2013 Oil & GasIndustry ForecastRotterdam, 29 January 2013

4...our industry continues to outperform expectations...

Preface

Jeff Sluijter

5Dear reader,

At the time of writing, we can look back at yet another successful edition of our Gulf Publishing forecasting event.

This event started, as usual, with a presentation of Gulf Publishing of the expectations for the up and downstream for the coming year. Gulf Publishings detailed presentations have been included in this booklet, showing, per region, what the exact level of activity is expected to be the coming year.

Looking at these data, it is evident that we can only repeat our conclusions of prior years: the Oil and Gas Industry is still going strong as nearly all regions show for the coming year again a high(er) level of activity. This can easily be explained by the strong underlying fundamentals of our industry which have not changed: nearly all (long-term) forecasts confirm a growing demand for (traditional) energy sources for the coming decennia, mainly caused by the industrialization and urbanization of the upcoming countries, with the spending needed to explore and exploit these new oil and gas assets increasing accordingly. It is also evident that the search for these assets often imply new, far-away countries with new principals, partners or subcontractors, whilst the size and complexity of the projects also increases. Our service industry is worldwide well-owned for its proven quality and innovative and solution driven approach, but it is clear that these developments imposes new challenges for all of us.

After Gulf Publishings presentation on the global developments, my colleague Ren Coenradie of our Transaction Advisory Support Group presented the outcome of our 2013 questionnaire. This survey was as usual held under the Dutch suppliers to the offshore industry and was filled in by more than 100 respondents across this industry.

With most companies being focussed on export sales nowadays, it is not surprising that the outcome of this questionnaire reflects to a large extent the worldwide developments: most companies had in 2012 again higher sales than anticipated and the year before. This trend of increased orders and sales is generally expected to continue, also for the coming year. We also see that the uncertainty about the market of a few years ago is generally being replaced by a more optimistic attitude, although we remain a bit cautious still in our sentiments.

Looking back, we can only conclude that our industry has not been significantly impacted by the crises. At the beginning of the (first) crises, most companies were still sheltered by their existing order backlog, in particular in the case of long-term projects. At the time this backlog was drying up, cautious optimism awoke and the market was starting to show signs of recovery again. This market had obviously cooled down in comparison to the overstressed market conditions which marked the period before the crises and had also become somewhat hesitant. This upward trend has, with the usual ups and downs, continued as of today, with an outlook which, setting the sentiments aside, can only be qualified as positive.

Our industry obviously already had its challenges, such as the lack of sufficient (qualified) personnel, but one thing did change as a result of the crises and that is the availability of financing. For this reason, we have included specific questions on the companys so called Capital Agenda in this years survey. The responses provide an interesting insight into the trends in this area and how companies presently perceive this situation.

With most of the banks having been in financial distress, the availability of financing became obviously tight during the crises and is by many respondents still seen as a problem as of today. Also before the crises, many companies had actually already some difficulties in getting their growth financed and this is expected to become even more of an issue in the current setting, in particular if the current growth continues as expected. An issue which will primarily impact the midsized and smaller companies, as the large(r) companies have generally better access to capital. One sees simultaneously other trends taking place with the latter, such as consolidation, strategic repositioning and partnering, or private equity or strategic buyers from countries as Russia or Brazil taking over or participating in companies.

I trust our booklet will provide useful reading and wish you all yet another successful year. It is evident that the outlook for our industry is generally positive and that we are well positioned to take advantage of this. Should you have any questions, or if we can assist you in any other way in your ambitions and challenges, please do not hesitate to contact us.

Jeff SluijterEnergy LeaderErnst & Young The Netherlands

For further information: www.ey.nl/oil-gas

Index

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7Photo collage 8

Word from the Managing Director of IRO 14

Presentation Gulf Publishing, Upstream worldwide Forecast 2013 16

Presentation Ernst & Young, The Capital Agenda of Oilfield Services 54

Presentation Gulf Publishing, Downstream worldwide Forecast 2013 68

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8Photo collage

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Photo collage

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Global developments in the upstream Oil and Gas Industry ask for the latest solutions, this is why we as Dutch Suppliers belong to the top 5 worldwide.

Word from the Managing Director IRO

Sander Vergroesen

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Word from the Managing Director IRO

The 2013 Oil & Gas Industry Forecast on Tuesday January 29th was again a great example of one of the main goals of IRO, the Association of Dutch Suppliers in the Oil and Gas Industry : networking and providing the members with relevant information.

The results of both the Oil and Gas survey and the Gulf Publishing Forecast 2013 confirmed the positive feeling among the IRO members that times are good for innovative suppliers in the Oil and Gas industry.

To promote the skills and experiences of our member companies in those areas where they are needed most, IRO organizes Holland Pavilions at the major Oil and Gas exhibitions and trade missions around the world.

In 2012 a lot of our member companies joint us in our travels to Perth Australia, Abu Dhabi UAE, Houston US, Stavanger Norway, Rio de Janeiro Brazil, Singapore, Doha Qatar and Aberdeen UK. All these

countries showed progress in the figures as presented by Gulf Publishing during the January 2013 edition of the Oil & Gas Forecast.

Also for 2013 IRO scheduled visits for our members to areas where it is happening. Next to the earlier mentioned we plan to go to Mexico, Vietnam and Malaysia.

In order to inform the member companies with the latest developments Member Meet Member meetings are and will be organized where the members present their latest products and innovative steps to each other with the opportunity to network in an informal but very effective setting.

The latest developments in our Oil and Gas Industry ask for the latest solutions, we as Dutch Suppliers are together working on that to make sure we stay ahead and among the top 5 suppliers worldwide.

To help to achieve this, board members of IRO chair committees where Industry related topics are discussed and relevant experience is shared with fellow members.

For more information about IRO, please have a look at www.iro.nl , our members look forward to work with you!

Yours sincerely,

Sander VergroesenManaging Director IRO

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Presentation Gulf Publishing, Upstream worldwide Forecast 2013

Ron Higgins

Global E&P spending continues to grow.

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Presentation Ernst & Young, The Capital Agenda of Oilfield Services

Ren Coenradie

The majority of the Dutch suppliers in the Oil & Gas industry are focussing on optimizing capital through portfolio review and working capital management.

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Presentation Gulf Publishing, Downstream worldwide Forecast 2013

Bret Ronk

...gas demand will continue to rise, but shale gas has led to different worldwide trade flows...

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Ernst & Young

Assurance | Tax | Transactions | Advisory

About Ernst & YoungErnst & Young is a global leader in assurance, tax, transaction and advisory services. Legal and notarial services are provided by Holland Van Gijzen Advocaten en Notarissen LLP through a strategic alliance with Ernst & Young Belastingadviseurs LLP. Worldwide, our 167,000 people are united by our shared values and an unwavering commitment to quality. We make a difference by helping our people, our clients and our wider communities achieve their potential.

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How Ernst & Youngs Global Oil & Gas Center can help your businessThe oil and gas sector is constantly changing. Increasingly uncertain energy policies, geopolitical complexities, cost management and climate change all present significant challenges. Ernst & Youngs Global Oil & Gas Center supports a global practice of over 9,000 oil and gas professionals with technical experience in providing assurance, tax, transaction and advisory services across the upstream, midstream, downstream and oilfield service sub-sectors. The Center works to anticipate market trends, execute the mobility of our global resources and articulate points of view on relevant key sector issues. With our deep sector focus, we can help your organization drive down costs and compete more effectively to achieve its potential.

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This publication contains information in summary form and is therefore intended for general guidance only. It is not intended to be a substitute for detailed research or the exercise of professional judgment. Neither EYGM Limited nor any other member of the global Ernst & Young organization can accept any responsibility for loss occasioned to any person acting or refraining from action as a result of any material in this publication. On any specific matter, reference should be made to the appropriate advisor.

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