1. Chamber Colloquium 13 February 2014

2. AGENDA The upstream context explained
Renewable Energy v/s conventional?
Cleaner Fuels
The Shale Gas Factor
Some SAOGA Lessons
Closer to industry
The power of pilot projects

3. “Upstream” is the front end of the Oil & Gas value chain
Why we exist?
“Upstream” is the front end of the Oil & Gas value chain
60-90% of Net Margin in the Value Chain
Low Margin – where SA currently plays
GAS
OIL
Source: Petrostrategies

4. Upstream Play Fabrication & Construction
(Subsea modules, jackets, topsides modules, steels & pipe, tugs/barges)
Maritime Repairs & Maintenance
(Rig/ship repairs, class surveys, rope access services, certification, inspection & testing)
E&P Service Companies
(Local/regional bases of global players)
General Engineering Services
(Mechanical, electrical & controls, civil & structural, geotechnical, environmental, chemical & process, marine, general & specialised project management)
Equipment & Materials Supplies
(Pumps, valves, pipes, motors, hoses, instrumentation, chemicals, hydraulic & pneumatics, process equipment)
Logistics
(Freight forwarding and clearing, warehousing & storage, helicopters, crew changes, chandelling, bunkering, stevedoring)
Other Services
(ROV repair, training, financial, legal, commercial, IT, medical services, SHEQ services, recruitment, salvage, diving services, hospitality)

5. Sector Overview – SA Major Projects
Activity Year 14 15 16 17 18 19 20 21 22 23
SA Offshore
SA Onshore
Africa Onshore & Offshore
Refineries
Terminals
Mozambique – Palma Bay, LNG
Planning | Local Participation | Infrastructure | Skills
Ebrahim Takolia, CEO © 2014 South African Oil & Gas Alliance

6. Renewable Energy v/s conventional?
Why we exist?
AGENDA
The upstream context
Renewable Energy v/s conventional?
Cleaner Fuels
The Shale Gas Factor
Some SAOGA Lessons
Closer to industry
The power of pilot projects

7. Renewables vs the conventional?
Feeding an energy hungry nation/s!!!!
Reality - SA is a net importer of energy
40 GW additionally needed by 2030
Solar Technologies *
Geothermal energy *
Bio Fuel *
Oil
Gas (Eg Ibhubesi and shale)*
and…….
*Up to 50 % more efficient and -50% reduction in carbon emissions

8. “Upstream” is the front end of the Oil & Gas value chain
Why we exist?
“Upstream” is the front end of the Oil & Gas value chain
60-90% of Net Margin in the Value Chain
Low Margin – where SA currently plays
GAS
OIL
Source: Petrostrategies

9. The Magnitude of the Clean Fuels project
LOCATION
APPROX BUDGET RAND MILLIONS
APPROX COMBINED PROFESSIONAL SERVICES BUDGET
APPROX COMBINED PROFESSIONAL SERVICES - RSA MANHOURS
APPROX COMBINED PROFESSIONAL SERVICES - AVERAGE RSA STAFF
SAPREF CLEAN FUELS
DURBAN R R
447
NATREF CLEAN FUELS
SASOLBURG R R
415
ENGEN CLEAN FUELS R R
518
CHEVRON CLEAN FUELS
CAPETOWN
SASOL CLEAN FUELS
SECUNDA R R
437
PETROSA CLEAN FUELS
MOSSEL BAY R R 52
SUNRISE LPG TERMINAL
SALDANHA R R
85 750 49

10. Demand for Skills - Clean Fuels
PROJECT
LOCATION
APPROX BUDGET RAND MILLIONS
APPROX COMBINED CONST SERVICES BUDGET
APPROX COMBINED CONST SERVICES - RSA MANHOURS
APPROX COMBINED CONST SERVICES - AVERAGE ARTISANS (e.g WELDERS)
APPROX COMBINED CONST SERVICES - AVERAGE SEMI SKILLED
APPROX COMBINED CONST SERVICES - AVERAGE UN SKILLED STAFF
SAPREF CLEAN FUELS
DURBAN R R
293
220
951
NATREF CLEAN FUELS
SASOLBURG R R
271
203
882
ENGEN CLEAN FUELS R R
339
254
1 102
CHEVRON CLEAN FUELS
CAPETOWN
SASOL CLEAN FUELS
SECUNDA R R
286
214
928
PETROSA CLEAN FUELS
MOSSEL BAY R R 34 25
110
SUNRISE LPG TERMINAL
SALDANHA R R 44 33
144
OTGC FUELS TERMINAL
COEGA R R
127 95
413
VOPAK FUELS/CHEM TERMINAL
RICHARDS BAY
PETROSA LNG IMPORT TERMINAL R R
136
102
441 R R
1 928
1 446
6 266

11. “Upstream” is the front end of the Oil & Gas value chain
Why we exist?
“Upstream” is the front end of the Oil & Gas value chain
60-90% of Net Margin in the Value Chain
Low Margin – where SA currently plays
GAS
OIL
Source: Petrostrategies

12. The Shale Gas Factor Imperative 20tcf 50tcf
Potential Annual Economic Impact (ZAR bn)
80 bn Rands
200bn Rands
Potential Contribution to GDP
3.3 %
9.6 %
Estimated contribution to GDP
35 bn Rands
90 bn Rands
Potential permanent employment

13. Renewable Energy v/s conventional?
AGENDA
The upstream context
Renewable Energy v/s conventional?
Cleaner Fuels
The Shale Gas Factor
Some SAOGA Lessons
Closer to industry
The power of pilot projects

14. SAOGA ‘Closer to Industry’ Lessons
The quality of logbooks is critical
CBMT Learning Materials
A competency approach is critical
Screening of entrants
Bridging the gaps
Life Skills
Certification should reflect competence

15. The Power of Pilot Projects
Chieta Karroo/West Coast projects
Getting to know the lay of the land
Netherlands funded Skills project
Integrating Renewables, Ship and Rig repair and Manufacturing
DEDAT Artisan Development Project
Are the scarce skills really scarce?
Training the Trainer gaps
The SAOGA Oil and Gas Academy
A coherent approach to skills development

16. Connect with us Adrian Strydom
Studio 604 | 6th Floor | 4 Loop Street | Cape Town 8001 T   | C