1. SAPIA Supply Chain Risk Matrix 12 November 2013

2. Mandate from DOE The Heads of Supply (HOS) forum provides a means for the petroleum industry to ensure optimal use of the existing infrastructure and address any other threats to security of petroleum supply or supply disruptions. The HOS forum consists of various stakeholders in the petroleum industry. Terms of Reference for the Heads of Supply Forum : Department of Energy page 1

3. Mandate from Board of Governors “…the SAPIA Board of Governors (BoG) are seeking a solution to improve the monitoring of fuel Supply Chains, and the coordination of normal activities to ensure sustainable supply and to assist in the event of Supply Chain disruptions.”

4. Current Reality – Oil Industry in South Africa Tanzania Zambia Namibia Botswana Zimbabwe Mocambique Malawi South Africa Kenya Indian Ocean Islands Cape Town Durban Maputo Beira Nacala Walvis Bay Dar-es-Salaam Mombasa Road/Rail Export by Ship 1990’s and early 2000 Nett exporter 4 bn ltrs p.a. 1990’s and early 2000 Nett exporter 4 bn ltrs p.a. Import by Ship Tanzania Zambia Namibia Botswana Zimbabwe Malawi South Africa Kenya Durban Walvis Bay Cape Town Current Nett importer >2 to 4 bn ltrs p.a. RSA + BLSN = 25.5 bn ltrs p.a. Current Nett importer >2 to 4 bn ltrs p.a. RSA + BLSN = 25.5 bn ltrs p.a. Mocambique

5. Durban East London Port Elizabeth Mosselbay Richards Bay Cape Town Inland 60% Current Reality – Oil Industry in South Africa Rest of Country 40%

6. RSA has become a net importer of refined fuel Inland Demand has increased from 6.7bn in 1970 to > 16.0 bn in 2013 Multi Product Pipeline commissioned Limited tankage on either end is a constraining factor No increase in existing refining capacity Places common infrastructure under pressure Current Reality : Summary

7. Identify Key and Common Supply Chain Infrastructure Identify, prioritise and mitigate the key supply chain risks facing the Oil Industry in South Africa over the next 5 years Develop a sustainable methodology to identify, mitigate and manage these risks Develop a strategy for sustainable key and common supply infrastructure efficiency, to ensure continuity of supply Objectives of the Heads of Supply workshop

8. Process Map infrastructure in the Supply Chain Ground Fuels Aviation Map infrastructure in the Supply Chain Ground Fuels Aviation Develop Mitigating Actions Identify Common and Key Infrastructure Develop a Risk Matrix And Prioritise each risk Develop a Risk Matrix And Prioritise each risk Identify risks for each Identify Probability and Impact of each risk Evaluate Residual Risk Finalise Mitigation Plans Develop Recommendations for a Security of Supply Plan: Threats to Security of Supply Risk Mitigation Plan Process to monitor Security of Supply – Product / Infrastructure Plan for Sustainable Solutions Develop Recommendations for a Security of Supply Plan: Threats to Security of Supply Risk Mitigation Plan Process to monitor Security of Supply – Product / Infrastructure Plan for Sustainable Solutions

9. Process Map infrastructure in the Supply Chain Ground Fuels Aviation Map infrastructure in the Supply Chain Ground Fuels Aviation Develop Mitigating Actions Identify Common and Key Infrastructure Develop a Risk Matrix And Prioritise each risk Develop a Risk Matrix And Prioritise each risk Identify risks for each Identify Probability and Impact of each risk Evaluate Residual Risk Finalise Mitigation Plans Develop Recommendations for a Security of Supply Plan: Threats to Security of Supply Risk Mitigation Plan Process to monitor Security of Supply – Product / Infrastructure Plan for Sustainable Solutions Develop Recommendations for a Security of Supply Plan: Threats to Security of Supply Risk Mitigation Plan Process to monitor Security of Supply – Product / Infrastructure Plan for Sustainable Solutions HOS at this stage

10. Map the Supply Chain – An example Crude VLC SBM Refinery Coastal IV Tankage Crude Oil Pipeline NMPP IV Tankage Natcor line Natref Refinery Berth 4,5,6,9 TPL Inland Network Separate Flows TPL Inland Network RTC Gantry DJP RTC Gantry RTL Gantry Coastal Ship RTL Gantry

11. Identify Key and Common Infrastructure Crude VLC SBM Refinery Coastal IV Tankage Crude Pipeline MPP IV Tankage Natcor line Natref Refinery Berth 4,5,6,9 TPL Lines Separate Flows RTC Gantry RTL Gantry DJP RTC Gantry RTL Gantry Coastal Ship TPL Inland Network Common Infrastructure Key Infrastructure

12. Durban SBM Finished Product Berth Issues Congestion Pumps Tankage DJP and MPP Jet Unplanned Refinery and Supply Chain Infrastructure Shut Downs Maintenance Coordination Refinery Turn arounds Berths Pipelines ORTIA and associated Supply Chain infrastructure Examples of Areas of focus

13. Developed a Risk Matrix for each common Infrastructure element Common Infrastructure elementRisk ScenariosImpact Probabilit yRisk LevelMitigation OptionsActionStakeholders By Whom By WhenImpleme ntation Date Estimated CAPEX Estimated OPEX IV Crude SBMShip collides and sinks SBMA310 - Have a Spare SBM available that can be rotated with the operational one for maintenance and reburbishment SBM housekeeper to justify suitable option Oil Companies,Refinery owners,SBM Housekeeper,Ship Owner SaprefDec-13 R120m R100 pa - Identify barges that can be used for Ship to Ship discharges and offloaded in Berth 9 Oil Companies,Refinery owners,TPA,Ship Owners SBM Catches FireB49 - Have a Spare SBM available that can be rotated with the operational one for maintenance and reburbishment SBM housekeeper to justify suitable option Oil Companies,Refinery owners,SBM Housekeeper SaprefDec-13 R120mR100 pa SBM Anchor Snagged by Ship and Anchor dislodged G66Identify Contractor for rapid deployment SBM Housekeeper to tender and apoint suitable contractor Oil Companies,Refinery owners,SBM Housekeeper SaprefDec-13Feb-13R0R1m pa SBM Anchor Compromised in Storm H59 Instal a second anchor pile and anchor chain SBM Housekeeper to install Oil Companies,Refinery owners,SBM Housekeeper Sapref Sep-13R3mR50k pa IV Oil BerthsBerth underminedF46 Strengthen the wharf emabnkments at Berths 4, 5,6 TPATPA, Oil Companies, TPA Dec-14R80mR0 EXAMPLE ONLY Infrastructure Associated Risk Risk Level Mitigation

14. Risk level: Probability and Impact Probability 12345678 Impact Severity Level Unlikely to occur Has never occurred Similar event has occurred in the World Similar Event has occurred in the region Similar Event has occurred in South Africa Likely to occur within the life time of the infrastructure Likely to occure more than once in the life time Common occurance of the infrasctructure A89101112131415 B7891011121314 C678910111213 D56789101112 E4567891011 F345678910 G23456789 H12345678 Total Financial LossEconomic ImpactPublic Reaction A >R100 bnInternational International Outrage B R50 - 100 bnRegional International media coverage C R10bn - R50bnNationalNational Outrage D R1bn - R10bnInter Provincial Extended National Media coverage E R500m - R1bnProvincial National Media Outrage F R100m - R500m Severe disruption to local population and industry Extended Local media coverage G R10m - R100m Disruption to local population and industry Local Media Coverage H <R10m Minor disruption to local population and industry Local Complaints

15. Developing Short, Medium and Long Term Activities that will sustain Security of Supply through : Operational Recommendations to the Board of Governors Strategic Recommendations to the Board of Governors Present Outcomes to the Board of Governors Next Steps

16. Supply Chain Risk Matrix Thank You !