S Savanna Energy Services Corp. Sustainability Report 2011
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Table of Contents 3 Introduction 4 President’s Message 5 Company Profile 6 Vision and Values 7 Business objectives 8 Commitment to our Stakeholders
8 Employees
9 Communities
10 Customers & Shareholders
11 Aboriginal Partnerships 13 Health, Safety &Environment 16 Financial Stability 17 Corporate Governance • Contact
Values Based Sustainable business and profitability for all stakeholders achieved in adherence to Savanna’s Vision and Values.
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Introduction Sustainability reporting has become commonplace across industries as organizations increasingly embrace the challenge of delivering results to stakeholders in an environmentally and socially responsible manner. In fulfilling our vision of “Defining leadership in global energy services through people, innovation, and technology—The path for others to follow” Savanna Energy Services Corp. (Savanna) is issuing our first Sustainability Report. Our stakeholders: employees, customers, shareholders, and the communities in which we operate, deserve to know how Savanna approaches long-term growth within the context of doing business in the present and preparing for the future. The environment; community involvement; work-life balance; long term viability; these are just a few of the considerations for any company wanting to attract the best people, and provide exceptional service.
With that in mind, Savanna is pleased to publish the first of what will be a regular look at our approach to sustainable operations with regards to three key drivers: • Community— the shared environment for all stakeholders. • People—our focus on customers, employees, and shareholders. • Profitability—the ability to adapt and grow our business with success in the present and plans for the future. Savanna addresses these key areas in adherence to our values of Integrity—demonstrating the courage to do the right thing; Relationships— building collaborative partnerships; Excellence— setting the industry standard; as well as Sustainability—driving short and long term successes. As one of our four values, sustainability means always setting goals based on our vision and meeting those goals in accordance with what we believe is right.
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President’s Message Sustainable business must balance three key drivers: Community; People; and Profitability. Savanna’s COMMUNITY is a large one consisting of all our stakeholders and the areas in which we operate, including our impact on both. Savanna is dedicated to the safe, efficient provision of services to companies seeking to extract oil and gas from the earth. We do so using equipment designed to leave as small a footprint as possible, disturbing the natural environment as little as possible and using the least amount of natural resources possible. The need for the products we help produce is irrefutable, and our aim is to provide our customers with the safest, most efficient rigs in the industry. In doing so however, we are pleased to implement technology that serves a dual purpose; increased performance with decreased costs is achieved through getting more from less. Getting more from less not only benefits both our customers and the environment, but encourages Savanna to continually strive to carry on our small contribution to oil and gas extraction in the safest most environmentally sensitive manner available. Savanna and its PEOPLE operate in a highly energetic, fast-paced business. The services we provide are not without inherent danger but we incorporate as much training, safe equipment, and safety processes as possible to keep our people out of harm’s way while they carry out their important work. In addition, we advocate and support a strong balance between work, community, and family for all our employees. We offer a comprehensive safety net of physical and psychological benefits beginning on the first day of employment, and we recommend and provide for continuous learning within the organization. While we operate some of the best equipment in our industry, we recognize fully that it is the people who run the equipment that make Savanna successful in the long term.
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Finally, PROFITABILITY may be viewed as a bad word in many quarters but it is essential to Savanna’s continued expansion of the tremendous foundation of equipment and people it has established, helping to provide all the advantages offered to our employees, customers, and the communities in which we work. The key to Savanna’s profitability is never losing sight of the need but always ensuring profitability itself is not the sole mandate. Discipline in this regard will allow Savanna to grow successfully far into the future.
Ken Mullen President and CEO
Sustainable “We are pleased to implement technology that serves a dual purpose; increased performance with decreased costs is achieved through getting more from less.”
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Company Profile Savanna Energy Services Corp. (Savanna) is a premiere drilling, well servicing, and oilfield rentals company. Our people and their expertise drive every aspect of our business and will continually provide opportunities for success regardless of market conditions. Savanna was founded in Alberta in 2001, with a head office in Calgary. Since then, two regional offices have been added in Houston, Texas and Brisbane, Australia along with several field offices throughout Canada, the United States, and Australia. The Company’s focus is strictly oilfield services and Savanna’s fleet of drilling and well servicing rigs is among the newest in the world. Our commitment to talent and technology has provided a strong domestic foothold enabling Savanna to expand its customer base to international markets. In 2010, Savanna decided to become a values-based company on a more visible and teachable level. As new operating areas continue to emerge, the need to summarize and communicate what Savanna stands for was identified, and a process for doing so initiated. The product of much hard work and thorough consideration by many, many Savanna employees, our Vision and Values have been identified, clarified, and adopted and are now a guiding force as we move into our second decade as a corporation. In May of 2010, 34 managers met to lay the groundwork for the Vision and Values process. From three days of intense discussion and debate, the skeleton of Savanna’s vision and values-based identity was formed and recorded. The resulting language and concepts were then taken back to our staff for further input and feedback. Savanna employees in every operating region came together to express their beliefs regarding what Savanna is and should be.
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Vision & Values VISION Savanna’s vision: “Defining leadership in global energy services through people, innovation and technology—The path for others to follow.” Defining leadership within an industry involves a commitment to re-examining strategies and practices regardless of success levels. As a service provider, anticipating future customer needs becomes as important as meeting existing ones. Savanna is committed to the advancement of energy services for the benefit of all stakeholders—our shareholders; our employees; our customers; and our communities.
Vision “Defining leadership in global energy services through people, innovation and technology— The path for others to follow.”
VALUES Savanna was designed for long-term stability on the principles of integrity, hard work, and responsibility. We are committed to creating value in ourselves by setting an example each and every day in our industry and in the communities in which we operate. Integrity: Demonstrate the courage to do the right thing • • • • •
Be Be Be Be Be
respectful trustworthy accountable honest and open ethical
Excellence: Set the industry standard • • • • • •
Be committed Be creative and open-minded Be focused Be disciplined Constantly pursue innovation Continuously learn and improve
Relationships: Build collaborative partnerships
Sustainability: Drive short and long-term success
• Be safe • Care for people • Communicate effectively • Treat others with dignity • Celebrate successes
• • • • • •
Create value for all Be adaptive Value diversity Be profitable Be environmentally responsible Develop and empower people
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Business Objectives Over the next several years, it is Savanna’s mandate to continue growth with an eye on international expansion. As we move forward, some of our key initiatives are as follows:
Digging Down Under! Savanna’s Don Goldade and Steve Kitzul in front of Savanna Australia’s third generation Hybrid rig.
1) Retrofit no less than 12 hybrids, subject to economics. 2) Execute and expand Australian operations by a minimum of two drilling and two service rigs, subject to contract. 3) Establish a technical services function to support technology development and cost effective construction and purchasing. 4) Develop a business plan and strategy to support growth of rental division domestically and internationally. 5) Improve staff development, training and safety execution. 6) Maximize operational efficiencies. 7) Continue to nurture international opportunities.
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Commitment to Stakeholders To define leadership in the energy services industry, Savanna must continue to evaluate and augment policy surrounding stakeholders every day. Our employees, customers, shareholders and communities are what define us, and as such we are committed to providing them with a diverse range of services to meet their needs.
Health and Wellness Savanna was founded by people who value activity and a healthy lifestyle. It is Savanna’s belief that physical and mental well being play an essential part in a successful workplace. Family First Policy
Employees At Savanna our employees are our number one asset, and we are committed to continually improving our workplace and employee wellbeing by providing a safe and progressive environment for both corporate and field work. We offer current and potential employees a wide range of career opportunities in several different countries and areas of expertise as well as significant room for advancement. Savanna's approach to training is designed to ensure our skilled professionals rank among the industry's best regardless of their discipline. One of Savanna’s values is excellence and we achieve this by focusing on creating a healthy and safe work environment in the following ways: Continuous Learning Our staff are encouraged to augment their skill set through practical or technical training and we will work with them to achieve their goals in this regard. Our Employee Performance Reviews are designed to create SMART (Specific, Measurable, Attainable, Relevant and Timely) goals and objectives and then chart a course for achieving them. We offer planning and financial incentives for achieving identified goals with the intent of realizing mutual success for both the business and the employee.
Savanna’s commitment to the families of our employees is a main priority. We will extend every reasonable option to employees to enable them to care for their families to the very best of their abilities. Our Paid Time Off (PTO) policy is designed to give employees maximum control over their time off. PTO requires no justification for days off and eligible employees may use their allotted time as they see fit or require. Further, in 2010, we re-examined our bereavement leave policy to better align with our value of Relationships by extending paid bereavement time to all field and office staff to better support our employees at difficult times. Benefits Wherever possible, Savanna provides employment benefit packages beginning immediately which typically include: dental and health care, longterm disability, life insurance, accidental death and dismemberment, an RRSP or equivalent matching program; and a confidential employee assistance program (EAP). We also offer a twoday multilateral safety training program for all field staff; training initiatives for all levels of employment, from management to green hands; opportunities for advancement in a dynamic growing company and commitment to a positive work/life balance for both office and field staff.
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Communities Savanna’s mandate, from day one, has been to give back to the communities in which we live and work through volunteerism, donations, employment, and partnerships among other initiatives. Whether through our annual United Way campaign; Christmas donations to the Veteran’s Food Banks; supporting the Adopt a Family program; providing customized training programs for our Aboriginal partners or newly arrived immigrants; or our mandate to employ local workers in all our satellite offices, Savanna tries to make a difference in the lives of those in our communities. In celebration of 10 years in business, Savanna is initiating a company wide charity initiative to reward employees for their charitable activities. Additionally, Savanna’s local employment mandate states that the majority of jobs resulting from Savanna opening offices in new regions will be offered to local people. In each of the communities we operate in, we hire local talent whenever possible and are diligent in setting up roots as productive members of the community from day one. Savanna also actively supports a variety of charitable organizations: Calgary HandiBus Association; United Way; Children’s Wish Foundation; urban & rural hospitals throughout the province; Ronald McDonald House Southern Alberta; Kids Cancer Care Foundation of Alberta; Alberta Children’s Hospital Foundation; Heart and Stroke Foundation of Alberta; Veteran’s Food Bank and Calgary Inter-Faith Food Bank to name a few. Further, Savanna encourages our employees to volunteer their time for community service activities (Habitat for Humanity, United Way, etc.). In order to promote this, Savanna organizes opportunities for
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Giving Back Through volunteerism, scholarships, and donations, Savanna has been giving back to the communitiy since its inception in 2001.
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team-building/volunteer events for employees to participate in. Savanna is also a member of Canadian Blood Services Partners for Life Program, which encourages employees to donate blood. Additionally, Savanna is a Corporate Sponsor and participant of Calgary Corporate Challenge, which is a volunteer-driven, Olympicstyle event that promotes team building, boosts employee morale and company pride, while at the same time raises funds for local charities.
Customers & Shareholders We are responsible for creating customer and shareholder value and do so through our commitment to sustainability, leadership, technology, and innovation. These four elements, aligned with our vision and values, combine to shape strategy and goal setting, and we have consistently delivered unique approaches to meet challenges in our industry successfully.
Savanna Well Servicing has funded in its entirety a comprehensive training program for new immigrants to Calgary with the emphasis on immediate job placement upon completion of the program. Additionally, Savanna works with several First Nations to select applicants interested in a program tailored to meet the needs of Aboriginal community members looking for a career in oilfield services. Our Aboriginal Training Program offers hands-on training and classroom instruction for eligible First Nations community members and provides them with a variety of skills to prepare them for employment. This type of innovation reflects Savanna’s commitment to all stakeholders in driving company success through creative and values-focused ideas and programs designed to reflect our vision of leading the way in energy services globally.
Innovation In response to a decrease in domestic shallow gas drilling and the resulting under utilization of our shallow focused Hybrid fleet, Savanna responded to the need to activate these units by developing a new platform. Savanna’s management and engineering teams created the TDS-3000tm, a top-drive single capable of drilling deeper wells utilizing larger pipe. With two new TDS-3000tms at work in the field currently, Savanna is scheduled to transform at least six more Hybrid units into top-drive singles to meet the demands of our customers. CCIS and Aboriginal Training Programs In response to the demand for skilled workers, Savanna has undertaken several initiatives to staff our rigs with qualified personnel. In conjunction with the Calgary Catholic Immigration Society (CCIS),
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Innovation Savanna recognizes innovation as essential to every aspect of our business. We are always looking for bright ideas and better ways to deliver results for all stakeholders.
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Aboriginal Partnerships The Power of Partnership History Since 2001, Savanna has worked closely with many First Nation and Métis communities to develop and maintain strong business relationships in the form of rig partnerships. These rig partnerships bring First Nation communities into the western Canadian energy industry as meaningful players in every sense. Our current partners include: The Dene Tha’; Saddle Lake First Nation; Duncan’s First Nation; Blood Tribe; Alexander First Nation; Sturgeon Lake Cree Nation; Heart Lake First Nation; Cold Lake First Nations; Alexis Nakota Sioux First Nation; Métis First Nation of Alberta; Frog Lake First Nation.
Teamwork The power of a partnership lies in mutual benefit from teamwork and support.
Community Relations Savanna has vast experience working with a unique business model that has proven successful and has a team who are dedicated to the success of the partnerships. Savanna employs a Business Development and Partner Relations Manager who is a First Nations member. The primary goal set for this position is to regularly communicate with our existing partners as well as develop and foster new relationships. Savanna also employs a Partner Relations Coordinator who is also a First Nations member. Our Partner Relations Coordinator focuses specifically on the training programs, community relations, Aboriginal partnerships, and also providing financial and operational reports to our partners. Corporate governance and open two-way communication and transparency are key to our Aboriginal partners and to Savanna, as we believe this is the basis for our respectful and successful relationships.
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Economic Benefit As a company, we have been exceptionally fortunate with the expansion and success of our Aboriginal partnerships. As a partner, Savanna is diligent at all times to maximize opportunities for partner success in terms of finances, operations, employment and management. This has the potential to provide cash flow for many years which can be used to reinvest or to go back to partner communities. Savanna also benefits from our strong relationships with Aboriginal communities as well as with oil and gas customers who see the value of this approach.
(SAIT). This bursary is the first such bursary that SAIT has ever offered on the condition the bursary is awarded exclusively to an Aboriginal student— a condition arranged at our insistence. The oil and gas industry in Alberta and across Canada conducts business on First Nations territories, and Savanna believes our Aboriginal partnerships are a meaningful way of ensuring these communities receive benefits from such activity. We feel these relationships are an extension of both our vision of leading the global energy services industry as well as a direct reflection of our values of building collaborative partnerships and fostering sustainability through developing and empowering people.
Community Support Savanna supports Aboriginal organizations on a case-by-case basis related to the group’s objectives and goals. Savanna is pleased to offer financial assistance to worthy causes. Each partnership has a sponsorship budget and funds are distributed to events on the recommendation of a committee made up of the community members. As a partner, Savanna’s only suggestion is that the funds go towards an event or cause which will benefit the community at large such as youth, Elders and cultural events. Corporate Support Savanna believes in the promotion of education for Aboriginal youth and demonstrates this value through corporate support. Savanna has committed to a bursary for three years in the amount of $2,500 towards Aboriginal individuals who are of Status, Métis or Inuit descent and who complete their first year of Petroleum Engineering Technology at the Northern Alberta Institute of Technology (NAIT) and Southern Alberta Institute of Technology
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Opportunity Savanna values developing and empowering people to achieve success.
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Health, Safety & Environment HSE 2011
The COACH Program
In conjunction with Savanna’s vision of “Defining leadership in global energy services”, we take steps every day to personify our belief that people are our number one asset. As a global drilling, well servicing, and oilfield rentals provider we recognize that far and away the most important element of what Savanna offers customers is exceptional service on every level. In order to provide this, Savanna must maintain a highly skilled employee base in a seasonal and market-driven industry which is a consistent challenge—one best met by identifying safe work practices and teaching and rewarding safe thinking.
The COACH program is a multifaceted approach to safety and its goal is empowering employees to make the right decisions without fear of reprimand. With COACH, Savanna emphasizes incorporating safe thinking into an employee’s skill set and the training provided is designed to produce results through actions: each employee is instructed to apply safety to the analysis of every task.
Creating an environment of safety begins with leadership and, more specifically, leading by example. One huge challenge in establishing a safe workplace lies in the ability to convince leaders that it is in their best interests to always adopt new and non-traditional ways of thinking about safety. In an industry historically known as rugged and dangerous, many managers and senior ambassadors have come up through an oil patch significantly different than the one existing today; however, we believe matching our employee’s hands on experience with advanced technology, safety procedures, and training will result in a safer workplace. Savanna continuously asks our leaders in all areas to make safety their first priority at work. On the rig lease we take a proactive approach and put practical means of practicing safety in place by providing the best tools available.
Savanna places significant emphasis on leadership training within the COACH program. We want to employ individuals who show pride in leading by example, and concurrently, individuals who are responsive to modeling safe behaviour. Character, work ethic, and conscientiousness are the foundations of good leaders and the COACH program is designed to explain how to incorporate all of the above into safe actions. Once a foundation has been laid, the tools must be in place for our employees to utilize their skill set proactively. As a result, Savanna has implemented a variety of procedures to allow our people to “practice what they preach.” Safety Meetings Job Hazard Assessments (JHAs) Behaviour Based Observation Program Near Miss Reporting Hazard Identification All of the above combine to create a safety program that reinforces and cultivates safe thinking and safe work habits.
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Vision and Values Applied The application of Savanna’s Vision and Values can be clearly seen in our approach to safety. Our value of Integrity asks that we “Demonstrate courage to do the right thing.” Safety first is always the right thing and we must never hesitate to act accordingly. Additionally, Savanna values Relationships and through these relationships we build collaborative partnerships. Our employees are charged with the task of embodying this value by being safe; caring for people; and treating others with dignity. Each of these statements function quite literally as tools available to our employees to ensure they never feel compromised or obligated to perform an unsafe act. Our goal in implementing our Vision and our Values is to saturate our employee base from the top down and from the bottom up by stating in no uncertain terms what we believe we can achieve and how we believe we can achieve it. Technology and the Environment Savanna is in the business of helping oil and gas explorers find fossil fuels to provide the world with energy. Furthermore, our equipment requires the usage of fossil fuels to operate on a daily basis. In accordance with our first value—Integrity—Savanna acknowledges and accepts our industry has an impact on the environment. As leaders in global energy services, Savanna also acknowledges, appreciates, and supports environmental stewardship. In our approach towards efficiency, our stakeholders, and our position as a role model in safety and technology, Savanna will
continue to pursue every means necessary to reduce our impact on the environment within the context of our business. As pioneers in oilfield services technology, Savanna has developed equipment that sets the industry standard from day one. Our patented Hybrid rig technology; our AC controlled telescopic double drilling rigs; and our custom PLC controlled Australian workover rigs, continue to lead the way in safety-inspired efficiencies. Simply put, we recognize the symbiotic relationship between safe work practices, environmentally friendly efficiencies, and revenue. Safe and happy employees, with more efficient equipment, deliver better results to customers. Therefore, in building the safest, most technologically-advanced equipment in the industry, our stakeholders are assured we are driving values based success because it’s the right thing to do any way you look at it. Our rigs have completely eliminated as many hazards as possible through engineering and we continue to evaluate and improve on all of our operations with this goal at the forefront of our efforts. In terms of environmental impacts, our goal is to minimize our rig footprints in the following ways: Engineering More Efficient Rigs Efficient rigs use less fuel, make less noise, and engineer hazards out of the drilling process meaning that by working safer, there is less down time and less time with the equipment running. Savanna uses AC driven electric technology which is cleaner; insulates engine and mud pump buildings to reduce noise; and creates compact structures that maximize space.
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Reducing the Number of Buildings/Loads Each rig consists of several components which are set up in buildings. Reducing the number of buildings subsequently reduces the amount of physical space a rig takes up on a lease and reduces the amount of loads (and fuel) needed to move from location to location. Patented Hybrid Rigs Savanna’s patented Hybrid rigs are capable of drilling with coiled tubing or drill pipe. In the instance of drilling with coil, no jointed pipe connections are required and therefore the drilling floor is clear of personnel and the driller is free to oversee drilling from the comfort of the doghouse with a bird’s eye view of operations. Because of the flexibility these rigs offer, a contractor is free to use two methods of drilling with one unit, instead of employing a separate rig when drilling conditions change. Additionally, Savanna’s Hybrid fleet utilizes a closed loop circulation system capable of reusing drilling fluids and minimizing water usage. Compact and efficient, these rigs are quiet and leave a minimal footprint on any area in which they operate. They are highly mobile and all buildings and the derrick and coil spool itself can be torn down, moved, and set back up within hours leaving virtually no environmental disturbance on location. Telescopic Doubles Our newest telescopic doubles are among the safest and most efficient rigs in the industry. AC electric power provides maximum control over all power systems and variables such as weight on bit (WOB) and rate of penetration (ROP) are all monitored on touch-screen gauges directly in front of the driller’s chair.
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These AC units allow precise control of engine activity and can provide high levels of torque and power with lower fuel consumption. The rig’s drawworks are operational without the main gensets via a smaller generator which enables faster set up and better distribution of power throughout the rig, again reducing engine running time and fuel consumption. PLC Workover Rigs In a manner similar to our drilling rigs, the bulk of Savanna’s workover fleet is PLC controlled and has a number of built-in safety features to minimize hazards and improve efficiency. In fact, the recently built Savanna Well Servicing 54 and 55 respectively, are among the most advanced rigs of their kind anywhere in the world.
Minimum Impact Our fleet of mobile Hybrid rigs is designed to leave a minimal footprint. These photos are taken from the exact same location. The top photo is of a well site in southeastern Alberta minutes after our equipment was removed. The photo below shows our Hybrid rig set up and ready to operate within approximately one hour of tear-down.
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Financial Stability Savanna has always been a growth oriented company. The $300 million of capital raised in the market and $540 million of operating cash flows generated by the company (from 2001 to December 31, 2010) have continually been reinvested into expanding or bettering Savanna’s equipment fleet. This investment created continually improving revenues, operating margins and operating cash flows relative to industry conditions. Other than 2009, which represented one of the lowest points in oilfield services history, Savanna’s key financial operating metrics have improved every year compared to the previous one over our 10 years of operations. Further, in 2009, the company persevered through a very difficult period by aggressively reducing its cost structure, all without lowering permanent staff levels and issuing shares to solidify its balance sheet strength. Since its inception, Savanna has made every effort to ensure a balance in maximizing returns for its shareholders over both shortterm and long-term activity levels in the oil and gas services business. At the end of each day, Savanna is in the business of creating profits and managing profits for future successes. Savanna’s primary objective in managing capital, given the cyclical nature of the oil and gas services business, is to preserve our financial flexibility in order to benefit from potential opportunities as they arise and in turn maximize returns for our shareholders and create opportunities for our employees. This objective is achieved by prudently managing the capital generated through internal growth; optimizing the use of lower cost capital; raising share capital when required to fund growth initiatives; and maintaining a conservative approach to safeguarding our assets.
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Technology Above: Savanna incorporates Top Drive technology to ensure safe and efficient drilling. Below: Human Machine Interface (HMI) allows Rig Technicians to view and set operational parameters.
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Corporate Governance Although Savanna cannot anticipate all eventualities in this regard, we maintain what we believe to be a conservatively-leveraged balance sheet by maintaining a debt to equity ratio below 0.50. In our 10-year history, Savanna’s debt to equity ratio has averaged 0.17 and never exceeded 0.30. At the end of 2010 Savanna’s debt-to-equity ratio was 0.14 and our net debt was only $34 million on $898 million of capital assets. Heading into the next decade, Savanna’s financial position provides for considerable flexibility while maintaining a conservatively-leveraged balance sheet. This financial flexibility will allow us to execute on our strategies and key initiatives in the next few years, including the revitalization of our Hybrid drilling fleet through retrofit and relocation. Our path as an innovative growth oriented company will continue through Savanna’s Vision, “Defining leadership in global energy services through people, innovation and technology—The path for others to follow”. We have the financial acumen to accomplish this according to our capital management objectives and in turn maximize returns for all Savanna stakeholders.
The principal mandate of the corporation's Board of Directors is to oversee the management of the business and affairs of the Corporation, and monitor the performance of management. The Board assumes responsibility for the stewardship of the Corporation and, as part of the overall stewardship, assumes responsibility for selecting its Chairman, appointing Board committees and determining directors' compensation. The Board oversees the development and approval of the mission of the Corporation, its goals and objectives, and the strategy by which these objectives will be reached. The Board is also responsible for approval and appointment of senior officers of the Corporation and the evaluation of their individual performance. Other responsibilities include ensuring the timely and effective communication with the Corporation's security holders, other stakeholders and the public in general, as well as the integrity of corporate control and management information systems. Savanna's Board is composed of six members, one of whom is not independent: Ken Mullen, President and Chief Executive Officer. In addition, the Board annually appoints members to the following Board committees: Audit Committee, Compensation Committee and Corporate Governance and Nomination Committee. All members of the committees are independent within the meaning set forth in Multilateral Instrument 52-110. Audit Committee The Audit Committee's mandate includes the review and recommendation for approval by the Board, the annual and quarterly financial statements, news releases and all financial information in any prospectus, offering memorandum, annual information form, MD&A
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or annual report of the corporation. In addition, the Audit Committee is to review and make recommendations with respect to information and control systems of the corporation; and provide oversight in respect of risk management policies and practices. The committee is also responsible for reviewing, reporting and recommending to the Board the appointment, terms of engagement, compensation, audit plan and provision of non-audit services of the Corporation's independent external auditor. Corporate Governance & Nomination Committee The responsibilities of the Corporate Governance and Nomination Committee include the oversight of the corporation's approach to corporate governance and the constitution of the Board and its committee. The Corporate Governance and Nomination Committee is also responsible for the periodic assessment of the effectiveness of the Board as a whole and its committees, along with the contributions of individual members. Compensation Committee The Compensation Committee has the responsibility to assess, monitor and make recommendations regarding compensation of senior officers and directors of the corporation. The Compensation Committee is also responsible for the periodic review of senior officer performance, including that of the Chief Executive Officer, and succession planning. Further information, including the mandate of the Board, the corporation's disclosure of Corporate Governance, the report of the Compensation Committee on Executive Compensation and the mandate of the Audit Committee can be found in the Information Circular and Annual Information Form of the Corporation available on www.sedar.com.
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Board of Directors Ken Mullen, Director President and CEO James Saunders 3 Chairman John Hooks 1,2* Director Kevin Nugent 1*,2 Director Tor Wilson 2,3* Director Allen Brooks 1,3 Director Committee Members
1. Audit/Disclosure 2. Compensation 3. Corporate Governance and Nomination * Denotes Chair
Head Office: Savanna Energy Services Corp. Suite 800, 311 6th Street SW Calgary, Alberta T2P 3H2 Phone: 403 503 9990 Fax: 403 503 0654 E-mail: info@savannaenergy.com www.savannaenergy.com
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Savanna Energy Services Corp. www.savannaenergy.com