Spwwestprovplan by Workforce South Pacific

BUSINESS OPPORTUNTIES: Juha Four Juha Four (4)(4)

Juha Juha FiveFive (5) (5)

Western Province Scoping Report

Figure 5.the On left the isleft theconditioning gas conditioning at Ridges they separate the waste gasonand Figure 5. On theisgas plantplant at Ridges wherewhere they separate the waste gas and theon the Right are two the two landowner leaders Mr. Frank Neobia Mr. Wabi John Wabi SaraOil with Oil Search Right are the JuhaJuha landowner leaders Mr. Frank Neobia & Mr.&John Sara with Search Community Affairs officer Mr. Philip Kimala at ridges at Kutubu. Community Affairs officer Mr. Philip Kimala at ridges at Kutubu.

Figure 6. The gas conditioning plantplant at Ridge in Kutubu and on the Figure 6. The gas conditioning at Ridge in Kutubu and onright. the right. Western International Oil &Oil Gas jobs in theinnear whenwhen Juha PDL Gas09Project Western International & Ltd Gaswill Ltddo willthe dosimilar the similar jobs the future near future Juha09PDL Gas Project Operates. Operates.

Figure 7. One of our Workforce crews Figure 7. One of our Workforce crews

Crew s having safety briefing before jobs. Crew s having safety briefing before jobs.

• Business planning • Finance plan • Export plan • Marketing plan

• Global environments • Multiple operations • Different cultures

• Global markets • Entry options • Maketing mix

International Planning

Market Strategy

International management

Export / Import Facilitation • Export /Import services • Export/import planning • Export/import development

Special focus on South Pacific enterprise developments

Table of Contents 1.0 EXECUTIVE SUMMARY .......................................................................................... 4 1.1 Background and description of the business ..................................................................... 4 1.2 Business Mission Statement .............................................................................................. 6

2.0 PRODUCT/SERVICE & MARKET ANALYSIS ........................................................ 7 2.1 Product/Service .................................................................................................................. 7 2.2 Market Analysis .................................................................................................................. 9 2.3 Industry Description and Outlook ..................................................................................... 19

APPENDICES ................................................................................................................. 23

1.0 EXECUTIVE SUMMARY 1.1 Background and description of the business Western International Oil & Gas Limited is a 100% nationally owned company. The company comprises of three (3) nationally owned companies that form the joint venture: Kupasabigu Investment Corporation Limited and Sania Investment Limited are both companies from the oil rich areas in Nomad District in Western Province of Papua New Guinea. Workforce South Pacific Ltd was established in early 2010 with Ok Tedi Mining Ltd (OTML) as a specialist reline and maintenance contractor on their ball mills & sag mills and has expanded their expertise to other countries like South Africa, Tanzania and Asia. The company also provides mechanical & civil construction and associated labour force services to its clients nationally and overseas.

Joint venture structure

Workforce South PaciGic Ltd,

Kupasabigu Investment Corporation Ltd

Sania Investment Corporation Ltd

Western International Oil & Gas Limited

This merger has come about to provide project capabilities to meet the demands of the PNG project development environment including longer term procurement opportunities sought by the PNG LNG developments in the Upstream Phases where Western Oil & Gas have secured strategic partnerships with key landowner companies located in the Juha Gas Fields region of Western Province. This alliance has provided Western Oil & Gas with a competitive project services capability 4

across the range of PNG LNG procurement categories for training, national content services and community infrastructure development projects. Further this partnership has provided Western Oil & Gas with the capacity to bring commercial strengths across three entities to enable the group to participate in the current and longer-term economic development programs being delivered by the principle agency in the Western Province, the Papua New Guinea Sustainable Development Program (PNGSDP).

Western Oil & Gas Project Capabilities

Training services

Rep Lanco enterprises

Community infrastructure projects

1.2 Business Mission Statement

It is our business strategy to build and sustain a long term ‘cooperative relationship’ with our clients by: §

Dedicating key resources to our clients to guarantee service excellence

§

Providing innovated and cost effective solutions

§

To enhance and accomplish company visions to meet the ever growing demands for business in PNG today.

§

Enhance and improve better government services through decent infrastructure development programs.

§

Maintain our level as a world-class company.

§

Strive to sustain our vision and mission by constantly seeking renewal through training and the application of new work methods, culture and best work practices

Service Excellence

Best Work Practices

Long-‐Term Client Relationships

Cost-‐ Effective Solutions

Meeting Business Demands

2.0 PRODUCT/SERVICE & MARKET ANALYSIS 2.1 Product/Service Western Oil & Gas provides a broad spectrum of project development and delivery services including construction, heavy industry plant maintenance and training and development for trades and heavy industry through its’ principle alliance partner South Pacific Workforce Ltd. Through its’ further partnership alliances with PNG landowner companies Kupasabigu Investment Corporation Limited and Sania Investment Limited it also is able to provide services which are accepted in the PNG project environment, as applying to PNG landowner companies including camp management, camp maintenance, catering, security, transport and vehicle hire and maintenance. Western Oil & Gas is especially suitable to meet the broad project services required by the PNG LNG procurement categories across industry training and inductions, targeted national content services and to support the delivery of community infrastructure developments throughout PNG. Western Oil & Gas Project Capabilities

Training services

Supply services

Community projects

• Trades speciGic training • Safety inductions training • Labour • Catering • Camp maintenance • Security • Vehicle hire • Infrastrucutre • Engineering • Project Management

The core benefits of these categories of services are to provide essential project support functions to enable owner agents to achieve their project delivery objectives including time, cost scope, built assets and services delivery. The actual product benefits provided by Western Oil & Gas are their business efficiencies including cost-effectiveness, quality standards in safety and service delivery, commitment to client relationships and their diverse project capabilities.

Western Oil & Gas Service Dimensions

Project Support: cost, time, scope, built assets, services delivery Cost-‐ effectiveness, Quality Standards, Client-‐ relationships, Diverse project capabilities

The results of the Representative Lanco business assessments were then linked to the segmentation process described in 6.3.2 above.

Stars 3

2.2 Market Analysis 3 Stars

2 Stars

Attributes All processes in place & followed

Operations Delivers in an autonomous manner Requires normal level of supervision

Most processes in place, generally 1 Star followed PNG LNG through the project operator Esso Highlands created a National Content Plan Basic processes Requires 1 and under this agreement with the PNG government encouraged a network of intensive in place, often not Potential contractors base supervision Representative Landowner Companies (Rep Lancos) to allow used these representative 2

PNG LNG Opportunities

companies to secure opportunities with the PNG LNG Figurebusiness 11 – Schematic representation of the stardevelopment. rating system

Based generally on this selected will be reserved for theConstruction Representative This structure allowed forprocess, the projects main activities Engineering Procurement and Lancos as discussed in Section 6.5.2. If a Representative Lanco’s star rating improves, they (EPC) contractors Appendices – EPC Contacts) and sub-contractors engage the may be considered(refer to perform more complex activities, providing that thesetoactivities are sustainable. EHL will establish an Enterprise Centre to help Representative Lancos and services of these Rep Lancos through the pre-qualification process set up through the other PNG businesses that will support the Production phase to become sustainable in the IBBM Enterprise Centre. The Enterprise Centre located in Port Moresby was set by PNG long term. LNG to provide these Rep Lancos with the required business training and capacity building 6.4.5 ThetoList of allow Representative Lancos capabilities then them to provide commercial services to the projects EPC The list of Representative Lancos, the time of writing, is provided below. EHL’s contractors and sub-contractors andcurrent to PNGatLNG project. Land and Community Affairs (L&CA) group may modify the list of Representative Lancos from time to time to reflect developments. Any change will be communicated to the EPC Representative Landowner Companies (Rep Landcos): Contractors and other stakeholders. Area Hides - Angore – Komo Juha

Acronym HGDC

Representative Lanco Hides Gas Development Company Ltd

Moran

MDC

Moran Development Corporation

Kutubu

MIC KSS KTL/TWL KCL Kawaso

Maka Investment Corporation Kutubu Security Services Kutubu Transport Ltd/Transwonderland Kutubu Catering Limited Kawaso Ltd

Gobe

GFE GFS

Gobe Field Engineering Gobe Freight Services

Kikori-Omati-Kopi

KOI GFS

Kikori Oil Investment Gobe Freight Services

LNG Plant

Laba

Laba Holdings Ltd

(Source: PNG LNG National Content Plan) Figure 12

PGGP-EH-BPZZZ-000013

- Current List of Representative Lancos June 2009 9 G Rev.

PNG LNG Project Overview Main EPC contractors: LNG Plant: Offshore Pipeline Hides Gas Plant Onshore Pipeline Infrastructure Early Works Associated Gas (OSH only)

Chiyoda/JGC Saipem CBI/Clough JV Spiecapag McConnell Dowell/CCC JV Clough/Curtain JV Jacobs (formerly Aker Solutions)

Different labour environment to Australian LNG projects Broadly there are two phases of the PNG LNG project, which are construction and Two years into four-year construction period. First LNG production, where these2014, Rep Lancos and other PNG goods and billion services providers have sales expected capital cost US$15.7 (Source: Oil Search presentation –‘Building Our Future’)

the opportunity to tender for business through the network of EPC, sub-contractors and to the PNG LNG project itself. 9

Under the National Content Plan for both construction and production phases there are three key areas identified where both Rep Lancos and other PNG firms have opportunities

Timetable

to secure business contracts. These are through providing training and induction services and general supplier opportunities through the EPC contractors responsible for each construction work package. The third area is with provision of community infrastructure

•Continued early works •Detailed design developments •Order long leadswith and the place purchase orders •Open supply routes •Contractor mobilisation •Commence AG construction

•Complete AG

project •Continue operator onshore Esso Highlands. pipe lay •Complete offshore pipe lay •Start Hides plant installation

First Gas from Train 1, then Train 2

(K1.26b –Construction / K200m – Production)

2010 2011 Training

Financial Close

2012 Goods/Services

•Ongoing procurement

and mobilisation Trades

•Airfield construction •Drilling mobilisation •Start offshore pipeline construction •Onshore line clearing and laying LNG equipment Safety I•Start nductions installation

Community 2013 infrastructure 2014

(K56m-‐Construction) (K14m p.a. -‐Production)

•Complete pipe layRoads, bridges,water Labour force •Ongoing drilling •Complete Hides plant •Commission LNG plant with Kutubu gas

Camp Maintenance

Engineering/ construction 10

(Adapted from: PNG LNG National Content Plan)

Specific services to be solely provided to the project by Rep Lancos include labour, catering, camp maintenance, security, vehicles and drivers. Project tender opportunities for Rep Lancos and other PNG firms to bid for upcoming contracts are provided through the PNG LNG web site ‘PNG Suppliers Dashboard’http://pnglng.com/dashboard.php.

Rep Landcos procurement opportunities

Labour

Security

Rep Lancos

Camps

Vehicles

(Adapted from: PNG LNG National Content Plan)

The construction phase during 2010-2013 represents the bulk of the business opportunities with budget expenditure projections around K1.26 billion allocated for procurement contracts for Rep Lancos and other PNG firms especially in the workforce supply to the EPC works including laborers, drivers, painters, equipment operators, concrete finishers, cooks, community workers, store men, freight handlers, secretaries, administrative assistants, security guards, laundry workers, welders, carpenters, pipefitters, sheet metal workers, electricians, trainers, machinery mechanics, steel fixers, managers, computer technicians, nurses, accountants, scaffolders/riggers, etc.

Timetable

PNG LNG construction project timelines (2010-2013)

•Continued early works •Detailed design •Order long leads and place purchase orders •Open supply routes •Contractor mobilisation •Commence AG construction

2010

•Complete AG •Continue onshore pipe lay •Complete offshore pipe lay •Start Hides plant installation

2011

•Ongoing procurement and mobilisation •Airfield construction •Drilling mobilisation •Start offshore pipeline PAPUA NEW GUINEA construction LNG Project •Onshore line clearing and laying •Start LNG equipment installation

2012

Financial Close

6.4.6

Rev G

First Gas from Train 1, then Train 2

2013

2014

•Complete pipe lay •Ongoing drilling •Complete Hides plant •Commission LNG plant National Content Plan with Kutubu gas Page 34 of 51

Estimated Revenue to Representative Lancos and other PNG businesses

(Source: Oil Search presentation –‘Building Our Future’)

The revenue directed to Representative Lancos and other PNG businesses is expected to be significant, although reliable estimates will only be available after the successful EPC Contractors are chosen. The current estimate of potential expenditure with PNG businesses during Construction is in the order of K1.26 billion (US$450million, assuming a K2.8 = US$1 Business contracts forecast -construction (2010-2013) exchange rate), as shown below. Estimated Expenditure with PNG Lancos and other PNG businesses during Construction - in millions of Kina Level 1

Level 2

Level 3

Total

Hides, pipelines and infrastructure

252

196

700

LNG Plant

140

224

196

560

Total

392

476

392

1,260

Upstream

(Source: PNG LNG National Content Plan)

Figure 13 – Estimated Project Expenditure with PNG Companies

Throughout the 30-year Production Phase, there will be an estimated spend with Representative Lancos and other PNG businesses generally of approximately K200 million 12 per year for goods and services. 6.4.7

Business with Other Companies

Training and induction services opportunities during the construction phase will be managed by the EPC’s and present opportunities for both trades and safety induction training to enable workforce ready capabilities across general trades: labourers, drivers, welder’s laborer, scaffolder’s laborer, pipe layer’s laborer, steel fixer’s laborer, earthmoving laborer, builder’s laborer, form worker, concreter/finisher, dogman/rigger, concrete pump operator, painter/rust proofer, concrete batching plant operator, lagger, electrical assistant, backhoe operator, forklift driver, water/petrol tanker driver, road roller operator, nonspecialist operator, dump truck operator, tyre fitter, vehicle mechanic’s helper, store keeper, security guard, and driller’s assistant. The production phase 2014-2044 represents reduced business contract opportunities with annual projections around K200million for workforce supply, training, general goods and services provisions and community infrastructure. This phase will see greatly reduced workforce numbers, more highly specialised training and generally less demand for goods and services. The production phase will occur for thirty years commencing in 2014, however there will be smaller construction phases such as the Phase 4 Juha Gas Field Developments scheduled to occur around 2020. The strategic community investments component to the National Content Plan identifies contract opportunities for Rep Lancos and other PNG firms to bid for infrastructure, water and sanitisation programs and other related engineering and construction works. There is a budget allocation during construction phase 2010-2013 of K56million and K14 million annually during production phase 2014-2044.

Western Province - Juha Opportunities PNG LNG National Content Plan has forecasted expenditure of K700million for the Upstream Gas Fields and Infrastructure phase of the project. The plan outlines the specific contract arrangements for the Hides Gas Fields component of the project which is based on the established umbrella company Hides Gas Development Company (HGDC) directly contracting to EPC’s and then sub-contracting work to Rep Lancos for the region including business opportunities for the Juha Gas Field Development Phase 4.

6.6.2

Strategy for the Hides Area

Relevant EPC Contractors will contract specific activities related to the Kobalu camp to a joint venture established between Hides Resources Owners Investment Ltd (HROI) and Kobalu Camp Services (KCS). For other activities, EPC Contractors will establish specific business agreements with the planned new umbrella company Hides Gas Development Procurement strategy for the Juha Gas Fields area Company (HGDC).

(Source: PNG LNG National Content Figure Plan)

16 - Hides Lanco strategy

The HGDC Umbrella Company is expected to replace the existing umbrella company (PEJV) covering Hides and Nogoli area and will progressively incorporate BDC (Benaria), Juha and Angore and possibly Komo Lancos. HGDCwithin also will opportunities for smaller Lancos HGDC represents fourteen landowners the provide upstream gas fields development area to participate in sustainable business through sub-contracting agreements. and provides those business services reserved for Rep Lancos under the project National TheContent Enterprise Centre willlabour be available to provide capacity-building assistance the Plan, namely hire, camp catering and maintenance services,tosecurity, landowners to enable the umbrella company to take over the management of sustainable vehiclerelationships hire and maintenance. HGDC have formed JV partnerships with selected PNG business at the end of Construction. firms like NCS for catering (The Alliance Group), Guard Dog Security and KK Kingston. HGDC also forms partnerships with EPC partners CBIC/CCJV to contracts for the gas field development works (HGDC Commercial manager- John Gourley) and drilling contractors PGGP-EH-BPZZZ-000013

June 2009

(Nabors, Kentz, EHL, Cisco Holloman â&#x20AC;&#x201C; HGDC Commercial Manager - John Bennett). Rev. G

HGDC LNG Upstream business alliance model

PNG LNG

HGDC

PNG JV's

EPC JV's

(Adapted from: HGDC Corporate Web Site- www.hgdcpng.com)

Timing for development activities for the Juha gas facilities is not scheduled until at least 2020 as this has been defined as a key gas expansion phase for continued production for PNG LNG project. Oil Search also reports that it has proven gas resources located at its’ P’ynang field site (90 kilometres north-west of Juha) which represents longer term business opportunities as this will also be located in Western province (Annual Report 2011- Oil Search). Oil Search has recently announced the P’ynang field has now moved into pre-FEED for concept design and costing, in readiness for gas expansion to the PNG LNG train 3 capacity (Oil Search Quarterly Report September PAPUA NEW GUINEA 2012). LNG Project

Rev G

National Content Plan Page 14 of 51

Juha- (Western province) LNG works

Phase 4

Juha Gas Field Development (~2020)

Construct three wellpads and drill four wells at the Juha gas field. Construct the Juha gathering system to bring the gas from the Juha gas field to the Juha Production Facility. Construct the Juha Production Facility (JPF) to separate gas and liquids from the Juha gas field. Construct the Juha-Hides Rich Gas Pipeline and the Juha-Hides Liquids Pipeline to transport rich gas and liquids from the JPF to the HGCP. (Source: Content Plan) PhasePNG 5 LNG National Associated Gas

Developments (~2031)

Modify the Agogo Production Facility to treat the gas from the Agogo and Moran 15 fields and construct a pipeline to carry this gas to the LNG Project Gas Pipeline. Phase 6

South East Hedinia Field (Under evaluation)

Other Western Province opportunities The principle agency for development projects in Western Province is Papua New Guinea Sustainable Development Program (PNGSDP) which promotes development of national and provincial projects in its’ capacity as administrator of OK Tedi Mining Lease (OTML) royalty funds (K518million – 2011). (Refer Appendices – PNGSDP Organisation Structure) In alliances including the OK Tedi Development Foundation (K680 million fund) and PNGSDP affiliates including Western Power, Cloudy Bay Forestry, PNG Microfinance, PNGSDP facilitates provincial development investments in infrastructure for roads, water, power, education, health, construction-related activities, (K166million: 2002- 2011). In addition PNGSDP allocates another K21.5million representing 2.5% of its’ OTML dividend, to be spent on all mine affected communities annually. PNGSDP partners with the private sector including the OTML to develop these projects. The OTML is scheduled to be decommissioned around 2015 and the mine has been seeking to diversity into other prospective leases it has interests in and well as conducting feasibility studies into expanding the existing mining lease to enable OTML to possibly continue beyond 2015. OTML has aligned with PNGSDP to provide management and engineering capabilities to enable PNGSDP to deliver its’ infrastructure projects using both it’s Development Fund as well as the OK Tedi Development Foundations’ funding allocations. Western Province economic development projects structure

OK Tedi Mining Lease (OTML) PNGSDP Development Fund (K474m-‐to date)

OK Tedi Development Foundation (K680m-‐since 2008)

Transition Projects (To date: K318m-‐PNG/ K166m-‐Western Province) Telecommunications; Daru Airport; Daru Port;

Infrastructure Corridor; Economic Hubs

Community Development Infrastructure (K21.5m p.a.-‐OTML communities) Roads, Water, Power

Health, Education

(Adapted from: Western Province Business and Investment Guide- 2012) (Financial information: PNGSDP Annual Report 2011)

PNGSDP has identified some strategic infrastructure developments for the Western Province which present business opportunities includingIncreasing road networks and township connectivity including the infrastructure corridor (PNDSDP awarded a road maintenance contract to Stanley Resources Investment Ltd for the Gre-Drimgas and Kiunga-Kokonda roads); Developing power infrastructure (PNGSDP upgraded Balimo capacity to enable industry development) Development of higher education facilities in Tabubil; Daru infrastructure improvements - expansion of the Daru International Port facilities at Tawo’o Point (PNGSDP commenced phase one construction in 2012) and supporting infrastructure like the Oriomo Industrial Centre (PNGSDP awarded contract to Curtain Bros for upgrade of the existing Daru wharf); Daru airport upgrade (completed), Daru water/sewerage upgrades; Development of economic hubs to stimulate industry development at Balimo, Daru, Kiunga, Lake Murray, Moorehead. (Refer Appendices –Western Province Economic Activities Map).

PNGSDP has also identified a range of community development infrastructure initiatives such as education where it allocated around K5million in 2012 to be spent on constructing schools in the province through its’ Church Agency Heath and Education Program; Another implementation project the PNGSDP has initiated is a partnership with NGO’s like ATprojects to deliver training to communities in toilet construction and installations; PNGSDP allocated K0.5million in 2012 for water treatment and sanitation projects for schools and communities; PNGSDP administers K10.3million in health projects in partnership with Church agencies like Evangelical Church PNG and the Catholic Health Agency for construction of accommodation and clinic facilities throughout the province. 17

Western Province projects portfolio

Provincial strategic projects

Daru infrastructure developments

Economic hubs -‐Balimo, Daru, Kiunga, Lake Murray, Moorehead

Daru airport upgrade (completed)

Infrastructure road corridor -‐ transects the province north-‐south

Daru International port -‐Oriomo Industrial Centre

Community infrastructure -‐ roads, bridges, schools

Daru water/sewerage upgrades

(Adapted from: Western Province Business and Investment Guide- 2012)

2.3 Industry Description and Outlook

PNG LNG The PNG LNG project is a JV alliance between ExxonMobile (US), Oil Search (AUS), Santos (AUS), Nippon Oil (JAP), PNG State and PNG Landowners and involves a capital investment of K36 billion over the construction phase and a further K23 billion over the 30year life of the PNG facility.

PNG LNG Project BISMARCK SEA HIDES

JUHA JUHA PRODUCTION FACILITY 250 mmcf/d

60 km x 14” gas line 60 km x 8” liquids line

ANGORE HIDES GAS CONDITIONING PLANT 960 mmcf/d

MORAN

100 km x 8” condensate line

PA P UA N E W G U I N E A

AGOGO KUTUBU GOBE MAIN

292 km x 32” gas pipeline onshore

Existing 270 km x 20” crude oil export line

KUMUL TERMINAL

407 km x 34” subsea gas pipeline

Oil field Gas field Oil & gas field Oil pipeline LNG gas pipeline

GULF OF PAPUA

100km

LNG FACILITY 6.6 mmpta PORT MORESBY

(Source: Oil Search Annual Report- 2011)

PNG LNG PROJECT SCOPE DESCRIPTION

The PNG LNG Project is a 6.6 million tonne per annum integrated LNG project operated by Esso Highlands PNG LNG project has a four-year construction phasea subsidiary (2010-2013) withMobil a further 30-year Limited, of Exxon Corporation. Gas will be produced from the Hides, Angore andboth Juha gas fields production phase (2014-2044) and has forecasted spending K1.26 billion over and from the associated gas in the Kutubu, Agogo, Moran and Gobe Main oil fields. These contributing fields are located in the Southern Highlands and Western provinces 19 of PNG. Over nine tcf of gas and 200 million barrels of associated liquids are expected to be produced over the 30 year Project life. Sale and Purchase Agreements have

phases with PNG local landowner companies (Rep Lancos) and other PNG suppliers. The upstream gas field facilities and drilling wells project components have a forecasted expenditure with Rep Lancos and other PNG suppliers totalling K700 million. ExxonMobile in its’ 2011 Financial & Operating Review declared that the project had already spent K600 million in total with Rep Lancos and other PNG suppliers and the workforce at the end of 2011 numbered 14,000 with 60% PNG content. The construction phase has only one year (2013) remaining before first gas scheduled for 2014 and therefore presents declining business opportunities. EPC activities are declining along with the labour and procurement demands for the project. HGDC the primary umbrella company representing all Rep Lancos involved in the upstream phase of the PNG LNG project including Juha Landowner companies in Western province, are currently in demobilisation status as many of the EPC’s scale down their project procurement activities reflecting completion of most of this phase of the project construction activities. The outlook for the remaining upstream phase will be around completion of the Hides Gas Conditioning Plant and ongoing drilling program for associated well heads as reported by Oil Search in its’ Quarterly Report to September 2012. Oli Search also reports on ongoing completion of other infrastructure including Gobe and Kutubu Gas Fields Facilities for 2012. Clough in its’ Annual Report 2012 confirms this stating their works have now consolidated around the Hides Facility on the Upstream Infrastructure component with around 1,300 labour force remaining (87% PNG content) and forecast a completion around early 2013. Their CBI Clough JV is also focused on the Hides Gas Facility completion works with labour force around 1,400.

Western Province The main economic driver of growth in this province the OK Tedi Mining Lease (OTML) is scheduled to be decommissioned around 2015 and this therefore will impact considerably on the local economy. There is however undertakings by OTML to extend the mine life to

around 2024 through expansion of the mining resource area in conjunction with seeking additional leases elsewhere in PNG. In order to transition away from reliance on the royalties provided by the OTML, Western Province is in the early economic development phase with large-scale infrastructure assets being created and some already completed like the telecommunications towers and Daru airport Upgrade. The capabilities of the provincial administration to undertake such scale of transformation projects is largely due to the funding provided through the OTML Development Fund which provided around K500milliion in 2011. The main project delivery agency in Western Province is the Papua New Guinea Sustainable Development Program (PNGSDP), which administers a Development Fund that allows it to allocate funding to both nationwide and local infrastructure developments. Since 2002 PNGSDP reported spending a total of K 318 million across itâ&#x20AC;&#x2122;s project portfolio throughout PNG and K166million in Transition and Community Development projects in Western Province. PNGSDP also has committed to spend around 2.5% of OTML dividend or K21.5million annually on development projects for those communities affected by the mine.

Both the PNG LNG and Western Province market opportunities represent highly costcompetitive environments with owner agencies operating under capital budget constraints and subsequently seeking to secure cost-effective returns for their shareholders. In the case of PNG LNG procurement opportunities there is a regulated PNG national content requirement, which supports business development opportunities for landowner companies and other PNG businesses. This provides the PNG business community with an advantage in securing preferential access to project procurement opportunities. The PNG government has been instrumental in establishing this requirement for both nationalisation of the project workforce as well as ensuring a high participation rate across the broad spectrum of project procurement contracts including reserving some key procurement services exclusively for PNG businesses. This includes the restriction of catering, camp management and maintenance, security and vehicle hire and maintenance contract opportunities. Further to this the nationalisation content also requires the projectsâ&#x20AC;&#x2122; 21

longer term human resources needs are comprised of PNG people who are trained and developed to then be able to occupy much of the ongoing production phase for the thirty year life of the project. Whist the Western Province project development opportunities are less regulated in the lack of a declared national content requirement, the principle project development and delivery agency Papua New Guinea Sustainable Development Program (PNGSDP) is representative of the landowners of the province. PGHSDP is a funded agency through the mining royalty arrangements paid to it from the OK Tedi Mining Lease (OTML) and therefore ensures that the flow-on benefits to the province and the nation extends to national participation in procurement opportunities and in training and development benefits. Being a project developer the PNGSDP agency is also highly cost-competitive in seeking to secure the most cost-effective project solutions for the nation and the province from itsâ&#x20AC;&#x2122; Development Fund.

EPC Contact Details C 1 – Clough-Curtain Brothers JV Upstream Infrastructures

APPENDICES

Michael Gibson Procurement & Area Manager Port Moresby E-Mail: michael.gibson@ccjvpng.com Jim Wilkins

Resource Manager 2.2 Market Analysis Human PNG LNG Opportunities

E-Mail: jim.wilkins@ccjvpng.com

PNG LNG EPC Contacts

EPC Contact Details EPC 1-TransTel Engineering PNG Limited C 1 –Warkia Clough-Curtain Brothers JV Allan Upstream Infrastructures Procurement Manager PNG P.O Box 981, Waigani MichaelCapital Gibson National District, PNG Procurement & Area Tel: 323 0667/ 325 3080 Manager Port Moresby E-Mail: Fax: 325 michael.gibson@ccjvpng.com 0386 E-mail: allan.warkia@cse-transtelpg.com Jim Wilkins Location: Old Forestry building opposite Vulupindi Haus in front Public Service Commission Human Resource Manager E-Mail: jim.wilkins@ccjvpng.com

EPC 2 – Saipem Offshore Pipeline David York Construction/Installation Manager Saipem Singapore Pte. Ltd. 73 Science Park Drive #01-03/22 Cintech I Bldg Singapore Science Park I Singapore 118254 E-Mail: David.york@saipem.com.sg

EPC 3Limited – Chiyoda-JGC JV nsTel Engineering PNG

EPCPipeline 4 – CBI Clough JV EPC 2 – Saipem Offshore Hides Gas Plant a David York Mr. T. Hoshino nt Manager PNG Hubert Construction/Installation Peter Manager External Affairs Director 81, Waigani Procurement Director Saipem Singapore Pte. Ltd. Chiyoda-JGC Joint Venture Motukea apital District, PNG E-Mail: phubert@cbi.com 73 Science Park Drive Island, Porebada Road PO Box 3019, 67/ 325 3080 #01-03/22 Cintech I Bldg Boroko, NCD Port Moresby, PNG 386 Singapore Science Park Bill I Ogilvie Tel: 305-0000 n.warkia@cse-transtelpg.com Fax: 321-0018 Singapore 118254 Community Affairs Directors Old Forestry building opposite Vulupindi E-Mail : john.aylward@cjjvlng.com E-Mail: David.york@saipem.com.sg E-Mail: wjogilivie@cbicloughjv.com nt Public Service Commission LNG Plant

Mr. S. Kumagai National Content Manager Chiyoda-JGC Joint Venture Motukea iyoda-JGC JV EPC 4 – CBI Clough JV Island, Porebada Road PO Box 3019, Hides Gas Plant Boroko, NCD Port Moresby PNG Tel: 305-0000 ino Peter Hubert Fax: 321-0018 airs Director E-Mail : susumu.kumagai@cjjvlng.com Procurement Director C Joint Venture Motukea

E-Mail: phubert@cbi.com bada Road PO Box 3019, D Port Moresby, PNG EPC 5 A – Spiecapag Onshore Pipeline EPC 5 B – McConnell Dowell-CCC Group JV 00 Bill Ogilvie 18 Community Affairs Directors Mr Axel d Aboville Komo Airfield n.aylward@cjjvlng.com E-Mail: wjogilivie@cbicloughjv.com Procurement Manager agai Rod Ireland SPIECAPAG NIUGINI LIMITED ntent Manager Procurement Manager PO Box 444 – KONEDOBU – NCD C Joint Venture Motukea 171 George Street Level 6 – Credit House bada Road PO Box 3019, Brisbane QLD 4000 D Port Moresby PNG Cuthbertson Street Port Moresby – NCD – PNG 00 E-Mail: rod.ireland@macdow.com.au E-mail : EPC5A-PNG-PROCUREMENT@spiecapag.com. 18 umu.kumagai@cjjvlng.com 23

Spiecapag Onshore Pipeline

boville

EPC 5 B – McConnell Dowell-CCC Group JV Komo Airfield

Upstream Infrastructures Michael Gibson Procurement & Area Manager Port Moresby E-Mail: michael.gibson@ccjvpng.com

APPENDICES

Jim Wilkins Human Resource Manager E-Mail: jim.wilkins@ccjvpng.com

EPC Contact Details EPC Contact Details EPC 1-TransTel Engineering PNG Limited Clough-Curtain Brothers JV Clough-Curtain Brothers JV stream Infrastructures Allan Warkia stream Infrastructures

Procurement Manager PNG ael Gibson ael Gibson P.O Box Waigani rement & Area Manager Port981, Moresby National District, PNG urement & Area Manager PortCapital Moresby l: michael.gibson@ccjvpng.com Tel: 323 0667/ 325 3080 l: michael.gibson@ccjvpng.com Fax: 325 0386 Wilkins E-mail: allan.warkia@cse-transtelpg.com Wilkins an Resource Manager Location: Old Forestry building opposite Vulupindi an Resource Manager l: jim.wilkins@ccjvpng.com Haus in front Public Service Commission l: jim.wilkins@ccjvpng.com

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EPC 2 – Saipem Offshore Pipeline EPC Saipem Offshore Pipeline EPC 32––Chiyoda-JGC JV LNG Plant David York David York Construction/Installation Manager Construction/Installation Manager Mr. T. Hoshino Saipem Singapore Pte. Ltd. Saipem Singapore Pte. Ltd. External Affairs Director 73 Science Park Drive 73 Science Park Chiyoda-JGC JointDrive Venture Motukea #01-03/22 Cintech I Bldg Island, Porebada Road PO Box 3019, #01-03/22 Cintech I Bldg Singapore Science Park I PNG Boroko, NCD Port Moresby, Singapore Science Park I Singapore 118254 Tel: 305-0000 Singapore 118254 E-Mail: David.york@saipem.com.sg Fax: 321-0018 E-Mail: David.york@saipem.com.sg E-Mail : john.aylward@cjjvlng.com

EPC 4 – CBI Clough JV Hides Gas Plant Peter Hubert Procurement Director E-Mail: phubert@cbi.com Bill Ogilvie Community Affairs Directors E-Mail: wjogilivie@cbicloughjv.com

Mr. S. Kumagai National ManagerJV EPC 4 –Content CBI Clough EPC 4 – CBIJoint Clough JV Chiyoda-JGC Hides Gas PlantVenture Motukea Hides Gas Plant Island, Porebada Road PO Box 3019, Boroko, NCD Port Moresby PNG

Peter Hubert Tel: 305-0000 Peter Hubert Procurement Director Fax: 321-0018 Director Procurement E-Mail: phubert@cbi.com E-Mail : susumu.kumagai@cjjvlng.com E-Mail: phubert@cbi.com Bill Ogilvie EPCOgilvie 5 A – Spiecapag Onshore Pipeline Bill Community Affairs Directors Community Affairs Directors E-Mail: wjogilivie@cbicloughjv.com Mr Axel dwjogilivie@cbicloughjv.com Aboville E-Mail: Procurement Manager SPIECAPAG NIUGINI LIMITED PO Box 444 – KONEDOBU – NCD Level 6 – Credit House Cuthbertson Street Port Moresby – NCD – PNG E-mail : EPC5A-PNG-PROCUREMENT@spiecapag.com.

EPC 5 B – McConnell Dowell-CCC Group JV Komo Airfield Rod Ireland Procurement Manager 171 George Street Brisbane QLD 4000 E-Mail: rod.ireland@macdow.com.au

EPC 5 5B B– – McConnell McConnell Dowell-CCC Dowell-CCC Group Group JV JV EPC Komo Airfield Airfield Komo Rod Ireland Ireland Rod Procurement Manager Procurement Manager 171 George George Street Street 171 Brisbane Brisbane

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E-Mail : john.aylward@cjjvlng.com

E-Mail: wjogilivie@cbicloughjv.com

Mr. S. Kumagai National Content Manager EPC 4 – CBIJoint Clough JVMotukea Chiyoda-JGC Venture Hides Porebada Gas Plant Island, Road PO Box 3019, Boroko, NCD Port Moresby PNG Peter Hubert Tel: 305-0000 Fax: 321-0018 Director Procurement E-Mail E-Mail:: susumu.kumagai@cjjvlng.com phubert@cbi.com

APPENDICES

Bill Ogilvie EPC 5 A – Spiecapag Onshore Pipeline Community Affairs Directors Mr Axel dwjogilivie@cbicloughjv.com Aboville E-Mail: Procurement Manager SPIECAPAG NIUGINI LIMITED PO Box 444 – KONEDOBU – NCD Level 6 – Credit House Cuthbertson Street Port Moresby – NCD – PNG E-mail : EPC5A-PNG-PROCUREMENT@spiecapag.com.

EPC 5 B – McConnell Dowell-CCC Group JV Komo Airfield Rod Ireland Procurement Manager 171 George Street Brisbane QLD 4000 E-Mail: rod.ireland@macdow.com.au

APPENDICES M APS - W ES TER N PR O VI N C E

M A PS

Other Western Province opportunities â&#x20AC;&#x201C; Economic Activities Map

(Source: PNGSDP-Annual Report 2011) 126

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P N GS DP M A N A GE M E N T C H ART M an a g e m e n t O rg anisatio n al Struct ure

Advisory Council

Chief Executive Officer

Corporate Governance Manager - Corporate Governance Fund Managers N ewton Investment Management Limited Schroderâ&#x20AC;&#x2122;s Private Bank

Chief Operating Officer Office of the CO O Economist Legal Counsel

Deutsche Bank HSBC, Global Asset Management Philip Capital Management(s) Ltd

Chief Program Officer

Sustainable Forestry Program Manager Program O fficer

Community Infrastructure Program Manager Engineering Project Manager, Project Manager (Com ms. Towers)

Sustainable Agriculture Development Program Manager Program O fficer

Community Sustainable Investment Program Program Manager Senior Program O fficer (HIV & Development), Senior Program O fficers (CSIP), Program O fficers (CSIP), Program Assistant

114

Chief Financial Officer

Head of Corporate Services

Head of Mine Impact

Auditing Auditors

Travel and Accommodation Travel & Accom m. Coordinator, Travel & Accom m. O fficer

Mine Impact Project Leader, Mine Impact C M CA Coordinator, Com munity Relations O fficer, Program O fficer

Finance Financial Controller Financial & Projects Accountant, Assistant Accountant Accounts O fficers Data O fficer Errands & Filing Clerk Investments Investment Analyst

Human Resources HR O fficer Information Technology IT Team Leader Program mer/Analyst IT Support O fficers Administration Admin Coordinator Receptionist Drivers O ffice Attendant

Tabubil Project Leader, Tabubil Senior Program O fficer, Social Impacts Projects Manager, Infrastructure

Head of Transformational Projects

Director, SMIT Registrar Facilities Manager

Daru Port Project Leader Contract Manager Master Planning Lands O fficer

Regional Office Regional Manager C M CA Coordinator Com munity Relations O fficer, Admin Assistant Driver/Logistics

Cross-Border Development Program Manger

Infrastructure Corridor Program Leader Project Manager (Roads), Project Manager (Oil & Gas)

Public Relations Public Relations Manager

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