EPC – SPIE Oil & Gas Services

1. EPC – SPIE Oil & Gas Services Bonsai Team – 12.01.2010

2. Summary • 1°) EPC • 2°) SPIE Oil & Gas • 3°) Strategy • 4°) Example • 5°) Human aspects

3. EPC • EPC: Engineering Procurement and Construction • Design the installation, procure materials and construct it • LSTK: Lump Sum Turn Key • LS: Payment of a fixed sum for the delivery • TK: The scope of work includes start-up of the facility to a level of operational status • EPCM: Engineering, Procurement, Construction Management • The contractor ≠ the constructor • Procures and manages the construction process • EPCS: Engineering, Procurement, Construction and Start up • Company realizes the commissioning of the product by a maximum of three usual stages • EPCI: Engineering, Procurement, Construction and Installation • Set it up at the offshore site

4. SPIE, L’ambition partagée • Turnover 2008: + 8,4 %  3,75 B€ • Operational results: + 26 % 172,9 M€ Multi-Technical services • SPIE Ile-de-France Nord-Ouest • SPIE Ouest-Centre • SPIE Sud-Ouest • SPIE Sud-Est • SPIE Est • SPIE Matthew Hall (UK) • SPIE Benelux Specialized Services • SPIE Communications • SPIE Oil & Gas Services • SPIE Nucléaire

5. SPIE Oil & Gas Services Core business: • Maintenance • Services • EPC Clients: • main companies (Total, Exxon Mobil) • main contractors (Technip, Saipem, Ponticelli)

6. SPIE Oil & Gas Services Interview M. Hachin Director, Systems Projects Business Unit

7. Strategy • Earlier strategy: • Large EPC projects  Pipeline project in India that almost « killed » the company • Today’s strategy: • Focus on maintenance and services (Core business) • Size limited projects  1 to 3 years and no more than 50 millions € • Restricted to Oil & Gas branch

8. Activities • Main type of contracts: • EPCS Lump Sum in majority of cases • QHSE = Quality, Hygiene, Security and Environment • Respects internationals QHSE regulations • “Everybody is responsible for what he is let others do” • Transparency of QHSE results • Evaluation of all subcontractors • “If the subcontractor is not mature enough in terms of QHSE  Compensate by more control

9. Organization • Derived from history and opportunities • Decisional organization: • Up to 6 millions, decision is made by regional directors • Between 6 and 15 millions  Decision Mr. Hachin • More than 15 millions  Risk Engagement Commission • Three steps: Go no Go BidnoBid DecisionComission

10. Examples • Pipeline construction in Algeria • Pipes, pumping stations, information systems, turbo pumps … • Pre-Engineering, fine engineering, material selection in terms of functionality, then choose the different subcontractors • Relation with the client is really important • Relational qualities for the project manager

11. Human aspects

12. Human aspects Generalities • 10 millions Euros Project10 persons directly involved EPC = Credibility • International mobility • Intern evolution possibilities • Multi technical environment

13. Human aspects Project Manager Desk, costing work as Fieldwork • Relation • Technique • Organisation Winning teams Clients Project Manager Team Subcon-tractors

14. Human aspects Responsibilities of project managers = EPC Success Delegate Control Success = Satisfaction Problem: Senior PM to train Junior PM Risks Questioning Critical thinking versus Anticipation Experience

15. Conclusion • Being successful in EPC business • Good project managers • Good team to support them • “The method to secure markets is to secure the effective people” • Strategy • Cash cow  Maintenance, Services • Visibility and credibility  EPC • Working on relation and trust with customers • Limit risk thanks good internal decisional processes • QHSE

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