SPC quarterly report

Jan – Mar 2012

Breaking frontiers

03 Recognising Our Best 04 The Road to SAP Implementation

08 Spreading Joy Every Chinese New Year

10 The Merlimau Building Complex – A New Standard in Safety and Design

ROAR Jan • Mar 2012 page 03

We are only several months into 2012, and I am glad to note that the Company has recorded a number of significant milestones.

The Exploration & Production team, for example, has overcome various challenges to commence gas production in the Wortel development. SPC Mahakam Hilir Pte. Ltd. also achieved good progress for the drilling campaign in Naga Utara-1.

We started work on systems integration between PetroChina and SPC more than a year ago. Since then, we have made great strides forward, such as the implementation of the SPC SAP system. Much time and effort was put into this SAP project. I would like to take this opportunity to thank all involved for their contributions.

In this issue of Roar, we also take a look at SRC’s new administration building. The Merlimau Building Complex epitomises SRC’s overwhelming regard for safety and personnel protection. As an environmentally friendly building, it was also awarded the BCA Gold Award for its green technologies and practices.

Thirty-four colleagues received the 2011 Outstanding Employee Recognition Award. Congratulations to all recipients! I would like to encourage all colleagues to continue to excel with the Company.

Year 2012 is expected to be a challenging year with uncertainty in economic outlook. Let us all work together and continue to progress and strive as one company to achieve greater excellence and performance.

Adam XiongExecutive Vice President, PCSGExecutive Director and Executive Vice President, SPC

I am really grateful to be recognised as an outstanding individual and appreciate the good teamwork with all colleagues and support from my superiors over the past year. The recognition has given me even more motivation and made my work more enjoyable and challenging.

Andarina, Marketing Group

I am honoured to be recognised as an outstanding individual. Thanks to the Management and all my colleagues, especially my team members and my superiors – without your support and good teamwork, I will not be here to enjoy this proud moment.

Jiamin, Finance & Accounting Group

Recognising Our BestBy Jolyn Chong, Human Resource Group

This year a total of 32 employees from various business and service units were awarded the 2011 PetroChina International Company Limited (PCIC) Outstanding Employee Recognition Award. The Certificates of Honour were presented to the recipients at the Chinese New Year Lunch on 30 January 2012 at Imperial Herbal Restaurant.

In addition, Mr Chua Yeow Seng and Mr Lim Swee Yong were also awarded the 2011 China National Petroleum Corporation (CNPC) Employee Recognition Award for Outstanding Employee and HSE Excellence respectively.

01. Recipients of the PCIC Outstanding Employee Recognition Awards. 02. Mr Lim Swee Yong receiving the CNPC Employee Recognition Award for HSE Excellence from Mr Adam Xiong, Executive Vice President, SPC. 03. Mr Chua Yeow Seng receiving the CNPC Employee Recognition Award for Outstanding Employee from Dr Shi Boqing, Head, Exploration & Production, SPC.

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Editorial

ROAR Jan • Mar 2012 page 05ROAR Jan • Mar 2012 page 04

First Gas from WortelBy Eugene Chiam, Exploration & Production Group

SPC is proud to announce that gas production from the Wortel development project in Indonesia has commenced!

The Wortel Field, located in the Sampang Production Sharing Contract (PSC) off East Java, was discovered in 2006.

Two exploration and appraisal wells, Wortel 1 and Wortel 2, were drilled within the PSC area. The development project phase continued in 2011 following the sanction in November 2010.

The development includes two gas wells (Wortel 3 and Wortel 4), an unmanned wellhead platform and a 10-km gas pipeline to the existing Santos-operated Oyong facilities. Gross gas production from the combined Oyong and Wortel fields is expected to be around 82 mmscfd, of which Wortel will contribute 44 mmscfd. Gas will be exported via an existing pipeline to the Grati processing plant, where it will be sold for domestic power generation.

SPC’s Exploration & Production team (E&P), together with its joint-venture partners Santos and Cue Energy, has proven its ability and dedication with this impressive achievement of first gas. Challenges that the team had to overcome in this project also provided a priceless experience. SPC E&P believes that with persistence, it will be able to scale to new heights!

The Road to SAP ImplementationBy Gerald Tan, Finance & Accounting Group, and Trena Chan, Executive Vice President Office

SPC’s SAP system went live on 1 April 2012!

The journey to SAP implementation began in June 2010 with the full support of the Company’s Management Team and at the initiation of PetroChina International headquarters (PCI HQ).

SAP is renowned for its advanced system architecture and integrative features with other modules. However, its implementation posed many challenges. For instance, all SPC external subsystems that interfaced with the Enterprise Resource Planning system had to be upgraded. In addition, integrating the SAP systems of both SPC and PCI HQ on a single client platform was also unfamiliar to the SPC SAP team. Various system interfaces also required specific customisation, which had to be managed as separate background projects with additional resources, time and effort.

Despite the challenges, the SAP system was implemented in record time and within the nine-month schedule! The implementation also provided excellent learning opportunities for the SPC SAP team.

The SPC SAP team is thankful to the Company’s Management Team, SAP Steering Committee members, users, consultants and the HQ team for their support during the SAP system development and implementation – and not forgetting those who helped in one way or another.

01. The Finance and IT teams made a trip to Beijing to better understand PCI HQ’s global SAP system. 02. SAP system users went through rounds of end-user training and unit testing before the implementation.

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JUN 2010 The journey begins!

JUN to AUG/SEP 2010 Three months of intensive meetings between the teams from PCI HQ, SPC and SAP to scope out system requirements and SPC’s business process needs.

NOV 2010The Finance and IT teams and SAP consultants made a study trip to PCI HQ in Beijing to gain deeper understanding of PCI’s global SAP system.

FEB 2011The SAP implementation project is officially launched. The project charter and structure are set and SAP implementation project team members are elected.

MAR 2011SAP system overview and introduction training is conducted over a week for more than 50 key system users.

MAY 2011 PCI HQ’s SAP delegation, which consists of senior Finance and IT representatives, visits SPC to study and approve SPC’s SAP system design proposal.

MAY 2011 to JAN 2012The project progresses systematically, covering areas such as business process evaluation; blueprint drafting; system design; end-user training; integration testing and more.

MAR 2012SPC successfully migrates to SAP system and completes the SAP/JDE system parallel run.

1 APR 2012SPC’s SAP system goes live.

Our SAP Implementation Journey


200 Trembesi Trees Planting ProgrammeBy Nikko Widityawan, SPC Mahakam Hilir Pte. Ltd.

SPC Mahakam Hilir Pte. Ltd. (SPC-MH) firmly believes that it should always maintain and protect the environment in the communities where it operates.

As part of its “Go Green” efforts, SPC-MH conducted the 200 Trembesi Trees Planting Programme at the Naga Utara-1 (NU-1) drilling site. The programme was aimed at strengthening the soil structure and preventing soil erosion in the slope area of the NU-1 drilling well. It was also in line with Indonesia’s National Planting Month, which is commemorated annually in December.

Carried out by both the SPC-MH Team and the community, the programme also gave the locals and us an additional opportunity to interact and socialise.

Site Inspection at SamarindaBy Dr Shi Boqing, Exploration & Production Group

In March 2012, Mr Xia Hongwei, Chairman and President of SPC, and Mr Koh Ban Heng, Senior Advisor of SPC, made a field trip to the Makaham Hilir PSC Block at Samarinda. SPC Mahakam Hilir Pte. Ltd. (SPC-MH) is currently drilling two onshore commitment wells at the site. Besides Mr Xia and Mr Koh, Ms Eliza Wu, Chairman of Sinaco, CPTDC Singapore Branch, which is the provider of the drilling bit, casing and tubings, also joined the field inspection.

The group first visited the Naga Utara-1 drilling and testing operations. They also checked the Health, Safety and Environment (HSE) policy to ensure that safety rules were adhered to. They inspected the testing equipment, spoke with various team members and contractors, observed the conditions and facilities of the drilling platform, and checked the mud equipment and working procedures. The group also visited the access road of the well pad of Naga Saletan-1. They also met SPC-MH colleagues who had worked hard to ensure that operation logistics, local procurement, site HSE and technical management were moving along as planned.

On 13 March 2012, the Open Hole Testing of Naga Utara-1 was conducted at the second well opening. Mr Xia and Mr Koh witnessed the gas flaring. Mr Xia then congratulated the team on the smooth field operations. He also noted that the relations with the local communities are well handled and the current testing results show positive results for oil and gas discovery. Mr Koh added that it was the first time that SPC’s Senior Management were visiting the onshore drilling field and they had observed the difficulties and challenges faced in onshore drilling operations. He further added that the positive results of Naga Utara-1 proved that SPC’s investment decision is correct. Mr Xia and Mr Koh expressed their appreciation and encouraged the SPC-MH team and field staff to carefully drill Naga Saletan-1 in accordance with SPC and BPMIGAS’s HSE requirements.

The SPC-MH team and contractors were very excited to meet Mr Xia and Mr Koh onsite. The attention shown by SPC’s Senior Management and CNPC Headquarters has encouraged them to work even harder.

01. During the site visit, Mr Xia and Mr Koh inspected testing equipment, spoke with various team members and contractors, and observed the conditions and facilities of the drilling platform.02. Mr Xia and Mr Koh with the SPC-MH team.

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Naga Utara-1 – The First Discovery Well in Makaham Hilir PSCBy Dr Shi Boqing, Exploration & Production Group

Naga Utara (Northern Dragon) is the first exploration well in the Makaham Hilir PSC Block. Naga Utara-1 was spudded on 5 January 2012. On 7 February 2012, during the fourth spud of the 8 1/2” hole, high-pressure gas was encountered at the depth of 4,887 feet.

SPC-MH continued the drilling campaign with a side track well and it penetrated another set of high-pressure oil and gas below the depth of 4,895 feet, which was proven by Open Hole Testing. Naga Utara-1 reached a final total depth of 5,066.18 feet on 8 March 2012.

After 80 days of operations, Naga Utara-1 successfully found a new exploration concept in East Kalimantan, Indonesia. Some critical geological samples were obtained, generating confidence for the next appraisal programme and development stage.

The team faced many challenges but with strong teamwork and support from the Management, the SPC-MH team has achieved its drilling target with no HSE incidents and also forged harmonious relations with the local community.


Spreading Joy Every Chinese New YearBy Sharon Tan, Corporate Communications

Year after year, our volunteers have put smiles on the faces of the elderly during Chinese New Year. SPC was happy to participate in a Chinese New Year lunch for the elderly for the seventh year. Organised by the Singapore Women’s Association, this year’s lunch was attended by 200 residents from Indus Moral Care, Kreta Ayer Senior Activity Centres, Tai Pei Old Peoples’ Home and Sarah’s Senior Activity Centre, as well as samsui women and other elderly from Redhill Estate.

Some 60 volunteers packed the goodie bags and helped the elderly to the coaches and the restaurant. It was heartening to see many new faces among the volunteers.

This year’s Guest-of-Honour was Dr Lily Neo, Member of Parliament for Tanjong Pagar GRC. Known to many of the elderly participants, Dr Neo had no problem

01. Ms Foo Jang See, SVP, Refining, Crude Supply Trading, SPC receiving the appreciation plaque from Dr Lily Neo. 02. The volunteers who made this lunch memorable for the elderly.

03. The volunteers helped the elderly from the coaches to the restaurant, and packed the goodie bags. 04. Dr Lily Neo, with the Company’s Management Team and “God of Fortune” distributed red packets to the elderly during the lunch. 05. The elderly had smiles on their faces watching the different performances on stage. Some even stood up and danced.

interacting with them and even danced with one participant. Dr Neo, together with SPC’s Management Team and other donors, distributed red packets to the elderly. Those above 90 years old received an additional longevity red packet.

Various volunteers took to the stage with performances of songs that many elderly remembered fondly. Many were seen singing and moving to the music.

When the lunch came to an end, we bade farewell to the elderly. We look forward to seeing them again next year.

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The Merlimau Building Complex – A New Standard in Safety and DesignBy Sharon Tan, Corporate Communications

From its beginnings in 1979, Singapore Refining Company (SRC), which is jointly owned by SPC and Chevron, has always held workplace safety and worker protection as a prime focus.

The former administration office, its workshops and other supporting offices were located inside the refinery, close to the processing units. This posed certain safety and security risks. The two shareholders thus decided to jointly fund the construction of a new complex at a cost of nearly S$100 million.

On 30 March 2012, SRC held the inauguration ceremony of the new administration building, the Merlimau Building Complex, to much anticipation.

The Merlimau Building Complex was completed safely without any incident and within budget and schedule. All SRC and contractor offices and facilities are now housed in the same location, thus giving productivity and teamwork a major boost. In addition, the location of these facilities outside the operating area of the refinery further helps to improve security and reduce operational risks.

The Merlimau Building Complex epitomises SRC’s overwhelming regard for safety and personnel protection. It is indeed a manifestation

01. (Left to right) Mr Ryan Krogmeier, Vice President, Joint Venture and Affiliates of Chevron; Mr James Er, General Manager and Chief Executive Officer of SRC; and Mr Xia Hongwei, Chairman of SRC and Chairman and President of SPC, at the ribbon-cutting ceremony. 02. Mr Xia Hongwei and Mr Ryan Krogmeier unveiling the plaque.

Pictures courtesy of SRC

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of SRC’s commitment to an Injury- and Incident-Free Culture (IIF). To protect against major emergencies such as explosions, fires and toxic gas hazards, advanced safety features and best-in-class protective shelters are incorporated in the Complex. For instance, the walls, doors and windows of all the buildings are able to withstand a blast over-pressure of 3 psi. The buildings come with state-of-the-art fire protection and suppression systems. Specific rooms are also able to serve as In Place Protection to shield people in the event of toxic gas release.

The Complex is also a “green” building awarded with the BCA Gold Award Green Mark. Offering green technologies and practices as well as energy-saving features, it demonstraties SRC’s commitment to energy conservation and the environment.

Other features include advanced firefighting facilities, workshops, a warehouse and contractor facilities. Adding to the comfort of the work environment are staff and contractor canteens as well as a gym, which is aligned with SRC’s focus on work-life balance, camaraderie and teamwork.

“This course was useful as it equipped me with the basic skills to help others. Most importantly, I can apply what I learnt to help my loved ones in times of emergency. It is necessary for all our frontline staff to understand the importance of safety and enjoy this learning process.”

May, SPC Ang Mo Kio 1

Ready for EmergenciesBy Low Fang Ling, Marketing Group

On 21 March 2012, a group of Retail Marketing and frontline staff attended the first Emergency Preparedness Programme at the Queensway Fire Station. A collaboration between Singapore Civil Defence Force (SCDF) and SPC, the programme is aimed at equipping frontline staff with firefighting and first-aid skills.

The programme covered three modules, namely Basic First Aid, One-Man CPR* and AED**, and Fire Safety and Casualty Evacuation. Besides classroom instruction, the participants also had

hands-on practice in firefighting, using a fire extinguisher, treating injuries and performing CPR. The course not only enhanced their capabilities, it also equipped them with critical skills for handling emergency situations.

The course was well received by the participants as they had fun picking up new knowledge and enjoyed the practical training. The hands-on experience also gave them a chance to try out equipment that most had never used before.

As the retail business has a dynamic nature and operates 24 hours, it is important to increase the emergency preparedness of our staff. Retail Operations will thus be conducting this programme on a regular basis to benefit frontline staff.

* Cardiopulmonary resuscitation** Automated external defibrillator


Asymmetrical Design

WHAT: Designed to deliver both comfort and wet-weather performance. Half of the tyre tread surface is designed for wet-weather performance and the other half is for comfort.

CONS: Usually priced with a small premium.

Symmetrical Design/Wave/Non-Directional Design

WHAT: Designed with grooves arranged in a wave-like manner. Usually also comes with smaller lateral grooves cutting the tyre design to further break up road noise.

PROS: Usually quieter as the priority is not wet-weather performance. There are again exceptions, when wider grooves are built in for slightly better wet-weather performance.

Directional Design

WHAT: Designed with grooves in a directional manner

PROS: Directional grooves disperse water outwards and away from the direction of travel for better road-holding in wet weather. Wider grooves for better water dispersion.

CONS: Wider grooves trap and compress air and release it continuously, thus creating tyre noise.

FOR WHOM: Consumers who can tolerate some level of tyre noise but have preference for wet-weather performance over riding comfort. However, some directional tyres are designed more for comfort than wet-weather performance. You will need to see how wide the grooves are.

Your Tyres – How Old is Too Old?

What is the shelf life of a tyre?Did you know that tyres are marked with their dates of manufacture on their sidewalls (See picture 01). It is coded as the week and year of manufacture; for example, “0109” means that the tyre was manufactured in Week 01 of Year 2009.

Most manufacturers give their tyres a shelf life of 4 to 5 years. This means that a tyre is considered “fresh” enough to be fitted onto a vehicle within 4 to 5 years from the date of manufacture.

What is limited warranty?Tyres that have been fitted are given a “limited tyre warranty”. In many instances, the warranty is up to a remaining tread depth of 1.6mm, though in some countries this may be more than 1.6mm.

The warranty is limited because once a tyre is fitted, its damage may be unrelated to its manufacturer.

Manufacturers will not be liable should any of the following occur:

• Tyresaredamagedbyroadhazards,fire,accidents,corrosion,orother acts of God

• Tyresareofnormalwearandtear

• Tyresaremisused,forexampleviakerbing,runningoverforeignobjects and potholes

• Tyresaredamagedfromimproperfitting,improperinflationpressure, faulty rims, negligence, alteration or repairs

• Tyresareusedinmotorracingorinexceptionalconditions

• Tyrenoisefromunevenwear

How old is too old?Most motorists cover an average of 25,000km a year, and tyres are usually worn out at about 50,000km. Therefore, a tyre that is up to 3 years old is considered safe to be installed – assuming the manufacturer gives a 5-year warranty.

Should the dates of manufacture be the same for all changed tyres?It may be unnecessary for tyres to have the same manufacture date. Common tyres are manufactured almost 365 days a year. This means that tyres may come from the same manufacturing line at the same factory but are warehoused and delivered to consumers a few months apart.

All things said, while the manufacture date of a tyre may be important, nothing beats regular inspection, proper tyre inflation pressure and safe driving!

Choose Tyres That Work for You

Before your purchase, it is important to first understand your driving style and the preferred characteristics to be delivered by your tyres. Two key factors are relevant to most motorists: water and noise. Water affects your breaking distance, especially important in Singapore’s wet weather. The noise level is important because it can be quite unbearable if your tyres keep humming and drumming throughout your ride.

Unfortunately, quiet tyres rarely perform excellently in wet weather, and a wet-weather tyre is rarely quiet. Understanding tyre design will therefore help you decide what is best for you.

Happy motoring!

Know Your TyresBy Tyrepac Pte Ltd

Are your tyres suitable for your vehicle? Did you know that different tyre designs offer different characteristics? In fact, many areas should be considered before you buy the right tyres for your vehicle. We discuss two areas here: the age and the design of tyres.

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Broadly speaking, there are three types of tyre design: directional design; symmetrical (wave) design; and asymmetrical design.


Chinese New Year Lunch

Getting to Know the Rec-ComBy Marvin Chu, Marketing Group

Ever wondered who organised Movie Night, JP Morgan Run, Disney on Ice, Dinner & Dance and other company-wide events? The Recreation Committee (or Rec-Com in short)! The Rec-Com is made up of members who come from different departments and different backgrounds and have stepped forward to dedicate their time to the team. The 2012 Rec-Com members are:

• ValerieHo(Exploration&ProductionGroup)• SereneTing(HumanResource)• EstherWeiShu(Finance&AccountingGroup)• LimWoiWoi(Finance&AccountingGroup)• SharonTan(ManagingDirectorOffice)• LowFangLing(MarketingGroup)• MarvinChu(MarketingGroup)• ShawnHo(MarketingGroup)• MaoKai(ProductsTradingGroup)

As Chairman of the 2012 Rec-Com, I would like to say a big “thank you” to the previous committee members. The 2012 Committee will strive to continue their legacy and good work. We aim to encourage employee engagement, team bonding and forge a stronger sense of belonging through the various activities.

We welcome colleagues to give us feedback on the events and activities. Let us know if we have done well and how else we can improve. You will hear more from the Rec-Com this year and we certainly hope to see more of you as well.

Bowling for a Good CauseBy Sharon Tan, Corporate Communications

SPC has participated in the Down Syndrome Association (DSA) Charity Bowl since 2006. This year was no different. This initiative is aimed at bringing balance and fun into the lives of kids and adults with special needs through bowling.

In March 2012, the Company sent two teams to DSA Charity Bowl 2012. Each team consisted of three colleagues and one DSA member. Our colleagues were joined by Chen Wan Yi and Jalauluddin from DSA.

The DSA bowling programme trains its members every Saturday at the Singapore Recreation Club. Its two bowling coaches, Mr Daniel Chang and Mr Tan Kim Joo, continue to hone the bowling skills of DSA members.

Many organisations participated in this year’s DSA Charity Bowl. DSA noted: “We are heartened to find organisations and individuals that continue to make a difference through their acts of philanthropy. We are grateful for SPC’s contribution to and support of our cause, and for its trust that we can help persons with Down Syndrome realise their dreams of living independently.”

PetroChina International (S) Pte. Ltd.Singapore Petroleum Company Limited

One Temasek Avenue #27-00, Millenia Tower, Singapore 039192 Tel: 6276 6006 • Fax: 6275 6006

www.spc.com.sg

MICA (P) 038/09/2011 Co. Reg No: 196900291N

CONTRIBUTORS IN THIS ISSUE:Trena Chan, Executive Vice President OfficeEugene Chiam, Exploration and Production Group

Dr Shi Boqing, Exploration & Production GroupGerald Tan, Finance and Accounting GroupJolyn Chong, Human Resource Group

Low Fang Ling, Marketing GroupMarvin Chu, Marketing GroupSharon Tan, Corporate Communications

Nikko Widityawan, SPC Mahakam Hilir Pte. Ltd.Tyrepac Pte Ltd

EDITORIAL: Corporate Communications

Chinese New Year Lunch

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