HOW TO KEEP A PROJECT ON TRACK

Jean-Marc AUBRYProject Director

INVESTOR DAY, PARIS, FRANCE - October 22, 2004

171Investor Day – 22 October 2004

WHAT IS A PROJECT?

As an example:

NEB Onshore and Offshore Oil Field Development (Abu Dhabi)

è Contract: $ 600 Million Lump Sum Turnkey Project (EPC)

è Joint Venture with a local partner (Technip as the Leader)

è Contract signature to provisional acceptance: 35 Months

è 800,000 man-hours for engineering / procurement services(300 people at peak)

è Operating centers: Abu-Dhabi, Chennai, Düsseldorf, Paris

è 10,000,000 man-hours for construction (5,000 people at site at peak)

è 30,000 tons of material to be ordered, manufactured, transported, erected

172Investor Day – 22 October 2004

WHERE SHOULD THE EMPHASIS BE?

SAFETYè No Compromise

PLANNINGè An EPC project lasts 3 years but has to

be monitored on a daily basis

COSTè Project revenues, margin and cashflow

to be updated

PERFORMANCEè Delivered according to client’s

expectations & requirements

173Investor Day – 22 October 2004

KEY STEPS TO STAY ON TRACK

Getting a GOOD startè Right from bidding stage

Ensuring a CONTROLLED execution developmentè Apply know-how and group procedure to deliver the whole Technip

experience

Managing to get an EFFICIENT Close-Outè Technically and commercially

174Investor Day – 22 October 2004

WAYS TO KEEP A PROJECT ON TRACK

Updated and proven tools for:

è Reporting è Planning and Forecastè Engineeringè Procurementè IT

These tools are configured to match the project’s specificities and requirements

A constant availability of technical & managerial expertise among the Group

A feed back via “lessons learned” from existing or other on going projects

Benchmarking

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CONTROL OF PROJECT EXECUTION

Two principles are concurrently implemented:l Project Director: single point of accountability for each project l Senior Management: hands-on policy, supported by central expertise

SeniorManagement

Reporting

Project Management

Global Procurement

PEC

Support

Reporting

Monitoring (Monthly PMRs)

CostControl

ConstructionInstallationEngineering Procurement

Project Director

Full AuthorityReporting

176Investor Day – 22 October 2004

HOW TO KEEP A PROJECT ON TRACK

.

177Investor Day – 22 October 2004

KEY FACTORS TO KEEP A PROJECT ON TRACK

Project execution strategy

People

Adequate resources

Benchmarking

Management support

Reactivity

Client trust

Achievable objectives

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PROBLEM:

Normal execution too longfor client’s strategy and competi-tiveness

EXAMPLE: MONITORING A CHALLENGING PROJECT (1/2)

CLIENT’S OBJECTIVESMarketing strategy:

Construction and start-up operations to be completed as quickly as possibleIf delivery schedule too long: No project!

MARKET CHARACTERISTICS

High demand and under-capacity worldwide at that timeBenchmarkè Normal execution

calendar:29 months (Gauss Curve estimate)

TECHNIP SOLUTION19 month fast track execution LSTK contract

Based on maximum contract price guaranteed

With incentives (safety, quality, representative milestones, final completion date)

Having high investment in engineering man-hours and procurement follow-up

With early start of construction

Integration of start-up preparation phase with the construction phase

POLYPROPYLENE PLANT (CAPACITY: 250,000 TONS PER YEAR)

179Investor Day – 22 October 2004

EXAMPLE: MONITORING A CHALLENGING PROJECT (2/2)

Completion 3 WEEKS AHEAD of the contractual date for the benefit of all

For the Client:

First polymer production after 2 days of operationCommercial operation one month after completion dateCompetitive position on the market: 10 months in advanceHuge commercial success

For the Client:

First polymer production after 2 days of operationCommercial operation one month after completion dateCompetitive position on the market: 10 months in advanceHuge commercial success

For Technip:

All milestones completedAll incentives gained / High margin levelBecame client’s preferred contractor for this type of unit

For Technip:

All milestones completedAll incentives gained / High margin levelBecame client’s preferred contractor for this type of unit

180Investor Day – 22 October 2004

For more information, please contact:

INVESTOR RELATIONS

G. Christopher WeltonTel. +33 (0) 1 47 48 66 74e-mail: cwelton@technip.com

David-Alexandre GuezTel. +33 (0) 1 47 78 27 85e-mail: daguez@technip.com

181Investor Day – 22 October 2004

TRADING TECHNIP

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