that is on track for on-time completion and with an exemplary HSE record.” On the final day of the trip, guests were treated to a guided tour of the ruined city of Palmyra, close to the Jihar gas plant, before visiting the Ebla gas plant, which was completed by Petrofac on behalf of Petro-Canada earlier in 2010. After a short coach-based tour of the site, guests met with senior representatives of Petro-Canada, who praised Petrofac’s performance in relation to the completion of the project two months ahead of schedule.

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Project Focus: The National Training Centre Supporting the development of Syria’s workforce

Project Focus: Jihar gas plant Introducing hydrocarbons and celebrating key safety milestone

The National Training Centre, which opened its doors to students in September, forms part of the Syrian Government’s commitment to develop competent personnel for the growing oil & gas sector. The centre was refurbished and equipped by Petrofac and donated by the group to the Syrian Government.

During November our Jihar project with Hayan Petroleum Company (HPC) successfully introduced hydrocarbons into the gas plant.

The training centre, the first of its kind in the country, provides competence-led training to the workforce of General Petroleum Corporation, the parent company of the Syrian Petroleum and Syrian Gas companies. Designed by Petrofac’s Training Services business, the facility has been built on a brownfield site near Al Bisa, Homs in central Syria. The centre can accommodate 120 delegates each year and the programme starts with three months of technical English language training followed by nine months of technical training incorporating the electrical, mechanical, instrumentation and production disciplines.

Commenting on this important development, Maher Mustafa, Jihar project director said: “During November the project team of HPC and Petrofac celebrated achieving mechanical completion and the successful introduction of hydrocarbons into the plant. This was the culmination of significant efforts on the part of everyone involved but a special note of thanks must be extended to the construction and commissioning teams for their considerable endeavours in helping us reach this milestone.” The Hayan block is located near to the town of Palmyra and consists of gas and condensate oil fields at Jihar, Al Mahr and Jazal fields. Our project scope is for the EPCC of the Jihar gas processing facilities involving mainly the gas treatment plant with an inlet capacity of 141 million standard cubic feet per day, liquid petroleum gas (LPG) recovery of 350 cubic meters per day (m3/ day) and condensate of 1,800m3/day, LPG storage and loading facility, gas gathering and condensate collecting systems, satellite gathering stations, well sites and flow lines, utilities and offsite facilities, transport pipelines, and also living quarters. The Jihar project has been a great success for Petrofac in Syria and continues to progress on target for final completion and handover in Q1 2011. Through the dedication of everyone involved there has also been an enviable HSE track record throughout this project where seven million man-hours have been completed without a Lost Time Incident (LTI). Mustafa explains: “This HSE performance has been down to the meticulous attention paid to safety through all aspects of the planning, design and execution of the project. This was evident throughout the project and the results now speak for themselves. “As Petrofacts goes to press, we are in the final stages of the project, and will be completing the performance testing in order to hand over the plant fully to Hayan Petroleum Company in the early part of 2011.”

Self-sufficient in five years The centre will be operated by Petrofac Training Services for five years. It is currently staffed by a 30-strong Petrofac-led team including nine expatriate instructors, but over time all instructors will be local, as Paul Groves, managing director of Petrofac Training Services explains: “We have applied our knowledge and experience to design and develop the centre and for the next five years we will provide the operations support for the facility. During this time, we will be recruiting, training and developing local instructors and managers to create a sustainable facility where Syrian students are being trained exclusively by Syrian instructors by 2015.” An unrivalled offering The ability to offer world-class training either through the network of Petrofac’s training facilities, or through the creation of bespoke in-country sites is a fundamental part of Petrofac’s differentiated offering. By including the training and ongoing development of local staff within the wider EPC projects, governments and national oil companies can benefit from increased efficiencies and reduced training expenditure while improving their workforce competence and increasing their levels of local content.

7 million

The number of LTI free man-hours completed during the Jihar project so far

February 2011

project update

Petrofac to commence US$3.4 billion South Yoloten field contract

Grading at the South Yoloten site

Following successful completion of the first phase of the South Yoloten project for Turkmengas, the state-owned national gas company of Turkmenistan, Petrofac has commenced work on the second phase of the project, worth US$3.4 billion. Marwan Chedid, managing director of Petrofac’s Engineering & Construction Ventures business, said: “Following the successful completion of the first phase of this contract awarded in December last year, I am delighted that we are moving into the substantial second phase where we will be able to bring to bear our extensive experience of designing and constructing facilities to handle and process sour gas. Our initial planning and set-up studies have given us confidence that we can maintain our high working standards and first class project delivery in Turkmenistan, and we are excited to be working with Turkmengas on this important project.” When complete, the South Yoloten field, which is situated approximately 400km south east of the capital Ashgabat, is expected to export 20 billion cubic metres per annum (bcma) of gas. Under the second phase of the contract, which is scheduled to last 31.5 months, Petrofac will provide engineering, procurement and commissioning work on a lump-sum basis for a 10 bcma gas processing plant along with the infrastructure and pipelines for the entire 20 bcma development. The feed gas from the field contains up to 6% H2S, and the development will include gas treatment and sulphur handling facilities, along with well pad facilities, gathering facilities, infrastructure and utilities, condensate processing, storage and export. Maroun Semaan, group chief operating officer, commented: “Whilst we have substantial experience of working in the region, Turkmenistan is a new market for us, albeit one with considerable potential, where we would like to build a sustained presence. Successfully delivering this contract will underpin our endeavours in this respect and I look forward to developing our relationship with Turkmengas as we move into the second phase of our work on this important development.”

Ashgabat, capital of Turkmenistan

Marwan Chedid, managing director of Petrofac Engineering & Construction Ventures

Key facts South Yoloten field is situated approximately 400km south east of the capital Ashgabat

It is expected to export 20 bcma of gas

Second phase of the contract scheduled to last 31.5 months

Feed gas from the field contains up to 6% H2S

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petrofacâ&#x20AC;&#x2122;s story

The next stage of the journey... Petrofac marks its 30th year in business on 26 February 2011

continued overleaf >

February 2011

> continued from overleaf

Petrofacts has been talking to those responsible for the creation of the company and the inspiration behind its 30-year journey. Group chief executive, Ayman Asfari will also mark his 20th year with the company in 2011; he believes the building of Petrofac has truly been a team effort. At the end of 2010 as he accepted the Ernst & Young UK Entrepreneur of the Year award, Ayman Asfari thanked all of the 13,000 people within Petrofac, dedicated the award to them all and said he was ‘simply the public face’ of the group. At Petrofac’s Leadership Conference in November Asfari reflected on the group’s journey and his vision for the future. He cited a number of early events and the people who influenced him and the future direction of the group as being instrumental in its subsequent development and success. It’s no surprise that top of his list was Maroun Semaan, Petrofac’s group chief operating officer, who co-founded Petrofac International with Asfari in 1991. Asfari and Semaan were friends and industry peers, and it was Asfari that introduced Semaan to Ralph Martin, then CEO of Petrofac Inc, a producer of modular plant based in Tyler, Texas. Together with the Petrofac team of the era, including: Lou Owen, Greg Hendrickson and Gordon McLeod, they hatched a plan to create Petrofac International, a Middle East-based small to medium-sized EPC provider. Recounting those early meetings which started in the late 1980s, Ralph Martin, one of the original founders of Petrofac Inc, and the CEO of the time, said: “We had worked successfully with Ayman’s previous company on a project in Oman, and I was introduced to Ayman through a senior colleague at Occidental. Ayman then introduced me to Maroun. At that time Ayman was talking to a Canadian company about forming a joint venture and it made me realise that if Ayman and Maroun were going to be playing in the field, I wanted them on our team.” Martin clearly had high hopes for the joint venture with Asfari and Semaan but did he ever believe Petrofac would go on to enjoy such tremendous growth and success? “If I had, I would never have sold my stock when I retired!” Asfari himself cites Martin as his mentor and inspiration. “I count Ralph as one of my closest friends. I respect and admire him immensely. We each had different strengths but shared a vision for Petrofac which aligned us when we were discussing the joint venture.” So just how did it come to be that two Middle East-based engineers, who knew each other but had never worked together, formed an alliance with a US business with an established business model and a ten-year history? Maroun Semaan recalls those early discussions, “I joined Petrofac International officially on 1 September 1991, but the journey began much earlier. Ayman and I first came to know each other in the early 1980s when we were working for different organisations in Oman, sometimes competing against each other for work in the local market. I soon realised he had strong ambitions to set up an oil & gas contracting

Ralph Martin

Ayman Asfari

Joined Petrofac: January 1981

Joined Petrofac: March 1991

First position: Chief executive officer of Petrofac Inc

First position: Chief executive officer of Petrofac International

Final position: Chairman of Petrofac Limited Proudest moment: When the billion dollar job was signed in Algeria - it was signed in the Petroleum building in Algeria which overlooked Algiers harbour. The salad and soup were served on very nice china then the main course was lamb on a spit and you tore the meat off and ate it with your right hand. Toughest challenge: 1981 was a terrible year in the oil business but we were fortunate enough to get a small refinery job through a promoter in Hong Kong. We made a million dollars on the job – which gave us some operating capital! Which one word or phrase would you use to sum-up Petrofac’s journey from then to now?: Amazing!

business in the Middle East and wanted me to join in. This vision became clearer in early 1991 when discussions with Petrofac Inc culminated in the establishment of Petrofac International in July of that year as a joint venture company between Petrofac Inc and AMcorp, a company that Ayman and I had just formed.” Gordon McLeod joined Petrofac in 1982, left in 2003 but rejoined in 2010: “Prior to establishing the joint venture, Petrofac’s US business was built around our fabrication shop. Our innovative process designs and fast-track approach were fuelled by the considerable technical talents of Lou Owen and Ralph Martin. When I joined there were only a handful of engineers and our total workforce including the fabrication shop was around 25 people, it was an exciting time when we all wore lots of different hats.” Like many new businesses, it took a number of years to grow Petrofac Inc to the extent where it had a robust pipeline and good revenue visibility.

Current position: Group chief executive of Petrofac Limited Proudest moment: There are so many moments when I feel proud, such as: • visiting a project and being struck by the magnitude of what we are involved in • receiving appreciative feedback from a customer or shareholder • watching a new recruit blossom and grow inside Petrofac Toughest challenge: Again there were a few: • before we won our first contracts we had no resources, no systems and no capital! • when we invested US$100 million in the Ohanet project the total equity of Petrofac was only US$40 million! • selling the US business was without doubt the toughest decision I have ever had to make Which one word or phrase would you use to sum-up Petrofac’s journey from then to now?: We’ve come a long way in 30 years but our potential for continued growth is still tremendous. I have enjoyed every minute of it! Greg Hendrickson was the chief financial officer and remembers the time well: “The sleepless nights revolved primarily around how to bid and execute larger projects, and we took on any project that was in our skill set and worked hard to gain larger, more lucrative projects. We came close to failure in 1984, when we engineered and built a plant for a customer that ended up in bankruptcy. We had invested most of our working capital and available credit in the project and were at the mercy of the bankruptcy courts. Fortunately the project was not complete at the time when the customer filed for bankruptcy and so we were able to negotiate a payment that returned most

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of our investment in exchange for committing to complete the project.” It was through this continued search for growth and development that the idea for the creation of Petrofac International came, but it was met with some strong opposition. The US founders were nervous about the deal and if it had not been for Ralph Martin’s belief in the duo it may never have gone ahead. Hendrickson continues: “Most of us had heard of Ayman from the Oman project we had worked on, but only Ralph had actually met him. So when Ayman came to Tyler and made a very positive yet aggressive presentation on the business plan we were somewhat sceptical that a newly formed company could achieve success and be awarded major contracts as rapidly as Ayman was predicting. Ralph was instrumental in convincing the Board to proceed with the proposed business arrangement, recognising that it would be better to be working with, rather than competing against Ayman and Maroun.” Petrofac International was capitalised at US$1 million, funded equally between the US business and AMcorp. The management team realised that no further funds would be forthcoming so it was imperative to build strong foundations for the business quickly. In the early weeks and months efforts were focused entirely on business development. Early breakthroughs came in the form of some relatively small contracts (circa US$ 6 - 7 million) in Syria and Azerbaijan. With very few people to execute these contracts, it was a true test of the fledgling business’ capability and the team’s determination. Further challenges were ahead however, with the company’s funds dwindling rapidly, the business needed to secure larger contracts and it needed more staff. A breakthrough came in late 1991 when Petrofac was invited to pre-qualify for the North Oman Crude Stabilisation (NOCS) project for Petroleum Development Oman (PDO). There was a problem, however, as Petrofac International did not have the financial muscle to take on, what was at the time, a massive US$60 million project. Undeterred the team turned to Galfar, one of Oman’s leading construction companies, and formed a joint venture. Galfar brought the necessary financial strength and the JV was prequalified and invited to bid for the project.

“Those first ten years very much represented laying the foundations of Petrofac: systems, procedures and the painstaking process of establishing the different departments, country offices and partnerships.” Maroun Semaan, Chief operating officer

Maroun Semaan

Lou Owen

Joined Petrofac: 1 September 1991

Joined Petrofac: 1 January 1982

First position: Vice president, operations and Board member

First position: Vice president engineering

Current position: Chief operating officer and Board director

Final position: Senior vice president/President Petrofac Inc

Proudest moment: There have been many events of which I am immensely proud. Each was at the time, and continues to remain, significant to me as we take the business forward. Our four EPC project wins in 1992 allowed us to kick start the company and this was a fantastic and challenging period for the whole team with a continual succession of projects thereafter. At a personal level, my proudest moments are being able to play a part in and share the achievements of my fellow Petrofac colleagues and of course my own family.

Proudest moment: Formation of Petrofac International. I always felt it was going to be a positive development.

Toughest challenge: The constant challenge of remaining competitive, growing an enduring business and building a solid reputation was a big challenge on day one of Petrofac’s journey and will always continue to be so. It is that challenge that makes it exciting for me to get out of bed every day and work with our teams to ensure we remain successful. Which one word or phrase would you use to sum-up Petrofac’s journey from then to now?: A journey of excitement, passion and hard work and a voyage of many new beginnings. Although clearly delighted with this progress, the team now had another problem – people – or rather the lack of them. In anticipation of winning the contract Asfari and Semaan headed to India in search of engineering talent. “It was not difficult to find excellent engineers or to persuade them to join Petrofac”, recalls Asfari “what was difficult was the considerable red tape around processing work permits and visas for them to come and work in the US. In the end I think we hired around 20 engineers and many of them are still with us today in senior roles.” Gordon McLeod worked on the NOCS bid: “We submitted an alternate design based on an idea that Ralph and I had discussed during the prequal stage, which was to substitute liquid ring vacuum compressors for the centrifugal machines called for in PDO’s specification. The alternative saved a considerable amount of money as well as circumventing a significant technical difficulty. Ultimately PDO accepted our alternate proposal and the Petrofac/Galfar team was awarded the project in April 1992.”

Toughest challenge: The early days were challenging as we never knew if we were going to be able to pay the bills or not but selling the US business was the toughest decision. Which one word or phrase would you use to sum-up Petrofac’s journey from then to now?: Absolutely great! It was just fun all the way!

So the stage was set, the company was expanding and had its first major project secured. Semaan, having initially been based in Tyler, relocated to the now established Sharjah office in order to start to realise the company’s vision. “We had the determination to pursue, win and execute large lump-sum projects – a challenge which many contractors still avoid today! We realised from the very beginning that in order to be successful we first had to be based close to our customers. Secondly, we had to establish and grow a multinational and cost efficient organisation of the highest calibre that could execute and manage the risks associated with EPC contracts. “The Sharjah journey really gathered momentum when we were joined in those early formative days by members of team who are still with us today: Rajesh Verma, Marwan Chedid, Murugan Pitchai, Mark Thomas, Jean Chidiac, Rohit Beri, RG Gopal and indeed many others, too numerous to mention here but certainly not overlooked, who created the bedrock for the business. “Those first ten years very much represented laying the foundations of Petrofac: systems, procedures and the painstaking process of establishing the different departments, country offices and partnerships.” Throughout this the company continued to grow. It secured and successfully executed numerous projects and in the late 1990s the group was joined by Amjad Bseisu to set up the Resources division (now Energy Developments). The vision was to align Petrofac more closely with its customers through the provision of capital investment in upstream and infrastructure projects for which Petrofac was also deploying its service capability. continued overleaf > 13

February 2011

Company timeline

1981 Petrofac Inc, Tyler, Texas 25 members of staff

1991 Ayman Asfari and Maroun Semaan join and found Petrofac International. Capitalised as US$1 million

1992 Awarded the NOCS project, valued at US$60 million

1997 Amjad Bseisu joins to set up Resources division (now Energy Developments)

2000 Awarded the Ohanet project, valued at US$1 billion

2002 Petrofac undergoes a corporate reorganisation

2003 US business is sold

2005 The group admitted to the Official List of the London Stock Exchange with market capitalisation of around US$1.3 billion

2008 The group enters the FTSE 100

2010 Completes demerger of UKCS oil & gas assets to EnQuest PLC

2011 Petrofac’s market capitalisation more than US$8 billion. The group has some 13,000 staff working in around 25 countries worldwide

> continued from overleaf The first realisation of this strategy came in 2000 when the group entered an agreement with Algeria’s Sonatrach and BHP Billiton to provide EPC capability for the US$1 billion Ohanet project in the country while also deploying capital for a 10% investment in the development. Ohanet took 39 months to complete and was the largest contract Petrofac had undertaken at that time. By becoming a partner and aligning itself through the deployment of capital Petrofac was able to assist in the challenges the joint venture faced. The project was an outstanding success and the signing of the Ohanet contract and its significance for the group is something that stands out as a milestone event for many of the founders. In January 2002, Asfari led a corporate reorganisation through which Petrofac Limited became the parent company for the group. In May 2002 Petrofac raised US$40.25 million of longterm capital from 3i Group plc giving them a 13% interest in the Company. Martin became chairman and Asfari the chief executive of the new group which had around 900 staff. Within this new structure the team set about growing the already successful EPC and coinvestment businesses through both acquisition and organic development. In early 2001 Mike Stacey joined to establish full field facilities development and front end engineering design capability through the creation of the engineering

business in Woking. Stacey went on to serve as the group’s vice chairman until his retirement from Petrofac in 2005. In December 2002 Petrofac entered the UK North Sea market through the acquisition of PGS Production to provide facilities management, operations and maintenance services. This was led by current group director for strategy and corporate development, Rob Pinchbeck, who had just joined that year and was instrumental in the development and growth of the UK North Sea business. In the same year, Keith Roberts joined as group CFO and was instrumental in the creation of internal processes that would enable Petrofac to continue to grow and develop and ultimately fulfil its potential to become a public company. The new group was developing its capability and entering new markets, but in contrast the US business was struggling to adapt its business model in order to keep pace with the changing market landscape. As Asfari recalls: “When we realised that the US business was not going to continue to succeed as part of our group, the decision to sell it to Chicago Bridge & Iron company was the hardest I have ever had to make. I didn’t want to sell the US business, it was where our journey had started, but it was clear it was the right thing to do if we were to take the maximum advantage of the opportunities that were presenting themselves in international markets.” The sale was completed in 2003 and many of the US shareholders chose to sell their stock back to Petrofac at that time; a decision many say they now regret.

petrofac.com

“It would be easy to feel satisfied with what we have achieved and to simply coast along, but I believe that complacency, above all things, is the quickest path to failure.” Ayman Asfari, Group chief executive

Greg Hendrickson

Joined Petrofac: February 1981 First position: Corporate secretary/treasurer Final position: Senior vice president and chief financial officer of Petrofac Inc Proudest moment: There was no single moment but providing a livelihood for employees and their families while improving opportunities and operations for our customers was always an inspiring feeling. Toughest challenge: Always keeping enough work on the horizon to avoid having to lay off employees that were doing a good job. It is never difficult to fire an under performer, but it is a bad feeling to have to lay off a hard working, dedicated employee because you cannot gain enough contracts to keep them employed. Which one word or phrase would you use to sum-up Petrofac’s journey from then to now?: Proud

During 2004, Petrofac created its training capability through the acquisition of leading international training provider RGIT Montrose, reflecting the importance the group placed on being able to provide safe and competent personnel for the oil & gas facilities it was building and operating around the globe. Since the beginning of the decade the group had focused on expanding its portfolio and capabilities and had an extremely robust business model when it came out of private ownership. In October 2005, following a successful Initial Public Offering (IPO), the group was admitted to the Official List of the London Stock Exchange with a market capitalisation of around US$1.3 billion. 3i, having invested in the business during the 2002 re-organisation, exited at the time of the IPO. Petrofac’s IPO was a major achievement in the group’s history. For the first time there was an independent validation of the business and its future prospects, along with exposure to a new and wide-ranging set of stakeholders. When asked about the significance of the IPO Asfari has one thought to share: “It was gratifying and something of a relief to prove to the team the shares they had in the group were not just worthless ‘bits of paper’ and the share price in the public market was evidence of their real value. For many years, I had been telling them this would be the case, but I’m not sure they believed me!” One person who had complete faith in Petrofac and its leadership was Lou Owen. In 2003, when the US business was sold, he made the decision to retain his shares in Petrofac. As Owen recalls: “I never even thought about selling. Ayman and I had talked about his plans and I had always believed him to be a far-sighted and visionary individual with the ability to make things

happen, and you could not get anyone better than Maroun at running an engineering & construction company. Petrofac was in safe hands and I was confident that they would either sell or float the business; it didn’t seem like much of a gamble to wait. “I have been extremely fortunate as a result and my wife Peaches and I have donated more than US$40 million to local causes and charities here in Tyler. We set up the Owen Family Foundation which still donates around US$800,000 each year from the earnings gained on Petrofac stock.” In April 2010 Petrofac completed the demerger of its UK Continental Shelf (UKCS) oil & gas assets to EnQuest PLC where they were combined with the UKCS assets of Lundin Petroleum AB in a separately listed entity. This crystallised a significant gain for Petrofac and enabled all existing shareholders in the group to also become shareholders in an E&P company which has since gone on to increase in value as a public company. Having joined in 1997 to establish Energy Developments within Petrofac Amjad Bseisu left Petrofac following the demerger to lead EnQuest PLC as chief executive officer. At the end of January 2011, as we go to print, Petrofac is entering its fourth year as a constituent of the FTSE100 Index with market capitalisation of more than US$8 billion. The group has experienced significant organic growth and now has some 13,000 staff working in around 25 countries worldwide. 2010 closed with record backlog having signed our largest ever contract with Turkmenistan’s state-owned national gas company, Turkmengas, worth US$3.4 billion. continued overleaf > 15

February 2011

> continued from overleaf So what do Ayman Asfari and Maroun Semaan think of this company they built 20 years on and what does the future now hold for Petrofac? “Ensuring we have an enduring and efficient business with clear targets and objectives which are well understood by our management without diluting the prevailing entrepreneurial culture will be critical to success,” says Semaan. “Back in 1991 the board had a consistent vision for continued growth and success underpinned by our passion and commitment to delivery for our customers and to attract the best talent on board, a vision that we continue to live by today. The entire energy sector is constantly evolving and we have to take considered, strategic measures to ensure we can change with it, remain innovative in our approach - technically and commercially and instil the same set of values as new people continually join our organisation. “At a personal level, I am extremely passionate about what we do but I am certainly not alone in that. There is a high degree of commitment, loyalty and dedication running through our business which is very powerful and, as we grow, we need to ensure that remains as alive in 30 years time as it was in 1981, 1991 and today. “Looking back at the journey and with hindsight, most of us would do many things differently, however, I relish my life’s journey and have soaked up every experience along the way.” Asfari concludes with his thoughts on the journey so far and the next instalment: “The hard work and dedication of many exceptional people combined with some good fortune has brought us to this point, and we can all

Gordon McLeod

Joined Petrofac: I first joined Petrofac on 1 December 1982. I left in April 2003 and rejoined full time in September 2010. First position: Instrument and electrical engineer Current position: Vice president, Americas Proudest moment: Being selected to serve as vice president Engineering in the newly formed Petrofac International in 1991. Toughest challenge: Serving simultaneously as vice president engineering and director of Petrofac International and as project director of the North Oman Crude Stabilisation Project, Petrofac International’s first major EPC project. Which one word or phrase would you use to sum-up Petrofac’s journey from then to now?: Vision

be very proud of what we have achieved. It hasn’t always been easy and we have had to make some tough decisions along the way, but every decision has been made in the best interests of the group and its future sustainability and success. “I would like to take this opportunity to extend my personal thanks to those colleagues who have supported me on this journey so far. Firstly, to the Board of Petrofac Inc for their belief and especially to Ralph and Lou, my mentors and dear friends. I’d especially like to thank Maroun for sharing this journey with me; it has been a fantastic experience to work alongside someone for so long and to have achieved so much together. To Amjad, who made a significant contribution to our group and is now a very important customer for Petrofac! To Keith Roberts and Rob Pinchbeck, who both joined Petrofac in 2002 and I am grateful for their support and contribution. Keith has been instrumental in creating process and structure within our business as we have grown and also led the execution of the IPO transaction very successfully in 2005, while Rob led the acquisition of PGS production in 2002 establishing and building our offshore business in the North Sea. Our group director for legal and commercial affairs, Richard Milne, joined us in 2004 and has been instrumental in creating our governance and compliance framework. I’d like to thank each of the business unit managing directors: Marwan Chedid, Rajesh Verma, Subramanian Sarma, Rob Jewkes, Gordon East, Bill Dunnett and Paul Groves. Some have been with us for almost 20 years and some have joined the group more recently, but their individual

contribution is both recognised and appreciated. This is not an exhaustive list and so many more people have contributed to Petrofac’s success and I do thank you all most sincerely. Finally, I would like to recognise the guiding role of our Board and the contribution of our non-executive directors. They have supported the executive team at every stage of Petrofac’s development. I would especially like to thank Rodney for leading our Board as chairman for the last six years and for his own valuable contribution. “It would be easy to feel satisfied with what we have achieved and to simply coast along, but I believe that complacency, above all things, is the quickest path to failure. The Petrofac of 2041 will look very different to the Petrofac of today, of that I am certain. So, the next steps in our journey will be to continually evolve and develop our capability, our commercial structures and to stay at pace with the market and the changing demands of our customers. I am as committed to Petrofac today as I was in 1991. I’m looking forward to participating in this next chapter of our history and am very excited by the inevitable challenges it will bring.”

petrofac.com

infrastructure update

Project TEMPO successfully launched in malaysia and India Update from Mohan Narasimhan, group chief information officer

In November 2010 we celebrated the launch of our new Oracle Enterprise Resource Planning (ERP) system - project TEMPO - in Chennai and Mumbai, India, and Kuala Lumpur, Malaysia. This was the first part of our staged roll-out of TEMPO across the group and I am delighted to report the success of TEMPO in daily operations.

Name Mohan Narasimhan Title Group chief information officer Location Sharjah

The successful implementation of TEMPO in India and Malaysia could not have been accomplished if it were not for the unwavering efforts of the ERP teams and all individuals involved in this two-year project. Energy Developments’ finance manager for the Malaysian business, Jeffry Ahmad, is one such employee who contributed above and beyond expectations. In recognition of this, and as a token of Petrofac’s appreciation, Jeffry has been awarded a letter of recognition and a gift. These were presented to Jeffry by chief financial officer, Keith Roberts, at the recent Petrofac finance conference in London. The next stage will see the implementation of the system in our UK businesses. Although initially estimated to begin roll-out in January, due to crucial challenges around customisation and system configuration, this launch date is scheduled to take place between March and April. The implementation of TEMPO is a significant structural investment for Petrofac and demonstrates our commitment to continued development. It is therefore essential that every opportunity is taken to ensure the system is robust and right for our business. This is a system we hope to be using for the next 20 years.

Petrofacts caught up with the teams in KL, where the system has been embedded now for more than two months to find out how it has been working for them… Faisal Razak: “The system now has all of our projects data in one place for the first time. It is very powerful, but it will take a while for us to understand how best to extract the data.” Zahari Jasmani: “Switching to the new system was harder than we expected. However, it’s in now and we are ready to support all existing and any new projects in Malaysia.” Fariz Ikshan: “Transaction entry is very structured so now all of the upfront approval prevents problems later.”

February 2011

business focus

Petrofac awarded onshore UKCS gas plant development contract Petrofac Offshore Engineering & Operations (OE&O) has been awarded a contract for the development of a gas processing plant at Sullom Voe, Shetland for Total E&P UK (Total) that will see the business leverage capabilities from across the group.

Supported by the Engineering & Construction business, Petrofac OE&O will develop the 500 million standard cubic feet per day gas processing plant on behalf of Total. The project comprises engineering and procurement (on a lump-sum basis) and supply, construction, commissioning and start-up (on a combined lump-sum and reimbursable basis). The plant will facilitate the transportation of gas from the Laggan and Tormore fields, which lie 125km North-West of the Shetland Islands, to the Total operated St Fergus Gas Terminal in Aberdeenshire. Significant milestone Maroun Semaan, Petrofac’s group chief operating officer, commented: “We are pleased to have been awarded this important contract with Total, a major international customer for our group. The contract, which has been secured following an extensive project definition and competitive bidding process, forms part of the strategic growth plan for the OE&O business and marks our first EPC contract in the UK.” Bill Dunnett, managing director of OE&O, said: “This announcement represents a very significant milestone for the OE&O business. We have mobilised an excellent project team focused upon delivering the project objectives, while ensuring we respect both the location and the environment, and to work alongside the local Shetland community.” Local engagement Total’s gas terminal will be developed on land adjacent to BP’s existing facility at Sullom Voe. The area is one already synonymous with gas processing but the potential impact of another gas terminal in the area has not been overlooked. Total has embarked on a significant programme of consultation and engagement with the Shetland community to ensure that the operations teams from both Total and Petrofac work harmoniously within the community. These teams will form a key part of the local landscape for almost four years and Petrofac intends to maintain these high levels of engagement going forward. Protecting the environment has also been a key concern of the project and Petrofac has engaged an environmental consultant expert on the Shetland ecology to guide and support the project team throughout the build.

Alex Hosie, project director, OE&O, outlined our commitments to the local area: “As a business we’re expert in dealing with complex projects in remote locations. We take that expertise to Shetland alongside a respect for and dedication to protecting the local community. Not only is this project expected to create more than 500 jobs in the UK, it will also utilise the Shetland-based supply chain, will bring more people to the island and ultimately increase spending in the area. We are dedicated to ensuring that the people of Shetland are positively impacted by this development and we will work with them to ensure a legacy that continues to do so beyond the completion of the project in 2014.” Thinking differently A unique aspect of the project will see the team maximising the use of modularised components allowing the plant to be developed mainly offsite and therefore helping to overcome the remote location and potentially harsh weather conditions. With work having commenced in October and first gas anticipated in Q2 2014 a project team has been deployed to Sharjah to begin initial engineering works. Construction work is expected to begin later this year.

petrofac.com

OE&O growth plan delivers Following the recent success of the Laggan-Tormore contract award, Petrofac OE&O has also announced a new three-year agreement worth £40 million with Maersk Oil North Sea (Maersk Oil). The contract covers the provision of engineering services including concept, front end engineering, detail design, workpack development, procurement and document control for the Janice, Gryphon and Global Producer III assets. OE&O has been providing offshore operations and support services to these assets since 2000 and this contract extends the existing scope. Bill Dunnett, managing director of Petrofac OE&O, said: “I’m delighted to announce a further significant contract award for OE&O. This is yet another important step in our growth plan and reflects the leading capabilities of our engineering team as well as our continued commitment to our existing customer base. The contract builds on our longstanding and successful relationship with Maersk Oil and is an excellent example of how Petrofac can deliver a full range of services across the asset lifecycle.” The contract, which will be managed from Petrofac’s Bridge View office in Aberdeen, includes three one-year options and will require the support of up to 70 people. The team will be resourced from the reallocation of existing resources, potential transfers under the TUPE regulations from the incumbent provider, Aker Solutions and the recruitment of between 30 and 50 new employees.

Engineering opportunities within OE&O Following a number of recent contract awards for Petrofac OE&O, Petrofacts caught up with Jim Lenton, projects director for OE&O, to talk about plans to expand on the talented pool of engineers within the business unit. What has lead to the growth in the engineering team? With a healthy bidding pipeline and ambitious plans for the future, we rely upon a strong and talented workforce to maintain our track record. We are always looking to recruit exceptional talent, but due to recent contract awards we have the opportunity to add to our team of skilled engineers.

Name Jim Lenton Title Projects director, OE&O Location Aberdeen

What are you looking to achieve when you recruit engineers into your team? We are looking for talented engineers and designers to add value to our expanding service offering and every person within OE&O plays a vital role in achieving the end goal. Our engineers come up with innovative solutions to the challenges we face, and so we need people who are not afraid to tackle these complexities head-on; these are the people who are right for our business. What opportunities have become available due to these contract awards? We have a range of positions available including those across engineering, design and project management disciplines, with opportunities for overseas travel, details of which can be found on our website.

What does the future look like for engineering within OE&O? We are working on some of the industry’s most innovative projects. In the UK alone we have a number of long-term contracts underway, including our work with Apache, Marathon and Centrica, and also with our recent Maersk award. Further afield, we are working on significant projects with Petrom in Romania and have a growing presence in Dubai. The OE&O business unit is rapidly expanding and we have a clear strategy for growth outside the UK. As a financially strong player, we can bid for lump-sum contracts that would be beyond some of our competitors. It is definitely empowering to be part of something so big. If we continue the way we are currently working under the leadership of our managing director, Bill Dunnett, this will likely be achieved. It’s an exciting time to be part of Petrofac and we are looking to the future with confidence.

February 2011

country expansion

PETROFAC FORMS STRATEGIC ALLIANCE WITH NIGERIA’S SEVEN ENERGY In November, Petrofac announced that it had entered into a strategic alliance with Seven Energy International Limited (Seven Energy), a leading Nigerian production and development company. The transaction will allow Petrofac to establish an ongoing presence in country and provide an opportunity for further growth. With proven oil & gas reserves estimated at 37 billion barrels and 185 trillion cubic feet respectively, Nigeria is Africa’s largest oil producer and the tenth largest oil producer in the world. The West African country is predicted to be one of the fastest growing emerging countries with expected growth in the energy and power sectors making it an attractive prospect for Petrofac. Petrofacts talks to Gordon East, managing director, Production Solutions to find out more.

Niger

Name Gordon East Title Managing director, Production Solutions Location London

Nigeria

Cameroon

1 Name Graeme Jack Title VP, developments, Septa Energy Location Lagos, Nigeria

What exactly does this strategic alliance mean for Petrofac? Petrofac has invested US$100 million, funded from cash resources, to acquire a 15% interest in Seven Energy. As part of the agreement we are providing experienced personnel to assist Seven Energy with the development of its existing production, processing and transportation assets and we will be represented on Seven Energy’s Board and management committees. The agreement also provides an arrangement between Petrofac and Seven Energy in relation to further co-investment opportunities in Nigeria.

Chad

Septa Energy’s upstream interests comprise interests in: 1. OML’s 4, 38 and 41 2. The Matsogo field in OML 56 3. The Uquo field in OML 13 4. The Stubb Creek field in OPL 276

Has Nigeria always been a focus country for Petrofac? Yes, Nigeria is a market in which we have been trying to establish an ongoing presence for a number of years and this opportunity to both co-invest and co-develop with a well-respected partner will give us the platform to do so. Nigeria represents a long-term market with huge potential in mature onshore redevelopment and new offshore finds. The country provides the scope for Petrofac to deploy the full breadth of its capabilities from EPC contracting, operations support, training or further opportunities for Production Solutions presented by the maturing production base. However, our short-term focus will of course be on mobilising a team to assist Seven Energy with the delivery of its key existing projects. Does Seven Energy own any oil & gas assets in Nigeria? Yes, Seven Energy’s activities are currently focused on two core geographic areas of operation in the Niger Delta. It has a 40% working interest in the Uquo field and a 51% interest in the Stubb Creek field, both onshore assets and are currently under development. It also has an interest in the Matsogo field, which has not yet been approved for field development. Furthermore, Seven Energy recently entered into an alliance agreement with Nigerian Petroleum Development Company (NPDC) to provide technical support and development funding of NPDC’s interests in oil mining licenses 4, 38 and 41 in exchange for a profit sharing entitlement to NPDC’s share of the hydrocarbons produced.

petrofac.com

facility upgrade

Name Richard Freund Title Document control manager, Engineering Services Location Woking

185 trillion

Collaboration between Petrofac’s Energy Developments and Engineering Services businesses ensures FPF1 is ready for action Petrofacts speaks to Richard Freund, document control manager for Petrofac’s Engineering Services business in Woking, to find out more about this project.

Proven gas reserves in Nigeria estimated in trillion cubic feet

37 billion

Proven oil reserves in Nigeria estimated in billion barrels

Crucially, Seven Energy shares Petrofac’s approach to and focus on safety and security issues, and has taken a systematic approach to carefully selecting assets that are located in secure operating areas of the Niger Delta. How will Petrofac employees be involved in the development of these assets? As mentioned we are already mobilising a number of existing experienced engineering and project management personnel to assist with the delivery of Seven Energy’s key existing projects. The first of these is Graeme Jack who has been seconded into Seven Energy as VP, developments, Septa Energy*, reporting into Scott Aitken, chief executive, Septa Energy. As part of his role, Jack is responsible for delivering the pipeline and facilities projects that are currently being developed to bring the Uquo field onto production; setting up a facilities organisation that will be able to provide the necessary project and engineering support once Petrofac’s input has finished; developing the necessary project management and operations processes and procedures for Septa Energy and establishing the local knowledge required for Petrofac to set up Petrofac Nigeria. Jack also provides in-country support for Petrofac and Septa Energy’s other Nigerian opportunities and he has been based in Lagos since early December. We are very excited about working with Seven Energy, a company with complementary skills, access, credibility and an established track record in the Nigerian oil & gas industry. This opportunity to work with a well-respected partner, while deploying some of our own people, will give us the platform to establish a local presence in Nigeria which is something we have been looking to do for a number of years.

*Seven Energy’s upstream activities in Nigeria are conducted under the name Septa Energy. For further information, please visit: www.sevenenergy.com

Firstly can you tell us about the project you are working on? I’m currently involved in scoping the improvements to be made to the FPF1 floating production facility. Our main focus is to ensure that the upgrade of the vessel satisfies Lloyds Register and obtains a class certificate, enabling continued operation in a UK North Sea harsh environment for a period of ten years without the need for a special survey. This involves conducting the requisite inspections, calculations and engineering to the hull and marine systems. You recently took part in a site visit to the McNulty facility in South Shields where the FPF1 is alongside dry dock – tell us more about this. Unless you see such a vessel in person it is hard to conceive just exactly how big it is from simply reading documentation. The enthusiasm of the FPF1 team for the refurbishment was contagious and the scope of their knowledge impressive. It was also positive for the team in building morale and instilling a sense of pride by understanding the effect that the work we do will have in the long run. What are the biggest challenges of working on this project? Working on a project as large as this, it is essential that all relating documentation is readily available for the long-term operations of the vessel. As the hull was built in 1977, there is a substantial amount of historical documentation that needs to be verified; however after having visited the facility and getting to meet everyone, the challenges appear more manageable. I look forward to the team delivering a successful project.

February 2011

inteGrity and quality

Year of Integrity and quality: summing up During 2010 we learned about the ‘year of integrity and quality’ initiative being run across our E&C, E&CV and ES businesses. As we take our programme forward into the New Year Nigel Paton, deputy managing director, ES gives us a round up of the initiative, its successes and also the path ahead. The year of integrity and quality (IQ) has been a marked success across our three business units, capturing the attention and imagination of our workforce and stimulating a level of involvement that would otherwise not have been possible. From an integrity perspective we have taken a relatively new concept and made it both tangible and accessible across our businesses. This started with the development of an integrity group led by Richard King, director – integrity assurance; the group is now ten strong with plans for further growth in 2011. With the support of our Plant Asset Management business we have developed a bespoke asset integrity framework involving five key stage reviews focussed on identifying threats and the corresponding barriers throughout a project’s lifecycle. These reviews begin during the tender stage and are now being carried out on all our new projects. We have also developed an online support tool within which all key project integrity activities are to be managed. As well as having valuable lessons learned and action tracking functions the tool allows project and business management teams to review at a glance the integrity status of a project across all phases of its lifecycle, providing transparency around the status of key project threats and barriers. Following a pilot the tool will be ready for a broader roll out. An asset integrity standard has been developed for our businesses. Incorporating the requirements of the group standard, we have gone one step further to make it clear to our projects what is expected to be in place, as well as identifying the tools available to them for implementation. This is supported by an e-learning course targeting all our personnel involved with project delivery. We have raised integrity awareness further by achieving full saturation across our engineering disciplines at our Sharjah, Woking, Mumbai and Chennai locations by means of an asset integrity awareness e-learning course. We have also been progressive in taking key lessons from across our business and the oil & gas industry and turning them into a series of 15 minute video lectures which have been screened during lunchtimes at all our major operating centres. One of the key areas of our continued integrity effort will be in the areas of root cause analysis and lessons learned. In recognition of this we have selected Apollo Root Cause AnalysisTM as our methodology of choice to aid us in effectively solving problems and identifying the root causes of incidents, and to use that information to generate clear lessons to be learned across our businesses.

In the quality field we have continued to consolidate our efforts following the restructuring of the quality assurance/control team. By devolving responsibility for quality on projects to their respective business units we have allowed the quality team led by Alistair Gourlay, quality director, to focus more closely on the development and maintenance of our systems and standards, allowing us to keep pace with the rapid growth we have experienced over recent years. 2011 will see the roll out of the new version of our BMS, now built on a more robust platform offered by Documentum. We have also begun to implement our newly issued quality management standards, helped by a QMS e-learning course. This IQ initiative did not end on 31 December 2010. It was just the beginning of an ongoing focus on the integrity and quality of the assets we design and construct. This initial phase has provided us with a strong foundation upon which to build our future integrity efforts. During 2011 we shall be focusing more closely on consolidating our internal engineering standards and also working with the construction and commissioning groups to identify areas where their activities and practices can impact on the integrity of an asset. By the end of 2011 we aim to have our Asset Integrity Management System (AIMS) support tool rolled out across our Sharjah, Mumbai and Chennai employee base, with all new projects operating within its framework.

Name Nigel Paton Title Deputy managing director, Engineering Services Location Sharjah

petrofac.com

world quality day

World Quality Day a celebration of excellence Name Alistair Gourlay Title Director, quality assurance Location Sharjah

Celebrated annually on the second Thursday in November, and promoted by the Chartered Quality Institute, World Quality Day (WQD) is a celebration of excellence. WQD provided the E&C, E&CV and ES business units with a convenient culmination point for its 2010 Integrity and Quality (IQ) activities, Alistair Gourlay, director quality assurance explains: “The build up to WQD has formed an integral part of our IQ programme of activities. The main aim was to promote our IQ message through events and activities that maximise participation across our large employee base, at the same time making these fun as well as thought provoking. “Across our sites and office locations special events were held to mark WQD. A special IQ seminar was held at our Sharjah offices to take stock of our achievements throughout the year. Around 70 senior personnel from across the E&C, E&CV and ES businesses attended. Similar seminars were also held at the Chennai and Mumbai offices with a focus on improvement and sharing lessons. Our Kauther project site held a collaborative event with their customer and subcontractors, and produced a purpose made video with a strong IQ statement of commitment from the project team. At the Woking office an ‘improvement ideas’ competition was launched to promote local process improvements. The Harweel project site held a ‘lessons learned’ competition, and in Kuwait our local masterchefs baked a special cake to mark the day. We are delighted to share with readers a selection of our WQD ‘action’ images.”

1. 2. 3. 4. 5. 6. 7. 8. 9.

Kauther site Woking Saudi Arabia Prize winners for the Improvement Ideas Competition in Sharjah Mumbai Chennai Kuwait Petrofac Emirates WQD get together Cutting the WQD cake, Petrofac Emirates 23

February 2011

developing talent

PETROFAC FUTURE GENERATION PROGRAMME Ongoing development of our young engineers A new programme has been established to improve and enhance the continued development of our key assets - our people - within three of our Sharjah-based business units, ES, E&C and E&CV.

Participants in the programme were invited to suggest a name for the programme as part of a competition. Khaled Al Tier from the procurement department in Sharjah submitted the winning name, ‘Petrofac future generation programme’ and was rewarded with a gift of vouchers on behalf of Petrofac. Building on our existing two-year graduate programme we have extended the duration beyond the current prescribed graduate development period, so that the programme is delivered during the third, fourth and fifth years of a graduate employee’s tenure. The future generation programme was developed in collaboration with the organisational development team and Petrofac’s Training Services business and is specifically tailored with Petrofac’s business objectives in mind. Examples of some of the courses delivered to Petrofac graduates include: advanced problem solving, negotiation skills, decision making, communication skills, team working, presentation skills, project management, supervisory skills and customer relationship management. Course selection is based on the current role and development needs of each individual, who will receive on average ten training days per year. The key drivers of this initiative are: • maintaining the engagement of our graduates to support their career development and requirements • ensuring the overall capabilities of the graduates are enhanced • increasing retention and engagement by providing a comprehensive development platform • ensuring our graduates achieve effective business contribution as soon as possible by increasing their competence in priority areas

project update

Dubai Petroleum handover September 2010 saw the second transition of Dubai Petroleum, as Petrofac moved from a full operations service role to a technical services agreement and enabled the Dubai Government to take full operational responsibility for Dubai’s offshore assets.

Members of the Dubai Petroleum team wished a fond farewell to Petrofac in September 2010

Petrofac Production Solutions’ involvement in the offshore Dubai assets started in 2005 with the innovative negotiation of the facilities management agreement which mirrored the Duty Holder contracting model pioneered and proven in the UK North Sea. The contract became effective in 2006, and the transition from ConocoPhillips, as the original operator, was completed in April 2007, when the contract became fully operational with a significantly extended scope of service now including production and well construction and management. Peter Leach, senior vice president operations and production, worked on the asset from the start of the contract as the operations manager. Leach

remarked: “We are immensely proud of what we have achieved over the past five years. The challenges of working on an asset that is more than 40 years old genuinely tested Petrofac’s approach to integrity and risk management to the limit. We believe we have left a very good foundation for the future success of the fields, not only in terms of consistent safety and integrity standards, but also in production performance.” Petrofac continues to maintain an active role in the asset through its Offshore Engineering & Operations business unit and through the provision of the technical services agreement to the Dubai Petroleum Establishment.

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new development

PETROFAC CO-INVESTS IN UK GAS STORAGE

At the end of 2010, Petrofac announced that it had acquired a 20% interest in Gateway Gas Storage Limited (Gateway) to progress and develop the Gateway Gas Storage project in the East Irish Sea. As part of the deal, Petrofac joined Gateway as technical project operator, jointly responsible for developing the project, including determination of market demand for gas storage, ahead of the final investment decision (FID) which is expected during 2011.

Key facts A planned underground salt cavern in the East Irish Sea, approximately 25km offshore the UK At completion, working capacity of 1.512 billion standard cubic meters, adding nearly 30% to the current gas storage capacity in the UK market

Petrofacts talks to Ed Bassett, business development manager, Petrofac Energy Developments to find out more about this exciting opportunity, what makes gas storage an attractive investment option and why Petrofac is best placed to develop the project. What makes gas storage an attractive market for Petrofac? Salt cavern gas storage is proven onshore in the UK, although there are clearly different challenges developing offshore facilities. Gas storage in the UK is currently lower than European levels; the UK has around 4% of annual gas demand in capacity, compared to around 15-20% in Europe. As UK domestic gas production falls, and the market becomes more reliant on imports from distant sources, the need for flexible, high deliverability gas storage capacity is increasing. Currently gas pricing is reflecting a balanced market but we believe that over the medium-term this is likely to change. The UKCS continues to be a focus area for Petrofac’s future growth across the energy chain, as demonstrated by the recent award to develop a gas processing plant on the Shetland Island and the carbon capture project between our CO2Deepstore business and Shell. We continue to seek UK Continental Shelf upstream opportunities, following the successful Don development and harvest, and we also want to establish a portfolio of energy infrastructure projects; as embodied in our floating production

activities, and now this gas storage project. Through these projects we intend to position the company in this mature oil & gas province for the next 20 years and beyond. What stage is the project currently at? Work is currently underway to finalise the FEED phase of the project. Once this is finished, Petrofac will take on the responsibility of technically progressing the development through to FID. This involves a review of the FEED with an eye on the most efficient engineering and procurement strategy, preparing the project, via a dataroom process for additional equity investments and finalising the execution strategy postFID. Subject to attracting further strategic investors in gas storage into the project and reaching FID, Gateway is looking to move towards construction in late 2011/early 2012.

Name Ed Bassett Title Business development manager Location London

Why do you think Petrofac is well placed to take on the role of technical project operator of the Gateway project? The project involves the offshore drilling of gas injection and withdrawal wells into salt caverns and the installation of central processing hubs, offshore pipelines, and onshore gas processing. Petrofac’s experience in large scale project developments and its project engineering, procurement and construction track record will provide a robust background to developing this project to FID through owner’s eyes.

business improvement

Focus on…OE&O’s Incident Review Board Petrofac OE&O’s Incident Review Board (IRB) was set up at the end of 2009 to work with the business to carry out independent incident reviews, provide support to incident case owners, and share lessons learned. Mirroring the format of the group Incident Review Board, the IRB is helping to maintain the emphasis on safety as the business grows. In accordance with OE&O procedures, incidents that take place on Petrofac assets are subject to an incident investigation by a relevant, qualified individual and every investigation results in the creation of actions to be taken to try to ensure that such an incident does not take place again. On a monthly basis the IRB, which includes operations directors and managers representing Aberdeen, Cendor, Chergui, Great Yarmouth, Malaysia and Sharjah, reviews any overdue actions by person, location and customer. Duncan Collins, HSSEQ assurance advisor, who manages the process, explains: “We capture any incident and resulting actions through Synergi, a software system specifically developed for HSE incident management, but without additional review there is a chance that individual actions are deferred because they are difficult to tackle alone or they get lost amongst

day-to-day work. With a review by the IRB and senior team input there is support to ensure change is achievable.” One of the key focuses of the team is sharing lessons learned. For example, an incident that occurs at an external training facility in the UK can be shared with and flagged up to, colleagues based in the Middle East. Walter Thain, director, UK North/international operations, chairs the IRB on a rotating basis with other operations directors: “At every meeting we review two incidents in depth and as well as looking at the actions that have come out of the original review, we also consider whether the level of investigation is sufficient and if the root cause has been established effectively. We find this is something many case owners fail to understand and we think it’s our role to try and change that. It is only by addressing the root causes of an incident that we can reduce the likelihood of it occurring again.” The IRB works hard to share lessons between

themselves but is keen to extend these to the wider business. In 2011 it will publish a booklet highlighting real-life incidents that have taken place in our business, root causes and lessons learned. In addition, using data received from the business and in line with our Horizon Zero internal safety campaign, the IRB is developing a series of safety awareness programmes to be communicated across the OE&O business on a quarterly basis. The IRB has proved a valuable tool to help focus activity on making positive changes across the OE&O business. As the business continues to grow the emphasis will be on maintaining levels of engagement across all new and existing projects; the IRB is committed to keeping up the momentum.

February 2011

people

Andy Inglis joins Petrofac to lead provision of integrated services Former chief executive of BP’s Exploration and Production solutions business, Andy Inglis, has joined Petrofac as chief executive of the group’s Energy Developments and Production Solutions businesses.

“Andy shares our vision as to how the provision of integrated services to resource holders can create significant growth for Petrofac.” Ayman Asfari, Group chief executive

Inglis is a proven business leader who has a strong technical background and 30 years of global industry experience, a number of which have been spent in Petrofac’s core geographies in North Africa, the Middle East, the Caspian and Asia. As chief executive of Energy Developments and Production Solutions Inglis will further develop and drive the group’s vision to provide integrated services to resource holders through flexible commercial models that are aligned to specific customer requirements. Following a familiarisation period, he will join the board of Petrofac as an executive director in March and will re-locate to London on a permanent basis in April. Commenting on the appointment Ayman Asfari, group chief executive, said: “I am delighted to welcome Andy to Petrofac. The position of chief executive, Energy Developments and Production Solutions is a key role within our group, and we have taken both time and extreme care with this appointment. I am very pleased that Andy has agreed to join Petrofac as he shares our vision as to how the provision of integrated services to resource holders can create significant growth for Petrofac.” Speaking to Petrofacts about his new role, Andy commented: “I am excited to be joining Petrofac at this important stage in its development. The Company is leading a change in our industry and has identified a distinctive opportunity to provide a highly differentiated offering. This is an exciting time for Energy Developments and Production Solutions and I look forward to being able to work with Ayman and the Petrofac team to fully capitalise on the significant opportunities we see in the market.” A Chartered Engineer, a Fellow of the Royal Academy of Engineering, and a Fellow of the Institution of Mechanical Engineers, Inglis joined BP in 1980 as a mechanical engineer, working on various North Sea projects. In the late 1980s, he moved to a series of commercial roles in BP Exploration in Aberdeen and London. After a period in the upstream executive office, in 1994 he moved to Alaska to serve as the manager for the Kuparuk field before returning to London in 1996 as chief of staff for the upstream business. From 1997 until 1999, he was responsible for leading BP’s activities in the deepwater Gulf of Mexico. In January 1999, following the merger of BP and Amoco, he became vice president, US Western Gas business unit. In September 2000, he joined the upstream executive committee as a group vice president and was appointed executive vice president in 2004 with accountability for BP’s upstream growth centres which included North and West Africa, Egypt, Middle East, Azerbaijan and Asia Pacific in addition to the US.

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people

New chairman for Petrofac “I would like to thank Rodney for leading the Board so effectively for the last six years. We now look forward to working with Norman and Roxanne to take Petrofac through its next stage of development.”

After serving as chairman of Petrofac for six years, Rodney Chase will step down from our Board at Annual General Meeting (AGM) on 13 May 2011. Chase will be succeeded by Norman Murray who will be appointed a non-executive director on 1 March 2011 and will become chairman of the Board, subject to shareholder approval, at the AGM. Norman Murray has been a venture capitalist for some 25 years, was a co-founder and former chairman of Morgan Grenfell Private Equity Limited and has been an independent non-executive director of Cairn Energy PLC since 1999 and their chairman since 2002. He is a past chairman of the British Venture Capital Association, a past president of the Institute of Chartered Accountants of Scotland and chaired the independent committee charged with establishing the Audit Firm Governance Code which was published by the Financial Reporting Council in January 2010. Also on 1 March 2011 Petrofac will appoint Roxanne Decyk as a non-executive director. Decyk has enjoyed a varied executive career spanning three decades including 11 years with The Royal Dutch Shell Group, where she held a number of roles, most recently as head of the government affairs department, and also served on the Shell Executive Committee between 2005 and 2009. Non-executive director and senior independent director, Kjell Almskog will also retire from Petrofac’s Board at the AGM following six years of service. Commenting on these proposed appointments, Rodney Chase said: “As our customers and employees come from numerous geographies and cultures it is essential that our Board reflects that diversity and continues to be refreshed. After six enjoyable years as chairman of the Board I feel it is the right time to be stepping down and I wish Norman well. I have no doubt that both Norman and Roxanne will each make a strong individual contribution to the Board. I would like to thank Kjell Almskog, who will also leave the Petrofac Board this year, for his significant contribution in the last six years.” Petrofac group chief executive, Ayman Asfari said: “I would like to thank Rodney for leading the Board so effectively for the last six years. During this time we have made the successful transition from private to public company, with more than a seven-fold increase in market capitalisation, and Rodney’s experience has been invaluable. We now look forward to working with Norman and Roxanne to take Petrofac through its next stage of development.”

Ayman Asfari, Group chief executive

Rodney Chase

Norman Murray

Roxanne Decyk

February 2011

country focus

Algeria: projects in focus In the latest of our country features we take a look at our operations in Algeria. During the last quarter we have seen a lot of activity in Algeria: we have been awarded our sixth EPC contract in the country, the In Salah Gas compression project is nearing completion, we have introduced a technical training centre to the region and the El Merk CPF project has continued to make good progress.

Name Jim Burton Title Project director, In Salah Gas Location Sharjah

Handover of In Salah Gas facilities

Award of a US$1.2 billion lump-sum EPC contract

Petrofac has completed the compression scopes of the Teg, Reg and Krechba facilities on the In Salah Gas (ISG) project and the team has been preparing the facilities for the physical startup. Jim Burton, project director, provides a progress update: “Teg startup is complete and the facilities have been handed over to operations; Reg has successfully gone through the start-up programme and performance tests are to be completed prior to final handover; and Krechba compression facilities were completed at the end of November and are now entering the start-up programme. “The Krechba delivery is a great achievement. The substation was badly damaged while in transit to site and had to be returned to the manufacturer. Initially we thought this would delay the project by many months but through the collective and substantial efforts made by ISG, our suppliers, subcontractors and the Petrofac team there was only a seven week delay from the initial schedule. “The project has reached completion stage with no major incidents and exceptional safety standards have enabled the project to maintain a record of zero LTIs which is a great achievement for the teams on such a sizeable project. Of course our goal now is to continually maintain this level of safety performance and support our customer in startup and demonstrate that all our efforts in achieving the highest possible integrity and cleanliness allow for smooth transition into production.”

Following the success of previous projects on behalf of In Salah Gas, the association between Sonatrach, BP and Statoil awarded Petrofac a contract to develop southern fields in the In Salah development in January. Petrofac’s scope of work includes a new central production and gas gathering facility at In Salah comprising two dehydration trains, with the capacity to produce approximately 16.8 million cubic metres of gas per day, associated permanent camps, and approximately 300km of pipelines for gas collection from the in-field wells and export to the existing Krechba facility. Brownfield modifications will also be undertaken at the existing Reg facilities with an additional dehydration train plus modifications for future operation of the compression facilities. The existing Teg and Krechba compression facilities will also be upgraded for future operations. The 50-month project, to be completed in phases, will support the maintenance of plateau gas production rates of 9 billion cubic metres per annum beyond 2013. Commenting at the time of the award, Subramanian Sarma, managing director of Petrofac’s Engineering & Construction business said: “I am delighted that we have secured the southern fields project. We hope to build upon our experience and knowledge gained from our long track-record of working in Algeria, including our current involvement with the In Salah gas compression project and look forward to strengthening further our relationships with both ISG and our subcontracting partners during the execution stages.”

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El Merk project update

Name George Salibi Title Project director, El Merk Location Sharjah

At the time of going to press, the El Merk project home office engineering and procurement activities are substantially complete and sufficiently well defined to support the ongoing construction phase of the central processing facility. Cumulative progress of the project has now passed the 65% mark and we are making strong positive progress towards the scheduled completion date. George Salibi, project director of the El Merk project says: “The project is moving at a steady pace and with the engineering phase now in its final stages and material and equipment being delivered to site in large volumes, we have entered a phase of progress acceleration and look forward to executing the remaining construction scope as planned. I would also like to mention the solid relationship we enjoy with our customer. We respect the strength of our relationship with the El Merk team that has been instrumental in making such headway.” It goes without saying that our sustained presence in Algeria is dependent on the successful delivery of our ongoing contracts, be they conceptual studies through to large scale EPC projects or the provision of any other services from our portfolio. We understand the Algerian market, have good relationships with our customers and throughout the supply chain, and have an excellent understanding of the dynamics in the labour market. Establishing a training centre in Algeria was a logical next step for Petrofac. Wherever we work in the world, we are fully committed to ensuring countries maximise and continually develop their own local resource pool. As such, representatives from Petrofac recently held a conference at the National Polytechnic School auditorium in order to communicate to students the opportunities that are available to them in this thriving Algerian market.

Supporting Algerian nationalisation with the opening of a new construction skills training centre Petrofac Training Services’ (PTS) success is built on the ability to anticipate and meet the needs of customers globally. The most recent demonstration of this is PTS’ diversification into construction skills training with the opening of the Hassi Messaoud Constructions Skills Training Centre in Algeria. The facility and programmes on offer PTS, on behalf Petrofac Engineering & Construction (E&C), has converted an unused storage warehouse and fabrication workshop into a new construction skills training centre. The new training facility, which comprises two 875m2 existing buildings and a new 500m2 building, offers high quality technical construction training and contains technical classrooms, offices, workshops, changing facilities and dining and recreational areas. The training centre offers programmes in mechanical, electrical, instrumentation, pipe fitting/fabrication and welding and can facilitate the training of 75 trainees every three months. The programmes which are 70% practical skills training and 30% theory are taught in French. The training (which will be delivered with health, safety and environment as the underpinning competence throughout each training programme) will enhance the trainees’ ability to develop careers within their communities as part of the Algerian nationalisation programme. Fifteen Algerian trainees commenced the instrumentation training programme on 22 December with more trainees due to start the other training programmes on offer shortly. Training certificates will be awarded upon successful programme completion with each programme typically lasting three months. Centre management PTS has assigned an experienced project team to work alongside E&C personnel. The centre is jointly managed by an experienced PTS training manager and an E&C training centre manager to ensure the smooth delivery of all training programmes. Algerian trainee instructors will shadow experienced PTS instructors for a limited period while they acquire the necessary skills and knowledge to perform the instructor roles independently. Developing and measuring competence Throughout the programme, trainees will complete training and development activities designed to build competencies to acceptable levels. The training centre has training equipment which offers identical situations as encountered ‘on-the-job’. This ensures that a competence-measuring component is incorporated throughout the training programme thus further enhancing the value of the trainees as they join or re-enter the workforce on completion of their programme of study. On programme completion, the trainees will have the opportunity to seek employment relevant to their newly acquired skill set either within Petrofac or a company of their choosing. 29

February 2011

hsseia

Petrofac celebrates third successful environment month initiative The United Nations declared 2010 to be the ‘International Year of Biodiversity’ as a celebration of life on earth and the value of biodiversity for our lives. Throughout the month of November Petrofac colleagues around the globe embraced this vision during our third annual Environment Month campaign. In line with the biodiversity theme an interesting range of events and activities took place which encouraged all of us to ‘be part of the solution’. Biodiversity The world was made a greener place following the planting of 1,000 trees at the South Yoloten field in Turkmenistan,150 trees in the Oman desert at the Kauther site, 250 saplings at Pesil Green in Chennai an 50 trees at the Karan site in Saudi Arabia. Sharjah-based employees and their families planted around 200 mangrove seedlings along the coast of Kalba protected area while children released baby Hammour fish into the water in order to support increasing fish population in the area. Employees in Woking were joined by their families and friends to learn about biodiversity during an evening nature walk in Cobham Common, accompanied by Surrey Wildlife Trust Rangers. Organiser Lisa Lewis commented: “With the ranger’s expert help, the group was privileged to see several examples of a rare plants, heather, toadstools and insects. It was a fascinating evening covering the wildlife and history of a unique area right on our office doorstep in Woking.” In Aberdeen, employees were invited to ‘bee part of the solution’ when bee-friendly seeds and honey recipes were shared, and in Woking and London where colleagues learned about the bee keeping process. Around 300 employees and their families visited Sharjah Aquarium, where they learned about the effects of the environment on the underwater world.

Awareness raising

Total trees planted year on year

In conjunction with our objective to raise awareness of environmental issues, a series of ‘lunchtime lectures’ were held including a talk on renewable energy hosted by Martin Barnes, managing director of TNEI, Petrofac’s recent acquisition, and a lecture by Antartic explorer, Robert Swan - the first man to walk both the North and South poles. The Petrofac Emirates team in Abu Dhabi tackled the issue of excess waste head-on by eliminating the use of plastic cups in the office (substituting them with mugs and cups) and in our Mumbai office emails were distributed covering topics such as conserving water, energy usage, green house effect, wild-life extinction and solar energy. Our colleagues in Saudi Arabia increased their recycling efforts, held informative lectures and reduced the use of plastics by replacing plastic cups with mugs and glasses.

Clean-up

1,000

1,100

1,650

2008

2009

2010

Across the group, employees helped to the keep their neighbourhoods clean. More than 300 participants took part in the beach clean-up in Sharjah, including a team of qualified divers who cleaned-up the ocean bed. Petrofac IKPT employees in Jakarta planted trees into pots and tidied up the environment around their office.

petrofac.com

ENVIRONMENT MONTH ART COMPETITON

This year’s environment month culminated in the judging of our second group art competition for children. Congratulations go to the winning entrants - Madina Yuldasheva (5) from Kyrgyzstan, Sriparno Majumdar (10) from Sharjah, and Pooja Krishnakumar (15) from Sharjah. Chris Allen, group director of HSSEIA commented: “Well done to all those who participated; choosing the winners was not easy and the efforts and imagination involved were impressive!” The winning competition artwork and runner up drawings from Jakarta, Chennai, Mumbai and Abu Dhabi can be viewed by employees on our intranet site, PetroNet, along with further details on the many activities that took place across the business. Allen continued: “Petrofac understands the importance of giving proper consideration to protecting the environment for future generations. We are committed to conducting operations which minimise environmental impact. The actions of our teams throughout the month and in the future help to support our vision. Thank you and congratulations on a great effort to those of you who participated in the Environment Month campaign.” 31

February 2011

project focus

CELEBRATIONS AT PETROFAC TUNISIA AND A VISIT FROM THE BRITISH AMBASSADOR The Chergui project team in Tunisia has had a lot to celebrate recently. During October, the highest ever daily gas production rate of more than 30 million standard cubic feet per day was recorded at the plant, and more recently, in November, the team achieved three years of operations without a Lost Time Incident (LTI).

The British Ambassador with members of the Chergui project team

Brad Sinex, general manager for Petrofac’s operations in Tunisia commented: “Both of these achievements highlight the attention to detail, hard work and dedication of the whole Chergui project team. We must now focus on maintaining these very high standards we have set for ourselves as we move into the next phase of the Chergui development.” There was cause for further celebration for the project team when the British Ambassador to Tunisia visited Kerkennah Islands and the Chergui Central Processing Facility (CPF) in October. His Excellency was given a tour of the CPF and then visited various corporate social responsibility projects that Petrofac is delivering, largely centred on the island of Kerkennah where 40% of the Petrofac employees live. “Mindful of our responsibilities to the communities in which we operate, we have worked hard to overcome some

of the initial challenges we faced and have developed some really positive relationships”, commented Sinex. The team has been pro-active in supporting many local initiatives in the vicinity, including sponsorship of local cultural events, providing support to the Kellabrim Handicapped School in Ramla, and loaning out Petrofac minibuses to the community for use at local sporting events. The team also organises a series of regular visits for local primary school children to the CPF. This programme gives an early introduction to our industry and highlights the importance of safety and protection of the environment.

developing talent

employee donation

At the time of going to print, the unrest in Tunisia has stabilised. All Petrofac personnel are accounted for and remain safe. Operations and management support have returned to normal working cycles however we have maintained a very strict journey management procedure for all travel to and within the country.

FAITH IN GLOBALISATION DIWALI TREATS FOR ORPHANS IN CHENNAI During Diwali celebrations colleagues in Chennai raised Indian Rupees 150,000 for the purchase of notebooks, sweets, clothing and a festive lunch for more than 160 children from the Sri Sharada Sakthi Peetham and Bhavishya Deepam orphanages in the Tambaram area of Chennai.

On 28 November representatives from Petrofac Emirates attended the signing of a memorandum of understanding between the Higher Colleges of Technology (HCT) Foundation and the Tony Blair Faith Foundation which aims to provide partnership opportunities for the corporate sector, fulfilling the HCT’s mission to develop UAE national youth for effective nation building. A commemorative plaque was presented to Khaled Al-Hosani human resources manager for Petrofac Emirates, by His Excellency Sheikh Al Nahyan and former Prime Minster of the United Kingdom Tony Blair for Petrofac’s recognition and support.

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product launch

SPD update WellAtlas® Name Mark Gillard Title Product development manager, SPD Location Aberdeen

SPD, Petrofac’s well construction business, recently launched its latest product: WellAtlas®. WellAtlas® is an integrated project management and documentation system that enhances the quality and consistency of SPD’s current product lines (Well Engineering Services and Project Management Services). Petrofacts speaks to Mark Gillard, product development manager, SPD, to find out more about this exciting new product. The web-based application is designed to improve consistency, quality and auditability of the planning and execution of projects by providing a logical process for lifecycle planning, coupled with links to policies and procedures, external references, guidelines, toolboxes and best practices. It also provides a clear indication of project progress and timeline related to events during the project lifecycle. WellAtlas® combines four standalone modules into one integrated package:

Well Engineering Management System

Well Delivery Process

Well Engineering Management System A searchable and indexed hierarchical documentation module that comprises policies, standards, guidelines and best practices which can be viewed as individual documents linked to the various stages of the project delivery process for ease of reference. Well Management Process The Well Management Process module provides managers with an overview of the status of each project (both task and timeline based), and provides engineers with a logical way to progress from the initial feasibility stages of the project through to execution and wrapup. In excess of 500 individual workflows, guidelines and checklists are provided with a comprehensive set of templates and documents, with an auditable trail of revisions, ensuring that consistency and quality are key components of the project. LessonsAtlas® The LessonsAtlas® module provides an indexed and searchable ‘lessons learned’ database. It allows the user to interrogate lessons learned from previous projects thus ensuring improvements are incorporated into current planning. Action Tracker In order to enhance accountability and ensure timely completion, WellAtlas® offers a module that enables the user and manager to monitor and track actions generated during the lifecycle of a project.

Project Status

LessonsAtlas®

WellAtlas® is already in use internally, underpinning SPD’s Well Construction programme for 2011 and is currently being evaluated by several operators for future use. For more information about the WellAtlas® system, its capabilities and access, please contact us at sales@wellatlas.com

February 2011

subject matter experts

TAPPING INTO OUR TECHNICAL SPECIALISTS Within Petrofac we have a number of highly experienced and industry recognised technical specialists. In the sixth of our series of features, Petrofac talks to David Ward-Gittos, principle structural engineer based in our Woking office. As principal structural engineer and a renowned Petrofac subject matter expert (SME), you possess a wealth of information. Could you brief us on your journey so we can gain an insight into why you are, today, a recognised SME? Starting out as a graduate structural engineer in the North Sea I was initially involved in the design of jacket and topsides structures progressing to become a lead structural engineer for the FEED and detailed design of integrated decks and modules for some of the largest platforms in the North Sea. Next, I ventured into building consultancy and became a chartered engineer. Shortly after the Piper Alpha incident I returned to work in the offshore industry and was involved in reviewing the chain of events and providing recommendations for incorporation into the resulting safety standard during which time I became a Fellow of the Institute of Structural Engineers. In 1997, when activity in the North Sea reduced I progressed onto designing FPSOs in Canada, South East Asia, Angola and Brazil. I joined Petrofac in 2005 as I wanted to become more involved in consultancy work, particularly on conceptual and FEED projects. During the last five years I have been able to draw on my previous experience from the petrochemical industry to good effect. Could you share with us any innovative philosophies or designs you have introduced to a project? When working on a detailed design structure in the Arctic Ocean, I was responsible for establishing the ‘ice loading’ philosophy for the detailed design, as ice accumulation is the most significant and unpredictable environmental loading condition that affects offshore structural design. I have conducted a structural analysis using ductility to develop temporary mechanisms for the design of structures to absorb explosion forces, ten times the magnitude of the normal in-service loads. While working in Kazakhstan, we had to consider the use of ‘Continuous Flight Auger Piling’, and persuaded the customer to undertake this method of piling, involving the extraction of soil, which is then replaced by concrete and reinforcement.

What are the biggest challenges you face in your role? There are many challenges we structural engineers face on a daily basis, onshore or offshore. Onshore’s biggest challenges are primarily related to the foundations, vibration and the unknowns of soil mechanics. Consequently we consult with geotechnical engineers regarding this highly technical field, as these factors are crucial to a structure’s design. With regard to designing structures for offshore, weight is the main consideration. Having to design structures whilst working within the capacity of the lift vessel can be very difficult on occasion. Additionally, not all structures are the same, you can’t use standard parameters from published papers when, for example, you are constructing an FPSO. As structural engineers, when selecting the build method for an FPSO we opt between building it piecemeal or building the modules in a yard, and then lifting them on to the FPSO. Piecemeal construction can create challenges for material handling as the development increases in height and modular construction can bring its own challenges. If the development is in one country and the designed structures are being built in another, the transportation could be affected by volatile weather conditions often faced at sea, making structures heavier to transport. The diversity in the projects we cover here in Woking creates interesting challenges. They may be land based structures in a remote area of Kazakhstan, subsea in 1.5 thousand feet of water, fixed structures in shallow water or floating vessels such as FPSOs; therefore my skills and knowledge base must be able to manage all of these eventualities. Out of all the companies you have worked for during your career, what makes Petrofac different? It’s an encouraging culture, accommodating free thinking, questioning ways of doing things. It has the feeling of a flat structure and not overly regimented. As a consequence you are able to liaise with management easily and everyone is equally approachable.

Name David Ward-Gittos Title Principle structural engineer Location Woking

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training services success

PTS awarded ‘A’ rating in BTEC quality assessments Petrofac Training Services (PTS) develops the competence of individuals and the capability of organisations to enable them to improve performance. Differentiators in this regard include PTS’ ability to develop and implement competency standards gained from extensive experience in developing technical personnel.

One of these competency standards recently received an ‘A’ rating from Edexcel, an international accreditation body. As the UK’s largest awarding body, Edexcel offers academic and vocational qualifications and testing to schools, colleges, employers and other places of learning in the UK and internationally. PTS was awarded the ‘A’ rating in the quality assessment of its Business and Technical Education Council (BTEC) programme. Assessors observed all elements of the BTEC qualification regarding it as “first class relevant mix of practical and theoretical assessment opportunities.” BTEC qualifications are developed with key industry representatives and sector skills councils offering a practical, real world approach to learning without sacrificing any of the essential subject theory – the aim of the Chemical Processing Technology Centre (CPTC) in Singapore. PTS’ CPTC continually demonstrates the value of the BTEC programme for its key customers in the Asia Pacific region. In addition, PTS also works in close partnership with the Economic Development Board (EDB) and the Singapore Workforce Development Agency (WDA) in developing the Singapore Workforce Skills Qualification (WSQ) for process technology in the chemical sector. The standard has been successfully launched

in Singapore and is providing both local and international customers with a benchmark that has a true value and recognised currency. The WSQ programmes have helped meet growing labour demand within Singapore by creating a skill pool of competent and job ready technicians to support the petrochemical and related industries. Companies have also taken up the WSQ programmes to upgrade and refresh the competencies of their existing workforce in order to improve productivity. A successful partnership has been forged between the Singapore EDB, the Singapore WDA, Shell Eastern Petroleum and PTS’ CPTC to develop and deliver the training and assessment for Shell Eastern Petroleum’s Graduate Training Programme (GTP). The GTP is aimed towards developing and enhancing the competencies of Shell Eastern Petroleum’s new hires, fast tracking work readiness. Working closely with Brunei Shell Petroluem Co Sdn Bhd (BSP), one of the biggest energy companies in Asia, PTS is co-creating a BTEC programme for BSP’s control room operators (CROs). The jointly developed CRO programme has been designed to establish and maintain a resource pool together with trainers and verifiers. In addition to developing individual competence and organisational capability, the BTEC module allows for improved understanding and tracking of the necessary CRO competencies.

Two years without an LTI Petrofac Training Services has achieved the milestone of two years without a Lost Time Incident (LTI) at any of its facilities or offices. During this period, Training Services personnel completed two million man-hours of activity and delegates undertook four million man-hours of training. Stuart Walker, HSSEIA manager for Training Services, commented: “This is an excellent achievement for the business and in particular our instructors, who look after delegates during training exercises in a professional and caring manner. It is only a milestone and it is vital we do not become complacent in our approach to safety. Well done!”

February 2011

project update

Ticleni transition success Earlier this year, Petrofacts reported that Petrofac Production Solutions had secured its first major production enhancement contract in Southwest Romania. Under the terms of the contract, Petrofac provides production enhancement services to Petrom as the concession holder for the Ticleni oilfield and its eight satellite oilfields.

Name Tudor Gafton Title General manager, Romania Location Bucharest

On 1 November 2010, following a busy threemonth transition period, Petrofac formally took over the management of all aspects of the fields’ activity from Petrom, including responsibility for more than 900 employees working in Ticleni. Commenting on the successful completion of the transition phase, Tudor Gafton, general manager, Romania said: “I am delighted with the progress we have made over the past three months and I’m extremely proud of the hard work and dedication demonstrated by our transition team. The professionalism of all Petrofac employees in Romania was the main reason we achieved such a great result and will add to Petrofac’s track record for excellence in the production enhancement market.” The Petrofac transition team consisted of a combination of senior Petrofac personnel with experience in previous transitions; newly recruited local managers and supervisors; employees from SPD and Eclipse, as well as Petrom personnel.

During the three-month transition period, the following activities were completed: • full transition of oilfield operations involving more than 300 active wells located within a 100 km² area, 20 workover and well intervention rigs, 10 oil, water and gas separation facilities, two gas compressors stations, 10 steam boiler units, degasolination and gas dehydration plants, heavy transportation equipment and workshops, yards and office facilities

• a unionised workforce of 920 personnel was transferred under the provisions of TUPE legislation from Petrom to Petrofac • more than 12,000 fixed assets were inventoried, surveyed and categorised • more than 200 supply and service contracts were novated or renewed

around the business Petrofac demonstrates flow measurement capabilities Petrofac’s OE&O metering team, including SGC Metering, exhibited at the 28th North Sea Flow Measurement Workshop from 26 to 29 October in St. Andrews, Scotland, where more than 300 leading flow measurement specialists from around the globe met to discuss the latest issues relating to the measurement of oil & gas production and the associated emissions. More than 20 technical presentations were delivered, based on topical issues facing today’s oil & gas industry, whilst manufacturers from around the world exhibited the latest cutting edge technology. Mark Sinclair, general manager, metering commented: “The workshop was a great opportunity for our subject matter experts from SGC and OE&O to demonstrate the Meternet flow computer and Meteor supervisory systems and to discuss metering case studies all of which are being delivered to a worldwide customer base. In addition, we took the chance to discuss issues affecting business critical operations with current and potential customers.”

• all licenses and permits necessary for a major service company to operate in Romania were obtained • a fully functional SAP system, providing an enterprise risk planning function, was implemented

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around the business

developing talent

Petrofac supports ‘Seeing is Believing’ programme Robin Pinchbeck, Petrofac’s group director of strategy and development, joined a delegation of other senior business executives to participate in a ‘Seeing is Believing’ programme run by Business in the Community (BITC). Led by Sir Stuart Rose, executive chairman, Marks and Spencer, the visit highlighted the work of the Government-backed ‘Work Inspiration’ campaign launched by Sir Stuart last year.

This highly successful employability campaign aims to turn work experience into ‘Work Inspiration’ encouraging employers to help young people bridge the gap between the classroom and the world of work. It is widely believed that by 2020 there will be three million fewer low skilled jobs in Britain than there are today, and more than 40% of all jobs will require a graduate level qualification. The campaign was launched in response to this belief and addresses the social need to provide young people with a clearer picture of work, equipping them to make decisions about their future career paths and therefore increase their employability.

As a result of the visit, Petrofac hopes to sign up to the campaign to help further improve our work experience programmes

Pinchbeck met students at Haggerston School and Haringay VI Form Centre and heard firsthand about their internship experiences. Following his visit Pinchbeck commented: “Education and training is core to Petrofac’s CSR policy and we should therefore be delivering internship experiences of the highest quality and value. This trip was very thought-provoking and has sparked ideas which we will endeavour to utilise and apply within Petrofac.” Petrofac has been a member of BITC for several years. Its main function is to advise and support its 850 members to improve their corporate social responsibiltiy credentials by offering advice and programmes tailored to meet their needs. ‘Seeing is Believing’ is one of its flagship programmes, designed to showcase and increase the positive impact which business can make in the community. Gwen Folland, head of CSR said: “Robin is not the first of our senior managers from Petrofac to participate in the ‘Seeing is Believing’ programme and we hope that we can encourage others to follow suit. It is an excellent programme inspiring and engaging the UK’s top business leaders on key social responsibility issues.” Several ‘Seeing is Believing’ visits take place throughout the year with around ten delegates on each visit. All participants report back to HRH The Prince of Wales at a seminar at the end of the programme year.

The History of the RGIT HUET Petrofac Training Services prides itself on ensuring that delegates receive training of the highest quality. Realistic scenarios - whether it is offshore survival in training pools, or the safe operation of chemical processing plants at the world’s only live hydrocarbon training facility in Singapore - are what make Petrofac Training Services second to none. With helicopters often the main means of transport to offshore installations, there is a need for offshore workers to be trained in how to respond if something goes wrong during a flight. A helicopter that ditches on water could capsize, immersing passengers underwater and leaving them disorientated. Realistic simulation of this in a controlled environment during training is essential to ensure offshore workers can experience these challenges in order to understand how to react. In the 1970s, the RGIT Survival Centre, now part of Petrofac Training Services, led the industry in the design of offshore survival training courses. Even today, the survival course is often referred to as ‘The RGIT’ In order to make the survival training course as realistic as possible, the team at the Survival Centre tasked Alex Urquhart MRINA at the RGIT School of Mechanical and Offshore Engineering to design a helicopter underwater escape trainer (HUET). Urquhart’s design used buoyancy fitted low in the simulator to provide the rotation of the cabin once in the water. The design was simple and effective. Trials with a model were followed by construction of the first full size RGIT HUET Mark 1, which was installed in the survival centre, previously located at King Street, Aberdeen in 1978. A Mark 2 version followed, which included cockpits to permit the training of aircrew. The first of these was installed in an environmental training pool, also at King Street, with many others being sold to training centres around the globe. In the UK, Petrofac Training Services now delivers survival training at a state-of-the-art survival facility at Altens, Aberdeen where the Mark 1 and Mark 2 HUETs that were in use at RGIT Survival Centre are now installed. There have been many changes in helicopter design and safety over the years and these have been reflected in the many modifications and upgrades to the HUETs, but they are still instantly recognisable as the original HUETs – evidence of the enduring nature of the RGIT HUET design.

February 2011

business focus

Petrofac Emirates, a growing company

people

New recruits for OE&O

The end of 2010 marked a major milestone for Petrofac Emirates, Petrofac’s JV with Mubadala Petroleum Services, as the company now employs in excess of 550 personnel. With around 34 nationalities working for Petrofac Emirates, we work systematically to recruit the very best candidates for the role. Specifically, a major focus of our recruitment process is attracting locals to the business as Emiratisation is a key aspect of Petrofac Emirates’ growth strategy. Petrofac Emirates’ growth achievement was highlighted during a celebratory lunch on 1 December commemorating the 39th National Day of the United Arab Emirates. Also, in November 2010, Petrofac Emirates underwent an important assessment by Lloyds Register (LRQA) in order to obtain independent certification to international quality standard ISO 9001. Both the management team and the general staff deployed their efforts in order to demonstrate that we effectively plan, manage and execute quality within our business to a recognised international standard level. Petrofac Emirates’ commitment to quality was recognised and the company achieved its goal and was awarded with the coveted ISO 9001 certification. Hussain Al Ansari, Petrofac Emirates’ chairman commented: “Since Petrofac Emirates was established in 2008, we have grown our employee base significantly, enjoyed project success and have substantial operating centres in Abu Dhabi. I am pleased that we can now announce this milestone which demonstrates both our commitment to quality and our approach to building a sustainable business.”

From left to right: Shouab Zahid, director, sales & marketing, Petrofac Emirates; Peter Warner, chief executive officer, Petrofac Emirates; Zaher Abdulla Ghanem, VP asset management and operations, Mubadala Petroleum Services Company; Khaled Al Hosani, HR manager, Petrofac Emirates; Abdul Nasser Al Muflehi, senior business development executive, Petrofac Emirates and Mazin Rachid Nasser Al-Lamki, manager, asset management and operations

Petrofac Offshore Engineering & Operations (OE&O) recently mobilised seven new trainee operators to four Duty Holder assets in the North Sea. The new recruits and former Clyde Marine cadets have undergone a five-week bespoke training course, delivered by Petrofac Training Services, to prepare for their new offshore roles. Clyde Marine offers a range of marine and offshore personnel services and was originally established to recruit sea-going personnel for Glasgow based ship management companies. Since 2006 Petrofac has successfully recruited and trained 37 Clyde Marine cadets into its OE&O business unit. Andrew Ferguson, director, marine operations, commented: “We are pleased to have the opportunity to strengthen our relationship with Clyde Marine and are looking forward to working with the new recruits to expand their transferrable skills and help them to develop into confident operators.”

Left to right: Andrew Guy, Pauline Robertson - HR advisor, Andrew Ferguson director, marine operations, OE&O, Matthew Lloyd, Ross Craven, Steven Balcarras, Craig More, Calum Taig, Drew Johnston and Gordon Andrew - technical trainer

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news in brief

KOC cricket success

Petrofac wins six-a-side cricket tournament in Kuwait A Petrofac team was crowned champions at a cricket competition organised by Kuwait Oil Company’s cricket committee in Kuwait recently, beating construction company Kharafi National in the exciting final. The win came as a result of great teamwork from start to finish, with exceptional efforts from G. S. P. Ramaraju and Midhun Varma who are now helping to set up an official Petrofac cricket team in Kuwait.

Petrofac Training Services expands capability to deliver MEM course in U.S.

In November 2010, Petrofac Training Services (PTS) held a grand opening event in Houston to launch the operation of a second, state-of-the-art Major Emergency Management (MEM) training simulation suite at its Houston Training Centre. Existing and prospective customers attended the event to learn more about the MEM training course, which provides delegates with knowledge and hands-on experience in emergency management, as well as take part in demonstrations and scenario-based exercises led by David Potts, senior MEM instructor. Attendees experienced firsthand how the IT and audio-visual capabilities of the suite are used to replicate the same sights, sounds and stresses experienced during an emergency. Tony Littler, regional manager, PTS Americas, said: “For almost 20 years, Petrofac has delivered fit-for-purpose, competence-led MEM courses to help meet the safety and emergency response training needs of the oil & gas industry. We are committed to maintaining this level of service and meeting the increased demand of our customers in the U.S. by expanding our capability and opening a second simulation suite in Houston.”

ADIPEC 2010

Petrofac supports Syrian charity

Petrofac Saudi Arabia: Quality progress update

Petrofac had a prominent presence at one of the largest oil & gas exhibitions in the Middle East this year, ADIPEC 2010. The four-day international event which was held under the patronage of H.H. Sheikh Khalifa Bin Zayed AL Nahyan, President of the UAE, was attended by 1,500 exhibitors and more than 45,000 visitors.

Petrofac has donated US$200,000 to the only children’s cancer charity in Syria called BASMA (Battling to Smile Again). The money donated will be used for a new extension to the charity’s hospital unit to include additional services and increase patient numbers. BASMA differs from other charities in that it focuses on the social aspects of the disease and its impact on the family psychologically and financially. The new wing is nearing completion and is scheduled to open early this year.

Petrofac Saudi Arabia’s bespoke Quality Management System (QMS) is now ’live’ on its intranet, providing employees with vital links to documents and data which support the execution of their roles in an efficient, effective and compliant manner. The quality team recently sponsored a competition to design a QMS logo for the site, the objective being to build awareness and to stimulate interest in the system. There were nearly 70 entries from which the judging panel selected one that now appears on the local intranet. The winning design was by Daniel-Brian Murteza, organisation development and CSR manager. At the award ceremony Imad Shanan, senior vice president and general manager of Saudi operations, remarked that “the design clearly and immediately reflects the rapid access to the on-line functionality of our QMS. It is the framework upon which we will continually build to ensure we adhere to the highest standards of quality.”

February 2011

new appointments Pierre Tollis Group head of mergers & acquisitions (M&A) Pierre Tollis has joined Petrofac as group head of M&A, reporting to Keith Roberts and based in our London office. With more than ten years investment banking experience, Tollis has completed M&A transactions worth in excess of US$17 billion for companies such as Snamprogetti and Vetco Gray and helped to raise more than US$8 billion of capital for companies such as Dockwise, Acergy and Tecnimont. Tollis joins us from Nomura International where he held the position of executive director, responsible for oilfield services coverage across Europe and the Middle East.

Peter Ireton Vice president, business development Engineering Services Peter Ireton has been appointed vice president, business development for Petrofac Engineering Services. Ireton has more than 22 years of experience in the energy industry and joins Petrofac from Wood Group – Production Services, where he was responsible for the Middle East, Euraisa and North Africa region. Ireton has a degree in chemical engineering from Bradford University.

staff achievements

employee donations

Petrofac supports MBA success

Petrofac employees support Pakistan flood victims

Congratulations to James Wallace, senior proposals engineer and Ed Thompson, operations manager for the Heather platform, both Petrofac OE&O, on their recent graduation from their MBA courses.

Petrofac recently welcomed His Excellency, Mr Tariq Iqbal Soomro, Consul General of Pakistan in Dubai together with senior representatives from the Red Crescent, to its offices to present a donation supporting the rehabilitation programme for victims of the recent floods in Pakistan.

Studying through the Open University, Wallace and Thompson

Fadi Najjar, deputy managing director, E&C commented: “Following our campaign to collect funds in the wake of this tragic event, I am delighted that our volunteering staff members, supported by a matched donation from Petrofac, have raised more than US$100,000. This has been further supplemented by an ongoing campaign organised directly by our employees to collect clothing. “In the face of many natural disasters, Petrofac’s employee community has always been extremely proactive in responding. We have supported victims of the Haiti and Indonesia earthquakes and typhoons in the Philippines to name just a small number and on behalf of Petrofac I extend my sincerest gratitude to all our employees for their generosity.”

completed the challenging course whilst juggling study, work and family commitments over a four-year period. With five written exams, 24 course work assessments and more than 3,500 hours of study, the pair showed a level of commitment to be proud of. Describing the course, Thompson said: “It was a great way to supplement my existing technical education and experience. I have gained a broad exposure to business and management theory, and more importantly, the opportunity to apply it in practical situations at Petrofac.” Wallace commented: “After moving to the Sharjah office in 2007, I became an online student and for the remainder of the course, tutorials were conducted using the Open University website. The location of my fellow students ranged from Colorado to Shanghai.” Congratulations to both!

Petrofac E&C’s deputy managing director, Mr Fadi Najjar, in the presence of His Excellency, Mr Tariq Iqbal Soomro, Consul General of Pakistan in Dubai, handing their donation to Mr Khamis Mohd K Al Suwaidi , general manager of the UAE Red Crescent Sharjah branch.

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offices Petrofac Limited, Ogier House, The Esplanade, St Helier, Jersey JE4 9WG

Petrofac Corporate Services: 4th Floor, 117 Jermyn Street London SW1Y 6HH, United Kingdom T: +44 20 7811 4900 F: +44 20 7811 4901

Petrofac Energy Developments: 2nd Floor, 117 Jermyn Street London SW1Y 6HH, United Kingdom T: +44 20 7811 4700 F: +44 20 7811 4701

Main operational centres:

Egypt Kiroseiz Building, 6th Floor, 9 Ibrahim El Sherif Street Moustafa Kamel, Alexandria, Egypt T: +203 544 5540 F: +203 544 6909 Indonesia P.T. Petrofac IKPT International, JL. Prof. Dr. Soepomo No. 42, Jakarta Selatan – 12870, Indonesia T: +62 21 829 8080 F: +62 21 829 0030 Italy Sede Secondaria Italiana, Via Mola 48 (primo piano), 20156 Milan, Italy T: +39 02 89691638 / 89691689 F: +39 02 89691798

Saudi Arabia Al-Saeed Tower-2, 5th Floor, Khobar-Dammam Highway, PO Box 77378, 31952, Al-Khobar, Kingdom of Saudi Arabia T: +966 3 814 6922 F: +966 3 814 6917 Sudan Al-Tayf, Nakhil St 11, House No.220, Block 23, Khartoum, Sudan T: +24 9183 241795 F: +24 9183 241097 Syria Mazah Eastern Villas, Jade Sharjah, Al Farabi Street, Al Hamami Building No. 36, Damascus, Syria T: +963 11 6127714 F: +963 11 6125106 Tunisia Leman Center, Tour B Rue Du Lac Leman Les Berges du Lac, 1053 Tunis, Tunisia T: +216 71 964 090 F: +216 71 964 710

Sharjah, United Arab Emirates Petrofac House, Al Khan Road PO Box 23467, Sharjah, United Arab Emirates T: +971 6 574 0999 F: +971 6 574 0099

Kazakhstan Office No. 701, 7th Floor, 19th Satpayeva Street, Business Centre, Atyrau Plaza, Atyrau 060011, Kazakhstan T: +7 7122 973 500 F: +7 7122 973 501

Aberdeen, Scotland Bridge View, 1 North Esplanade West Aberdeen AB11 5QF, United Kingdom T: +44 1224 247000 F: +44 1224 247001

Kuwait PO Box 9816, Block No 8, Street No 38 Building No 6, Near Fahaheel old clinic, Kuwait T: +965 2392 9024 F: +965 2392 0345

Woking, England Chester House, 76-86 Chertsey Road Woking, Surrey GU21 5BJ, United Kingdom T: +44 1483 738 500 F: +44 1483 738 501

Kyrgyzstan 202, Promyshlennaya Street Jalal-Abad 715600, Kyrgyz Republic T: +996 3722 55505 F: +996 3722 52315

Azerbaijan Garadagh Industrial Park, Salayan Highway 22km, Baku, Azerbaijan T: +994 12 545 9156/7 F: +994 12 545 9160

Mumbai, India 7th Floor, Ventura, Central Avenue, Hiranandani Business Park, Powai, Mumbai 400076, India T: +91 22 3051 3100 F: +91 22 2570 4705

Malaysia Level 50, Tower 2, PETRONAS Twin Towers, Kuala Lumpur City Centre, 50088 Kuala Lumpur, Malaysia T: +6 03 2382 2700 F: +6 03 2300 2241

Russia PKT Training Services Limited, Sakhalin Technical Training Centre, Mira Ave, 6G, Yuzhno-Sakhalinsk 693000, Russia T: +742 42 505261 F: +742 42 505855

Chennai, India DLF Infocity SEZ, 7th floor, Block 9A, 1/124 Shivaji Gardens, Nandambakkam Post, Manapakkam, Ramapuram, Chennai-600 089, India T: +91 44 3927 3000 F: +91 44 3927 3100

Nigeria 289b Corporation Drive, Dolphin Estate, Ikoyi, Lagos, Nigeria T: +234 1 461 4061 F: +234 1 628 1509

Scotland Blackness Avenue, Altens, Aberdeen AB12 3PG, United Kingdom T: +44 1224 899707 F: +44 1224 244752

Oman PO Box 2012, PC 111, Seeb, Sultanate of Oman T: +968 24484525 F: +968 24487942

North Esplanade East, Aberdeen AB11 5QD, United Kingdom T: +44 1224 899707 F: +44 1224 244752

Qatar PO Box 2895, Souk Al Mirgab, Salwa Road, Doha, Qatar T: +974 4411005 F: +974 4411008

Marine House, Blaikies Quay, Aberdeen AB11 5EZ, United Kingdom T: +44 1224 348034 F: +44 1224 348035

Abu Dhabi (Petrofac Emirates) Abu Dhabi Business Hub, ICAD-1, Block A, 2nd floor, PO Box 9398 Abu Dhabi, United Arab Emirates T: +971 2 810 4000 F: +971 2 810 4801

Country offices: Algeria Tour ABC, Pins Maritimes Mohamadia, Alger, Algeria T: +213 21 89 15 52 / +213 21 89 15 55 F: +213 21 89 15 54

Romania Litexco Stirbei Center, 104-106 Stirbei Voda Street, Sector 1, Bucharest 010119, Romania T: +40 0372 136 502 F: +40 0372 136 532

China B803, Focus Center, No. 6 Futong Avenue, Wangjing Chaoyang District, 100102 Beijing, China T: +86 10 8453 9288 F: +86 10 8453 9388

Russia 23, Novoslobodskaya Street, 123055, Moscow, Russia T: +7 495 933 78 84 F: +7 495 935 78 84

United States 1130 Enclave Parkway, Suite B, Houston, TX 77077-1885, USA T: +1 832 379 0500 F: +1 832 379 0502

Training centres:

Forties Road Industrial Estate, Montrose DD10 9ET, United Kingdom T: +44 1674 672230 F: +44 1674 667334 Singapore Petrofac Training Pte Ltd, Chemical Process Technology Centre, 81 Jurong Island Highway, Singapore 237837 T: +65 6880 2000 F: +65 6896 7151 United States 1130 Enclave Parkway, Suite B, Houston, TX 77077-1885, USA T: +1 832 379 0500 F: +1 832 379 0502

Interested in a career with Petrofac? Join more than 13,000 Petrofac people across the globe by reviewing our current vacancies and applying online at: www.petrofac.com/careers

February 2011

We would like to say thank you to all our employees, customers, partners, suppliers and shareholders for supporting Petrofac on our journey during the last 30 years.

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February 2011