2010 ANNUAL REVIEW - The Bahrain Petroleum Company (Bapco) · Commander of the Kingdom of Bahrain ... 8 Annual Review 2010 Generating national wealth Bapco rose to the challenges

We care...

2010ANNUAL REVIEW

His Royal Highness Prince Salman bin Hamad Al-Khalifa

Crown Prince and Deputy Supreme

Commander of the Kingdom of Bahrain

His Royal HighnessPrince Khalifa bin Salman Al-Khalifa

Prime Minister of the Kingdom of Bahrain

His Majesty King Hamad bin Isa Al-Khalifa

King of the Kingdom of Bahrain

Annual Review 20102

His Royal Highness

Prince Khalifa bin Salman Al-Khalifa

The Prime Minister

Your Highness,

I am deeply honoured to present to you,

and to share with the people of Bahrain,

this record of the achievements of The

Bahrain Petroleum Company B.S.C.

(Closed) for the year 2010.

The year presented many new challenges

for the Company, not least as continued

volatility in international oil markets

and product demand patterns led to an

unpredictable operating environment.

However, thanks to the solid foundations

and prudent strategies put in place,

guided by the directives of the

Kingdom’s wise leadership over many

years, Bapco continues to pass all

tests with flying colours, demonstrating

robust financial performance and

productivity improvement in 2010 and

laying down several new markers for

the future.

One such marker is an intensified focus

on environment, health and safety (EHS)

issues across the organisation, and this

is reflected in the theme of this year’s

Annual Review: We Care.

Chairman’s Foreword

Several EHS-related initiatives and

campaigns spearheaded throughout the

year aim to inspire excellence in this

vital area. One of the most ambitious

and which typified this approach was

‘12 x 12’, a safety campaign in which

Bapco employees and contractors aim

to achieve 12 million man-hours worked

without lost-time injury before the end of

2012.

From an environmental perspective, the

official inauguration of the Refinery Gas

Desulphurisation Project (RGDP) in mid-

2010 turned the spotlight on a strategic

project which is already dramatically

cutting sulphur dioxide emissions

from the Refinery. Bapco’s status as a

champion of green issues will be further

elevated following the approval of a

waste water treatment project, which

will ensure only the cleanest water is

discharged to the sea.

Bapco’s role as a heartbeat of the

community was reinforced in several

ways. H.R.H. Princess Sabeeka Park

in Awali was inaugurated, offering

a pleasant natural environment for

the local community to enjoy. The

Company made a telling contribution

yet again to the prestigious InJaz

mentoring programme, and served the

community through generous donations

and sponsorships to businesses and

individuals, as well as scholarship

programmes for the Kingdom’s brightest

academic prospects.

Bapco’s many achievements and

contributions would be impossible

without careful forward planning,

and 2010 saw the Company lay future

foundations. Following a comprehensive

strategic review, a new developmental

framework was drafted which identifies

corporate priorities, investment

opportunities and projects over the

coming years, all of which will sharpen

Bapco’s competitive edge.

Bapco continued to contribute toward

securing sufficient energy resources for

the Kingdom as the company provided

valuable technical support to The Oil and

Gas Holding Company (nogaholding) in

studies for a potential liquefied natural

gas (LNG) receiving terminal to be built

Annual Review 2010 3

in the Kingdom. Progress was also

made in 2010 on the Refinery Master

Plan, the main elements of which will

see processing capacity expanded to

350,000 barrels per day and the product

slate adjusted to meet the very latest

international specifications, particularly

for environmentally-friendly products.

As Bapco embarks on its journey into

the future, I am immensely proud of the

contribution its employees continue to

make at all levels. Our greatest asset,

they wholeheartedly embrace new

concepts, projects and initiatives, in

many cases taking personal ownership

of issues of greatest importance to

them. This strong sense of teamwork,

cooperation and loyalty – core values

for which the ‘Bapco family’ is known -

bodes well for the future.

With this in mind, Bapco remains fully

committed to supporting the professional

and personal aspirations and welfare

of all employees. I am pleased that, in

recognition of employee efforts, Bapco

was able to agree a performance-linked

bonus scheme with the Trade Union,

Dr. Abdul-Hussain bin Ali Mirza

Minister of Oil and Gas Affairs

Chairman of the Board of Directors

The Bahrain Petroleum Company B.S.C. (Closed)

a morale boosting gesture, which

we expect to further encourage our

employees to reach for the stars.

No stone will be left unturned in Bapco’s

quest for continuous improvement

across all business areas. I have every

faith that it has the requisite vision,

expertise and resources to achieve this.

On behalf of the Bapco Board of

Directors, management and employees,

I offer my wholehearted gratitude to

His Majesty the King, to Your Royal

Highness the Prime Minister, and to His

Royal Highness the Crown Prince for the

support given to all of us in Bapco as we

seek to serve the Government of Bahrain.

Annual Review 20104

2010 Highlights

265,200 barrels per day of crude, the

highest in five years;

Gas Desulphurisation Plant (RGDP)

was officially inaugurated. This ‘clean

air’ investment significantly reduces

Refinery sulphur dioxide air emissions

and ammonia from the effluent;

the Company achieved a satisfactory

barrel;

products were sold to 36 countries

worldwide;

ultra-low sulphur gas oil (ULSD) was

exported to Singapore in May. This was

followed by two cargoes of similar size

shipped to Egypt and Singapore;

benefited from internal and external

training courses throughout the year;

more than 20,000 employees and their

families, raising awareness of key

environment, health and safety issues;

was initiated which will outline a future

roadmap for the organisation and

its business, including the Refinery

Master Plan;

Awali, a valuable community resource

for the people of Bahrain;

the objective of which is for Bapco

employees and contractors to reach

12 million lost-time injury-free man-

hours before the end of 2012;

Consultant on the Kingdom’s first

liquefied natural gas (LNG) terminal

project;

Trade Union on a performance-linked

bonus scheme amounting to two

months’ basic salary for 2010;

the prestigious inaugural Bahrain

International Air Show;

organizations and societies with

respect to sponsorships, supports

and donations as part of its continued

Social Commitment culture.

5Annual Review 2010

Annual Review 20106

Reviewing corporate priorities

The year marked a 360-degree change

in Bapco’s annual strategic planning

process. In September a project was

launched to develop a robust long-term

strategy and set a clear direction for the

entire organisation.

This involved a complete review and

update of global and regional market

trends; Company strengths, weaknesses,

opportunities, threats and areas of

competitive or operational opportunity

on its strategy, resources, process and

organisation; political, economic, social

and technological factors that could

impact the business.

A series of workshops to discuss

possible projects, future targets and

business objectives were held and a 15-

year strategy roadmap developed, with a

Five strategic priorities for 2010 continue

to define the framework and strategic

drives for Bapco in the coming years:

increased profitability; improved cost

efficiency and cost competitiveness;

image excellence; integrated OEMS

implementation; skilled, motivated and

productive resources attraction and

retention.

The strategy was then translated

into action plans giving staff full

accountability and buy-in for achievement

of their goals. The Company wants its

strategic plan to be a living document

that provides direction to frontline staff

and to align its corporate priorities from

top to bottom.

Meanwhile, progress was made on

the Bapco Refinery Master Plan, the

objective of which is to develop an

optimum plant configuration to make it

one of the most competitive, profitable

refineries in the Asia Pacific/Middle East.

This includes improving the product

slate by upgrading residue to improve

the gross margin, to stay competitive

under a wide range of feed and product

prices and market situations. The

Refinery also aims to meet all applicable

environmental regulations and improve

energy efficiency. The feasibility study

was concluded and results presented to

Bapco’s Board of Directors in November

and the next steps of the project were

approved.

Meanwhile, a structured screening

study to identify potential international

companies for acquisition and

investment was developed in the year.

The business development group

worked closely with a Consultant to

identify suitable target companies

which will allow Bapco to diversify into

new business opportunities, increase

international exposure and increase

career opportunities for Bahrainis in

both local and international markets.

An evaluation process was developed

and three of the most interesting

companies were initially selected

for detailed study. These business

opportunities will be presented to

the Board in 2011, and the Top 100

opportunities evaluated throughout

the year.

7Annual Review 2010

Annual Review 20108

Generating national wealth

Bapco rose to the challenges of a

turbulent global oil market in 2010,

registering higher revenues while

maintaining refining expenses within-

budget, which made a significant

contribution to Bahrain’s national

economy.

petroleum products were sold to 36

countries. GCC countries (at 44%)

accounted for biggest share of sales,

followed by Japan & East Asia (at 19%),

Africa ( at 14%), Europe and Indian

others (at 5%) and other Arab countries

(at 4%).

Sustained year-on-year sales were

achieved primarily due to safe and

reliable Refinery operations despite

some planned shutdown activities at the

Refinery and an increase in domestic

consumption.

the export barrel. This was followed by

fuel oil sold mainly to the Middle East

bunker market, and naphtha sold mostly

to Asian petrochemical manufacturers.

equivalent of sulphur was exported, with

main consumer.

The first cargo of 62,000 tonnes of ultra-

low sulphur gas oil (ULSD) produced on

the Low Sulphur Diesel project (LSDP)

was exported to Singapore in May. This

was followed by two cargoes of similar

size shipped to Egypt and Singapore.

prices have recovered appreciably,

creating a healthy outlook for the

upstream side of the business. The

average sales price realised for Abu

of Bahrain holds an equity share of

150,000 barrels per day (bpd) in output

from the joint Saudi Arabia - Bahrain

Abu Safah offshore field.

However, in comparison the gain in

refinery margins was modest. While

margins stayed depressed in the early

part of 2010 they improved during the

latter part of the year resulting in a

barrel, an improvement over 2009. This

barrel of throughput. Refining cost was

9Annual Review 2010

Annual Review 201010

Fast-tracking pivotal projects

Bapco is committed to fast-tracking

projects of strategic value to the

business, which help streamline

operations and improve performance,

and which benefit the people and

communities of Bahrain. 2010 was no

different in this respect, as progress was

spearheaded on several pivotal schemes.

LNG TerminalNine international contractors submitted

proposals for the build and operate

contract for the Kingdom’s first liquefied

natural gas (LNG) receiving terminal.

Proposals for the project, located near

Khalifa bin Salman Port in Hidd, will be

evaluated in the second quarter of 2011,

with a view to operations commencing in

the fourth quarter of 2014.

Bapco was nominated Technical

Consultant to nogaholding for the

project, in which it will collaborate with

technical staff from the National Oil &

Gas Authority (Noga) and nogaholding.

The LNG receiving terminal is of great

importance to Bahrain, since it can help

meet a significant percentage of the

rising gas demand from the Kingdom’s

power, water desalination and industrial

sectors, while building the country’s

strategic gas reserves to cover future

supply disruptions.

Lube Base Oil Plant (LBOP)As of the year-end, the LBOP and

associated export facilities was 96 per

cent complete and on schedule for

commissioning in the second quarter

of 2011. The engineering, procurement

and construction (EPC) contract is being

carried out by Samsung Engineering

Company Limited (SECL) of South Korea.

During the year, and to prepare for LBOP

commissioning and start-up Bapco

fine-tuned operating, start-up/shutdown

and emergency shutdown procedures,

which were drafted into LBOP operating

manuals. Bapco will operate and

maintain the plant,

Once commissioned the LBOP, a joint

venture between Bapco, nogaholding

and Finland’s Neste Oil, will produce

Very High Viscosity Index (VHVI), Group III

Lubricant Base Oils, demand for which is

growing in Europe and North America.

Al Dur Gas Pipeline and IWPPTwo 20-inch gas pipelines were

commissioned during the year to

transport natural gas from the onshore

gasfield to the new Al Dur Distribution

point (DDP).

From the DDP, Bapco also completed

a dual 20-inch gas pipeline through

per day (mmscfd) of gas was delivered

(as per contractual obligations) to serve

the pre-commissioning activities of the

Al Dur Water and Power Station, an

Independent Water and Power Plant with

a power generation capacity of 4,000

MW built to meet rising demand in the

Kingdom.

Wastewater Treatment Plant

procurement and construction (EPC)

contract was signed during the year

with South Korea’s GS Engineering &

Construction Corporation for the Waste

Water Treatment Plant project, located at

the Refinery in Sitra.

A key component of Bapco’s Strategic

Investment Programme at the Refinery,

the project will provide secondary

(biological) treatment facilities to meet

prescribed discharge limits at the

treatment plant outlet. The project will

better enable the Company to meet and

exceed its environmental performance

objectives and achieve full compliance to

liquid effluent environmental regulations

set by the Kingdom’s General Directorate

of Environment & Wildlife Protection, the

body which stipulates limits to airborne

emissions and water discharges.

The Project Management Team

mobilised to the contractor’s offices in

11Annual Review 2010

South Korea in October, and as of year-

end the project was on schedule.

A/B Pipeline A proposed route for a new 30-inch

crude oil pipeline to supply up to 350,000

bpd of Arabian Light crude from Saudi

Aramco’s Abqaiq Plant to Bapco Refinery

was approved. Saudi Aramco was

subsequently advised to proceed with

the front end engineering design (FEED)

for the project, which will replace the

existing A-B pipeline.

CO2 Recovery Plant A contract to build a carbon dioxide

(CO2) liquefaction and recovery plant at

the Refinery was awarded to Bahrain’s

Yateem Oxygen. Tie-in works for the

project, which will utilise the CO2-rich

stream from the Refinery, commenced

during the year and both parties expect

an early completion date of the second

quarter of 2012.


Fuelling future economic growth

Bapco achieved an average oil production

barrels per day (bpd) in 2010, marginally

lower than 2009 level of 32,192 bpd.

Gas production, meanwhile, averaged

(mmscfd) in 2010, up 30 mmscfd from

the 2009 average, showing an increase

of 2.5%.

Bapco continued to lend maximum

support to all efforts to increase the

Kingdom’s oil and gas reserves and

output capacity, which is integral to

future economic vitality. In this regard,

the Company imparted technical

expertise to local and international

partners, including the Tatweer

Petroleum onshore joint venture and

other offshore exploration joint ventures

in their quest for hydrocarbon reserves

on land and offshore.

Onshore Technical support was extended to

NOGA for the effective implementation

of the Bahrain Field Phased

Development Project (BFPDP), as well

as to nogaholding in reference to their

participating interest in the development

and production sharing agreement

(DPSA).

The BFPDP seeks to triple onshore oil

and raise natural gas production to more

than 2,500 mmscfd, while increasing

proven remaining oil and gas reserves in

the Bahrain Field.

OffshoreFurther progress was made by Bapco

and its international partners in their

quest to find viable oil and gas prospects

in four offshore blocks.

Bapco and Oxy identified several

hydrocarbon prospects in Block 1

following seismic data reprocessing,

geochemical survey, basin modeling and

seismic sequence studies. An exploratory

well will be drilled in 2011.

Teams from Bapco and the Petroleum

Authority of Thailand Exploration and

Production (PTTEP) jointly identified

a hydrocarbon prospect in the south

Jarim area of Block 2, following detailed

analysis of geological and geophysical

data, including more than 600line

kilometers of 2D seismic data acquired

by PTTEP. In 2010, PTTEP was granted a

six-month extension to complete the first

exploration phase, and planned to drill

its well commitment in 2012.

In Block 3, Oxy carried out seismic

data reprocessing,geochemical survey,

basin modeling and seismic sequence

stratigraphy studies to identify the

potential hydrocarbon areas. The US

Company OXY drilled its first exploratory

well in 2010 which encountered non-

commercial quantities of gas in the

Jurassic Hanifa Formation. Oxy also

acquired 212 square km of 3D seismic

data in the Block. OXY plans to drill their

commitment well in this Block in 2011.



Setting performance records

In keeping with recent years, the Bapco

Refinery achieved some remarkable

operational and performance milestones

and records during 2010.

An average 265,200 barrels per day (bpd)

of crude was processed in the year, the

highest run in five years and exceeding

by 3,200 bpd the budget. Of this total, an

Bahrain Field, with the balance supplied

as Arabian Light crude through the A-B

pipeline from Saudi Aramco.

High throughput rates were achieved as

the absence of major turnaround and

inspections (T&I) translated into a high

surpassing 94.9% availability in 2009.

This was despite small intermittent

supply interruptions from Saudi Aramco

during the year. A-B pipeline flows were

also enhanced by a drag reducing agent.

Several new records were set at the

Refinery, generating substantial savings.

These included:

Bapco’s established policy of maximising

heavy oil throughputs to the fluid catalytic

cracking unit (FCCU) paid dividends by

heavy oil was processed, eclipsing the

previous record of 6,500 bpd achieved

5,142 bpd achieved in 2009.

The Refinery further stepped up the

routing of offgas to Bahrain National

Gas Company (Banagas), with all CGRU

and some NRC offgas routed in this way

during the year, injecting an estimated

about four billion standard cubic feet

of offgas was sent to Banagas, leading

propane, butane and naphtha, worth an

Maintaining Refinery operational integrity

and safety is vital to optimal plant

performance. Planning and preparations

were made during the year for the so-

called ‘Hub 1 Shutdown’ in February

2011, which will involve the simultaneous

shutdown of a CDU, 6VDU and the LSDP

Complex (including the hydrocracker

1HCU) for scheduled T&I work.

Meanwhile, the Refinery Reliability Clock,

which measures the number of days the

Refinery remained online without any core

unit shutdown for more than 24 hours,

achieved a record of 160 days before being

reset, far exceeding the 90-day target.



Engaging with the community

As a national economic figurehead

and leading employer, Bapco has a

unique responsibility to care for the

communities in which it operates.

Nowhere was this entrenched

commitment to community engagement

better illustrated than in several

outreach initiatives, social projects,

educational schemes and business

events the Company spearheaded in the

year to improve the lives of citizens.

In 2010 Bapco contributed a total of

organizations and societies with

respect to sponsorships, supports and

donations as part of its continued Social

Commitment culture. This included a

Crown Prince’s International Scholarship

Programme (CPISP), the fourth

instalment of Bapco’s overall BD500,000

commitment as CPISP Gold Sponsor,

through which the Company provides

internship and training opportunities to

CPISP students.

Bapco also continued its practical

support for students enrolled on

InJaz Bahrain, a national activity-

based programme which equips

young Bahrainis with personal and

professional life skills. This included

assigning employee volunteers to give

presentations in the school classroom

as well as hosting students at several

local trade exhibitions and conferences

in which Bapco participates.

Bapco’s long-standing sponsorship

of the British Chevening Scholarship

Scheme for 2010-2011 was renewed,

giving the opportunity to another group

of talented Bahraini graduates to attend

postgraduate courses in the UK.

Meanwhile, a total of 404 Bahraini

university and college students benefitted

from on-the-job industrial training at

Bapco in 2010, up from 306 in 2009.

2010 also saw the launch of a new

scheme under which Bapco awards

bursaries to cover the higher education

fees of approximately 400 children

of Company employees at local

and international Universities and

institutions. In December, the Bapco

Scholars Enhanced Learning (BASEL)

pilot programme was launched, in which

25 of the selected students would receive

training to bridge the gap between

academic programmes and required

workplace skills.

Bapco’s philanthropy extended to the

Kingdom’s sporting and business

community, the Company sponsoring

the inaugural Bahrain International

Air Show and renewing sponsorship

agreements with the Bahrain

International Circuit (BIC), the

promising Bahraini motor racing

driver Hamad Al Fardan and a military

sailing championship held in the Kingdom.

Bapco also provided top-level support to

a diverse spectrum of trade and careers

fairs held in Bahrain through the year.



Developing tomorrow’s leaders

Several schemes and initiatives in 2010

underline the Company’s unwavering

commitment to maximising the potential

of its most valuable asset - its people.

One of the most important new

projects was the Masaar Learning

Management System, an IT-based

tool which streamlines the manager/

employee engagement process during

the employee learning and development

process, ultimately improving the way

managers can oversee all aspects of the

process. The system can also store and

distribute e-learning tools and maintain

and manage a competency framework.

The year also marked the continuation

of the highly-acclaimed Institute of

Leadership and Management (ILM)

certification programmes for senior

Bapco employees, in line with the

priority to groom the next generation

of managers. Four separate groups

completed ILM Level 3 Certificate for

Management Development, while by

year-end 22 individuals were working

towards ILM Level 2 Certificate for Team

Leadership.

Long-term senior executives

development received a further shot-

in-the-arm as Bapco forged closer ties

with prestigious universities in the USA

and UK, including the London Business

School, Darden School of Business and

The Wharton School.

To support and nurture the Kingdom’s

most outstanding academic talent, Bapco

awarded - against strict selection criteria

- scholarships to 16 young Bahrainis who

have subsequently embarked on courses

in Bahrain and overseas, including for

the first time at the University of Texas

at Austin in the USA. This takes to 65 the

number of individuals currently in higher

education under the Bapco Scholarship

Programme.

A total of 2,256 Bapco employees

benefitted from internal and external

courses throughout the year. Notably, staff

selected to operate the upcoming Lube

Base Oil Plant project received classroom

tuition and simulator training in Bahrain,

as well as on assignment in Finland and

the USA with the joint venture partners.

By year-end, several Bapco procurement

personnel had, meanwhile, completed

all Chartered Institute of Purchasing &

Supply (CIPS) Level Four modules, while

a total of 111 security officers completed

an in-house programme to develop basic

English, Mathematics and Computers

skills.

In keeping with Bapco’s goal of

encouraging employees to take greater

interest in and ownership of various

facets of the business, an employee

suggestion scheme received more than

900 submissions, representing potential



Championing key EHS causes

Bapco yet again in 2010 stepped up to

the plate to preserve the welfare of its

employees, the local community and

Bahrain’s natural environment. In this

regard, several important environment,

health and safety (EHS) initiatives,

campaigns and projects were prioritised

during the year to further embed the

EHS culture in Bapco’s corporate psyche.

Environment

Inauguration of Princess Sabeeka ParkHer Royal Highness Princess Sabeeka

bint Ibrahim Al Khalifa, wife of His

Majesty King Hamad bin Isa Al Khalifa,

chairwoman of the Supreme Council

for Women and Honorary President of

the Supreme Organising Committee of

Bahrain International Gardens Show,

patronised the opening of Bapco’s

‘Princess Sabeeka Park’ in Awali on 21

February, a valuable community resource.

SOx emissions reduced

Desulphurisation Project (RGDP), one

of the most important and complex

environmental compliance projects ever

undertaken by Bapco and a key component

of its strategic investment programme,

was officially inaugurated in May. The

RGDP, which removes sulphur from

refinery gases and contaminants from

water produced in refining processes, has

already greatly reduced sulphur dioxide

emissions from the refinery stacks.

Bapco Green School AwardMuharraq Secondary Girls School won

the 2009/2010 academic year Bapco

Green School Award. The Award,

run in association with the Ministry

of Education, seeks to encourage

secondary school students to participate

in eco-related projects including water

and energy conservation and recycling.

The winning project was for the design

of a dust insulator for windows to reduce

dust pollution.

Health and Safety

Bapco’s unique approach to employee

and community welfare and its policy

of continuous improvement in its safety

programmes and systems bore fruit

again in 2010 as new health and safety-

related campaigns were launched. These

included:

12 x 12 campaignThis major safety campaign, the

objective of which is for Bapco to reach

12 million lost-time injury-free man-

hours (employees and contractors)

without lost-time injury before the end

of 2012, was launched. The campaign,

at the heart of which is a ‘4 Keys to

Safety’ concept, comprises events and

activities in the community to ensure all

employees and contractors understand

their role in creating and sustaining a

safe working environment.

EHS WeekThis annual event was again held in

November and serves as an important

tool to promote health and safety and

raise awareness of EHS issues among

Bapco employees, their families and the

wider community. Activities included

health lectures and walks, culminating

Bahrain International Circuit, which was

attended by more than 20,000 people.

Lighten Up ProgrammeA prime focus during the year for Bapco’s

Health Promotion Committee was to

tackle obesity. The ‘Lighten Up’ weight-

loss competition was launched in May to

encourage overweight employees to lose

weight over a six-month period. A total of

Other key EHS-related achievements at

Bapco during the year included:

Veritas (DNV) to Occupational Health

and Safety Assessment Series (OHSAS

in November;

the compliance processes for the

integrated EHSQ (Environment,

Health, Safety and Quality) audits was

successfully completed and the second

phase is underway;

in Dubai in the Public Corporation

Category;

was launched which recognises

groups that have made an outstanding

improvement to safety in the

workplace;

achieved three million employee hours

without any lost time injury;

audits were undertaken without any

non-conformances;

reduction in SOX emissions, 416 tonnes

of lead sulphide waste material was

tonnes of hazardous waste recycled;

groundwater study was conducted

at the Refinery, Sitra Tank Farm and

all disposal areas, and a detailed

quantitative risk assessment in terms

of possible impact on human health

was completed.



Harnessing technological advances

Technology and innovation continued to be the driving force behind Bapco’s broad achievements in 2010, helping streamline performance, improve economies of scale and drive down costs, and deliver excellent results across the business.

The Company’s national leadership position was reinforced through an innovative, collaborative project comprising Tamkeen and nine of the Kingdom’s biggest organizations (Alba, Asry, Banagas, Bahrain Airport Services, Batelco, Garmco, GPIC and Gulf Air) to develop e-Business solutions aligned to support the Bahrain Government’s 2030 Economic Vision.

This project, initiated and lead by BAPCO, will establish a Collaborative Forum to promote common procurement standards and best practices and build shared solutions for participants, using ‘cloud’ technology. The objective is to create process efficiencies, promote local suppliers and ultimately create more value jobs in the local economy. After one year of planning and design, implementation is expected to commence in Quarter 2, 2011

Bapco meanwhile completed work on a comprehensive IT strategy – based on Company objectives as well as oil and gas IT trends - for the next five to 10 years. Seven core strategic business programmes were identified for implementation: reliability excellence;

integrated electronic procurement; talent management; financial reporting and governance; knowledge management; business efficiency; IT infrastructure and business application productivity improvement.

Bapco’s corporate website was upgraded in 2010 to allow approved users to view the Company’s inventory data online to share with other GCC refineries, thereby optimising inventory and reducing costs.

Work also progressed on a replacement for the EMPAC Enterprise Asset Management System, in operation since

by the end of 2012. The system is used Company-wide for asset management, work order management, procurement, inventory management, and contract management. Vendor packages which offer leading practices and technological advances to Bapco’s benefit will be selected in 2011 following evaluation.

The streamlining of various audit processes, including the quality management system (QMS), occupation, health & safety (OHSAS), environment management system (EMS) and process safety management system (PSM) was completed in 2010. The new electronic system now enables system owners to consolidate all audit programs into one system, which can then be shared across the organisation. This will both save costs and enable better identification of problem areas, while achieving and

exchanges were upgraded to include Voice Over Internet Protocol (VoIP), improving communications and providing significant cost savings.

maintaining regulatory compliance.

Among other achievements, the Refinery, Sitra and Awali telephone


Throughout its distinguished history,

Bapco has consistently proven its ability

to adapt its business model to meet

diverse challenges.

This dynamic approach will be important

as ongoing uncertainty about the global

economic recovery, regional geopolitical

pressures and persistent crude oil price

volatility makes predicting future oil and

gas industry trends ever more difficult.

One thing is certain, however. Bapco

is well equipped to draw upon its rich

experiences and competitive strengths

to plot a sustainable, profitable and safe

path to success.

A key focus going forward will

be ensuring the profitability and

sustainability of Bapco’s downstream

business. Through the Refinery Master

Plan project, several strategic initiatives

are being spearheaded which will

sharpen the competitive edge of the

business and better position it to capture

opportunities offered by future market

environments.

The Master Plan will include an

expansion of the Refinery to further

enhance refinery profitability. The

product slate will also be optimised to

reflect changing local and international

market specifications, including the

manufacture of products which have

reduced environmental impact and those

that are of higher value.

Laying future foundations

Bapco will also implement

recommendations identified through

its Productivity Improvement Project,

which will reduce costs in key areas

by improving efficiency, reliability and

productivity of key assets.

To further diversify its business

interests and generate potential new

revenue stream, Bapco is now also

actively identifying target companies

- particularly outside Bahrain - for

potential acquisition and/or investment,

particularly in the upstream exploration

and production sector.

Aligning future corporate objectives

with available manpower and skills

will remain a priority, and Bapco’s

commitment to grooming high calibre

individuals who will be the future

backbone of the organisation will be

reinforced. Company will also continue

to provide upskilling programmes for

all employees to equip them for the

challenges ahead.

In implementing the strategies and

achieving these goals, Bapco’s non-

negotiable approach to environmental,

health and safety compliance will remain

firmly entrenched in the corporate

psyche, and ever-stricter standards

imposed where possible.

Bapco is facing the future with

confidence, possessing the necessary

ingredients to thrive in uncertain times.

And in a rapidly changing world, Bapco’s

commitment to serving the nation, its

leaders, the economy and its people,

remains unchanged, as it has done

since 1929.


H.E. Dr. Abdul-Hussain bin Ali MirzaChairman

Dr. Mustafa Al SayedMember

H.E. Rasheed Al MearajMember

Shaikh Mohamed bin Khalifa Al KhalifaMember

Maj. Gen. Basim Yacoub Al HamerMember

Abdul Rahman JawaheryMember

Yousif Abdul Hussain KhalafMember

The Board Committee مجلس ا�دارة

Faisal Al-MahroosChief Executive

Mohamed GhuloomGM Engineering

Essa Ghuloom Al AnsariGM Major Engineering Project

Dr. Dawood V. NassifGM Strategy & Business Development

Khalid E. SabbaghGM Marketing

Anwar S. KhalafGM Exploration & Petroleum Eng

Dr. Eion TurnbullDCE Refining & Marketing

Mohamed Al JameaGM HR & Admin

Mahmood Al AlawiGM Finance & IT

Ebrahim TalibGM Refining

Hussain Al AnsariGM Maintenance

Executive Management

2010 ÉÄ``¾¡�dG ™j™```²ˆdG 24

ا�دارة التنفيذية

Documents

2010 ANNUAL REVIEW - The Bahrain Petroleum Company (Bapco) · Commander of the Kingdom of Bahrain ... 8 Annual Review 2010 Generating national wealth Bapco rose to the challenges