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Global Top 10 Energy Companies

Global Top 10 Energy Companies

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Global Top 10 Energy Companies Report: Industry, Financial and SWOT Analysis

Reference Code: DBEN0784 Publication Date: March 2011

Global Top 10 Energy Companies Report: Industry, Financial and SWOT Analysis
© Datamonitor. This brief is a licensed product and is not to be photocopied

03/2011
Page 1

Table of Contents

TABLE OF CONTENTS
Executive Summary Industry analysis Industry definition Research highlights Market Value Value Market Share Share Market Segmentation – Product Product Market Segmentation – Geography Geography Five Forces Analysis Summary Buyer power Supplier power New entrants Substitutes Rivalry Top 10 Companies Landscape Companies Landscape Revenue analysis Financial performance analysis Company Reports Exxon Mobil Corporation Royal Dutch Shell Plc BP Plc China Petroleum & Chemical Corporation (Sinopec) TOTAL S.A. Chevron Corporation 7 7 7 7 8 8 9 9 10 10 11 11 12 12 14 16 18 20 21 23 23 27 28 33 33 44 58 74 84 102

Global Top 10 Energy Companies Report: Industry, Financial and SWOT Analysis
© Datamonitor. This brief is a licensed product and is not to be photocopied

03/2011
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Table of Contents
PetroChina Company Limited ConocoPhillips Eni SpA OAO Gazprom Financial Analysis Exxon Mobil Corporation Royal Dutch Shell Plc BP Plc China Petroleum & Chemical Corporation (Sinopec) TOTAL S.A. Chevron Corporation PetroChina Company Limited ConocoPhillips Eni SpA OAO Gazprom APPENDIX Methodology 113 123 131 145 161 161 164 167 170 173 176 179 182 185 188 191 191

Global Top 10 Energy Companies Report: Industry, Financial and SWOT Analysis
© Datamonitor. This brief is a licensed product and is not to be photocopied

03/2011
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by value. 2005–09 Figure 2: Global energy industry share: % share. % share. $bn. % share. FY2009 8 9 10 11 12 14 16 18 20 21 24 28 29 30 Global Top 10 Energy Companies Report: Industry. 2009 Figure 5: Forces driving competition in the global energy industry Figure 6: Drivers of buyer power in the global energy industry Figure 7: Drivers of supplier power in the global energy industry Figure 8: Factors influencing the likelihood of new entrants in the global energy industry Figure 9: Factors influencing the threat of substitutes in the global energy industry Figure 10: Drivers of degree of rivalry in the global energy industry Figure 11: Turnover of global top 10 energy companies. 2009 Figure 4: Global energy industry segmentation: geography. Financial and SWOT Analysis © Datamonitor. This brief is a licensed product and is not to be photocopied 03/2011 Page 4 . FY2009 Figure 12: Revenue growth of global top 10 energy companies. 2009 Figure 3: Global energy industry segmentation: product. FY2009 Figure 14: Net profit analysis.Table of Contents TABLE OF FIGURES Figure 1: Global energy industry value. 2007–09 Figure 13: Operating profit analysis. $m.

$m.: financial and operational highlights. 2005–09 ($m) Table 22: PetroChina Company Limited: key industry-specific ratios. 2005–09 8 9 10 11 23 27 28 31 161 163 164 166 167 169 Table 15: China Petroleum & Chemical Corporation (Sinopec): financial and operational highlights. FY2009 Table 8: Key industry-specific ratios Table 9: Exxon Mobil Corporation: financial and operational highlights. by value. 2009 Table 3: Global energy industry segmentation: product.: key industry-specific ratios. 2005–09 ($m) Table 14: BP: key industry-specific ratios. 2005–09 ($m) Table 10: Exxon Mobil Corporation: key industry-specific ratios. 2009 Table 5: Turnover of global top 10 energy companies. 2005–09 Table 19: Chevron Corporation: financial and operational highlights. % share. 2005–09 ($m) Table 18: TOTAL S. 2005–09 ($m) 170 Table 16: China Petroleum & Chemical Corporation (Sinopec): key industry-specific ratios. FY2009 Table 6: Revenue growth of global top 10 energy companies. 2005-09 Table 11: Royal Dutch Shell: financial and operational highlights. 2005–09 ($m) 173 175 176 178 179 181 182 Global Top 10 Energy Companies Report: Industry.A. 2005–09 Table 21: PetroChina Company Limited: financial and operational highlights. 2005-09 Table 13: BP: financial and operational highlights. This brief is a licensed product and is not to be photocopied 03/2011 Page 5 . $bn. 2007–09 Table 7: Key financials of global top 10 energy companies. % share. 2005–09172 Table 17: TOTAL S.A.Table of Contents TABLES Table 1: Global energy industry value. 2005–09 Table 2: Global energy industry share: % share. 2005–09 Table 23: ConocoPhillips: financial and operational highlights. 2005–09 ($m) Table 12: Royal Dutch Shell: key industry-specific ratios. 2009 Table 4: Global energy industry segmentation: geography. 2005–09 ($m) Table 20: Chevron Corporation: key industry-specific ratios. Financial and SWOT Analysis © Datamonitor.

2005–09 184 185 187 188 190 Global Top 10 Energy Companies Report: Industry. Financial and SWOT Analysis © Datamonitor. 2005–09 ($m) Table 28: OAO Gazprom: key industry-specific ratios. This brief is a licensed product and is not to be photocopied 03/2011 Page 6 . 2005–09 Table 25: Eni: financial and operational highlights.Table of Contents Table 24: ConocoPhillips: key industry-specific ratios. 2005–09 Table 27: OAO Gazprom: financial and operational highlights. 2005–09 ($m) Table 26: Eni: key industry-specific ratios.

Executive Summary

EXECUTIVE SUMMARY Industry analysis
The global energy industry had shown strong growth in recent years until it fell into a steep decline in 2009. Recovery is expected in 2010, with strong growth over the period spanning 2009–14. The global energy industry generated total revenues of $6,050 billion in 2009, representing a compound annual rate of change (CARC) of -0.1% for the period spanning 2005–09. In comparison, the European industry declined with a CARC of -4.5%, and the Asia Pacific industry increased with a compound annual growth rate (CAGR) of 3.4%, over the same period to reach respective values of $1,217.9 billion and $1,384.1 billion in 2009. Oil, gas, and consumable fuel sales proved the most lucrative for the global energy industry in 2009, generating total revenues of $5,797.6 billion, equivalent to 95.8% of the industry's overall value. In comparison, sales of energy equipment and services generated revenues of $252.3 billion in 2009, equating to 4.2% of the industry's aggregate revenues. The performance of the industry is forecast to accelerate, with an anticipated CAGR of 13.2% for the five-year period 2009–14, which is expected to drive the industry to a value of $11,250.4 billion by the end of 2014. Comparatively, the European and Asia Pacific industries will grow with CAGRs of 11% and 13.5% respectively, over the same period, to reach respective values of $2,047.9 billion and $2,602.5 billion in 2014.

Industry definition
The energy industry consists of oil, gas, coal, and consumable fuels, and the energy equipment and services industries. The energy equipment and services industry values reflect revenues generated from the provision of equipment and services to the oil and gas industry, including contract drilling. The oil, gas, and consumable fuel industry consists of oil, gas, coal, and related consumable fuels. Industry values reflect revenues generated from exploration, production, refining, marketing, storage, and transportation of oil and gas, and also from the coal and consumable fuels market. The coal and consumable fuels market is defined as revenues generated by the sale of coal for industry and power generation, but excludes the sale of metallurgical coal. Any currency conversions used in the creation of this report have been calculated using constant 2009 annual average exchange rates. For the purposes of this report, the global market consists of North America, South America, Western Europe, Eastern Europe, and Asia Pacific.

Research highlights
The global energy industry generated total revenues of $6,050 billion in 2009, representing a CARC of -0.1% for the period spanning 2005–09. The performance of the industry is forecast to accelerate, with an anticipated CAGR of 13.2% for the five-year period 2009–14, which is expected to drive the industry to a value of $11,250.4 billion by the end of 2014.

Global Top 10 Energy Companies Report: Industry, Financial and SWOT Analysis
© Datamonitor. This brief is a licensed product and is not to be photocopied

03/2011
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Market Value

MARKET VALUE Value
The global energy industry shrank by 35.1% in 2009 to reach a value of $6,050 billion. The CARC of the industry in the period 2005–09 was -0.1%. Table 1: Global energy industry value, $bn, 2005–09 Year 2005 2006 2007 2008 2009 CAGR, 2005–09 Source: Datamonitor $bn 6,075.2 6,663.5 7,207.6 9,320.2 6,050.0 Ebn 4,369.0 4,792.1 5,183.4 6,702.7 4,350.9 Growth (%) 9.7% 8.2% 29.3% (35.1%) (0.1%)
DATAMONITOR

Figure 1: Global energy industry value, $bn, 2005–09

10,000 9,000 8,000

40% 30% 20%

7,000 6,000 $bn 5,000 4,000 3,000 -20% 2,000 1,000 0 2005 2006 2007 Year $bn
Source: Datamonitor

10% % Growth 0% -10%

-30% -40% 2008 2009

% Growth
DATAMONITOR

Global Top 10 Energy Companies Report: Industry, Financial and SWOT Analysis
© Datamonitor. This brief is a licensed product and is not to be photocopied

03/2011
Page 8

Market Share

MARKET SHARE Share
Exxon Mobil Corporation is the leading player in the global energy industry, generating 5% share of the industry's value. Royal Dutch Shell accounts for a further 4.6% of the industry. Table 2: Global energy industry share: % share, by value, 2009 Company Exxon Mobil Corporation Royal Dutch Shell BP Others TOTAL Source: Datamonitor Share (%)
5.0 4.6 3.9 86.5

100.00
DATAMONITOR

Figure 2: Global energy industry share: % share, by value, 2009

Exxon Mobil 5.0%

Royal Dutch Shell 4.6% BP 3.9%

Others 86.5%

Source: Datamonitor

DATAMONITOR

Global Top 10 Energy Companies Report: Industry, Financial and SWOT Analysis
© Datamonitor. This brief is a licensed product and is not to be photocopied

03/2011
Page 9

% share. This brief is a licensed product and is not to be photocopied 03/2011 Page 10 .8% of the industry's total value. accounting for 95. Gas and Consumable Fuels 95. Table 3: Global energy industry segmentation: product. 2009 Energy Equipment and Services 4.8% Source: Datamonitor DATAMONITOR Global Top 10 Energy Companies Report: Industry. Gas and Consumable Fuels Energy Equipment and Services TOTAL Source: Datamonitor Share (%) 95.2 100. % share. The energy equipment and services segment accounts for the remaining 4.0 DATAMONITOR Figure 3: Global energy industry segmentation: product.2% Oil. gas. 2009 Category Oil.2% of the industry.8 4. and consumable fuels is the largest segment of the global energy industry.Market Segmentation – Product MARKET SEGMENTATION – PRODUCT Product Oil. Financial and SWOT Analysis © Datamonitor.

8% Americas 30.9 20. % share.1% Asia-Pacific 22.9% of the global industry. Table 4: Global energy industry segmentation: geography.1 26.2 22. 2009 Rest of the World 26. This brief is a licensed product and is not to be photocopied 03/2011 Page 11 . % share.Market Segmentation – Geography MARKET SEGMENTATION – GEOGRAPHY Geography The Americas account for 30. Asia Pacific accounts for a further 22. Financial and SWOT Analysis © Datamonitor.2% of the global energy industry value. 2009 Category Americas Asia Pacific Europe Rest of the World TOTAL Source: Datamonitor Share (%) 30.8 100.2% Europe 20.0 DATAMONITOR Figure 4: Global energy industry segmentation: geography.9% Source: Datamonitor DATAMONITOR Global Top 10 Energy Companies Report: Industry.

Five Forces Analysis FIVE FORCES ANALYSIS Summary Figure 5: Forces driving competition in the global energy industry Source: Datamonitor DATAMONITOR Global Top 10 Energy Companies Report: Industry. This brief is a licensed product and is not to be photocopied 03/2011 Page 12 . Financial and SWOT Analysis © Datamonitor.

The global oil. The vast majority of revenues come from oil. or Halliburton. Global Top 10 Energy Companies Report: Industry. however players. However. Baker Hughes. involved in large-scale international operations are dominant. and coal. Prior to 2009. a situation that was attractive to new entrants. gas. and consumable fuels and consequently this analysis will focus majorly on this industry. primarily oil. this industry was growing at an incredibly strong rate. increasing the rivalry level. gas. Entry to the industry is limited by the existence of scale economies and the significant regulatory environment. Such companies have large scale operations. gas.Five Forces Analysis Major players in the global energy industry are large vertically integrated multi-national companies such as Exxon Mobil and Royal Dutch Shell. economic difficulties in 2009 contributed to a huge decline in this industry. gas. The size and vertical nature of such companies grants them considerable power over buyers. and the consequently high cost of switching weakens the threat posed by these substitutes. Major suppliers are gas and oil equipment and services providers. However. Financial and SWOT Analysis © Datamonitor. such as Exxon Mobil. with few activities in alternative industries. and consumable fuels industry is fragmented with a substantial number of companies present. gas. This brief is a licensed product and is not to be photocopied 03/2011 Page 13 . which hugely reduces the attractiveness of the industry. The global energy industry comprises the oil. However. Buyer power is boosted by the large size of buyers and their financial strength as well as lack of product differentiation. and consumable fuels industry and the energy equipment and services industry. and Royal Dutch Shell. the majority of the world’s energy production takes place with the use of non-renewable sources. currently. and coal are highly important to its users tends to weaken buyer’s strength. including Schlumberger. the fact that oil. Limited number of suppliers and their importance to the industry increases supplier power. which produce a high level of rivalry. BP. Substitutes can be considered in terms of the increasing importance of alternative energy sources.

Five Forces Analysis Buyer power Figure 6: Drivers of buyer power in the global energy industry Source: Datamonitor DATAMONITOR Global Top 10 Energy Companies Report: Industry. This brief is a licensed product and is not to be photocopied 03/2011 Page 14 . Financial and SWOT Analysis © Datamonitor.

Large oil and gas companies usually conduct integrated operations. Buyers’ backward integration is also unlikely. and consumable fuels industry is assessed as moderate. and the importance of oil and gas products to end-users are among the several factors which weaken buyer power within the sector. Buyer power with respect to the global oil and gas refining and marketing sector is moderate. they appear as both buyers and players’ within different sectors. Lack of product differentiation and brand loyalty strengthens the buyer force furthermore. This brief is a licensed product and is not to be photocopied 03/2011 Page 15 . However. and consumable fuels industry comprises several sectors. the importance of the product offered within the market to the success of the buyers' businesses dilutes this power somewhat. Large. Buyers within the global oil and gas storage and transportation sector tend to be large diversified oil and gas companies. which lowers buyer power. provided they meet accepted quality criteria and brand loyalty is not of significant meaning. A large number of buyers. The large size of customers and strong financial muscle strengthen buyer power. Overall buyer power with respect to the oil global oil. both individual and institutional. On the other hand. There is often little to distinguish between the products of competitors in this industry. Such independence tends to boost buyer power. which effectively ameliorates buyer power on the basis of price. who can leverage their economies of scale in dealing with companies in the sector.Five Forces Analysis The global oil. the price of which is set according to supply and demand by the mercantile exchanges of New York. Buyers may also be willing to switch to a different provider if a better priced offer was presented. diversified international companies are present within the industry and as their operations are highly integrated. and Dubai. gas. Within the global oil and gas exploration and production sector buyers are both individual as well as institutional end users able to make large purchases. pipeline infrastructure is such that in certain regions oil and gas producers have no option but to use a particular pipeline. Financial and SWOT Analysis © Datamonitor. gas. These factors tend to strengthen buyer power to some extent. London. Commodities such as crude oil or natural gas are relatively undifferentiated products. Power generation companies are major buyers of coal. Global Top 10 Energy Companies Report: Industry. often incorporating transportation and storage activities. Such buyers are also large sized and have strong financial muscle.

Five Forces Analysis Supplier power Figure 7: Drivers of supplier power in the global energy industry Source: Datamonitor DATAMONITOR Global Top 10 Energy Companies Report: Industry. Financial and SWOT Analysis © Datamonitor. This brief is a licensed product and is not to be photocopied 03/2011 Page 16 .

Some of these may exert strong bargaining power due to their size. some supplies. such as specialist equipment. primarily roller cone bits. Typically. which combined with high demand from the oil and gas industry. has a wide product portfolio catering to the worldwide oil and natural gas industry. While there are a large number of companies providing specialist equipment. Baker Hughes also supplies drilling and evaluation services which include directional drilling. may be difficult to sell to any customer outside the market. governments. as coal and metal ores are non-renewable. Amongst the suppliers within the global coal and consumable fuels market there are specialist equipment providers. highly diversified companies and this therefore affords them greater bargaining power. Moreover. This means that major landowners. due to the specific nature of the business. enhances their supplier power. and these may be in a strong position. Such suppliers are small in number. such suppliers are large. many larger oil and gas companies have backward integrated into oil and gas services operations. and Halliburton. including Schlumberger. This. It supplies them to the oil and natural gas industry worldwide. Baker Hughes. This brief is a licensed product and is not to be photocopied 03/2011 Page 17 . and consumable fuels industry is assessed as moderate. Overall supplier power with respect to the global oil. reduces the supplier power of oil equipment and services companies. On the other hand.Five Forces Analysis Major suppliers are oil and gas equipment and services providers. it may be more difficult to assure adequate reserves. and logging-whiledrilling (LWD) services. for example. The company manufactures and supplies drill bits. The company provides formation evaluation and wireline completion and production services for oil and natural gas wells. human resources providers. and fixed-cutter polycrystalline diamond compact (PDC) bits. and similar bodies can be viewed as suppliers. measurement-while-drilling (MWD). Baker Hughes. Global Top 10 Energy Companies Report: Industry. combined with the high importance of the oil and gas industry to supplier revenues. as well as landowners or governments. gas. Financial and SWOT Analysis © Datamonitor. and use third-party service companies to supplement their own activities.

This brief is a licensed product and is not to be photocopied 03/2011 Page 18 . Financial and SWOT Analysis © Datamonitor.Five Forces Analysis New entrants Figure 8: Factors influencing the likelihood of new entrants in the global energy industry Source: Datamonitor DATAMONITOR Global Top 10 Energy Companies Report: Industry.

multinational companies. To keep up with the leading players who can utilize their scale economies. and consumable fuels industry is complicated by the fact that it is possible for companies to operate in one or more parts of the supply chain. Such players have invested heavily in their fleets of drilling rigs. The gas refining and marketing sector in many countries is unbundled. The presence of such powerful incumbents acts as a significant barrier to entry and the need for substantial initial investment to set up facilities such as drilling rigs also reduces the threat of new companies establishing themselves in this sector. or marketing. and consumable fuels industry is assessed as weak at present. Leading oil companies. and BP are typically large. Gas production and refining is typically integrated with that of oil and therefore has equivalent barriers to entry. there are also restrictions regarding environmental impact. the logistics of coal mining including the prohibitive start-up costs for a mine provide further barriers to entry. Financial and SWOT Analysis © Datamonitor. but may change going forward as the industry begins to recover and grow. Global Top 10 Energy Companies Report: Industry. other equipment. highly vertically-integrated. Royal Dutch Shell. and obtaining it may be a lengthy process.Five Forces Analysis Analysis of the threat of new entrants into the global oil. namely Exxon Mobil. combined with the increasing popularity of energy provider switching. Permission to explore new fields and extract oil and gas is generally in the hands of national governments. There is also a significant regulatory environment within the oil and gas industry. which is restrictive to the entry of players into the industry. The industry in 2009 declined rapidly as economic difficulties were felt on a global scale. gas. and technology. including product innovation. This brief is a licensed product and is not to be photocopied 03/2011 Page 19 . with companies typically involved either in the production. the lack of switching costs for end-users. which constitutes a considerable barrier to entrance. The assets required for coal mining are also considerable including a large amount of specialized machinery. which use the large scale of their production and distribution networks to reduce costs and enhance profitability. Such a dire situation could discourage potential new entrants. As well as regulations surrounding taxation and the issue of whether oil and gas exploration is permitted. which promotes consolidation. increases opportunities for the entrance of new companies. In addition. Overall the threat of new entrants within the global oil. Major players within the coal and consumable fuels sector can leverage the large economies of scale found in bulk coal production to minimize the per unit selling price for coal. strong research and development (R&D) capability is required. Smaller companies within the market may therefore struggle to compete with them successfully. With respect to gas marketing. gas. supply infrastructure.

which is in short supply – the world must reduce its output of carbon dioxide (CO2) by 50–85% by 2050.Five Forces Analysis Substitutes Figure 9: Factors influencing the threat of substitutes in the global energy industry Source: Datamonitor DATAMONITOR Substitutes in the global oil. coal. the majority of the world’s energy production takes place with the use of non-renewable sources. Such substitutes can be seen to offer notable benefits in terms of environmental impact and sustainability. and the consequently high cost of switching weakens the threat posed by these substitutes. primarily oil. Global Top 10 Energy Companies Report: Industry. and coal. while power companies can alter their primary energy mix to a small extent without incurring many costs. This brief is a licensed product and is not to be photocopied 03/2011 Page 20 . However. Financial and SWOT Analysis © Datamonitor. solar. gas. Shifting to renewable energy sources is costly and will take time. However. which constitutes a very high switching cost. There are no apparent direct substitutes for oil and gas storage and transportation. and consumable fuels industry is weak but still growing. then the requirement for storage and transportation services will be reduced. Overall. However. and consumable fuels industry can be considered in terms of alternative energy sources (those other than oil and gas such as nuclear. gas. the threat of substitutes within the global oil. if oil and gas resources are developed nearer to target markets. gas. currently. There are several substitutes for coal and consumable fuels within the power generation market like nuclear fuels and alternative energy sources. and wind). a thoroughgoing transition to these substitutes would require investment in different generation facilities.

Financial and SWOT Analysis © Datamonitor. This brief is a licensed product and is not to be photocopied 03/2011 Page 21 .Five Forces Analysis Rivalry Figure 10: Drivers of degree of rivalry in the global energy industry Source: Datamonitor DATAMONITOR Global Top 10 Energy Companies Report: Industry.

gas. Players like Exxon Mobil try to diversify the scope of their operations. These combine to produce a high level of rivalry. Such companies have large scale operations. but also refining. gas. There is a tendency towards concentration. such as oil and gas in the energy industry. and consumable fuels industry. especially the national oil companies. some companies. Major buyers in this sector are electricity generators. are involved in large-scale international operations. and electricity generation. The global oil. high fixed costs. Xstrata. and players in this sector are therefore constantly contending with the threat of substitutes. Industry players are similar in the way that they operate and the services they provide. However. Financial and SWOT Analysis © Datamonitor. commodity petrochemicals. such as Exxon Mobil. The coal and consumable fuels market is fragmented with companies such as China Shenhua Energy. SaudiAramco has a monopoly over upstream oil development in Saudi Arabia.Five Forces Analysis The threat of competition is strong within the different sectors of the global oil. Global Top 10 Energy Companies Report: Industry. although the leading players. BHP Billiton. and the marketing of oil and natural gas. with a few multinationals dominating in several segments. The company is also engaged in the production of chemicals. which constitutes a significant barrier to entry. For example. however. and this fact tends to ease pressure when it comes to the operating performance within this particular industry. and BP. that many pipelines are effectively local-monopolies for oil and gas transportation between particular regions and therefore geographical separation of companies within the sector may lessen rivalry. Major players are large vertically integrated multi-national companies such as Exxon Mobil and Royal Dutch Shell. Within the storage and transportation sector it should be appreciated. and consumable fuels industry is fragmented with a substantial number of companies present. and Peabody Energy benefiting from scale economies. Royal Dutch Shell. engaging not only in exploration and production. These companies will be on the lookout for cheaper and more effective substitutes for coal and metals. with few activities in alternative industries. The mining sector is capital intensive. have specialized in particular locations. and also raises exit costs. This brief is a licensed product and is not to be photocopied 03/2011 Page 22 . High fixed costs and the high exit barriers created by the need to divest industry specific equipment on leaving the industry both mean that competition is substantial. and high exit barriers.

341.3 China 183. The economic crisis has led to limited capital funding for new projects and substantially delayed new investment plans. In comparison. Chevron Corporation PetroChina Company Limited ConocoPhillips Eni SpA OAO Gazprom Revenue ($m)* 301. Financial and SWOT Analysis © Datamonitor.0 149. and continued production restraint by members of the OPEC.927. The American and European industries were severely affected and the companies recorded huge losses. followed by Royal Dutch Shell and BP. In 2009.152. FY2009 Ranking 1 2 3 4 5 6 7 8 9 10 Company name Exxon Mobil Corporation Royal Dutch Shell Plc BP Plc China Petroleum & Chemical Corporation (Sinopec) TOTAL S.4 France US China US Italy Russia Country US The Netherlands UK * Currency conversions calculated using constant 2009 annual average exchange rates. The industry has begun to recover in 2010.500. Exxon Mobil Corporation was the leading player in terms of revenues.6 167. the Asia Pacific industry was less affected.435.4 94. Table 5: Turnover of global top 10 energy companies. The global financial crisis has affected the demand for products forcing energy companies to cut production.0 140. The oil prices are expected to rise with increase in demand as a result of projected global economic growth.402. This brief is a licensed product and is not to be photocopied 03/2011 Page 23 .Top 10 Companies Landscape TOP 10 COMPANIES LANDSCAPE Companies Landscape The global energy industry witnessed a sharp decline in value in 2009.933.A.188.0 192.926.9 149. $m.272.0 278. Source: Datamonitor DATAMONITOR Global Top 10 Energy Companies Report: Industry. slower growth in non-OPEC (Organization of the Petroleum Exporting Countries) oil supply.0 239.

000 150. FY2009 350.000 300.000 100.Top 10 Companies Landscape Figure 11: Turnover of global top 10 energy companies. Financial and SWOT Analysis © Datamonitor. $m. This brief is a licensed product and is not to be photocopied Eni DATAMONITOR .000 Revenue ($m) 250.000 200.000 0 China Petroleum & Chemical PetroChina Company Exxon Mobil Royal Dutch Shell Chevron ConocoPhillips TOTAL Gazprom 03/2011 Page 24 BP Source: Datamonitor Global Top 10 Energy Companies Report: Industry.000 50.

chemical fibers. It has operations in more than 100 countries. downstream. and natural gas liquids. and others. Chevron operates through four business segments: upstream. Chevron Corporation Chevron Corporation (Chevron) is engaged in every aspect of the oil and natural gas industry. It is also involved in the chemicals. Royal Dutch Shell Plc Royal Dutch Shell (Shell) is a holding company which owns direct and indirect investments in a number of companies comprising the group. BP Plc BP is one of the largest vertically integrated oil and gas companies in the world with presence in more than 80 countries. The company engages in the exploration and production of gas and crude oil. production. coal mining. including upstream and downstream operations. It operates worldwide through three segments: upstream. TOTAL operates through three business segments: upstream. transportation and marketing of natural gas and electricity. chemicals. including exploration and production. Global Top 10 Energy Companies Report: Industry. and all others. TOTAL S. Sinopec operates through five principal business segments: exploration and production. development. refining. and marketing and shipping of oil products and chemicals.Top 10 Companies Landscape Exxon Mobil Corporation Exxon Mobil Corporation (Exxon Mobil) is engaged in exploration and production. Shell has extensive operations in more than 90 countries around the world. downstream. refining. The company engages in exploration. and chemicals. oil refining and marketing. mining operations. and chemicals. China Petroleum & Chemical Corporation (Sinopec) China Petroleum & Chemical Corporation (Sinopec) is a vertically integrated energy and chemical company which operates through several subsidiaries and branches mainly located in China. Financial and SWOT Analysis © Datamonitor. This brief is a licensed product and is not to be photocopied 03/2011 Page 25 . and marketing of oil and natural gas. marketing and distribution. It operates through two reportable business segments: exploration and production. The company has operations in more than 130 countries. and power generation businesses. chemicals manufacturing and sales. TOTAL is engaged in all aspects of the petroleum industry. It engages in oil and gas exploration and production. and power generation. The company also manufactures and markets commodity petrochemicals and specialty products. and refining and marketing. chemical fertilizers. downstream. and other chemicals. marketing and transportation.A. power. and marketing of crude oil and natural gas. and marketing and trading of natural gas. and production and sales of petrochemicals. and generates electricity. geothermal. chemicals. It operates through two business segments: upstream and downstream. refining.

and other. an integrated energy company. and production and sales of crude oil and natural gas and refining. and engineering industries. development. chemicals. natural gas distribution. engages in the oil and gas exploration and production. and emerging businesses. engages in exploration. The company is engaged in the exploration and production of petroleum. The company operates in 77 countries. electricity generation. This brief is a licensed product and is not to be photocopied 03/2011 Page 26 . OAO Gazprom Gazprom. Eni SpA Eni. It operates through five business segments: exploration and production. refining and marketing. midstream. production. and other activities. and marketing of crude oil and petroleum products. petrochemicals. refining. refining and chemicals. refining and marketing. refining and marketing. oilfield services. gas storage. The company is controlled by China National Petroleum Corporation (CNPC). one of the largest gas producing companies in the world. marketing. engineering and construction. LUKOIL Investment. and marketing of natural gas. production of crude oil and gas condensate. It operates through eight business segments: production of gas. gas and power. as well as refining and production of crude oil and gas condensate. electric and heat energy generation and sales. transportation of gas. and others. distribution of gas. natural gas and pipeline. transportation. transportation. processing. and polymers businesses. Global Top 10 Energy Companies Report: Industry. Financial and SWOT Analysis © Datamonitor.Top 10 Companies Landscape PetroChina Company Limited PetroChina engages in exploration. ConocoPhillips ConocoPhillips is an integrated energy company which owns assets and businesses in nearly 40 countries. chemicals. It operates through seven segments: exploration and production. storage. corporate and financial companies. It operates through six segments: exploration and production. The company has strong presence in Europe. petrochemicals. natural gas.

341.152.A.9 2008 459.0 192.9 264.3 CAGR (2007–09) (%) (12) (12) (8) 6 221.Top 10 Companies Landscape Revenue analysis Table 6: Revenue growth of global top 10 energy companies.926.0 284.3 76.913.328.7 2009 301.958.437. Chevron Corporation PetroChina Company Limited ConocoPhillips Eni SpA OAO Gazprom 2007 390. Global Top 10 Energy Companies Report: Industry.365.0 178.100.402.8 250.400.0 157. Exxon Mobil Corporation.4 94.0 149.361. Source: Datamonitor DATAMONITOR The top 10 global energy companies have witnessed a sharp revenue decline during 2007–09. This brief is a licensed product and is not to be photocopied 03/2011 Page 27 .500.0 148.0 355.0 172. and China Petroleum & Chemical Corporation recorded increase in revenues at a CAGR of 11%.5 240.272.3 183. However.617.0 458. Gazprom.933.579.6 104. PetroChina Company.435.143.0 361.842.208.0 122. and Chevron Corporation recorded highest revenue decline at a CAGR of 12%. Royal Dutch Shell.3 214.6 167.927.0 239. and 6%. 2007–09 Revenues ($m)* Company name Exxon Mobil Corporation Royal Dutch Shell Plc BP Plc China Petroleum & Chemical Corporation (Sinopec) TOTAL S.7 187.359.0 207.254.782.999.091. Financial and SWOT Analysis © Datamonitor.188. respectively.0 140. 10%.189. The decrease in revenues was primarily due to decline in general economic conditions.281.4 (9) (12) 10 (11) (3) 11 * Currency conversions calculated using constant 2009 annual average exchange rates.9 149.0 278.

65 Net profit ($m)* 19.054. This brief is a licensed product and is not to be photocopied Eni DATAMONITOR 03/2011 Page 28 .360.04 11.092.0 21.4 21.0 27.0 * Currency conversions calculated using constant 2009 annual average exchange rates.0 6.08 14.00 4. Financial and SWOT Analysis © Datamonitor.3 12.90 6.744.57 6.52 11.157.93 28.0 9.72 7.005.325. Chevron Corporation PetroChina Company Limited ConocoPhillips Eni SpA OAO Gazprom Operating profit ($m)* 35.518.378.090.6 4.280.030.483.556.Top 10 Companies Landscape Figure 12: Revenue growth of global top 10 energy companies.4 18.3 24.858.780.43 6.0 12.6 11.578. FY2009 Company name Exxon Mobil Corporation Royal Dutch Shell Plc BP Plc China Petroleum & Chemical Corporation (Sinopec) TOTAL S.54 10 11 -3 Source: Datamonitor Financial performance analysis Table 7: Key financials of global top 10 energy companies.26 26.0 12. 2007–09 15 10 CAGR % (2007-09) 6 5 0 -5 -10 -15 -12 Exxon Mobil -12 Royal Dutch Shell TOTAL BP China Petroleum & Chemical -8 -9 -12 Chevron PetroChina Company -11 ConocoPhillips Gazprom DATAMONITOR NPM (%) 6.0 16.61 11.0 21.07 8.812.0 16.198. Source: Datamonitor Global Top 10 Energy Companies Report: Industry.45 3.A.0 15.57 7.52 4.4 OPM (%) 11.31 10.31 5.178.4 10.42 11.3 27.

42% during the same period. FY2009 40000 35000 operating profit ($m) 30000 25000 20000 15000 10000 5000 0 Royal Dutch Shell Exxon Mobil Chevron PetroChina Company ConocoPhillips TOTAL China Petroleum & Chemical Gazprom BP Eni 40 35 30 25 20 15 10 5 0 operating profit margin (%) operating profit operating profit margin Source: Datamonitor DATAMONITOR Operating margin is a measurement of what proportion of a company's revenue remains after paying for variable costs of production such as wages. China Petroleum & Chemical Corporation (Sinopec) recorded an operating margin of 6. This brief is a licensed product and is not to be photocopied 03/2011 Page 29 . Financial and SWOT Analysis © Datamonitor. Global Top 10 Energy Companies Report: Industry. such as interest on debt.65% in FY2009. and so on. In contrast. A healthy operating margin is required for a company to be able to pay for its fixed costs.Top 10 Companies Landscape Operating profit analysis Figure 13: Operating profit analysis. Gazprom recorded the highest operating margin of 28. raw materials. A low operating margin indicates scope for improving cost structure.

000 25.Top 10 Companies Landscape Net profit analysis Figure 14: Net profit analysis.000 0 Royal Dutch Shell Exxon Mobil Chevron PetroChina Company TOTAL ConocoPhillips China Petroleum & Chemical Gazprom BP Eni 30 25 20 15 10 5 0 net profit margin (%) net profit ($m) net profit ($m) Source: Datamonitor net profit margin (%) DATAMONITOR The net profit margin indicates how much profit a company makes for every $1 it generates in revenue.31% during the same period. This brief is a licensed product and is not to be photocopied 03/2011 Page 30 . Gazprom recorded the highest net profit margin of 26.000 5. A higher profit margin indicates a more profitable company that has better control over its costs compared to its competitors.000 10.000 20.54% in FY2009. A low net profit margin suggests need for optimizing capital structure. FY2009 30. Financial and SWOT Analysis © Datamonitor. Global Top 10 Energy Companies Report: Industry.000 15. ConocoPhillips recorded the lowest net margin of 3. On the other hand.

11 16.29 3.14 0.34 0.45 0. Chevron Corporation PetroChina Company Limited ConocoPhillips Eni SpA OAO Gazprom Current ratio 1.02 1.98 22.36 7.A.31 4.77 9.40 DATAMONITOR Source: Datamonitor Global Top 10 Energy Companies Report: Industry.76 0.14 7.87 6.36 4.50 0.64 1.61 ROA (%) 8.20 9.43 6.46 0.06 1.30 Inventory turnover 16.54 0. This brief is a licensed product and is not to be photocopied 03/2011 Page 31 .45 1.71 10.44 7.42 0.99 1.14 1.09 0.73 10. Financial and SWOT Analysis © Datamonitor.81 3.28 0.45 6.11 0.48 8.04 D/E ratio 0.08 4.26 0.Top 10 Companies Landscape Ratio analysis Table 8: Key industry-specific ratios Company name Exxon Mobil Corporation Royal Dutch Shell Plc BP Plc China Petroleum & Chemical Corporation (Sinopec) TOTAL S.

ConocoPhillips’ unusually high inventory turnover ratio compared to the industry average could mean ineffective buying.61 times in FY2009. Eni had the highest D/E ratio of 0. ConocoPhillips recorded lowest ROA of 3. may have problems meeting their short-term obligations. This implies that the company is better at converting its investment into profit.64 and 0. If the current assets of a company are more than twice the current liabilities.04% in FY2009. A higher ROA indicates the company’s effectiveness to generate profits from the assets employed. respectively. excess inventory. However.50 times. This brief is a licensed product and is not to be photocopied 03/2011 Page 32 . In contrast. then the company is generally considered to have good short-term financial strength. Global Top 10 Energy Companies Report: Industry. Exxon Mobil’s D/E ratio was 0. A weak ROA indicates the need for utilizing the assets of the company more effectively to generate income.40 times in FY2009. It indicates what proportion of equity and debt the company is using to finance its assets. This can result in volatile earnings as a result of the additional interest expense. which recorded current ratios of 0. Financial and SWOT Analysis © Datamonitor. China Petroleum & Chemical Corporation (Sinopec) and PetroChina Company. As inventories are the least liquid form of asset. a high inventory turnover ratio is generally positive.09 times in FY2009. Debt/equity ratio (D/E ratio) D/E ratio is a measure of a company's financial leverage. Gazprom. implying poor sales and. Inventory turnover ratio Inventory turnover ratio represents how many times a company's inventory is sold and replaced over a period. This implies that in the short-term. is financially much stronger when compared to the other players in the industry. which recorded a current ratio of 1.54 times in FY2009. indicating that the company is exposing itself to a large amount of equity.76 times. A high debt/equity ratio generally means that a company has been financing its growth with debt. In comparison.Top 10 Companies Landscape Current ratio Current ratio indicates a company's ability to meet short-term debt obligations. therefore. Gazprom recorded the highest ROA of 10.29% in FY2009 among the top players in the industry. Return on assets (ROA) ROA gives an indication as to how efficient management is at using its assets to generate earnings. followed by TOTAL with 0. Gazprom recorded the lowest inventory turnover ratio of 4. High inventory levels are unhealthy because they represent an investment with a zero rate of return.

The net profit was $19. Canada. Further.325m in FY2009. aromatics.Company Reports COMPANY REPORTS Exxon Mobil Corporation Company overview Exxon Mobil is an integrated oil and gas company based in the US. a decrease of 34. Australia. It is headquartered in Irving. This includes a majority interest in the Castle Peak Power Company that generates electricity for consumers in Hong Kong and mainland China. commodity petrochemicals. the Caspian region. and marketing of oil and natural gas. the company’s net production of liquids. The company is also a major manufacturer and marketer of commodity petrochemicals. The company is also engaged in the production of chemicals.556 of crude oil and 9.700 people. and chemicals. Exxon Mobil operates across the globe. synthetic oil. polyethylene.4% compared with FY2008. Business description Exxon Mobil is an integrated oil and gas company engaged in exploration and production. and upstream-research activities.9 million barrels/day. The upstream segment explores for and produces crude oil and natural gas. Financial and SWOT Analysis © Datamonitor. and bitumen for FY2009. which include crude oil. Exxon’s proved reserves of oil and gas during FY2009 was 23 million barrels.4 million barrels/day. including asset sales. South America. The company conducts its business activities across the globe. by adding two billion oil-equivalent barrels to proved reserves while producing 1. The company recorded sales and operating revenues of $301.007 billion cubic feet of natural gas. It is engaged in exploration and production. The company's upstream business has operations in 36 countries and includes five global companies. a decrease of 57. Exxon Mobil’s net exploration acreage totaled 72 million acres in 33 countries. The company is also engaged in power generation. Global Top 10 Energy Companies Report: Industry. and electricity generation. was 2. Russia. downstream. Exxon Mobil has interests in about 16. and a wide variety of specialty products. The operating profit of the company was $35. The company’s production of natural gas and oil-equivalent for FY2009 was 9. the company had liquid proved reserves of 11.651 million barrels and 68. respectively.5 billion net oilequivalent barrels. Moreover.273 million cubic feet and 3. refining. including olefins. This brief is a licensed product and is not to be photocopied 03/2011 Page 33 . Exxon Mobil operates through three segments: upstream. These companies are responsible for the corporation's exploration.280m in FY2009. The company's upstream portfolio includes operations in the US. and marketing of oil and natural gas. At the end of FY2009.000 megawatts of power generation capacity worldwide. It also has interests in electric power generation facilities. the Asia Pacific. natural gas liquids. a decrease of 58% compared with FY2008. gas and power marketing. Europe.500m in the financial year ending December 2009 (FY2009). and Africa.4% compared with FY2008. refining. the Middle East. the company replaced 133% of reserves produced.760 of natural gas net production wells at the end of FY2009. and polypropylene plastics. Further. production. The company had 16. development. for FY2009. Texas and employs about 80. During the same year.

transportation systems. lubricants. synthetic lubricant base stocks. and other products and feedstocks to its customers around the world. the company had interests in 37 refineries across 21 countries. Global Top 10 Energy Companies Report: Industry. aromatics.3 million barrels per day and lubricant basestock manufacturing capacity of 143 thousand barrels per day. Exxon Mobil's refinery throughput was 5. synthetic rubber. and distribution centers that provide a range of fuels. The refining and supply operations encompass a global network of manufacturing plants.4 million barrels per day. supply. plasticizers. fluids. The company supplies lube base stocks and markets finished lubricants and specialty products. The fuels marketing business operates throughout the world. oriented polypropylene packaging films. The company's refining and supply business focuses on providing fuel products and feedstock. with distillation capacity of 6. This brief is a licensed product and is not to be photocopied 03/2011 Page 34 . Mobil. and On the Run brands serve motorists at nearly 28.Company Reports The company's downstream activities include refining.000 service stations and provide over one million industrial and wholesale customers with fuel products. The Exxon. polyethylene. and other petrochemical products. Esso. and other highvalued products. In FY2009. and fuels marketing. Exxon Mobil Chemical is an integrated manufacturer and global marketer of olefins. At the end of FY2009. additives for fuels and lubricants. zeolite catalysts. The chemicals division manufactures and sells petrochemicals. lubes. Financial and SWOT Analysis © Datamonitor. Exxon Mobil manufactures clean fuels. polypropylene.

and marketing of natural gas and electricity. the company’s net production of liquids. which include crude oil. energy retailing and trading. The annual ranking by Forbes magazine of the top 2. Exxon Mobil was ranked fourth on the Forbes Global 2. production. synthetic oil. The company is also involved in the natural gas supply. was 2.4 million barrels/day. The company has established a strong brand image operating for several years worldwide. assets. the company’s refineries are more than 60% larger than the industry average with more conversion capacity and more integration with chemical and lubes operations.000 public companies in the world is based on a mix of four parameters: sales. and to produce higher-value products with lower feedstock and operating costs. In FY2009. Financial and SWOT Analysis © Datamonitor. the company is actively involved in exploration. In upstream. Global Top 10 Energy Companies Report: Industry. and bitumen. the company produces and markets refined petroleum products.Company Reports SWOT analysis Strengths Leading market position Exxon Mobil is one of the largest oil companies in the world. Leading market position across key product lines gives the company a competitive edge with a strong brand image. Exxon Mobil has a distillation capacity of 6. transport. The company's vertically integrated operations provide it with greater flexibility to optimize operations. and gas and power marketing activities. Vertically integrated operations Exxon Mobil is a vertically integrated energy company and its operations include exploration and production. The company has interests in oil production operations in 36 countries including five global companies. storage.9 million barrels/day respectively. conducted in 2009 and 2010.3 million barrels per day and lubricant basestock manufacturing capacity of about 143 thousand barrels per day. it also has majority interest in 37 refineries worldwide. Exxon Mobil’s fuels and lubes marketing business portfolios include operations around the world. and market value. Further. distribution activities. In downstream. with multiple channels to market serving a globally diverse customer base.000 ranking. power generation. This brief is a licensed product and is not to be photocopied 03/2011 Page 35 . natural gas liquids. The company’s production of natural gas and oil-equivalent for FY2009 was 9.273 million cubic feet and 3. profit. development.

6%. France. Germany. in April 2010. its core market.7% of the total revenues. as well as to enhance manufacturing and production methods and improve service. Other countries accounted for 27. and France.050m on R&D in FY2009. The company’s global operations and regional brand identity gives it competitive advantage over its competitors and also indicates that the company has a wider scope in increasing its revenues by utilizing its global presence. Singapore. The reinjection of these gases would also reduce the plant's air emissions by almost one-third. Because of its strong R&D capabilities. ExxonMobil Chemical developed two new grades of V series co-extruded battery separator films. respectively. which enhanced safety for hybrid and electric vehicles. and Singapore were 5. The company intends to recover and reinject nitrogen and other gases from the field's natural gas production. Financial and SWOT Analysis © Datamonitor. Germany. which boosted the production capacity by 5. The non-US region covers Japan. US. Further. ExxonMobil Chemical applied its proprietary catalyst hydrogenation technology to produce ultra-low aromatic (ULA) fluids that comply with the most stringent environmental and regulatory requirements. Italy. 4. and 2. and $712m in FY2005. Further in 2009. Global Top 10 Energy Companies Report: Industry. Moreover. $814m in FY2007. Belgium. for instance. 4. Italy. the company extended its drilling technology at its Santa Ynez unit offshore southern California. Exxon Mobil divides its geographic divisions as US and non-US. $733m in FY2006.5% of the remaining revenues. and revenues from the UK accounted for 6. It spent $1. Revenues from Japan accounted for 7.3%. the UK. Strong R&D capabilities Exxon Mobil has strong research and development (R&D) capability. Canada. in order to enable more oil and gas to be recovered from the reservoirs. Over the past three years the company’s capital expenditure in Texas has exceeded $700m.8%.Company Reports Diversified revenue stream Exxon Mobil has wide presence across various regions. 4%. R&D expenses in previous years were $847m FY2008. its revenue contribution for FY2009 from Belgium. In FY2009.9%. This brief is a licensed product and is not to be photocopied 03/2011 Page 36 .8 million barrels of oil. its world wide presence reduces exposure to economic conditions or political stability in any one country or region. the company. revenues from Canada accounted for 7%. power tools. and electronic devices including laptop computers. Further.3%.8% of the total sales and operating revenues from the US. the company generated 29. The company’s revenue stream is diversified in terms of geographies. the company introduced an advanced technology to extend the production life of oil and natural gas fields in Texas. in January 2010. The company conducts research to develop new products and improve existing products. In the same year. The company's strong R&D capabilities provide it with a competitive advantage and help it to innovate and launch new products.

A continuation of this trend is likely to have an adverse impact on the company's revenue growth rates. Further. and it might have to pay a huge penalty of up to a $1 billion regarding this. Chinese National Offshore Oil Corporation (CNOOC) expressed its interest of acquiring 49% stake in 23 oil blocks already leased to the international oil companies (IOCs). for not renewing three oil mining leases (OMLs) for 20 years and operating the leases illegally. Further. along with others held by Shell Petroleum Development Company. Legal proceedings leading to administrative action in Nigeria In May 2010. Exxon Mobil is currently facing allegations that it damaged the Texas oil wells it leased with cement. Rilwanu Lukman. The proved oil reserves fell from 7. The production has declined at a CARC of 4%. and dynamite to prevent other producers from tapping fields it no longer wanted.744 million barrels in FY2007 to 6. Some of these legal proceedings and claims seek damages. Lukman declined to sign the contract because the $600m offered for renewal by Exxon Mobil was far below the valuation undertaken by a committee set up to negotiate and renew the leases. Global Top 10 Energy Companies Report: Industry. Financial and SWOT Analysis © Datamonitor. the company's proved oil reserves have also declined significantly over the past three years. In 2009. fines. The net liquids production volumes worldwide have been declining since FY2007. Moreover. a Texas oil family.Company Reports Weaknesses Litigation and contingencies likely to hamper company’s image The company is involved in various lawsuits. claims. to the federal government. The absence of a valid contract encouraged the CNOOC to offer a revised $50 billion bid for a 30% stake in the oil leases held by Exxon Mobil. Exxon Mobil plugged several wells it had drilled in the land of the O'Connor family. at a CARC of 9%. both the companies have illegally discharged hundreds of tons of volatile organic compounds annually from their gasoline terminals in Guam and Mariana Islands. the company’s subsidiaries Mobil Oil Guam and Mobil Oil Mariana Islands were fined $2. Exxon Mobil faced a legal hurdle from the Nigerian Ministry of Petroleum Resources.4m for violating the federal Clean Air Act by failing to control emissions from their facilities. Such litigations and lawsuits will adversely affect the image of the company besides resulting in huge financial penalties. trash. or penalties in substantial amounts or remediation of environmental contamination. The mining leases were operated without the signature of one of the key participant to the contract. and Total.4 million barrels per day in FY2009. and legal proceedings arising out of the conduct of the company's business. former Minister of Petroleum Resources.6 million barrels per day in FY2007 to 2. For instance. Dr. Declining net liquids production and oil reserves The upstream division has recorded a consistent decline in its production volumes. Chevron Nigeria. This brief is a licensed product and is not to be photocopied 03/2011 Page 37 . from 2. The government sources confirmed that Mr.469 million barrels in FY2009. in April 2010.

Global Top 10 Energy Companies Report: Industry.6 billion as a reserve value for Exxon Mobil's oil and gas reserves in the blocks. which was later revised to $1.5 billion after several consultations with Mr.Company Reports The valuation carried out by committee on the blocks arrived at approximately $2. However. Exxon Mobil was therefore required to pay $600m in proportion to its 40% interest in the blocks. the contract still remains invalid and pending due to the absence of supervision over all operations by the minister. Lukman and Dr. Financial and SWOT Analysis © Datamonitor. President's Special Adviser on Petroleum Matters. Such kind of violations could result in severe administrative actions affecting the company's credibility. Emmanuel Egbogah. This brief is a licensed product and is not to be photocopied 03/2011 Page 38 .

Exxon Mobil has dramatically increased investments in the oil sands over recent years through its stake in Imperial Oil and Exxon Mobil Canada. This brief is a licensed product and is not to be photocopied 03/2011 Page 39 . and Asia Pacific markets. Europe. Hence. driven by the demand in North America. affordability.6% interest in Imperial Oil. In addition. supplying markets in Asia. a joint venture established to recover shallow deposits of oil sands. Further.000 barrels per day. Exxon Mobil has a 69. The Canadian Association of Petroleum Producers estimates that Canada’s oil sands deposits have about 175 billion barrels of economically viable oil. and North America. Exxon Mobil could hence benefit on improving the unconventional resources through these investments and expand its product portfolio. Canada’s oil sands have one of the largest known reserves of oil. Syncrude’s net production of synthetic crude oil was about 259. particularly for the economies in the fast growing Asia Pacific region. such as oil sands. estimated to be worth around $15 billion. Europe. In FY2009. The company is also participating in the development of LNG in Australia. in the Kearl oil sands project. The projected increase in demand for liquid fuels and natural gas in the coming years would help the company enhance its sales and strengthen its financial base.000 barrels per day and gross production was about 280. Canada.000 barrels per day (bbl/d) and raw bitumen production capacity to 600. are currently observed as a feasible option to conventional oil. and ease of transport.Company Reports Opportunities Exploratory and development activities using alternate energy resources Unconventional energy resources. The company forecasts the global LNG demand to more than triple in volume from 2005 to 2030. respectively. Exxon Mobil is currently participating in LNG production in Qatar and Indonesia with a combined gross capacity of over 50 million tons per year.000 bbl/d by 2020. The demand for liquid fuels is expected to increase to 104 million oil-equivalent barrels per day by 2030. It has interests in Canada’s oil sands deposits through Syncrude. Rising demand for liquid fuels Liquid fuels provide the largest share of energy supply presently due to their availability. in December 2009. The Kearl project is located approximately 40 miles north of Fort McMurray. the PNG LNG Project will be an important supply source to meet this future demand. Imperial Oil is the owner of a 25% interest in the joint venture. Further. Imperial Oil and Exxon Mobil Canada Properties holds 70% and 30% interest. Financial and SWOT Analysis © Datamonitor. Syncrude recently announced plans to expand synthetic crude production capacity to 425. The company’s share of net production in FY2009 was about 65. due to the diminishing oil and natural gas reserves. Exxon Mobil announced that all the co-venturers have agreed to proceed with the development of the Papua New Guinea (PNG) LNG project. a joint venture established to recover shallow deposits of oil sands. Global Top 10 Energy Companies Report: Industry. Alberta. The strong economic growth in the developing countries will drive global oil and natural gas demand.000 barrels per day. an increase of 25% from 2005.

Exxon Mobil expects to spend about $28 billion in 2010. This brief is a licensed product and is not to be photocopied 03/2011 Page 40 . Middle East. North America. an aromatics extraction unit to produce 340. and a paraxylene unit to produce 80.000 net barrels per day to the company's production in FY2010.000 metric tones per year (mt/year) polyethylene units. a 125. bring on new upstream projects.000 mt/year of benzene. In the chemical business. Moreover.000 mt/year oxo-alcohol unit. the company expects its share of production from new projects to increase by 1. the company has scaled up construction activity on world-scale petrochemical projects in Singapore.000 mt/year specialty elastomers unit. Exxon Mobil started up eight major projects which are projected to add the equivalent of 400.000 mt/year polypropylene unit.Company Reports Increase in capital investments Exxon Mobil plans to invest between $25 billion and $30 billion annually through 2014 to deliver major projects to meet growing world energy demand. during FY2009. by early 2011. Singapore. Global Top 10 Energy Companies Report: Industry. The company expects the remaining production volumes to be sourced from established areas. a 300. The company plans to increase its production volumes annually till FY2014. These investments also reinforce Exxon Mobil’s position as an industry leader in bringing new supplies to the market. and Asia Pacific. in April 2010. these growth areas account for about 42% of Exxon Mobil’s production. Overall. and are expected to generate about 50% of total volumes by FY2014. Further. The company's petrochemical project is expected to have two 650. increase the company’s base refining capacity. and Russia.000 mt/year. Financial and SWOT Analysis © Datamonitor. For instance. a 450.5 million barrels of oil equivalent per day by FY2015. by focusing in regions such as West Africa. and grow its chemical business. Currently. An additional 12 major projects are expected to start production between FY2010 and FY2012. These investments aim to develop new technology. Exxon Mobil announced that it has plans of commencing its second petrochemical project on Jurong Island. about 3% more than its previous year towards capital investments. which include Europe.

owned by Transocean and leased to BP. Hence. especially regarding global warming. the incident has also placed the environmental protection bill in risk. According to the rule. resulting in oil leakage of about 5. Environmental regulations Exxon Mobil’s businesses are subject to numerous laws and regulations relating to the protection of the environment. Further. The non-US countries accounted for more than 70% of the total revenues of the company in FY2009. This brief is a licensed product and is not to be photocopied 03/2011 Page 41 . complex regulatory requirements. The company might also face changes in the political or economic conditions in the foreign countries it operates in. For example. compared with 1990 emissions levels. Mr. the company’s ability to mitigate the adverse impacts of these events depends substantially on the effectiveness of its rigorous disaster vigilance and business continuity planning. high tides. by 2015 compared with the 2003 levels. The protocol calls on industrialized countries to reduce their greenhouse gas emissions level by 5. Such instabilities could negatively impact the revenue growth of the company. the states have to reduce the allowable sulfur dioxide (SO2) emissions by 70% and reduce nitrogen oxide (NOX) emissions by 60%. to reduce the emission levels.2% on an average annual basis during the 2008–12 period. The bill supported by the US President. In these foreign locations. regulatory standards have been continuously tightened in recent years. The company is governed by these regulations which could impose new liabilities on the company. which could be a threat to the wildlife. demands for new offshore drilling. One of the most important developments in this area has been the introduction of the Kyoto Protocol for the reduction of greenhouse gases. Further. Moreover. the company might experience fluctuations in exchange rates. hurricanes may damage its offshore production facilities or coastal refining and petrochemical plants in vulnerable areas. Risks associated with conducting business outside the US The company operates in more than 200 countries under the names Exxon Mobil. uncontrolled spill of oil in the Gulf of Mexico have made the path to approval of the bill even more complicated. Obama. This could result in a material decline in Exxon Mobil’s profitability in the short term. According to the US National Weather Service. The explosion and the growing. and restrictions on its ability to repatriate investments and earnings from its foreign operations. in April 2010. Global Top 10 Energy Companies Report: Industry. With rising awareness of the damage to the environment caused by industry. ponds and lakes in south-east Louisiana. and Mobil. the strong winds.2 million acres.000 barrels every day. Exxon. and waves could drive the oil into inlets. Esso. the US environmental protection agency (EPA) issued a Clean Air Interstate Rule (CAIR). which aims to reduce carbon and other greenhouse gas emissions 17% below 2005 levels by 2020.Company Reports Threats Natural calamities Exxon Mobil’s operations may be disrupted by severe weather events and natural disasters. in 2005. Exxon Mobil’s net acreage in the Gulf of Mexico during FY2009 was 2. The incident forced the US administration to pass a bill to ban oil drilling in new areas of the US coast and in the Gulf of Mexico. exploded in the Gulf of Mexico. Financial and SWOT Analysis © Datamonitor. the Deepwater Horizon Rig.

liquids recovery and fractionation facilities. Exxon Mobil Libya.8 million tonnes per annum. with 1. in January 2010. In the same month. In the subsequent month. commenced its drilling operations in deepwater exploration well in Libya. This brief is a licensed product and is not to be photocopied 03/2011 Page 42 . In December 2009. Exxon Mobil inaugurated its newest co-generation plant at its Antwerp refinery in Belgium. and 43 of its company owned and operated sites in the Phoenix. and two additional offshore wellhead platforms. Arizona to Couche-Tard. Petronet LNG entered into a sales and purchase agreement with the Australian subsidiary of Exxon Mobil for the long-term supply of LNG from Gorgon LNG Project in Western Australia. the company announced its plans to build a technology center in Shanghai. Exxon Mobil Chemical applied its proprietary catalyst hydrogenation technology to produce ultra-low aromatic (ULA) fluids that comply with existing environmental and regulatory requirements. The following month. In February 2010. Exxon Mobil Iraq. China to provide product applications support for its growing business in the Chinese and Asian markets. and electronic devices including laptop computers. power tools. Exxon Mobil announced the sale of its On the Run convenience store franchise system in the US. Besides generating 125 MW. In April 2009. Exxon Mobil and Papua New Guinea Liquefied Natural Gas (PNG LNG) Project finalized on a gas sales agreement with Tokyo Electric Power Company (TEPCO) for the long-term sale and purchase of LNG totaling approximately 1. Qatar Petroleum and Exxon Mobil announced the commencement of operations of Al Khaleej GasPhase 2 (AKG-2) project. the new plant would reduce Belgium's carbon dioxide emissions by approximately 200. signed an agreement with the Iraq Ministry of Oil to redevelop and expand the West Qurna field in southern Iraq. which enhanced safety for hybrid and electric vehicles. The AKG-2 project involves construction of onshore gas treating. in March 2009. the Turkish government approved an agreement between Exxon Mobil Exploration and Production Turkey and the Turkish national oil company Turkiye Petrolleri Anonim Ortaklıgı (TPAO) to explore two deepwater blocks in the Black Sea. In August 2009. Financial and SWOT Analysis © Datamonitor. Subsequently. also in March 2009. In June 2009. one of the largest operating LNG production facilities in the world. Qatar Petroleum and Exxon Mobil established the Qatargas 2 Train 52. In the following month. Global Top 10 Energy Companies Report: Industry. Exxon Mobil Chemical developed two new grades of V series co-extruded battery separator films.000 tonnes per year.Company Reports Recent developments Exxon Mobil. the company’s subsidiary. announced an investment between $25 billion and $30 billion annually over the next five years to meet expected long-term growth in world energy demand.250 million cubic feet per day (mcfd) of sales gas capacity. Exxon Mobil’s subsidiary.

an Exxon Mobil affiliate. in March 2010. Singapore by early 2011. Global Top 10 Energy Companies Report: Industry. In April 2010. Financial and SWOT Analysis © Datamonitor. In March 2010. a specially designed. Sinopec announced its plans of entering into a joint venture with Exxon Mobil and Saudi Aramco to build an oil refinery which could process 12 million tons of crude per year in Fujian. to explore the deepwater Black Sea offshore Turkey. In the same month. This brief is a licensed product and is not to be photocopied 03/2011 Page 43 . newly built drillship from a subsidiary of Transocean.Company Reports Exxon Mobil Chemical expanded its portfolio of metallocene polyethylene (mPE) resins with the introduction of Enable mPE 35-05 grade resin for high clarity films. China. Enable mPE 35-05 resin provides converters and end users with significant unprecedented combination of film processing and higher alpha olefin (HAO) performance benefits. announced its plans of using the Deepwater Champion. Exxon Mobil announced that it could start its second petrochemical project on Jurong Island. Exxon Mobil Exploration and Production Turkey.

the company participated in 345 successful exploratory wells drilled outside proved areas. Moreover. Guyana.4% compared with FY2008. Italy. It is headquartered in the Hague. Norway. of which 3. Global Top 10 Energy Companies Report: Industry. The company also has interests in renewable sources of energy such as wind. a decrease of 58. This brief is a licensed product and is not to be photocopied 03/2011 Page 44 . The net profit was $12. Financial and SWOT Analysis © Datamonitor. It is a holding company which owns direct and indirect investments in a number of companies comprising the group.518m in FY2009.000 people. In FY2009. Business description Shell is engaged in the aspects of the oil and natural gas industry worldwide. The company recorded revenues of $278. It extracts bitumen from mined oil sands and converts it to synthetic crude oil. the company's total hydrocarbon production totaled 3. Brazil. solar and hydrogen. and marketing and shipping of oil products and chemicals.632 million boe was from its subsidiaries and 785 million boe was associated with Shell’s share of equity-accounted investments.178m in FY2009.5% compared with FY2008. Shell has extensive operations in more than 90 countries around the world. The upstream segment consists of the upstream international and upstream Americas businesses. The upstream segment explores for and recovers crude oil and natural gas around the world. In FY2009. The business also markets and trades natural gas and power in support of Shell’s businesses. Shell added acreage to its exploration portfolio mainly from new licenses in Australia. and successfully bid for new exploration licenses in Egypt. and the US. Shell operates through two business segments: upstream and downstream.417 million boe of proved oil and gas reserves before accounting for production. Additionally. it manages the US based wind business.142 thousand barrels of oil equivalent (boe) per day. The company has extensive operations in more than 90 countries around the world. The upstream Americas manages the upstream business in North and South America. It also extracts bitumen from oil sands that is converted into synthetic crude oil. Shell added 4. the Netherlands and employs about 101. a decrease of 39. power generation. During FY2009. The segment also engages in liquefying natural gas by cooling and transports it to customers. and renewable energy.188m in FY2009. The upstream international manages the upstream business outside the Americas. a decrease of 52. transportation and marketing of natural gas and electricity.3% compared with FY2008. Canada. the segment also develops wind power as a means to generate electricity. along with joint venture partners. It also manages the global LNG business and the wind business in Europe. and French Guiana. The operating profit of the company was $21. South Africa. Shell also has interests in chemicals. It also converts natural gas to liquids (GTL) to provide cleaner burning fuels. Jordan.Company Reports Royal Dutch Shell Plc Company overview Royal Dutch Shell (Shell) is engaged in oil and gas exploration and production.

and industrial use. Shell Marine Products. trades about 15 million barrels of crude oil equivalent per day. mining. Germany. which in turn are used in items such as fibers and textiles.45 billion liters of fuel in FY2009. Financial and SWOT Analysis © Datamonitor.000 kilometers of pipeline in about 60 countries. the UK. Shell Trading. It supports the oil products. biofuels. and chemicals businesses of Shell. distribution. and Shell Global Solutions. marketing which includes retail. Shell has interests in more than 30 chemical manufacturing sites worldwide. Shell Bitumen. The alternative energies and CO2 business manages the company’s emerging businesses or functions to support the development of new transport fuels until the business is integrated into Shell’s mainstream businesses. The segment also oversees Shell’s interests in alternative energy (excluding wind) and CO2 management. 2. with a capacity of approximately four million barrels of crude oil per day. Alternative energies and CO2 is also responsible for leading energy conservation and CO2 management activities across Shell. and Shell Sulphur Solutions. The downstream segment also trades Shell’s flow of hydrocarbons and other energy related products. and coaches. and agriculture and construction industries in around 100 countries. thermal and electrical insulation. and biodegradable detergents. Canada. The manufacturing portfolio of Shell includes interests in over 35 refineries. and research and development expertise to Shell companies and the energy and processing industries across the world. The chemicals business produces and markets petrochemicals for industrial customers. The B2B business of Shell sells fuels and special products and services to a broad range of commercial client base through six separate businesses: Shell Aviation. Shell Lubricants sells lubricant products to customers across the transport sector for passenger cars. gas and power. paints. trucks. Shell is one of the largest single branded retailers with about 44. The downstream segment manages Shell’s manufacturing. The distribution network includes about 250 distribution facilities. Norway. technical services. engaged in trading and shipping activities. computers. and 9. Qatar. supplies the downstream businesses. as well as in manufacturing. The chemicals business. and alternative energies and carbon dioxide (CO2) business. lubricants. lubricants. business to business (B2B). markets gas and power. power generation. and provides shipping services. one in the Netherlands and another in the US. and liquefied petroleum gas (LPG) for home. The directorate has two main research and development laboratories. and India. The company sold 1. Shell Global Solutions provides business and operational consultancy. Shell Trading.Company Reports The exploration and production business is supported by the exploration and production research and development (R&D) directorate which is engaged in application of technology to enhance the cost-efficiency and performance of the company's exploration and production activities. These products are used in manufacturing plastics. including joint ventures. and detergents. coatings. These include GTL products. Shell Gas (LPG).000 service stations spanning more than 80 countries. bitumen. transport. This brief is a licensed product and is not to be photocopied 03/2011 Page 45 . and marketing activities for oil products and chemicals. vehicles. produces and sells petrochemicals to industrial customers worldwide. a part of the company’s downstream business.500 storage tanks. Global Top 10 Energy Companies Report: Industry. Shell Commercial Fuels. The segment sells a range of products including fuels. medical equipment and sterile supplies. The segment comprises the downstream businesses of manufacturing which includes the following: refining and supply and distribution. Additional technology facilities are in Oman. and hydrogen.

propylene. Global Top 10 Energy Companies Report: Industry. solvents. propylene oxide. and Shell insurance operations. Financial and SWOT Analysis © Datamonitor. non-trading currency exchange effects. The chemicals portfolio of the company includes several joint ventures: Infineum. The corporate segment also includes insurance underwriting results and the functional and service-center costs that have not been allocated to the other segments. and intermediates chemicals such as styrene monomer. It formulates. France. This segment consists of the following functional activities: holdings and treasury. Shell also reports a non-operating segment. lubricants. Italy. This brief is a licensed product and is not to be photocopied 03/2011 Page 46 . and Shell Petrochemicals Company (CSPCL). and Singapore. CSPCL is a 50:50 joint venture between Shell and CNOOC Petrochemicals Investment. detergent alcohols. Germany. and specialty additives and components. Brazil. and markets high-quality additives used in fuel. it also accounts for the interest and other income of non-operational nature. Saudi Petrochemical Company (SADAF). headquarters and central functions. and aromatics. which represents the functional activities supporting the whole group. The company produces a variety of petrochemicals for the Chinese market. Mexico. manufactures. corporate. It is a 50:50 joint venture between Shell and Saudi Basic Industries Corporation (SABIC). Infineum has manufacturing centers in seven countries: the US. and tax on these items. interest expense. In addition. Infineum is a 50:50 joint venture between Shell and Exxon Mobil.Company Reports The segment produces base chemicals such as ethylene. SADAF produces base and intermediate chemicals for international markets. and ethylene glycol. ethylene oxide.

LNG. synergies.000 kilometers of pipeline in about 60 countries. and marketing of natural gas and electricity.000 service stations spanning more than 80 countries. The company is also involved in the natural gas supply. Global Top 10 Energy Companies Report: Industry. The company's vertically integrated operations give it significant competitive advantage in the global market in terms of economies of scale. over 250 distribution facilities. The cornerstone of the company is its leadership position in various domains such as oil products. The company has established a strong brand image operating for over 100 years worldwide. the company participated in 345 successful exploratory wells. Shell is ranked second in 2009 Forbes Global 2000. Its refining and marketing division operates 35 refineries with an installed capacity of approximately four million barrels per day.Company Reports SWOT analysis Strengths Strong market position Shell is one of the largest oil companies in the world. the company is engaged in the exploration and production of oil and gas. transport. During 2009.142 thousand barrels of oil equivalent (boe) per day. In FY2009. This brief is a licensed product and is not to be photocopied 03/2011 Page 47 . and cross-marketing opportunities. Financial and SWOT Analysis © Datamonitor. deep-water production. Vertically integrated operations Shell’s business operations are vertically integrated with presence in both upstream and downstream businesses. and polyolefin. The company's strong market position gives it significant bargaining power in the global oil industry. with about 44. It was ranked eight in 2007. distribution activities. Shell is one of the largest single branded retailers with more than 44. In downstream. The company conducts its operations through an extensive distribution network comprising 9. the company produces and markets refined petroleum products. Its operations include upstream and downstream operations spanning 90 countries. and 2. up from sixth in 2008.500 storage tanks. storage. The company has interests in oil production operations in several countries and majority interest in over 35 refineries worldwide. In upstream. Shell operates the world's largest single-brand retail network.000 service stations. the company's total hydrocarbon production totaled 3. The company is ranked first in 2009 Fortune Global 500 ranking up from third in 2008.

Company Reports Strong exploration technological capability Shell has strong exploration technological capabilities. to meet the rising global energy demand. In FY2009. For instance. which helps in the accurate exploration drilling. The company’s research and development (R&D) focuses on conducting research to access oil and gas in frontier locations such as ultra deep water and the Arctic. This brief is a licensed product and is not to be photocopied 03/2011 Page 48 . Through its Smart Fields technologies. and to access heavy oil resources that are mined at the surface. The company has been making efforts towards enhancing its exploration technology to locate new resources of oil and gas. the company is also pursuing the next generation of EOR applications. where it is looking to combine steam. solvent. The company’s strong exploration technological capabilities provide it with a competitive advantage by strengthening its upstream operations. across a number of fields for enhanced oil recovery (EOR) to help increase oil recovery figures. Shell undertakes airborne and satellite-based gathering of geophysical data and analyses it for better understanding of underground formations. such as oil shale and very heavy oil. such as hybrid thermal technologies in Canada. Global Top 10 Energy Companies Report: Industry. Shell recovers resources in locations considered to be difficult or too costly to extract. In addition. Shell has also been working towards increasing its access to contaminated gas resources by developing and applying technologies that lower the cost of removal of contaminants such as CO2 and hydrogen sulphide. Financial and SWOT Analysis © Datamonitor. the company has been recovering oil at the Champion West field in Brunei that had remained undeveloped for more than 25 years. to unlock hydrocarbon resources with complex compositions. these technologies helped in Shell identify new exploration prospects in the Middle East and Africa. and heater techniques to optimize economic recovery. Shell is also implementing three advanced technology applications with its partners in Oman.

It processes 145. The investigation by the department was conducted as part of a national inspection program following a lethal explosion at BP's Texas City plant in 2005.5m in November 2009. The Anacortes refinery employs 400 people and several hundred contractors. Financial and SWOT Analysis © Datamonitor. was contacted by the US Department of Justice regarding Shell’s use of the freight forwarding firm Panalpina and potential violations of the US Foreign Corrupt Practices Act (FCPA) as a result of such use. Shell Oil. Kazakhstan. in a settlement accepted by the Superior Court of California. and Saudi Arabia. Shell was one of 11 oil groups asked by the SEC to detail its relationship with Panalpina. in June 2008. which the US authorities were investigating in relation to suspected irregular payments. The refinery is the second largest of the four major facilities supplying gasoline and other petroleum products to the Puget Sound region. Administrative action Shell had agreed to pay $19. the US. This could result in additional costs for the company. This brief is a licensed product and is not to be photocopied 03/2011 Page 49 . Previously.600 by Washington's Department of Labor and Industries. contrary to the Foreign Corrupt Practices Act. bunker oil and other products. Shell could face penalties if the allegations that bribes were paid to Nigerian customs officials on behalf of the company are proved. In March 2008. Shell’s US subsidiary. Panalpina’s own internal investigations had revealed payments to Nigerian customs officials. a Swiss shipping and logistics company. affecting its profits.Company Reports Weaknesses Violation of anti-corruption laws Shell is currently under investigation by the US Securities and Exchange Commission (SEC) and the US Department of Justice for violations of the US Foreign Corrupt Practices Act. in Nigeria. aviation fuel. following allegations by the state government concerning some of its underground storage tanks with regards to safety norms. diesel. Further such safety violations could result in severe administrative actions affecting the company’s credibility. the company had faced an administrative action in 2008. In July 2007. In 2007. The department cited 23 violations ranging from inadequately instructing operators on how to deal with emergencies to faulty inspections.000 barrels of crude everyday into gasoline. The company was fined for multiple safety violations in its Anacortes refinery. Shell was fined $109. Global Top 10 Energy Companies Report: Industry.

There was an allegation against Shell of overstating oil and natural gas reserves and artificially inflating stock prices over a five-year period from April 1999 to March 2004. This brief is a licensed product and is not to be photocopied 03/2011 Page 50 . plus administrative costs. to settle a lawsuit with investors outside the US who purchased the company’s shares. Financial and SWOT Analysis © Datamonitor. to settle a class action lawsuit led by the Pennsylvania State Employees' Retirement Board and the Public School Employees' Retirement Board. Global Top 10 Energy Companies Report: Industry. In 2004.Company Reports False statement of oil and gas reserves Shell agreed to pay $120m in June 2008. including then Chief Financial Officer Judy Boynton. Shell agreed to pay $352. Such huge penalties can have adverse effects on the company’s profitability.9 billion barrels). Many of the company’s executives lost their jobs. Shell admitted to have overstated its oil reserves by about 20% (equivalent of 3.6m. In April 2007.

000 square kilometers) of mineral rights in the Eagle Ford shale play. The company’s increasing focus on its tight gas portfolio. Shell has agreed to acquire subsidiaries which own substantially all of the business of East Resources for $4. Following the success of Pinedale.7 billion boe (21 trillion cubic feet equivalent) resources base. and through divestment of non-core positions.250 square kilometers) of acreage overall. One of the company’s key strategies is to grow and upgrade the quality of its North America tight gas portfolio.000 barrels of oil equivalent per day (810 million cubic feet equivalent per day). Shell’s activities in US tight gas began in 2001. Shell estimates that these new positions have the potential to yield over 16 trillion cubic feet of gas equivalent (tcfe) of resources (more than 2.250 square kilometers) of North America tight gas acreage.05 million net acres (4. and will be able to integrate these new assets into its existing South Texas operations. with acreage purchases in the Pinedale Anticline in Wyoming. operated acreage in the Marcellus. where Shell has been active for many years. The company has been expanding its North America tight gas portfolio. East Resources also has about 60 million cubic feet equivalent per day (10.7 billion. through the 2008 acquisition of Duvernay. In 2010. Shell has added approximately 1. from a 3. These undeveloped acreage positions are in the liquids rich window of the Eagle Ford play.000 net acres (2.600 square kilometers) of highly contiguous. The company’s continued focus on operating efficiency has resulted in low production costs. This brief is a licensed product and is not to be photocopied 03/2011 Page 51 . an increase of 62% over FY2008. in the Haynesville play in Texas/Louisiana. East Resources is a privatelyowned business with its primary activity focused on the Marcellus shale.3 million acres (5. in the northeastern US. and in Western Canada. predominantly in natural gas. Shell has more recently expanded its tight gas acreage positions in South Texas.000 barrels oil equivalent per day) of production. and divestments from noncore positions across North America. will enable the company to position itself for profitable growth. Shell has acquired 250.000 net acres (1. with substantial medium-term growth potential. East Resources has about 650. in 2010. Shell’s strong technology and capabilities will help unlock the potential from these resources and strengthen the company’s position in the industry. the company’s North America tight gas production was about 140. In FY2009.7 billion boe).Company Reports Opportunities Development of upstream portfolio Shell has been developing its upstream portfolio through exploration and focused acquisitions. Shell will be the operator in this highly contiguous acreage. In addition. as part of its on-going acreage build strategy. Financial and SWOT Analysis © Datamonitor. in South Texas. In May 2010. and 1. Global Top 10 Energy Companies Report: Industry.

just off the Singapore coast. Shell designed the new facilities to maximize the benefits of locating refining and petrochemicals production within a single manufacturing hub on Bukom and Jurong islands. Diesel produced with the BioForming technology process would have the same properties as conventional diesel. 750. and logistics. and with Codexis on enzyme conversion. 230. Jurong Island is a major petrochemical zone which provides opportunities for further integration with current and potential customers.000 tons per annum of propylene. and 155. This brief is a licensed product and is not to be photocopied 03/2011 Page 52 . The additional capacity brought on stream by the SEPC project includes: 800. In June 2010.000 tons per annum of ethylene. Traditionally. This new joint technology program will investigate Virent’s BioForming process as a means for converting plant sugars directly into diesel. The company also has a joint venture. Cellana. Financial and SWOT Analysis © Datamonitor. and other agricultural residues. and many chemicals. the expansion of the joint technology program to include research into the production of diesel from plant sugars offers considerable potential and complements Shell’s wider biofuels portfolio. operations. 450. The fuel could also be blended with conventional diesel in higher concentrations than conventional biodiesel. including biogasoline. SEPC is Shell’s largest petrochemicals investment to date and the second world-scale petrochemicals project the company has completed in Asia in four years.000 tons per annum of monoethylene glycol. As part of this effort. The collaboration would help Shell sustain its leading position in the biofuels market. Shell has been focusing on expanding its operations in growth markets and to integrate oil and chemicals manufacturing to gain efficiencies.000 tons per annum benzene.000 tons per annum of butadiene. Virent’s BioForming process is a leading technology for the production of sustainable advanced biofuels. Its global program includes collaborations with Iogen Energy on the production of enzymatic cellulosic ethanol from agricultural waste. biodiesel has been made from vegetable oils. fully-integrated refinery and petrochemicals hub. In addition. Investment in advanced biofuels Shell is a leader in the development of advanced biofuels. corn stover. Shell and Virent have been conducting a joint research and development effort since 2007 to make biogasoline from plant sugars. The sugars could eventually be sourced from a range of non-food feedstocks such as sugarcane bagasse. Shell is working towards meeting government mandates for biofuel. which undertakes research of marine algae for vegetable oil. This project will enable the company to sustain its leading position in the Asian petrochemicals market. It is the company’s largest. The existing joint research and development agreement will also be expanded to include research into the production of diesel. a pilot plant was started in 2009.Company Reports Shell Eastern Petrochemicals Complex Shell completed the Shell Eastern Petrochemicals Complex (SEPC) project in Singapore in May 2010. and jet fuel. Shell acquired an equity stake in Virent Energy Systems (Virent). The companies also collaborated on a joint technology program to convert plant sugars directly into diesel. This integrated site will bring considerable synergies in terms of feedstocks. It would not require specialized infrastructure and could be transported through existing pipelines. diesel. Shell’s investment in Virent provides opportunities for the company to combine Virent’s expertise in the area with its own competencies to develop advanced biofuels. The company is working with biofuel manufacturers to secure costeffective supply with clear social and environmental standards. as well as with Shell’s own operations. Global Top 10 Energy Companies Report: Industry.

as state sponsors of terrorism and currently impose economic sanctions against these countries. 2271/96 adopted by the Council of the European Union. Shell has exceeded US imposed investment limits in the past and may exceed the US imposed investment limits in Iran in the future. and prohibits the transfer of goods or services made with the knowledge that they will contribute materially to that country’s weapons capabilities. However. the company could be subject to sanctions or other penalties in connection with these activities.Company Reports Threats Environmental regulations Shell’s business is subject to numerous laws and regulations relating to the protection of the environment. including Iran and Syria. The company is governed by these regulations which could impose new liabilities. especially regarding global warming. countries against which the US government has imposed sanctions. compliance with this investment limit by European companies is prohibited by Council Regulation No. One of the most important developments in this area has been the introduction of the Kyoto Protocol for the reduction of greenhouse gases. This could result in a material decline in the company’s profitability in the short term. US law sets a limit of $20m in any 12 month period on certain investments knowingly made in that country. This brief is a licensed product and is not to be photocopied 03/2011 Page 53 . Breaking these bans can trigger penalties including criminal and civil fines and imprisonment. As a result. Financial and SWOT Analysis © Datamonitor. This could materially affect the company’s business operations as well as its financial performance. denial of certain export licenses. Investments in Iran and Syria Shell has presence in Iran and Syria. regulatory standards have been continuously tightened in recent years. including denial of financings by the US export/import bank. The law authorizes sanctions against any company violating these rules. Global Top 10 Energy Companies Report: Industry. With rising awareness of the damage to the environment caused by industry. and limits of loans or credits from US financial institutions. denial of certain government contracts.2% on an average annual basis during the 2008–12 period. which means the statutes conflict with each other in some respects. Certain activities and transactions in these countries are banned. The protocol calls on industrialized countries to reduce their greenhouse gas emissions level by 5. For Iran. The US laws and regulations identify certain countries. compared with 1990 emissions levels.

cancellation of contract rights. The assessment of the impact of these developments on the company’s operations is difficult. construction. including war. civil unrest and local security concerns that threaten the safe operation of company facilities. and other retroactive tax claims. In July 2009.5%). a joint development by Qatar Petroleum and Shell. They also included a new pipeline gas agreement for the delivery of an equivalent volume of gas to Shell in Europe. and environmental regulations. The sudden imposition of any of these developments could affect the employees.1 share). In June 2009. Shell also increased its equity stake in Codexis. limits on production. and development of floating storage and regasification units for gasification in remote regions of Russia. tax increases. a part of the Sakhalin II Project. Mitsui & Company (12. The agreement provided for broadening of cooperation in future Sakhalin II project development. In March 2009. and financial position of Shell. expropriation of property. import and export restrictions. Shell Gas & Power Developments signed a master agreement with a consortium comprising Technip and Samsung for the design. Pearl GTL in Qatar. including in difficult ice conditions. which stretched from Qatar’s coast out into the Persian Gulf. Shell International Trading & Shipping Company and Sovcomflot signed a general cooperation agreement for cooperation in potential LNG shipping projects in Russia.5 million tons per annum (mtpa) FLNG solution. Shell and Technip-Samsung also signed a contract for execution of the front end engineering and design (FEED) for Shell's 3. operational performance. being developed by Sakhalin Energy Investment Company (Sakhalin Energy). Gazprom and Shell signed LNG and natural gas contracts in April 2009. re-writing of leases. operations commenced at the Russia’s first liquefied natural gas (LNG) plant. including on the Arctic offshore.Company Reports Risks associated with wide geographic presence The company operates in more than 90 countries in different political conditions. Sakhalin Energy was set up for implementation of the Sakhalin II Project by Gazprom (50% + 1 share). The agreements include the purchase of LNG by both Shell Eastern Trading and Gazprom Global LNG from Sakhalin Energy Investment Company. reputation. additional windfall taxes. This brief is a licensed product and is not to be photocopied 03/2011 Page 54 . further improvement of LNG shipping technologies. and installation of multiple floating liquefied natural gas (FLNG) facilities over a period of up to fifteen years. The potential developments that could affect Shell include the following: forced divestment of assets.5% . development of joint shipping solutions for natural gas fields on Yamal Peninsula. price controls. Shell started production at its multi-field Parque das Conchas project 110 kilometers off Brazil’s south-east coast. Recent developments Shell announced the construction of the world's largest gas to liquids (GTL) plant. in February 2009. and Mitsubishi Corporation (10%). The plant. Financial and SWOT Analysis © Datamonitor. the North Field. In the same month. would process about three billion barrels of oil equivalent over its lifetime from the world’s largest single non-associated gas field. Global Top 10 Energy Companies Report: Industry. Subsequently. international conflicts. Its wide geographic presence exposes Shell to a wide range of political developments and resulting changes to laws and regulations. Shell (27. Shell and Codexis announced an expanded agreement to develop better enzymes that could accelerate commercialization of next generation biofuels.

from an affiliate of Tullow Oil.000 square kilometers situated in water 2. Further in November 2009. Shell Lubricants began operating its newest lubricants complex in Asia to meet growing demand in China.000 meters deep. at the Shell Eastern Petrochemicals Complex in Singapore. Shell took the final investment decision on the Gorgon LNG project signaling the start of initial construction of a liquefied natural gas facility with an annual capacity of around 15 million tonnes per year on Barrow Island. Subsequently. Shell Chemicals started operating its new world-scale monoethylene glycol (MEG) unit with a nameplate capacity of 750. about the size of the Netherlands. Shell announced the construction of a major new lubricants blending plant in Torzhok in the Tver region. Under the terms of the deal. In December 2009. and Shell Gas A. Shell announced the acquisition of a 33% interest in the Guyane Maritime Permit. This brief is a licensed product and is not to be photocopied 03/2011 Page 55 . Valhall and Hod. The plant. Global Top 10 Energy Companies Report: Industry. Chevron would operate the project. the South African Petroleum Authorities confirmed Shell as the successful bidder for exploration rights in the Orange Basin deep-water area.B. Subsequently. Financial and SWOT Analysis © Datamonitor. Shell agreed to sell its downstream businesses in Greece to Motor Oil (Hellas) Corinth Refineries. and Petronas Carigali 30%. The exploration area covered approximately 37. The complex had a production capacity of 200 million liters a year. north-west of Moscow.000-3. in British waters west of the Shetland Islands.000 square kilometers. Subsequently. In November 2009. The plant with a capacity of 200 million liters a year (about 180. Further in December 2009.000 tons of MEG per annum. with a 50% stake. expected to come on stream in the second half of 2011. This transaction is a strategic trade with no cash payment involved.E. Qatar Petroleum International and Shell Eastern Petroleum signed a series of agreements as a result of which Qatar Petroleum International would acquire a stake in two Shell Chemicals joint ventures in Singapore. and the potential for a phased development to 400 million liters a year. In September 2009. lowsulfur fuels production at the 400 thousand barrels per day refinery. with participants Shell and ExxonMobil each holding 25% shares. Subsequently. Hess would acquire Shell’s interest in a pair of Norwegian offshore fields. The permit covered an area of approximately 185. The permit area covered approximately 32.Y.000 tons) would be ready for commercial operation by the end of 2010. The South African Petroleum Authorities (Petroleum Agency) awarded Shell a technical cooperation permit for a one-year study to determine the hydrocarbon potential in parts of the Karoo Basin in central South Africa.000 square kilometers.E. Motor Oil (Hellas) Corinth Refineries would acquire Shell’s shares in Shell Hellas A.E. the Iraqi Ministry of Oil awarded Shell and Petronas Carigali a contract for technical assistance in developing the Majnoon field. approximately 150 kilometers off the coast of French Guiana. Shell announced that it would build a new hydrodesulfurization plant at its Pernis Refinery in the Netherlands. Shell would operate the development and production service contract under the terms of the second licensing round for Iraqi oil and gas contracts. Subsequently. In return.Company Reports In August 2009. Shell would hold a 45% share. off the country’s west coast. would increase cleaner-burning. off Western Australia’s coast. In the same month. Shell agreed to acquire Hess Corporation’s (Hess) entire upstream portfolio in Gabon and its interest in the Clair field.

along with Maurel & Prom of France. from East Resources. its largest. Further in May 2010. and its advisors Jefferies & Company. In the same month. a Nigerian company jointly held by two Nigerian firms. The Shell Petroleum Development Company of Nigeria (SPDC) agreed to transfer its 30% interest in oil mining leases 4. Shell announced a significant new oil discovery in the deepwater eastern Gulf of Mexico. In March 2010. and Petronas Carigali signed a 20 year contract to provide technical assistance in the development of the Majnoon oilfield. the world’s deepest offshore drilling and production facility. operated by the Al Furat Petroleum Company (AFPC). In April 2010.1% shareholding in the 104. SSPD had interests in three production licenses including Deir-Ez-Zor. distribution. Shell agreed to acquire subsidiaries which own substantially all of the business of East Resources for $4. As part of the agreement. In the same month. fullyintegrated refinery and petrochemicals hub. Further in March 2010. On successful completion of the acquisition. and retail of transportation fuels. The deal included all of Shell’s downstream assets in New Zealand.089 square kilometers onshore and offshore Qatar. the joint venture would own Arrow’s Queensland CSG assets and domestic power business as well as Shell’s Queensland CSG assets and its site for a proposed liquefied natural gas (LNG) plant on Curtis Island at Gladstone. Platform Petroleum and Shebah Petroleum Development Company.200 meters (7. its private equity investor. Kohlberg Kravis Roberts & Co. the partners will jointly explore for natural gas in Block D which covered an area of 8. In the same month. CS CSG (Australia). Qatar Petroleum signed a new exploration and production sharing agreement (EPSA) with Shell and PetroChina Company for Qatar Block D. This brief is a licensed product and is not to be photocopied 03/2011 Page 56 . Subsequently.. wholly owned by Shell. In February 2010. Shell completed the Shell Eastern Petrochemicals Complex (SEPC) project in Singapore. Shell.000 barrel per day refinery at Marsden Point and also its network of more than 220 retail stations. and 41 covering approximately 2. the Iraqi Ministry of Oil. Under the agreement. Shell produced its first oil and natural gas from the Perdido Development.Company Reports In January 2010. Financial and SWOT Analysis © Datamonitor. China National Petroleum Corporation and Shell announced plans to jointly develop and produce natural gas in China’s Sichuan basin. Shell divested its LPG business in India. Global Top 10 Energy Companies Report: Industry. Subsequently. In the same month.650 square kilometers in the north western Niger Delta to Seplat Petroleum Company. In May 2010. sugar. China National Petroleum Corporation acquired a 35% interest in Syria Shell Petroleum Development (SSPD). Fourth Annex. 38. Shell’s floating liquefied natural gas (FLNG) technology was selected as the Sunrise joint venture’s preferred option for developing the Greater Sunrise gas fields in the Timor Sea. Shell would sell its 17. entered into an agreement to acquire Arrow Energy (Arrow). and the supply.217 feet) of water in Mississippi Canyon blocks 391 and 392. In the same month. and power.7 billion. The discovery was at the Appomattox prospect in 2. Shell International Petroleum Company and Cosan signed a non-binding MOU to form a $12 billion joint venture in Brazil for the production of ethanol. the 50/50 joint venture company owned by Shell and a subsidiary of PetroChina. Shell signed a sale and purchase agreement to sell its downstream business in New Zealand to a consortium of Infratil and the Guardians of New Zealand Superannuation. and Ash Sham.

and LPG businesses. Global Top 10 Energy Companies Report: Industry. as well as a lubricants oil blending plant. The sale included Shell’s retail. commercial fuels. Shell and Motor Oil (Hellas) Corinth Refineries announced the completion of the sale of Shell’s downstream businesses in Greece and an agreement for the continued use of the Shell brand in the Greek market. supply and distribution. chemicals. This brief is a licensed product and is not to be photocopied 03/2011 Page 57 .Company Reports In June 2010. bitumen. Financial and SWOT Analysis © Datamonitor.

Egypt. The segment’s activities also include gas marketing and trading activities. and refining and marketing. and the deepwater Gulf of Mexico. Trinidad. and the US. Russia. Trinidad & Tobago (Trinidad).360m in FY2009. The net profit was $16. the North Sea.7% compared with FY2008. Its exploration program is currently focused around Angola. It also includes the marketing and trading of natural gas (including liquefied natural gas or LNG). The exploration and production business includes oil and natural gas exploration. North Africa. This segment includes upstream and midstream activities in 30 countries. Libya.6% compared with FY2008. Major development areas include Algeria. the UK. Asia Pacific. Upstream activities involve oil and natural gas exploration and field development and production. as well as the marketing and trading of natural gas.300 people. and processing activities (midstream activities).578m in FY2009. The company’s operations primarily include the exploration and production of gas and crude oil. transportation.272m in the financial year ended December 2009 (FY2009). a decrease of 24. Europe. a decrease of 33. During FY2009. including Angola. Latin America. production came from 21 countries. and the US. Global Top 10 Energy Companies Report: Industry. Russia. and natural gas liquids.7% compared with FY2008. Egypt. Oman. together with related pipeline. It also operates a third business segment. The principal areas of production are Angola. and the Middle East. Angola. Norway. other businesses and corporate. primarily in Canada. Azerbaijan. Canada. BP is headquartered in London. the US and locations within Asia Pacific. Azerbaijan. Azerbaijan. It has presence in more than 80 countries. the UK. power. the deepwater Gulf of Mexico. the Middle East. Egypt. field development and production (the upstream activities). The operating profit of the company was $27. The company recorded revenues of $239. and natural gas liquids (NGLs). power.Company Reports BP Plc Company overview BP is one of the largest vertically integrated oil and gas companies in the world. Latin America. Financial and SWOT Analysis © Datamonitor. the UK and employs about 80. a decrease of 21. Egypt. and onshore US. Asia Pacific. The company operates through two reportable business segments: exploration and production. Business description BP is one of the world’s largest oil and gas companies. This brief is a licensed product and is not to be photocopied 03/2011 Page 58 .

the total natural gas production of BP was 7. This brief is a licensed product and is not to be photocopied 03/2011 Page 59 . Its net proved hydrocarbon reserves. and petrochemicals products and related services to wholesale and retail customers. covering the west coast and mid-west regions of the US. These refineries had crude distillation capacities totaled to 3. BP has interests in 16 refineries worldwide. The total liquid production of BP as of FY2009 was 1. and transportation of crude oil. The company also has a significant midstream pipeline interest in the South Caucasus Pipeline (SCP). was 1. supply. It also includes BP’s NGL extraction businesses in the US.671 mmboe as of FY2009. The company has six integrated FVCs. both in the UK sector of the North Sea. manufacturing.135 mb/d. on an oil equivalent basis for equity-accounted entities alone. and Indonesia are conducted through equity-accounted entities. It operates primarily in Europe and the US and also manufactures and markets its products across Australasia.689 mboe/d in FY2009. in which BP had a share of 2. Kazakhstan. on an oil equivalent basis and excluding equity-accounted entities. as well as some of BP’s operations in Angola. Upstream operations in Argentina. logistics. and LNG processing facilities and transportation. and Indonesia. petroleum.666 mboe/d. supply and trading. and Iberia. processing facilities. and natural gas liquids. Financial and SWOT Analysis © Datamonitor. pipelines. The refining and marketing segment consists of two main business groups: fuels value chains (FVCs). power. Chile. and LNG plant facilities. Australasia (ANZ). Bolivia. BP’s activities include the marketing and trading of natural gas. the UK. Its most significant midstream pipeline interests are the TransAlaska Pipeline System in the US. Georgia. liquefied petroleum gas (LPG). In FY2009. Additionally.450 million cubic feet per day (mmcf/d). In total. the Forties Pipeline System and the Central Area Transmission System pipeline. Canada. and Australia. Venezuela and Russia. comprised 5. offshore platforms. They are organized regionally. marketing. The company’s net proved hydrocarbon reserves.621 million barrels of oil equivalent (mmboe) as of FY2009. its total hydrocarbon production averaged 2. including those partially owned. The FVCs integrate the activities of refining. gathering centers. petrochemicals. while natural gas production on equity-accounted entities alone was 1.684 thousand barrels of oil equivalent per day (mboe/d) for subsidiaries and 1. Canada. while liquids production on equity-accounted entities alone. For the same period. and international businesses (IBs). The refining and marketing segment is responsible for the refining. and China. and Turkey. Major LNG activities are located in Trinidad. which takes gas from Azerbaijan through Georgia to the Turkish border and in the Baku-Tbilisi-Ceyhan pipeline. and aviation fuels.314 mboe/d for equity-accounted entities. Southern Africa. in-field flow lines. Indonesia. and marketing of lubricants.035 mmcf/d. Abu Dhabi. export systems (transit lines). comprised 12. supply. storage facilities.400 thousand barrels per day (mb/d).Company Reports The midstream operations involve the ownership and management of crude oil and natural gas pipelines. BP is also investing in the LNG business in Angola. marketing. and trading on a regional basis. BP’s oil and natural gas production assets are located onshore and offshore and include wells. the Rhine region. processing facilities and export terminals. Southern Africa. running through Azerbaijan. BP markets its products in more than 80 countries. The IBs include the manufacturing. Global Top 10 Energy Companies Report: Industry. India.

paraxylene (PX). In O&D. In addition. BP manufactures and markets three main product lines: purified terephthalic acid (PTA). primarily in Europe. and South Africa. and acetic acid. predominantly in Asia.Company Reports At the end of FY2009. BP’s retail network in the US comprised 11. particularly China. Its products include aviation and marine fuels. BP had approximately 500 sites outside Europe and the US in countries such as Australia. jobbers. LPG. ARCO. During FY2009. lubricants. at the end of FY2009. trucks. BP’s industrial lubricants business is a supplier to those sectors of the market involved in the manufacture of automobiles. BP’s marine fuels business focuses on the distribution and sale of refined fuel oils to the shipping industry. China. BP markets primarily through its major brands of Castrol. In A&A. and franchisees who continue to operate these sites under the BP brand.500 convenience retail sites in 10 countries. it sold around 1.400 retail sites operated under the brands BP. and Aral. Korea. New Zealand. and various plastics. and energy markets across the world. and steel. BP has a strong global market share in the PTA and acetic markets with a major manufacturing presence in Asia. BP’s petrochemicals operations comprise the global aromatics and acetyls businesses (A&A) and the olefins and derivatives (O&D) businesses.200 sites in Greece to Hellenic Petroleum. At the end of FY2009. including joint ventures. In FY2009. BP manufactures ethylene and propylene from naphtha and also produces a number of downstream derivative products. BP supplied its aviation products to its customers in approximately 64 countries. Indonesia. In addition to these three main products.500 branded retail sites.200 were branded ampm. the US. In Europe. Amoco. Belgium. and the Aral brand in some specific markets. It sells products directly to its customers in around 46 countries. BP’s IBs provide products and offers to customers in more than 80 countries worldwide. It operates 14 manufacturing sites located in the UK. Malaysia. machinery components. BP’s worldwide network consisted of about 22. which continue to be operated under the BP brand through a brand licensing agreement. fibers. North America. BP also divested around 100 company-owned sites to third parties. In addition. and Asia. The company manufactures and markets lubricants and related products and services to the automotive. Air BP is one of the world’s largest and best known aviation fuels suppliers. BP produces several other specialty petrochemicals products. serving all the major commercial airlines as well as the general aviation and military sectors. BP. BP’s marine lubricants business supplies its products to many types of vessels from deep-sea fleets to marine leisurecraft. industrial. marine. Global Top 10 Energy Companies Report: Industry. of which 1. and a range of petrochemicals that are sold for use in the manufacture of other products such as fabrics. BP is also a supplier of lubricants for the offshore oil and aviation industries. the retail network consisted of 2. and Taiwan. This brief is a licensed product and is not to be photocopied 03/2011 Page 60 . Financial and SWOT Analysis © Datamonitor. the company sold over 600 company-owned sites to dealers.

BP has been working with DuPont since 2003 to explore new approaches to the development of biofuels. solar. and Bangalore (India). BP has plans to invest more than $1 billion in building its own biofuels business operations. and wholesale LPG products to a wide range of customers in 12 countries. and shipping and corporate activities worldwide. the Netherlands. The venture focuses on hydrogen-fuelled power generation. hydrogen power. Xi’an (China). BP Solar’s main production facilities are located in Maryland (the US). US). which it manufactures primarily from recycled aluminum. including partnerships with other companies to develop the technologies. it provides the link between BP and the international financial markets and makes available a range of financial services to the company. a joint venture with Santelisa Vale and Maeda Group. BP’s aluminum business engages in the supply of aluminum coil to the beverage can business. The company has wind farms in the US. BP Solar operates in the entire solar value chain. including supporting the financing of BP’s projects around the world. Financial and SWOT Analysis © Datamonitor. a wholly owned subsidiary of BP. the production of wafers and cells. Hydrogen Energy International. This brief is a licensed product and is not to be photocopied 03/2011 Page 61 . to produce bioethanol from sugar cane. automotive. bottled. The aluminum business is a non-integrated producer and marketer of rolled aluminum products (headquartered in Kentucky. India.Company Reports The LPG business of BP sells bulk. and carbon capture and storage (CCS) technology businesses. These investments include a 50% stake in Tropical BioEnergia. The first product from this collaboration will be an advanced fuel molecule called biobutanol. Treasury operations of the other businesses and corporate segment of BP co-ordinates the management of the company’s major financial assets and liabilities. and the Asia Pacific region. BP has partnered with ABF (British Sugar) and DuPont to construct a biofuels plant in Hull. Under its biofuels business. BP has net wind generation capacity of 711 MW. and on vacant land. and in Maharashtra. feedstocks. and a $90m investment and strategic alliance with Verenium to accelerate the development and commercialization of biofuels produced from lignocellulosic bioethanol. to the creation of solar panels that are then sold and distributed as solar systems on the roofs of residential homes. using fossil fuels and CCS technology to produce new large-scale supplies of clean electricity. BP is engaged in wind. which has a higher energy content than ethanol. Under its alternative energy business. From locations in the UK. and processes required to produce advanced biofuels. Other businesses and corporate segment of the company comprises treasury (which includes interest income on the company’s cash and cash equivalents) the company’s aluminum asset. from the acquisition of silicon as a raw material. Global Top 10 Energy Companies Report: Industry. develops decarbonized energy projects around the world. large commercial buildings. the alternative energy business. the US. biofuels. With respect to wind power. BP Solar operates the solar energy business of BP.

four very large crude carriers. At the end of FY2009. BP transports its products across oceans. At the end of FY2009. All these ships are double-hulled. BP spot-charters vessels. Of the eight LNG carriers. Financial and SWOT Analysis © Datamonitor. This brief is a licensed product and is not to be photocopied 03/2011 Page 62 . Global Top 10 Energy Companies Report: Industry. and four LPG carriers). BP manages one on behalf of a joint venture in which it is a participant and operates seven LNG carriers. BP had an international fleet of 54 vessels (37 medium-size crude and product carriers.Company Reports Through its shipping business. typically for single voyages. and spot-chartered vessels. using a combination of BP-operated. of which 102 are double-hulled. around coastlines. eight LNG carriers. one North Sea shuttle tanker. time-chartered. BP had 104 hydrocarbon-carrying vessels above 600 deadweight tonnes on time-charter. and along waterways.

the South Caucasus Pipeline (SCP).Company Reports SWOT analysis Strengths Dominant market position BP has a strong market position. and LNG processing facilities and transportation. Its midstream operations involve the ownership and management of crude oil and natural gas pipelines. It supplies customers in approximately 64 countries and has annual marketing sales of more than 25 billion liters. and general aviation sectors. Aral. BP’s retail network comprised approximately 11.500 convenience retail sites in 10 countries. Amoco. and Castrol are well recognized and trusted by customers all over the world. The company is the largest producer of oil. particularly China. the second largest producer of gas and the largest overall producer of hydrocarbons in the UK. Its upstream activities involve oil and natural gas exploration and field development and production. In Europe. and South Africa. This brief is a licensed product and is not to be photocopied 03/2011 Page 63 .500 branded retail sites. It is one of the world’s leading oil companies on the basis of market capitalization and proved reserves. BP has interests in 16 refineries worldwide. Amoco. with global presence in over 850 ports. Moreover. and downstream oil businesses. Global Top 10 Energy Companies Report: Industry. the company has established a robust brand image over 100 years of operation across the globe. Canada. BP Marine Lubricants is one of the largest global suppliers of lubricants to the marine industry. and refining and marketing. BP’s downstream activities include refining and marketing of oil and natural gas and related products. and Aral. ARCO. The company’s dominant market position gives it significant bargaining power in the global oil industry. and Indonesia. and the Baku-Tbilisi-Ceyhan pipeline. the retail network consisted of 2. Vertically integrated operations BP has vertically integrated operations as it is involved in upstream. The company has a strong global market share in the purified terephthalic acid (PTA) and acetic markets with a major manufacturing presence in Asia. In addition. In addition. processing facilities and export terminals. military. BP’s worldwide network consisted of about 22. ARCO. BP is also one of the largest blenders and marketers of biofuels in the world. New Zealand. The company operates through two business segments: exploration and production.400 retail sites operated under the brands BP. including those partially owned. BP had approximately 500 sites outside Europe and the US in countries such as Australia. In total. It supplies many types of vessels from bulkers to container ships to dredgers and cruise ships. midstream. Brands such as BP. At the end of FY2009. Its most significant midstream pipeline interests are the TransAlaska Pipeline System in the US. supplying aviation fuel to the airline. Financial and SWOT Analysis © Datamonitor. and the Forties Pipeline System and the Central Area Transmission System pipeline in the UK sector of the North Sea. In the US. It has relationships with many of the major commercial airlines. It also includes BP’s natural gas liquids (NGL) extraction businesses in the US. at the end of 2009. the UK. Air BP is one of the world’s largest suppliers of fuels to the aviation businesses. BP is the largest producer of oil and gas in North America.

Over a period of time.1% of the total revenues. which enable the company to produce products. which are used at different stages in the entire value chain. among others. The company has a large consumer base across countries and therefore. and China. Wide geographic presence The company has a presence in over 80 countries across all major energy markets like Europe. Middle East. the US. Vertically integrated operations provide control over the entire value chain.9%. a widespread revenue base.Company Reports The company’s vertically integrated businesses confer advantages related to operational efficiencies. Global Top 10 Energy Companies Report: Industry. the company’s largest geographical market accounted for 35. while non US countries accounted for 64. In FY2009. This reduces the impact of market volatility and provides economic stability. The company’s vertically integrated operations give it significant competitive advantage in the global oil market. the US. This brief is a licensed product and is not to be photocopied 03/2011 Page 64 . Financial and SWOT Analysis © Datamonitor. the company has developed diverse revenue streams and is not heavily dependent on a single market.

In April 2010. The US Justice Department has launched both a criminal and civil investigation into the oil spill. However. Texas. including the creation of a $20 billion fund to satisfy certain obligations arising from the oil and gas spill. including the cost of the spill response. It will enable BP to capture most of the oil. BP announced an agreed package of measures. The US government expects the clean up efforts to last few years. BP had placed a new. The heavy financial penalties by the regulatory authorities and the clean up costs are likely to affect BP’s profit margins significantly. BP had paid more than 52. or help funnel it up to ships on the surface if necessary. and federal costs. 2010. claims paid. Subsequently. and dolphins. BP is known for its past record of safety and environment violations. Migratory Bird Treaty Act. The US government. 2010. relief well drilling.5 billion. sea turtles. tighter-fitting cap on top of the ruptured oil well on July 12. the rig worth over $500m sank triggering an oil spill in the Gulf of Mexico. 2010. containment.000 barrels per day. which could be double the economic loss and recovery costs. Mississippi.000 and 60. The company could be subject to penalties under several laws including Clean Water Act.000 claims submitted until July 10. on June 15. BP’s repeated attempts to control the oil spill have failed. The explosion killed 11 workers. grants to the Gulf states. The environmental damage caused due to the oil spill has considerably tarnished BP’s brand image. As of July 10. and Alabama). Furthermore. It has affected the multibillion-dollar fishing and tourist industries at a time of high unemployment. The company is liable for the economic loss and the recovery costs. the company could be subject to penalties for criminal violations.000 payments totaling approximately $165m from the 105. The flow of oil has had a catastrophic effect on the environment and wildlife killing birds. The rig was located approximately 41 miles offshore Louisiana on Mississippi Canyon block 252. soiling the shores of all five US Gulf Coast states (Louisiana. and Endangered Species Act. The company’s efforts to activate the well's blowout preventer failed and the well continued to spew oil. Financial and SWOT Analysis © Datamonitor. Global Top 10 Energy Companies Report: Industry. Florida.Company Reports Weaknesses Oil spill in the Gulf of Mexico BP is involved in one of the worst environmental disasters in the US. In June 2010. the new cap is a temporary fix and cannot totally prevent the blownout well from leaking. an explosion occurred on the Transocean's rig which was drilling an exploration well on BP operated license. BP’s total cost of response totaled $3. This brief is a licensed product and is not to be photocopied 03/2011 Page 65 . estimated the oil flow rate from BP’s ruptured oil well to be between 35.

Violation of tax laws in Turkey The Turkish Finance Ministry levied a tax fine of $275m on BP in March 2009 for cross-border duty-free petrol sales between 2006 and 2008. Global Top 10 Energy Companies Report: Industry. including in relation to the March 2005 explosion and fire. BP is one of the largest energy companies in Turkey. In addition to huge penalties. Financial and SWOT Analysis © Datamonitor. pursuant to the plea agreement. such law suits could also tarnish its brand image. In September 2009. BP Products has contested the citations and this will also be reviewed by the OSH Review Commission and possibly the federal courts. serving as the operator of the Baku-TbilisiCeyhan oil pipeline.3 gallons of fuel.4m civil penalty for alleged violations of the 2005 Agreement and alleged process safety management violations. Turkey imposes a tax on trucks entering the country with more than 145. Fifteen workers died in the incident and many others were injured. In February 2008. The authorities claimed that the retailer broke a legal limit on the amount of duty-free fuel it can sell to vehicles traveling outside of the country at filling stations on the Greek and Bulgarian borders. the second longest in the world. such violation of laws could affect BP’s business operations in the country with tightened surveillance.Company Reports Explosion in the Texas refinery In March 2005. That agreement resolved citations issued in connection with the March 2005 Texas City refinery explosion. Such events causing environmental damage could result in heavy financial penalties for the company eroding its profits. Settlement negotiations continue between BP Products and OSHA in an attempt to settle the citations for alleged violations of the 2005 settlement agreement. In addition. The company paid a $50m criminal fine and was sentenced to three years’ probation. The Texas Office of Attorney General. an explosion and fire occurred in the isomerization unit of BP Products’ Texas City refinery. the US Department of Justice (DOJ) announced that it had entered into a criminal plea agreement with BP Products related to the explosion and fire. This brief is a licensed product and is not to be photocopied 03/2011 Page 66 . In October 2009. The company also operates Turkey’s second-biggest chain of petrol stations. on behalf of the Texas Commission on Environmental Quality (TCEQ) filed a petition against BP Products asserting certain air emission and reporting violations at the Texas City refinery from 2005 to 2009. OSHA issued the Texas City Refinery citations seeking a total of $87. In October 2007. to one felony violation of the risk management planning regulations promulgated under the US federal Clean Air Act. BP Products pleaded guilty. OSHA has denied BP Products’ petition. Bilnam. The tax fine was related to BP’s operations by its dealer. BP Products filed a petition to clarify specific required actions and deadlines under the 2005 Settlement Agreement with the Occupational Safety and Health Act (OSHA). which transported petrol over the Turkish border to Greece and Bulgaria through duty-free refueling areas for trucks used for exports.

The two companies will form a 50/50 joint venture.63% stake in the ACG development will increase BP’s operating interest in the fields to 39. This brief is a licensed product and is not to be photocopied 03/2011 Page 67 . Devon will commit to fund an additional $150m of capital costs on BP’s behalf. In the US Gulf of Mexico deepwater. and enable it to proceed with the development of Canadian assets thereby reinforcing its global position as the leading deepwater international oil company. and the US deepwater Gulf of Mexico. This transaction marks the entry of BP into Brazil. namely Xerelete. acquisition of Devon’s 5. with a particular focus on the emerging Paleogene play in the ultra-deepwater. and the producing Polvo field. Azerbaijan. The assets also include interests in four producing oil fields: Zia. The acquisition will strengthen BP’s position in the Gulf of Mexico. enhance its interests in Azerbaijan. Magnolia. and Nansen. BP announced the acquisition of Devon Energy’s assets in Brazil. BP will sell a 50% stake in its Kirby oil sands interests in Alberta.Company Reports Opportunities Acquisition of Devon Energy’s assets in Brazil. In addition. to Devon Energy for $500m. a major portfolio of deepwater exploration acreage and prospects in the US Gulf of Mexico. Azerbaijan. this acquisition is a strategic fit with the company’s operating strengths and key interests around the world. to pursue the development of the interest. including seven in the prolific Campos basin. Canada. and the US deepwater Gulf of Mexico In March 2010. as well as two onshore licenses in the Parnaiba basin. Financial and SWOT Analysis © Datamonitor. Global Top 10 Energy Companies Report: Industry. operated by Devon Energy.77%. Merganser. Upon completion it will offer BP a significant additional long-term growth potential with an emphasis on high-margin oil. The deal will give BP a diverse and broad deepwater exploration acreage position offshore Brazil with interests in eight license blocks in the Campos and Camamu-Almada basins. These include the following: interests in ten exploration blocks in Brazil. In Azerbaijan. and an interest in the BP-operated Azeri-Chirag-Gunashli (ACG) development in the Caspian Sea. presalt Wahoo and Itaipu. Azerbaijan. The Campos basin blocks include three discoveries. The addition of Devon’s 30% interest in the major Paleogene discovery Kaskida will give BP a 100% interest in the project. BP will gain a high quality portfolio with interests in some 240 leases. Therefore.

Such oil and gas exploration projects coupled with oil discoveries could help BP in increasing its oil and gas production. the company is focusing on investments in the areas of wind and solar power. In October 2009. This brief is a licensed product and is not to be photocopied 03/2011 Page 68 . BP completed the restructuring of its manufacturing facilities. BP made its seventeenth oil discovery in Ultra Deepwater Block 31 in Angola. It has its first joint-venture ethanol refinery in Brazil and another joint-venture facility is under construction in the UK. enabled by the development and application of technology and the building of strong relationships based on mutual advantage.237 MW gross) at the end of FY2009. In May 2009. The company has entered into various agreements in FY2009 to develop its solar business further. offshore Trinidad. Investments in the alternative energy business In alternative energy. in February 2009. This has increased the total capacity in commercial operation to 711 MW (1. BP Trinidad and Tobago (bpTT) announced the start of natural gas production from the Savonette field. BP began production from the Dorado (in which it has 75% working Interest) and King South (in which it has 100% interest and was the operator) projects in the Gulf of Mexico. Furthermore. In the same month. It is developing advanced biofuels and low-carbon energy technologies such as hydrogen power and carbon capture and storage. For instance. produce. BP has added 279 MW of capacity including the construction of two wind farms in the US. In May 2009. Around 210. BP’s investments in its alternative energy business will help it in diversifying its product offerings. BP Exploration (Angola) and Sociedade Nacional de Combustiveis de Angola (Sonangol) announced the 'Oberon' oil discovery in ultra-deepwater Block 31. BP’s biofuels business is investing in advanced technologies. offshore Angola. BP announced a giant oil discovery at its Tiber Prospect in the deepwater US Gulf of Mexico. It would also help the company in enhancing its environment-friendly image. Saxony-Anhalt. The company has made several oil discoveries in FY2009. and market next-generation biofuels from biobutanol). BP Solar partnered with RGE Energy to plan one of the world's largest solar projects. The large-scale PV installation with over 46 megawatt peak (MWp) would be built in Koethen. the company began production at some of its major oil and gas exploration projects during FY2009. Global Top 10 Energy Companies Report: Industry. In wind business. BP Solar and SolarEdge announced a joint agreement to explore commercialization of a PV module-integrated power harvesting system embedded directly into BP Solar modules. thereby increasing its revenue growth. in October 2009. Therefore.Company Reports Oil and gas exploration projects BP aims to grow its exploration and production business by strengthening its portfolio of leadership positions in the world’s most prolific hydrocarbon basins. Financial and SWOT Analysis © Datamonitor. Fowler Ridge II in Indiana and Titan I in South Dakota. BP Exploration (Angola) and Sonangol announced the 'Tebe' oil discovery in ultra-deepwater Block 31. and Martek Biosciences (developing technology to convert sugars into diesel). Verenium (two 50:50 joint ventures accelerating the development and commercialization of biofuels from lignocellulosic feedstocks). In 2009. offshore Angola.000 crystalline photovoltaic modules with an output of 220 watt peak each would be supplied by BP Solar and installed by RGE Energy. BP’s biofuels business extended its reach and capability through joint ventures with Dupont (to develop. In solar business. In May 2009. in September 2009.

one of the most important developments in this area has been the introduction of the Kyoto Protocol for the reduction of greenhouse gas. The protocol calls on industrialized countries to reduce their annual greenhouse gas emission levels by an average of 5. and a reduction in demand by 20% (non-binding target). Environmental regulations The company is subject to various environmental laws and regulations that govern the discharge of pollutants and disposal of wastes. Many of these regions.2% (relative to 1990 levels) during 2008-12. the European Council adopted a European sustainability strategy based on three reference targets that must be achieved by 2020. This brief is a licensed product and is not to be photocopied 03/2011 Page 69 . The saturation of reserves in this region is a key challenge for the company especially as newer exploration activity in other parts of the world is far more localized and entails significantly higher investments. Instability in some oil-producing regions BP has exploration and production interests in 30 countries. much of the geo-political risks are outside its control.Company Reports Threats Saturation of resources in the North Sea The company has extensive offshore exploration operations in the North Sea. In 2007. There has been a succession of dry holes being drilled in the last few years. Global Top 10 Energy Companies Report: Industry. and South America. Though BP has been operating in these countries for a long time and understands the local environment very well. Offshore exploration in the North Sea has been highly prospective in the past and intensive exploration work has been carried out in this region in the past few decades. which include a 20% reduction in carbon dioxide (CO2) emissions. the European Union adopted important strategic objectives with regard to policies that address climate change. Financial and SWOT Analysis © Datamonitor. Failure to anticipate some of these events or the inability to mitigate risks in these regions could seriously impair its operations and disrupt the flow of output. With rising awareness of the effect that the environment has on human health. including Africa. The company may incur substantial costs to comply with these environmental regulations. In 2005. which in turn will impact its earnings and margins. Reserves in the region are maturing and are slowly getting saturated. In the same year. an increase in the penetration of renewable energy sources (binding target) to 20%. BP already has a weak record in environmental matters. regulatory standards have been continuously improved in recent years. are prone to political instability. the Middle East.

and Chevron $8. the hazards and risks could have a material adverse effect on the company’s business operations. Therefore. BP’s total cost of response from the spill totaled $3. It had agreed to set up $20 billion fund as directed by the US Government. BP also faces administrative actions from regulatory authorities which could result in huge penalties for the company. BP faces administrative proceedings from regulatory authorities for environmental damage caused by the spill. Any of these companies could possibly launch a take over bid on BP backed by their balance sheet strength. energy companies pay the US Government a royalty rate of up to 18. natural disasters. The spill has caused a multi-billion dollar damage severely affecting the environment and wildlife on the coastal shores of five US Gulf Coast states. an explosion on the Transocean's rig on an exploration well operated by BP killed 11 workers. environmental pollution. and the fishing and tourist industries at a time of high unemployment.5 billion excluding the $20 billion fund set up for the clean-up and recovery costs. Global Top 10 Energy Companies Report: Industry. or governmental investigations. This brief is a licensed product and is not to be photocopied 03/2011 Page 70 . Moreover. Exxon Mobil had cash reserves of $10. In April 2010. BP’s market capitalization has eroded by about $100 billion since the well began leaking oil.Company Reports Risks related to exploration and production activities The company’s exploration and production operations are subject to inherent hazards and risks such as fires.693m. the company stands liable for royalties with respect to the oil it is collecting from its ruptured well. The company’s repeated failure to cap the leak in its deep-sea well that has been spewing oil since April 2010 has severely affected investors’ confidence. Subsequently. With the company’s market capitalization declining more than half. As of July 10. financial condition. death. pipeline ruptures. The company’s efforts to control the oil spill over a period of two months have failed. collapses of wellbore casing or other tubulars. The company is considering asset sales to raise money for the clean-up fund. BP could become a target for takeover by other bigger energy companies such as Exxon Mobil and Chevron. which could result in huge penalties. BP therefore faces a threat of losing its high quality assets for an undervalued price owing to the damage caused by the oil spill. the rig sank triggering an oil spill in the Gulf of Mexico. Further. At the end of December 2009. an explosion occurred on a rig which was drilling an exploration well on BP operated license triggering an oil spill in the Gulf of Mexico. explosions. and cash flows. Currently. recommendations. property damage or business interruption. The company continues to work towards containing the oil spill after more than two months. blowouts during well drilling. fines or penalties. BP is liable for the economic loss and the clean up and recovery costs. spills. These events could cause a loss of hydrocarbons.75% of the value of the oil and gas drilled in the offshore tracts. claims.716m. to satisfy certain obligations arising from the oil and gas spill. claims for personal injury. In April 2010. and other hazards and risks. geological formations with abnormal pressures. Financial and SWOT Analysis © Datamonitor. Threat of a takeover BP faces the threat of a takeover in the light of the financial damage caused by the oil spill and the company’s subsequent failure to contain the spill.

In the same month. Subsequently. Indiana. BP announced a giant oil discovery at its Tiber Prospect in the deepwater US Gulf of Mexico in September 2009. Saxony-Anhalt. New Brunswick.000 homes.055 feet (10. The large-scale PV installation with over 46 megawatt peak (MWp) would be built in Koethen. BP Solar (a part of BP Alternative Energy) was selected to provide photovoltaic solar power systems for Wal-Mart stores in California. approximately 250 miles (400 kilometers) south east of Houston. BP Energy India. BP Wind Energy (a wholly owned subsidiary of BP) and Dominion (a producer and transporter of energy) announced full commercial operation of phase one of the Fowler Ridge Wind Farm in Benton County. was drilled to a total depth of approximately 35. Financial and SWOT Analysis © Datamonitor. The phase two of the project would have a capacity of 200 MW.Company Reports Recent developments In February 2009.000 crystalline photovoltaic modules with an output of 220 watt peak each would be supplied by BP Solar and installed by RGE Energy. Further in September 2009. BP Energy India owned and operated three wind farms in India with a total generating capacity of approximately 100 MW. BP West Java (BPWJ). offshore Angola. In June 2009. BP began production from the Dorado (in which it had 75% working Interest) and King South (in which it had 100% interest and was the operator) projects in the Gulf of Mexico. In May 2009. The first 400 MW of the project would generate enough carbon-free electricity to power about 120. to Indonesian state-owned oil and gas company PT Pertamina (Persero). BP and Irving Oil announced they would not proceed with the proposed second refinery in Saint John. In the following month. This brief is a licensed product and is not to be photocopied 03/2011 Page 71 .622 billion (approximately $95m). BP and Verenium formed a fifty-fifty joint venture to develop and commercialize cellulosic ethanol from non-food feedstocks. The well. In August 2009. as a result of global economic and industry conditions. In the same month. Global Top 10 Energy Companies Report: Industry. BP announced the sale of its wholly-owned subsidiary. Around 210. located in Keathley Canyon block 102. BP Exploration (Angola) and Sociedade Nacional de Combustiveis de Angola (Sonangol) announced the 'Oberon' oil discovery in ultra-deepwater Block 31. in Germany. In April 2009. BP Solar partnered with RGE Energy to plan one of the world's largest solar projects. in July 2009.685 meters) making it one of the deepest wells ever drilled by the oil and gas industry. BP Solar and SolarEdge announced a joint agreement to explore commercialization of a PV moduleintegrated power harvesting system embedded directly into BP Solar modules. to Green Infra for INR4. BP made its seventeenth oil discovery in Ultra Deepwater Block 31 in Angola. Subsequently. In the same month. BP and the State Oil Company of the Republic of Azerbaijan (SOCAR) signed a memorandum of understanding (MOU) to jointly explore and develop the Shafag and Asiman structures in the Azerbaijan sector of the Caspian Sea. Further in May 2009. BP announced the sale of its ground fuels marketing business in Greece to Hellenic Petroleum for E359m (approximately $500m). In the same month. the Egyptian Natural Gas Holding Company (EGAS) awarded BP two blocks in the 2008 international bid round on the Egyptian Offshore Nile Delta. BP and Martek Biosciences Corporation signed a joint development agreement (JDA) to work on the production of microbial oils for biofuels applications. BP Wind Energy moved into full construction of a second phase of the Fowler Ridge Wind Farm in Benton County. Indiana. BP sold its subsidiary. In the same month.

BP announced that it would join Jordan’s state-owned National Petroleum Company (NPC) to exploit the onshore Risha concession in the north east of the country. project development. This brief is a licensed product and is not to be photocopied 03/2011 Page 72 . Subsequently.Company Reports BP Exploration (Angola) and Sonangol announced the 'Tebe' oil discovery in ultra-deepwater Block 31. an explosion and fire onboard the Transocean's rig which was drilling an exploration well on BP operated license. and an interest in the BP-operated Azeri-Chirag-Gunashli (ACG) development in the Caspian Sea. owned jointly by BP and ENI. offshore Trinidad. as well as key business support activities. BP and China National Petroleum Corporation (CNPC) signed a technical service contract with Iraq's state-owned South Oil Company (SOC) to expand production from the Rumaila oilfield. In the same month. BP Trinidad and Tobago (bpTT) announced the start of natural gas production from the Savonette field. BP announced a commitment of up to $500m to an open research program studying the impact of the Deepwater Horizon incident and its associated response on the marine and shoreline environment of the Gulf of Mexico. a leading fuel retailer in Europe and a subsidiary of the Delek Group. in October 2009. In the same month. BP Solar shifted its remaining in-house manufacturing operations to its low cost joint ventures and regional supply partners. and cell manufacturing at its Frederick. Financial and SWOT Analysis © Datamonitor. the rig worth over $500m sank triggering an oil spill in the Gulf of Mexico. the company selected the Massachusetts Institute of Technology and the University of Manchester as its academic research partners to further investigate materials and corrosion science and technology. BP was directed to pay for the construction by the federal government. and Florida. and the US deepwater Gulf of Mexico. Alabama. signed a production sharing contract (PSC) with the Government of Indonesia for the exploration and development of coalbed methane (CBM) resources on the Sanga-Sanga block in East Kalimantan. BP announced its decision to sell its marketing businesses in Namibia. carrying oil between Kazakhstan and Russia. In March 2010. Malawi. In February 2010. Azerbaijan. As a result. the company ceased silicon casting. The rig was located approximately 41 miles offshore Louisiana on Mississippi Canyon block 252 (MC252). Mississippi. In December 2009. These would include interests in the following: ten exploration blocks in Brazil. Indonesia. to buy its French retail fuels and convenience business including selected fuels terminals. BP divested its interest in Kazakhstan's Tengiz oil field and the Caspian Pipeline Consortium (CPC) pipeline. by selling its 46% stake in LUKARCO to Russia’s LUKOIL. killed 11 workers. in November 2009. Subsequently. However. In June 2010. a consortium led by VICO. as part of its commitment to restore the environment and habitats in the Gulf Coast region. Maryland facility. and research and technology. BP Solar continued to maintain its US presence in sales and marketing. Subsequently. Zambia. Tanzania. a major portfolio of deepwater exploration acreage and prospects in the US Gulf of Mexico. Further in March 2010. and protect wildlife habitat along the coastline of Louisiana. Further in October 2009. including seven in the prolific Campos basin. offshore Angola. Global Top 10 Energy Companies Report: Industry. BP announced the acquisition of Devon Energy’s assets in Brazil. BP established a $360m escrow account to fund the construction of six sections of Louisiana barrier islands approved by the US government. Azerbaijan. In April 2010. restore. and Botswana to focus on those countries which would offer the greatest synergies with its supply portfolio. In May 2010. near Basra in southern Iraq. improve. BP announced that it would donate the net revenue from oil recovered from the MC252 spill to create a new wildlife fund to create. In the same month. BP received an offer from Delek Europe. wafering.

This brief is a licensed product and is not to be photocopied 03/2011 Page 73 . In July 2010.3m. Louisiana and San Diego. including the company's facilities in Jennings. BP and Verenium Corporation (Verenium) announced an agreement under which BP Biofuels North America would acquire Verenium's cellulosic biofuels business. Financial and SWOT Analysis © Datamonitor. BP announced an agreed package of measures. Global Top 10 Energy Companies Report: Industry. California for $98.Company Reports In the same month. including the creation of a $20 billion fund to satisfy certain obligations arising from the oil and gas spill.

Company Reports

China Petroleum & Chemical Corporation (Sinopec)
Company overview
China Petroleum & Chemical Corporation (Sinopec) is a vertically integrated energy and chemical company. China Petrochemical Corporation (Sinopec Group), a state owned company, holds a stake of 75.8% in the company. The company operates in China. It is headquartered in Beijing, China and employs over 371,300 people. The company recorded revenues of CNY1,315,915m (approximately $192,926.3m) in FY2009, a decrease of 6.9% compared with FY2008. The operating profit of the company was CNY84,431m (approximately $12,378.4m) in FY2009, compared to an operating profit of CNY26,336m (approximately $3,861.1m) in FY2008. The net profit was CNY61,760m (approximately $9,054.6m) in FY2009, compared to a net profit of CNY28,525m (approximately $4,182.1m) in FY2008.

Business description
Sinopec is a producer and marketer of oil products and petrochemical products. It is a vertically integrated energy and chemical company. The principal operations of Sinopec and its subsidiaries include exploration, development, production, and marketing of crude oil and natural gas, oil refining and marketing, and production and sales of petrochemicals, chemical fibers, chemical fertilizers, and other chemicals. The company's business activities also include storage and pipeline transportation of crude oil and natural gas, and import and export of petroleum products. Sinopec operates through five principal business segments: exploration and production; refining; marketing and distribution; chemicals; and others. The exploration and production segment of Sinopec explores and develops oil fields, produces crude oil and natural gas, and sells products to the refining segment of the company and external customers. As of December 31, 2009, the company held 193 production licenses with an aggregate acreage of 19,136 square kilometers and 318 exploration licenses for various blocks in which the company is engaged in exploration activities. At the end of 2009, Sinopec had proved oil and gas reserves of 3,943 million barrels of oil equivalent (mmboe), including 2,820 million barrels (mmbbls) of proved reserve of crude oil, and 6,739 billion cubic feet (bcf) of proved reserve of natural gas. In FY2009, the company produced an average of 962 thousand barrels of oil equivalent (boe) per day, of which approximately 85.8% was crude oil and 14.2% was natural gas. Sinopec’s refining business segment processes and purifies crude oil, which is sourced from the exploration and production segment of the company and external suppliers. It also manufactures and sells petroleum products to the chemicals and marketing and distribution segments of the company and external customers. Sinopec is the largest refiner of petroleum and oil producer in China, with its refining capacity ranking third in the world. The company's major oil products include gasoline, kerosene, diesel, lube oil, chemical light feedstock, fuel oil, solvent oil, petroleum wax, asphalt, petroleum coke, liquefied petroleum gas (LPG), propylene, and benzene products. The company’s refineries are mainly located in China's southeast coastal area, middle, and lower reaches of Yangtze River and North China.

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Company Reports

At the end of FY2009, the company's total processing capacity was 210 million tons per annum. In FY2009, the output of gasoline, kerosene, and diesel reached 113.69 million tons. The company also produced 26.87 million tons of chemical light feedstock in FY2009. The marketing and distribution segment of Sinopec owns and operates oil depots and service stations in China, and distributes and sells refined petroleum products (mainly gasoline and diesel) in China through wholesale and retail sales networks. The company operates the largest sales and distribution network for refined petroleum products in China. In FY2009, in China, it distributed and sold approximately 124.02 million tonnes of gasoline, diesel, and kerosene including jet fuel, representing a market share of approximately 60% in China. All of Sinopec’s retail sales are made through a network of service stations and petroleum shops operated under the Sinopec brand. At the end of FY2009, the company owned 29,698 retail stations, among which 643 sites were under franchise agreement. In FY2009, Sinopec sold approximately 78.9 million tonnes of refined petroleum products through its retail network, representing approximately 63.6% of its total refined petroleum products sales volume. Sinopec’s retail market share in FY2009 was approximately 76.7% in its principal market. Moreover, in FY2009, the company sold approximately 25.61 million tonnes of refined petroleum products, including 2.42 million tonnes of gasoline, 23.06 million tonnes of diesel, and 0.13 million tonnes of kerosene, through direct sales to commercial customers such as industrial enterprises, hotels, restaurants, and agricultural producers. In FY2009, Sinopec sold approximately 19.52 million tonnes of refined petroleum products through wholesale channels, representing approximately 15.7% of its total sales volume of refined petroleum products. Its wholesale sales include sales to large commercial or industrial customers and independent distributors as well as sales to certain long-term customers such as railway, airlines, shipping, and public utilities. Through its wholesale centers, Sinopec operates 410 storage facilities with a total capacity of approximately 14.0 million cubic meters, substantially all of which are wholly-owned by Sinopec. The company’s wholesale centers are connected to its refineries by railway, waterway and, in some cases, by pipelines. The company also owns some dedicated railways, oil wharfs, and oil barges, as well as a number of rail tankers and oil trucks. The chemicals segment of Sinopec manufactures and markets petrochemical products, derivative petrochemical products, and other chemical products mainly to external customers. Sinopec is the largest petrochemicals producer in China. It produces a range of petrochemical products, including intermediate petrochemicals, synthetic resin, synthetic fiber monomers and polymers, synthetic fibers, synthetic rubber, and chemical fertilizer. At the end of FY2009, the company had 11 ethylene plants (including three joint venture companies), 29 synthetic resin plants, 13 producers of synthetic fiber monomers and polymers, eight synthetic fiber plants, five synthetic rubber plants, and six urea plants. Sinopec’s others segment consists principally of trading activities of the import and export subsidiaries and research and development activities undertaken by the company’s other subsidiaries.

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SWOT analysis Strengths
Market leadership position in China Sinopec enjoys a strong market position in China. It is one of the largest integrated energy and chemical companies in China. In China, the company is the largest ethylene and aromatics producer as well as the largest producer of butanol, styrene, paraxylene, vinyl acetate, phenol, and acetone. It is the largest producer of polyethylene, polypropylene, and polystyrene and supplier of major synthetic resins products and the largest producer of purified teraphthalic acid, ethylene glycol, caprolactam, and polyester in China. Sinopec is the largest producer of polyester and acrylic fibers, styrene butadiene rubber (SBR), and cis-polybutadiene rubber. The company is the only producer of isobutadiene isoprene rubber (IIR) in China. In FY2009, Sinopec had retail market share of approximately 76.7% in its principal market. Further, the company operates one of the largest sales and distribution networks for refined petroleum products in China. In FY2009, in China, Sinopec had a market share of approximately 60% in the country’s gasoline, diesel, and kerosene market. Sinopec’s market leadership position in China enhances the revenues and profitability of the company. Strong marketing and distribution operations Sinopec has strong marketing and distribution operations in China. In FY2009, in China, it distributed and sold approximately 124.02 million tonnes of gasoline, diesel, and kerosene including jet fuel. All of Sinopec’s retail sales are made through a network of service stations and petroleum shops operated under the Sinopec brand. At the end of FY2009, the company owned 29,698 retail stations, among which 643 sites were under franchise agreement. In FY2009, the company sold approximately 78.9 million tonnes of refined petroleum products through its retail network, representing approximately 63.6% of its total refined petroleum products sales volume. Moreover, the company sold approximately 25.61 million tonnes of refined petroleum products, including 2.42 million tonnes of gasoline, 23.06 million tonnes of diesel, and 0.13 million tonnes of kerosene, through direct sales to commercial customers such as industrial enterprises, hotels, restaurants and agricultural producers. In FY2009, Sinopec sold approximately 19.52 million tonnes of refined petroleum products through wholesale channels, representing approximately 15.7% of its total sales volume of refined petroleum products. Its wholesale sales include sales to large commercial or industrial customers and independent distributors as well as sales to certain long-term customers such as railway, airlines, shipping, and public utilities. Through its wholesale centers, Sinopec operates 410 storage facilities with a total capacity of approximately 14.0 million cubic meters, substantially all of which are wholly-owned by Sinopec. The company’s wholesale centers are connected to its refineries by railway, waterway and, in some cases, by pipelines. The company also owns some dedicated railways, oil wharfs, and oil barges, as well as a number of rail tankers and oil trucks. Further, in FY2009, Sinopec generated 59.1% of its total revenues from its marketing and distribution operations.

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The company’s midstream operations include storage and pipeline transportation of crude oil and natural gas. and downstream operations.739 bcf of proved reserve of natural gas. In downstream. The company also owns and operates oil depots and service stations in China. and manufactures and markets petrochemical products. of which approximately 85.820 mmbbls of proved reserve of crude oil. the company produced an average of 962 thousand boe per day. and cross-marketing opportunities. and other chemical products. At the end of FY2009. and distributes and sells refined petroleum products.Company Reports Sinopec’s strong marketing and distribution operations provide it with a competitive edge. Financial and SWOT Analysis © Datamonitor. As part of its upstream operations. derivative petrochemical products. midstream. This brief is a licensed product and is not to be photocopied 03/2011 Page 77 . Sinopec explores and develops oil fields. Sinopec processes and purifies crude oil. and 6. synergies. including 2. Global Top 10 Energy Companies Report: Industry.8% was crude oil and 14.943 mmboe. and produces crude oil and natural gas. The company's vertically integrated operations give it significant competitive advantage in terms of economies of scale. Sinopec had proved oil and gas reserves of 3. Vertically integrated operations Sinopec is a vertically integrated energy and chemical company with upstream.2% was natural gas. In FY2009.

2% are from imports and 3. Financial and SWOT Analysis © Datamonitor.Company Reports Weaknesses Dependence on third party crude oil suppliers Sinopec is heavily dependant upon outside sources for its crude oil requirements. For the period 2006–09. This brief is a licensed product and is not to be photocopied 03/2011 Page 78 .293 million barrels (mmbbls) in FY2006 to 2. the oil and natural gas reserves and production of the company would decline further which would adversely affect the company’s financial situation and operation performance. The company has to invest a large amount of money. Lack of geographical diversification Sinopec generates all its revenues from the Chinese market. Global Top 10 Energy Companies Report: Industry.5% are from China National Offshore Oil Corporation (CNOOC) and 3.8% from PetroChina Company. from 3. of which 75. whether the company can obtain additional reserves is not certain. If the company fails to acquire additional reserves through further exploration and development or acquisition activities. To obtain additional reserves.6% of its total crude oil requirements (for the refining segment). the company’s total proved crude oil reserve has declined at a negative CAGR of 5%. Geographical concentration limits the growth potential of the company and exposes it to economic downturns in China. Decline in crude oil reserves Sinopec’s proved reserve of crude oil has seen a decline over the last three years. however. the company faces inherent risks associated with exploration and development and with acquiring activities. The company’s ability to achieve sustainable development is dependent on certain extent on its ability in discovering or acquiring additional oil and natural gas reserves and further exploring its current reserve base. Lack of geographical diversification limits the growth potential of the company.820 mmbbls in FY2009. The company's dependence on outside sources for crude oil puts it at a disadvantage against companies sourcing all their crude oil requirements from owned production. The company purchases 82.

in November 2009. and certain other assets related to its exploration and production.. in 2008. This brief is a licensed product and is not to be photocopied 03/2011 Page 79 . set up a joint venture in Guangzhou. Acquisitions to fuel growth Sinopec made a number of acquisitions in the recent past. a wholly-owned subsidiary of China Petrochemical Corporation. for a consideration of $1. Sinopec signed a joint venture agreement in China with Mitsubishi Chemical Corporation and Mitsubishi Engineering-Plastics Corporation to engage in manufacturing and sales of polycarbonate resin. and forms the basis for the company to acquire future new oil and gas assets. For instance. the annual processing capacity would reach approximately 300. Sinopec announced that it had entered into an agreement.7 billion. Global Top 10 Energy Companies Report: Industry. and argon for a wide range of industrial applications. Upon completion. and distribute industrial gases such as oxygen. would produce.000 tons of phenol. in June 2009. Praxair-GPC Industrial Gases. Sinopec and Mitsui Chemicals announced their plans to build two factories in Shanghai to manufacture high-performance materials for resins and synthetic rubber used in automobiles and consumer electronics. Shanghai Sinopec Mitsui Chemicals Co. Both the companies plan to invest approximately $428m to build a plant at their fifty-fifty joint venture.000 barrels per day.. Sinopec and Zhejing Provincial Government signed an agreement to jointly construct China's single integrated refining and petrochemical complex in Zhejiang Province. This acquisition of one of its parent’s assets marks the entry of Sinopec into the overseas upstream exploration and production business. in June 2010. The company's joint ventures and alliances would allow it to further strengthen its existing business as well as help Sinopec to gain a strong foothold in new sectors and markets. property interests in eight oil product pipeline project divisions. from Sinopec Group Company. The joint venture named. as well as bis phenol A. Praxair (China) Investment. through a wholly-owned subsidiary in Hong Kong. For instance. In the same year. a deep-water oil asset. SSI owns a 50% participation interest in Angola Block 18. These acquisitions can help Sinopec in its topline growth. and marketing and distribution segments.Company Reports Opportunities Growth through joint ventures and alliances Growth through joint ventures and alliances has long been a strategy of Sinopec. a material for resins used in products.. In March 2010. Further. a wholly-owned subsidiary of Praxair.99% equity interest in Shijiazhuang Chemical Fiber Co. to acquire 55% of Sonangol Sinopec International (SSI) from Sinopec Overseas Oil & Gas. refining. In May 2009. sell. 41. Further. Financial and SWOT Analysis © Datamonitor. Zhejiang Southeast Electric Power Company announced that it would sell its entire 10% stake in a Zhejiang-based natural gas development company to a subsidiary of Sinopec. nitrogen. the raw material used in the production of polycarbonate resin. Sinopec acquired 100% equity interest of Sinopec Qingdao Petrochemical Co. southern China with Sinopec. such as car headlights and LCD films. which would be able to annually produce 250.

boosting its revenues and solidifying its position. Demand will be driven by continued petrochemical demand. China’s continuing robust economic growth and accelerating industrialization will propel the demand for petroleum and petrochemical products upwards. and construction. Together with the large demandsupply gaps for these products in China. Global Top 10 Energy Companies Report: Industry. This brief is a licensed product and is not to be photocopied 03/2011 Page 80 .Company Reports High demand potential in China China is the world’s second largest consumer of oil. Sinopec would be in an excellent position to exploit the growth in petroleum industry. there is much room for further expansion of both the domestic supply and the imports of these products. agricultural and fishing activities. both domestic and foreign. Aggressive investment. is expected to be made in the industry in the next decade. Financial and SWOT Analysis © Datamonitor.

Such an intense competition threatens to erode the market share of the company. The company's business could also be adversely affected by future changes in certain policies of the Chinese government with respect to the oil and gas industry. such as exploration and production licensing. and setting safety. the petroleum and petrochemical industries in China are still subject to some forms of regulations. quality. Its main competitors in China are PetroChina Company (PetroChina) and China National Offshore Oil Corporation (CNOOC).Company Reports Threats Intense competition Sinopec faces intense competition in the oil and gas industry. Such government regulations and control could have a negative impact on the operations of the company. The company’s refining and marketing and chemicals operations compete with PetroChina and CNOOC. As a result. regulating the pricing of refined petroleum products. or to maximize its profitability. Global Top 10 Energy Companies Report: Industry. It competes both in China and international markets. The company’s products also face competition from imported refined products and chemical products. Although the government is gradually liberalizing the market entry regulations on petroleum and petrochemicals industry. It also includes granting the licenses to market and distribute crude oil and refined petroleum products. the competition is further intensified from foreign producers of refined products and chemical products. As a result of China’s entry into the WTO. and environmental and safety standards. In its exploration and production operations. are subject to extensive regulations and control by the Chinese government. to develop or expand its business operations. This brief is a licensed product and is not to be photocopied 03/2011 Page 81 . Government regulations and control Sinopec’s operations. Financial and SWOT Analysis © Datamonitor. and environmental standards. These regulations and control affect many material aspects of the company's operations. which include issuing crude oil and nature gas production licenses. collecting special gain levies. assessing taxes and fees payable. Sinopec could face significant constraints on its ability to implement its business strategies. deciding import and export quotas and procedures for the oil and gas industry. Sinopec competes with CNOOC for the acquisition of desirable crude oil and natural gas prospects. industry-specific and product-specific taxes and fees. like those of other Chinese oil and gas companies.

It is anticipated that the environmental laws and regulations to which the company is subject to would become increasingly strict. refineries. and chemical projects. quantities. including criminal and civil liabilities for serious pollution. These laws and regulations require an environmental evaluation report to be submitted and approved prior to the commencement of exploration. and concentration of various substances that can be released into the environment in connection with drilling and production activities. regional. transportation. refining. and treatment of solid waste materials. and impose penalties for pollution resulting from oil. It also restricts the type. handling. In addition. natural gas and petrochemical operations. These environmental laws and regulations could therefore have an increasing impact on the company’s operations. petroleum and petrochemical products. it is subject to numerous national.Company Reports Environmental laws and regulations Together with other companies in the industries in which Sinopec operates. The environmental laws and regulations also limit or prohibit drilling activities within protected areas and certain other areas. production. and local environmental laws and regulations concerning its oil and gas exploration and production operations. and other activities. chemical plants. Global Top 10 Energy Companies Report: Industry. These laws and regulations could also restrict air emissions and discharges to surface and subsurface water resulting from the operation of natural gas processing plants. pipeline systems. storage. disposal. This brief is a licensed product and is not to be photocopied 03/2011 Page 82 . and other facilities that the company owns. Financial and SWOT Analysis © Datamonitor. Sinopec’s operations are subject to laws and regulations relating to the generation.

to acquire 55% of Sonangol Sinopec International (SSI) from Sinopec Overseas Oil & Gas. and certain other assets related to its exploration and production. the Sinopec Zhenhai 1 million tonnes per annum ethylene plant was put into operation successfully. a wholly-owned subsidiary of TOTAL. Praxair (China) Investment. named Praxair-GPC Industrial Gases. Sinopec acquired 100% equity interest of Sinopec Qingdao Petrochemical Company. would produce. Sinopec and Sinopec Asset Management Company entered into six asset transfer agreements. Fushun Petrochemical Institute. The joint venture.Company Reports Recent developments In March 2009. 2010 Sinopec announced that the project of transmitting natural gas from Sichuan to Eastern China had been completed. Sinopec entered into agreements with certain of its subsidiaries to acquire property rights. In June 2009. cable testing and maintenance devices. Zhejiang Southeast Electric Power Company announced that it would sell its entire 10% stake in a Zhejiangbased natural gas development company to a subsidiary of Sinopec. through a wholly-owned subsidiary in Hong Kong. Financial and SWOT Analysis © Datamonitor. nitrogen. In the same month. refining and marketing. In November 2009. set up a joint venture in Guangzhou. In June 2010. and certain other assets. Shanghai Research Institute of Petrochemical Technology. sold a 10% interest in the Northern Lights Partnership (NLP) to SinoCanada Petroleum Corporation. In the following month. Sinopec announced that it was planning to set up an international exploration company. In April 2010. Research Institute of Petroleum Processing (RIPP). property interests in eight oil product pipeline project divisions. pursuant to which Sinopec acquired from Sinopec Asset Management Company all of the assets it held in Petroleum Exploration & Production Research Institute (PEPRIS). This brief is a licensed product and is not to be photocopied 03/2011 Page 83 . and distribution segments. in May 2009. submarine pipeline.99% equity interest in Shijiazhuang Chemical Fiber Company. Global Top 10 Energy Companies Report: Industry. southern China with Sinopec. Total E&P Canada. equity interests. a subsidiary of Sinopec. and argon for a wide range of industrial applications. In August 2009. Sinopec announced that it had entered into an agreement. a wholly-owned subsidiary of China Petrochemical Corporation. and distribute industrial gases such as oxygen. from Sinopec Group Company. In the same month. and Qingdao Safety Research Institute. Beijing Chemical Institute. In March 2010. for a consideration of $1. Sinopec and Mitsui Chemicals announced their plans to build two factories in Shanghai to manufacture high-performance materials for resins and synthetic rubber used in automobiles and consumer electronics.7 billion. sell. a wholly-owned subsidiary of Praxair. 41.

The net profit was E8. and other activities. TOTAL’s combined proved reserves of crude oil and natural gas were 10. The investments were made primarily in Angola. TOTAL operates through three business segments: upstream.1 billion) in FY2009. TOTAL is headquartered in Courbevoie. in the Middle East (mainly in Oman. Russia. TOTAL is also active in the chemicals. Nigeria.4m) in FY2009.6m) in FY2009. The company operates in more than 130 countries. the Republic of Congo. the US. France and employs about 96.400 people.092.327m (approximately $183. coal mining. Thailand. The company recorded revenues of E131. These reserves were located in Europe (primarily in Norway. and Venezuela). liquefied natural gas (LNG). the UK. The company is engaged in all aspects of the petroleum industry. 56% of which were proved developed reserves.152. Financial and SWOT Analysis © Datamonitor.447m (approximately $1. The company has operations in more than 130 countries. Nigeria. a decrease of 27% compared with FY2008. and liquefied petroleum gas (LPG). Liquids represented approximately 54% of these reserves and natural gas the remaining 46%. and Libya). and power generation businesses. This brief is a licensed product and is not to be photocopied 03/2011 Page 84 . Business description TOTAL is engaged in the exploration and production of oil and gas.Company Reports TOTAL S.483 million barrels of oil equivalent (Mboe). petroleum product marketing. and in Asia (mainly in Indonesia and Kazakhstan).4m) in FY2009. The company’s consolidated exploration and production subsidiaries’ development expenditures totaled E8 billion (approximately $11. Global Top 10 Energy Companies Report: Industry.A. Norway. Argentina. as well as power generation and trading.2% compared with FY2008. and Yemen). and chemicals. The reserves were also located in the Americas (mainly in Canada. the Republic of Congo.2% compared with FY2008. the US. the UAE. development. In FY2009. Indonesia. including upstream and downstream operations.124m (approximately $21. refining. and the UK) and in Africa (primarily in Angola. a decrease of 36. as well as its gas and power operations. Kazakhstan. Gabon. and production activities. and Qatar. downstream. TOTAL’s gas and power division conducts activities downstream from production related to natural gas. Company overview TOTAL is one of the leading integrated oil and gas companies in the world. Gabon. TOTAL has exploration and production activities in over 40 countries and produces oil or gas in 30 countries.1780. and international crude oil and product trading. as well as transportation. a decrease of 20. The operating profit of the company was E15. Canada. Qatar. The upstream segment includes the company's exploration.

Tenesol designs. In Nigeria. Financial and SWOT Analysis © Datamonitor. TOTAL is also engaged in renewable energies. marketing.6 Mt was South African steam coal. primarily to Europe and Asia. TOTAL is involved in upstream activities. TOTAL owns 28% of Eastern Power and Electric Company (EPEC). trading. in downstream activities. TOTAL also operates a wind farm in Mardyck (near its Flanders refinery. through its subsidiary Total Coal South Africa (TCSA). TOTAL and its partner. in partnership with Electricite de France (EDF). on the northern coast of Spain.4 million metric ton (Mt) of LPG (butane and propane) worldwide. The upstream business segment also includes the gas and power division which encompasses the marketing. A fifth mine is under development in Dorstfontein with a start-up expected in late 2011. One such example is the Taweelah A1 cogeneration plant in Abu Dhabi. Mardyck has a capacity of 12 MW and produced approximately 29. of which 3. TOTAL has interests in several cogeneration facilities. France). which combines power generation with water desalination and gas-fired electricity generation. TOTAL also trades and markets steam coal through its subsidiaries Total Gas & Power. LNG re-gasification and natural gas storage. In partnership with GDF Suez and IMEC (Interuniversity MicroElectronics Centre). with the manufacturing of photovoltaic cells. TOTAL holds a 50% interest in Tenesol. manufactures. TOTAL has decided to dispose of certain of its wind farm projects. Liquids accounted for approximately 61% and natural gas accounted for approximately 39% of TOTAL’s combined liquids and natural gas production in FY2009. and trading of coal and solar power systems (through its subsidiaries Tenesol and Photovoltech). markets and operates solar-photovoltaic power systems. Approximately 50% of TOTAL’s South African coal production was sold to European utility companies and the other half in Asia. In FY2009. In addition. The company. Global Top 10 Energy Companies Report: Industry. in 2005. TOTAL acquired a 10% interest in a pilot project located offshore Santona. In marine energy. located in Dunkirk. The construction of a first buoy. in partnership with GDF Suez and EDF.3 Mt of coal worldwide in FY2009. are participating in two projects to construct gas-fired power generation units. the state-owned Nigerian National Petroleum Corporation. TOTAL owns 50% of Photovoltech.281 thousand barrels of oil equivalent per day (kboe/d) compared with 2. In Thailand. In solar-photovoltaic power (based on silicon-crystal technology). and transport of natural gas and liquefied natural gas (LNG). owns and operates four mines in South Africa. TOTAL also participates in another type of cogeneration. and.33% interest in the project to build and operate the second French European Pressurized Reactor (EPR) in Penly.341kboe/d in FY2008. was completed and the buoy was put into the water in September 2008. It also includes power generation from gas-fired combined-cycle plants and renewable energies. In France. the trading and marketing of electricity. with a capacity of 350 megawatt (MW). TOTAL has an 8. a company specializing in manufacturing photovoltaic cells. TOTAL traded and sold approximately 4.Company Reports For FY2009. and CDF Energie (France). Total Energy Resources (Pacific Basin). with a particular focus on solar-photovoltaic power. and LPG shipping and trading. which operates the combined cycle gas power plant of Bang Bo. in which TOTAL has a 20% interest. with the marketing of solar modules and systems. in the northwest of the country. As a refiner and petrochemicals producer. This brief is a licensed product and is not to be photocopied 03/2011 Page 85 . with a capacity of 40 kilowatt (kW). the company’s average daily oil and gas production was 2. and the production. TOTAL also exports steam coal from its mines located in South Africa. TOTAL sold approximately 7.5 gigawatt-hours (GWh) of electricity in FY2008.

The chemicals segment is organized into the base chemicals (petrochemicals and fertilizers) and the specialties chemicals (including rubber processing. In FY2009. As of December 31. marketing. and petrochemical feedstock. is developing second generation biofuels derived from biomass.299 retail stations. bitumen. TOTAL’s worldwide refining capacity was 2. and special fluids. and China. Singapore. in partnership with the companies in this area. LPG. the shipping division of the company chartered approximately 3. has an average age of approximately four years. adhesives. TOTAL's main petrochemicals sites are located in Belgium. Qatar. TOTAL produced and blended 560 kilotonnes (kt) of ethanol in gasoline at twelve European refineries and 1. In FY2009. and electroplating. The trading and shipping division of the downstream segment of TOTAL sells and markets the company’s crude oil production and provides a supply of crude oil for the company’s refineries. Financial and SWOT Analysis © Datamonitor. Africa. TOTAL manufactures and markets nitrogen fertilizers made from natural gas. European. TOTAL’s refining business has interests in 24 refineries and it directly operates 12 of these refineries. This brief is a licensed product and is not to be photocopied 03/2011 Page 86 . produced from refined oil at its refineries and other facilities. TOTAL's petrochemical activities include base petrochemicals (olefins and aromatics) and their polymer derivatives (polyethylene. South Korea in partnership with Samsung. The company is also participating in French.616 kb/d (including trading activities). 2009. TOTAL employed a fleet of 55 vessels chartered under long-term or medium-term agreements (including four LPG carriers). 2009. and undertakes trading on various derivatives markets. resins. The base chemicals division comprises TOTAL’s petrochemical and fertilizer businesses. The company’s refineries produce a broad range of specialty products. TOTAL’s specialties chemicals division includes its business in rubber processing. marine fuels. France. As of December 31. It also imports and exports the appropriate petroleum products for TOTAL. and shipping activities. and styrenics). special fluids. TOTAL is one of the world’s largest integrated chemical producers. jet fuel. consisting entirely of double-hulled vessels. with more than 50% owned by the company. The company markets its specialty products in approximately 150 countries.000 voyages to transport approximately 123 Mt of oil. the US. such as lubricants. and international bioenergy development programs. TOTAL. These refineries are located in Europe. TOTAL is also active in the biodiesel and biogasoline biofuel sectors. lubricants. LPG.Company Reports The downstream segment is engaged in refining. resins. jet fuel. Global Top 10 Energy Companies Report: Industry. and China. and the largest marketer in Africa. The company also holds interest in a site with a steam cracker and two polyethylene units in Mesaieed. TOTAL’s worldwide marketing network comprised 16. Through its subsidiary GPN. TOTAL holds a 50% interest in an integrated petrochemicals site located in Daesan.870 kt of vegetable-oil-methyl-ester (VOME) in diesel at fifteen European refineries and several storage sites. TOTAL is among the leading companies in the specialty products market. the French West Indies. the US. adhesives. and electroplating activities). 2009. polypropylene. TOTAL is the largest refiner/marketer in Western Europe. The fleet. with a market share of 10%. in particular for bitumen.594 thousand barrels per day (kb/d) and its refined products sales worldwide were 3. As of December 31. trading. The company markets a wide range of specialty products. charters appropriate ships for these activities.

coatings and structural materials through three subsidiaries: Cray Valley. It is engaged in both the electronics and general metal finishing markets. based on worldwide sales. Financial and SWOT Analysis © Datamonitor. Sartomer. construction. TOTAL produces and markets resins for adhesives. and Cook Composites & Polymers. The consumer products business offers baby care products and household specialties. TOTAL. is the second largest company in this sector. Atotech.Company Reports Hutchinson manufactures and markets products derived from rubber processing for the automotive. is engaged in manufacturing adhesives for the industrial. and defense industries. which encompasses TOTAL’s electroplating activities. aerospace. inks. through its subsidiary Bostik. paints. Global Top 10 Energy Companies Report: Industry. and consumer and professional distribution markets. This brief is a licensed product and is not to be photocopied 03/2011 Page 87 . hygiene.

285 in FY2008. the UK. Rest of Europe accounted for 45. and marine fuels. Rest of the world accounted for balance 14. rest of Europe.5m) in FY2008. bitumen. LPG. jet fuel.091 in FY2006.016 in FY2009 compared with 4. Africa accounted for 7. It is also the largest marketer of petroleum products in Africa. In FY2009.Company Reports SWOT analysis Strengths Strong market position TOTAL is the fifth largest publicly-traded integrated international oil and gas company in the world. TOTAL is one of the leading marketers in Western European markets. the Middle East and Asia.7% of the total revenues. Africa. It spent E650m (approximately $906. Financial and SWOT Analysis © Datamonitor. TOTAL focuses its research and development activities on the areas of exploration and production technology. The number of employees dedicated to research and development activities was 4.4m) in FY2007 and E569m (approximately $793. The company’s diversified geographical presence and regional brand identity give it competitive advantage over its competitors and also indicate that the company has a wider scope in increasing its revenues by utilizing its global presence. and chemical processes. Spain. Germany. Its reserves are located for the most part in Europe.5m) on R&D in FY2009 compared with E612m (approximately $853. with products marketed in approximately 150 countries. accounted for 24.8% of the total revenues in FY2009. This brief is a licensed product and is not to be photocopied 03/2011 Page 88 . North America. and rest of the world. The company operates in more than 130 countries. as well as to enhance manufacturing and production methods and improve service. The company has strong market position in the specialty products market. Further.216 people in R&D in FY2007 and 4. The company employed 4. Diversified geographical presence TOTAL has wide presence across various regions. Global Top 10 Energy Companies Report: Industry.2% of the total revenues. and Italy. the Americas. Benelux. Africa. A strong market position provides it with a significant bargaining power in the global oil and gas industry. special fluids. R&D expenses in previous years were E594m (approximately $828. in particular for lubricants. refining technology. TOTAL’s largest geographical market. which includes countries such as France. Strong research and development (R&D) capabilities TOTAL has strong research and development (R&D) capabilities. The company conducts research to develop new products and improve existing products.5% and North America accounted for 7.5m) in FY2006. its world wide presence reduces exposure to economic conditions or political instability in any one country or region. TOTAL has exploration and production activities in over 40 countries and produces oil or gas in 30 countries. France.8% of the total revenues in FY2009. The company has operations in more than 130 countries. The company classifies its geographic divisions as France.

easy to handle. Further. and innovative electricity storage solutions. a next-generation plastic. polypropylene. and LPG shipping and trading. and shipping activities. in France. to reduce silicon use and still increase the efficiency of photovoltaic cells. thereby reducing propeller noise in the cabin. and chemicals. biotechnology. Financial and SWOT Analysis © Datamonitor. Presence across the energy value chain TOTAL operates in a wide range of businesses worldwide and commands presence across the energy value chain. The company’s upstream operations comprise exploration. TOTAL operates across the energy value chain through its three business segments: upstream. The company engages in fully integrated petroleum operations. mining operations of coal. and fully recyclable. and providing a supply of crude oil for the company’s refineries. chemicals operations. and Lumicene. cogeneration. The company launched acoustic insulation panels for aircraft. power generation. The company commissioned a pilot project for carbon dioxide capture and storage at Lacq field in January 2010. In November 2009. marketing. the company launched several new products in FY2009. The company also has interests in the coal mining. The downstream segment is engaged in refining. and transport of natural gas and liquefied natural gas (LNG). which are lightweight. TOTAL issued approximately 250 new patents applications in FY2009. as well as its gas and power operations. TOTAL has also introduced IDEE! FIX. and production activities. TOTAL’s presence across the energy value chain provides the company with opportunities to optimize its business while minimizing business risks. The agreement concerns a research program initiated by IMEC. TOTAL launched the Shesha gas cylinders. Through its strong R&D capabilities. development. Trading activities of the segment include selling the company's crude oil production. This brief is a licensed product and is not to be photocopied 03/2011 Page 89 . LNG re-gasification and natural gas storage. trading. the first removable grab adhesive. The gas and power division encompasses the marketing. The company's strong R&D capabilities provide it with a competitive advantage and help it to improve the efficiency of its products and processes. The company signed the IMEC Industrial Affiliation Program (IIAP) R&D agreement together with GDF SUEZ and Photovoltech (a joint subsidiary) in September 2009. downstream. TOTAL's petrochemicals activities include base petrochemicals (olefins and aromatics) as well as their derivatives (polyethylene. which block low frequency sound. trading. and styrenics). TOTAL continued its research and testing programs for fuel cell and hydrogen fuel technologies. the company signed a research agreement with the Massachusetts Institute of Technology to develop new stationary batteries to enable the storage of solar power. and energy services.Company Reports TOTAL is engaged in extensive R&D in the areas of solar energy. and electricity sectors. Global Top 10 Energy Companies Report: Industry.

5m (approximately $239m).5m (approximately $18. The court ordered the company to pay a fine of E375. Elf Aquitaine was held jointly and severally liable for. spewing nearly 20. the European Commission fined Arkema E13. E65. TOTAL was found guilty of recklessness in its vessel inspection and vetting procedure. an affiliate of TOTAL.000 (approximately $522. the European Commission commenced investigations in 2000. for E42m (approximately $58. Violation of anti-competitive laws In Europe. 2003. sank in December 1999. the Paris Criminal Court imposed a fine on TOTAL in relation to the sinking of the tanker Erika in 1999. In January 2008. pump out the heavy fuel oil remaining in the wreck.8m) and jointly fined Arkema and Elf Aquitaine. The company was subject to proceedings in relation to marine pollution.1m (approximately $305. TOTAL had already spent E200m (approximately $279m) after the sinking to help clean up the coastline. carrying fuel oil owned by a TOTAL division.1m (approximately $85. the Paris Court of Appeal in its judgment found that TOTAL was imprudent in implementing its vessel vetting process.4m (approximately $195. Global Top 10 Energy Companies Report: Industry. This brief is a licensed product and is not to be photocopied 03/2011 Page 90 . split in two and sank in rough seas in December 1999. In May 2006. TOTAL has spent more than E370m (approximately $516m) to compensate and repair the damages resulting from this catastrophic accident. TOTAL.35m (approximately $253m) of these fines while TOTAL was held jointly and severally liable. the commission fined Arkema E78.8m) and E181.000 metric tons of oil into the Atlantic. TOTAL was ordered to compensate the victims of pollution from the Erika.Company Reports Weaknesses Oil spill in the Atlantic TOTAL’s tanker Erika which was transporting products belonging to one of the group companies.7m).7m (approximately $109. respectively. In January 2005. E45m (approximately $62. and Elf Aquitaine of complaints concerning two other product lines in January and August 2005.6m) and E140. The European Commission notified Arkema. Arkema was spun off from TOTAL in May 2006 and became an independent company. causing an oil spill. and 2004 into alleged anti-competitive practices involving certain products sold by Arkema.986). and treat the waste collected along the coast. The tanker.8m). under one of these investigations.6m) as a result of each of these two proceedings. respectively. Financial and SWOT Analysis © Datamonitor.7m) and E219. The compensation totaled E171. Such accidents could result in heavy financial penalties by the regulatory authorities and the clean up costs affect TOTAL’s profit margins significantly. In March 2010.

6m) and individually in an amount of E20. Arkema and Elf Aquitaine received a statement of objections from the European Commission concerning alleged anticompetitive practices related to another line of chemical products.2m) for Elf Aquitaine. Global Top 10 Energy Companies Report: Industry.8m) for Arkema and E7.92m (approximately $13. Further in March 2009. In addition to huge penalties.43m (approximately $28.89m (approximately $22.7m (approximately $31.71m (approximately $10.Company Reports Arkema and Elf Aquitaine received a statement of objections from the European Commission in August 2007 concerning alleged anti-competitive practices related to another line of chemical products.7m) for Elf Aquitaine. The decision was rendered by the European Commission in November 2009.5m) for Arkema and E15. such violation of laws could affect TOTAL’s business operations in the region due to tightened surveillance. As a result. Financial and SWOT Analysis © Datamonitor. Arkema and Elf Aquitaine were jointly and severally fined in an amount of E22.3m) and individually in an amount of E9. This brief is a licensed product and is not to be photocopied 03/2011 Page 91 . Arkema and Elf Aquitaine were jointly and severally fined in an amount of E11m (approximately $15.

TOTAL. with a total continental capacity of roughly 116. This refinery reflects the company’s commitment to increase its capacity to meet the growing demand for refined products across markets. TOTAL and ERG signed an agreement to create a joint venture with 49% and 51% stakes. respectively.01 billion from the public investment fund and export credit agencies (covered and direct). The joint venture will also be active in the refining business. is expected to begin operations in 2013. The agreement will help further strengthen TOTAL’s position in Italy thereby reinforcing its leading position in the European refining and marketing industry.4 million metric tons per year. The transaction. In addition. excludes TOTAL Italia's aviation and AS 24 payment card operations and ERG Petroli's refining and marketing operations in Sicily. In June 2010.000 t/y of benzene.2 million metric tons per year. In January 2010. Establishment of Jubail Refining and Petrochemical Company TOTAL signed agreements with The Saudi Arabian Oil Company (Saudi Aramco) for the establishment of a joint venture in June 2008. Jubail Refining and Petrochemical Company.49 billion from commercial financial institutions. The joint venture is to construct a full-conversion refinery with a capacity of 400. Middle-East. finances totaling $8. however. while general retail and specialties business sales will amount to roughly 3. Financial and SWOT Analysis © Datamonitor. The integration will further strengthen TOTAL and ERG's competitiveness in Italy by expanding the product and service portfolio for Italian consumers. the project will produce 700. The joint venture will leverage the expertise and competencies of both companies and pursue opportunities for growth. Global Top 10 Energy Companies Report: Industry. 140. Saudi Aramco and TOTAL would share the marketing of the refinery’s products. would operate under both the TOTAL and ERG brands.Company Reports Opportunities Partnership with ERG to develop the refining and marketing business in Italy TOTAL has formed a partnership with ERG to further strengthen its refining and marketing business in Italy. Saudi Arabia. The joint venture (TotalErg) created through the merger of TOTAL Italia and ERG Petroli. in the Italian marketing and refining business. could supply transportation fuels and petrochemicals in Asia.5% of the company and TOTAL would own the remaining 37.000 barrel per day in Jubail. environmental and safety performance.5 billion for the project were secured from multiple sources including $4.000 t/y of polymer-grade propylene. with significant market shares in diesel. TotalErg will become one of the largest marketing operators in Italy.5%. This refinery is strategically located to benefit from its proximity to the Arabian heavy crude supply system. Saudi Aramco would initially own 62. The fuel sales are expected to exceed 3. The joint venture will also operate its shareholders’ logistics infrastructure. The joint venture. together with Saudi Aramco. The refinery would process Arabian heavy crude to high-quality refined products. Upon integration. and $4.400 service stations. This full-conversion refinery would maximize the production of diesel and jet fuels. and European markets where the demand for diesel and jet fuels continues to increase. This brief is a licensed product and is not to be photocopied 03/2011 Page 92 . LPG and bitumen.000 tons per year (t/y) of paraxylene. with a retail market share of nearly 13% and over 3. TotalErg will optimize its industrial assets in this segment to achieve excellence in its industrial. lubricants. and 200.000 barrels per day (about 8% of national demand).

and international bioenergy development programs. the company is participating in the BioTfueL research project intended to develop a technology to transform biomass into biodiesel. Total Exploration & Production Nigeria in association with Conoil Producing discovered hydrocarbons in the central portion of the Oil Mining Lease OML 136. in the deep waters of the Angolan offshore. entered into several agreements with Cobalt International Energy to jointly explore the deepwater Gulf of Mexico. TOTAL has a 50% interest in the block. In December 2009. In April 2009. as part of the second bid round held by ALNAFT. TOTAL’s subsidiary. In June 2009. TOTAL acquired an interest in Gevo. alongside partners Talisman Energy (30%) and Hocol (operator. TEPA (Block 15/06) and its partners made two important oil discoveries in Angola at the Nzanza-1 and Cinguvu-1 wells. The company has also made several oil and gas discoveries. discovered hydrocarbons in the southern portion of the Oil Prospecting License (OPL) 223 deepwater offshore South-Eastern Nigeria. GDF-Suez 8%) from the 50% held by KMG. 300 kilometers north east of Bogota. Such oil and gas exploration projects coupled with oil discoveries will help TOTAL in increasing its oil and gas production. is developing second generation biofuels derived from biomass. Financial and SWOT Analysis © Datamonitor. TOTAL would hold a 47% interest and would appraise and develop the Ahnet finds with partners Partex (2%) and Sonatrach (51%).Company Reports Oil and gas exploration projects TOTAL has entered into several agreements for oil and gas exploration projects. 20%). In October 2009. Strategic initiatives in the area of biofuels and photovoltaic solar power systems TOTAL has taken several strategic initiatives in the area of biofuels and photovoltaic solar power systems. In June 2010. TOTAL is also involved in Futurol. which intends to develop and promote on an industrial scale a production process for bioethanol by fermentation of lignocellulosic biomass. In this framework. in partnership with the leading companies in biofuels area. Colombia. European. TOTAL signed a Heads of Agreement establishing the principles of a partnership with KazMunaiGas (KMG) for the development of the Khvalynskoye field. TOTAL. TOTAL E&P USA. The company is also participating in French. Total Exploration & Production Nigeria. an R&D project for cellulosic bioethanol. located offshore in the Caspian Sea on the border between Kazakhstan and Russia. TOTAL’s subsidiary. Global Top 10 Energy Companies Report: Industry. In April 2010. In April 2009. This brief is a licensed product and is not to be photocopied 03/2011 Page 93 . TOTAL and GDF-Suez would acquire a participation of 25% (TOTAL 17%. offshore Western Nigeria. TOTAL announced the discovery of a significant gas condensate field in the Niscota block of the Andes foothills. the consortium of TOTAL and Partex was awarded a 49% interest in the Ahnet license. a US company developing a portfolio of bioproducts intended for the transportation fuel and chemicals markets. In December 2009.

has appointed the bidding consortium of TOTAL and Abengoa Solar as a partner to own. The initial investment is estimated at approximately E70m (approximately $103m). the world’s largest concentrated solar power plant and the first of its kind in the Middle East. and operate Shams 1. Global Top 10 Energy Companies Report: Industry. Financial and SWOT Analysis © Datamonitor.4% interest in US startup AE Polysilicon Corporation (AEP) in June 2010. In November 2009. Subsequently. In March 2009. TOTAL signed a research agreement with the Massachusetts Institute of Technology to develop new stationary batteries designed to enable the storage of solar power. Such strategic initiatives would help TOTAL in diversifying its product offerings and in turn increase its revenues. commercialization. TOTAL and GDF Suez announced that they were considering together locating a silicium wafers fabrication plant intended for the photovoltaic industry on the De Vernejoul industrial site in the Moselle region in France. Total Gas & Power USA. AEP has developed an advanced technology to produce polysilicon for photovoltaic panels. Masdar. build. and deployment of renewable and alternative energy technologies and solutions. This brief is a licensed product and is not to be photocopied 03/2011 Page 94 . TOTAL’s subsidiary.Company Reports TOTAL is also increasing its footprint in the solar power systems field. Abu Dhabi’s multi-faceted initiative advancing the development. acquired a 25.

the states have to reduce the allowable sulfur dioxide (SO2) emissions by 70% and reduce Nitrous Oxide (NOX) emissions by 60%. Further. The US government waived the application of sanctions for TOTAL’s investment in the South Pars gas field in Iran in 1998. in 2005. In each of the years since the passage of ILSA. According to the rule. Financial and SWOT Analysis © Datamonitor. Iran and Libya Sanction Act (ILSA).Company Reports Threats Environmental regulations TOTAL’s businesses are subject to numerous laws and regulations relating to the protection of the environment. One of the most important developments in this area has been the introduction of the Kyoto Protocol for the reduction of greenhouse gases. In July 2008. TOTAL may invest amounts significantly in excess of $20m per year in the country in the future. regulatory standards have been continuously tightened in recent years. the President of the US is authorized to initiate an investigation into the possible imposition of sanctions against persons who knowingly made investments of $20m or more in any 12 month period in the petroleum sector in Iran. by 2015 compared with the 2003 levels. As per this amendment. With rising awareness of the damage to the environment caused by industry. the US legislation implementing sanctions against Iran and Libya was amended and extended until December 2011. an immediate investment in Iran amid the mounting tensions over the country’s nuclear program could increase political risks for TOTAL. compared with 1990 emissions levels. This could result in a material decline in TOTAL’s profitability in the short term. TOTAL has made investments in Iran (excluding South Pars) in excess of $20m. Regulations concerning Iran In 2006. to reduce the emission levels. the US environmental protection agency (EPA) issued a ’clean air interstate rule’ (CAIR). The US has intensified its push for tougher sanctions on Iran over the country's nuclear program. Global Top 10 Energy Companies Report: Industry.2% on an average annual basis during the 2008–12 period. Therefore. especially regarding global warming. The act was amended to concern only business in Iran and renamed the Iran Sanctions Act (ISA). The protocol calls on industrialized countries to reduce their greenhouse gas emissions level by 5. TOTAL postponed plans to invest in a project linked to Iran's South Pars gas field in the midst of mounting tensions over its nuclear ambitions. This brief is a licensed product and is not to be photocopied 03/2011 Page 95 . The company is governed by these regulations which could impose new liabilities on the company.

property damage or business interruption. financial condition. Financial and SWOT Analysis © Datamonitor. the hazards and risks related to exploration and production activities could have a material adverse effect on the company’s business operations. This brief is a licensed product and is not to be photocopied 03/2011 Page 96 . This block was located in the Caspian Sea. The blocks were located in the onshore Sirte Basin and the offshore Sabratha Basin. environmental pollution. TOTAL and GDF Suez announced that they were considering locating a silicium wafers fabrication plant intended for the photovoltaic industry on the De Vernejoul industrial site in the Moselle region in France. development. These events could cause a loss of hydrocarbons. spills. The company is selling its asset to raise money for the $20 billion cleanup fund set up as directed by the US Government. TOTAL signed an agreement with Azerbaijan’s state-owned oil and gas producer. an explosion on the Transocean's rig on an exploration well operated by BP killed 11 workers. claims for personal injury. natural disasters. claims. recommendations. and cash flows. For instance. and the fishing and tourist industries at a time of high unemployment. to exploration and production sharing agreement (EPSA) IV format. American Shale Oil (AMSO).Company Reports Risks related to exploration and production activities The company’s exploration and production operations are subject to inherent hazards and risks such as fires. The exploration. in a water depth of around 500 meters. explosions. in April 2010. TOTAL signed a MoU with Libya’s National Oil Corporation (NOC) converting the existing petroleum contracts covering the blocks C17 and C137. In March 2009. The initial investment was estimated at approximately E70m (approximately $103m). SOCAR. the rig sank triggering an oil spill in the Gulf of Mexico. blowouts during well drilling. geological formations with abnormal pressures. death. Therefore. respectively. TOTAL agreed to acquire a 50% stake in IDT Corporation’s (IDT) subsidiary. fines or penalties. or governmental investigations. pipeline ruptures. around 100 kilometers from the Libyan coast. collapses of wellbore casing or other tubulars. 100 kilometers from Baku. and production sharing agreement (EDPSA) covered a license on the Absheron offshore block. Global Top 10 Energy Companies Report: Industry. The spill has caused a multi-billion dollar damage severely affecting the environment and wildlife on the coastal shores of five US Gulf Coast states. In February 2009. operated by its subsidiary Mabruk Oil Operations. Subsequently. Recent developments In January 2009. and other hazards and risks. Further in February 2009.

alongside its partner. which would hold the majority of the capital. a company engaged in developing biofuels. Subsequently. alongside the Abu Dhabi National Oil Company (Adnoc. EDF. TOTAL had a 50% interest in the block. In April 2009. TOTAL Exploration and Production Vietnam.8 million tons per year (Mt/y) each and for which TOTAL held a 16. TOTAL announced the discovery of a significant gas condensate field in the Niscota block of the Andes foothills. a company formed through the joint venture of Qatar Petroleum (67. petrochemicals. Total E&P Norge was awarded a 40% interest and operatorship in the production license PL 535 in the Barents Sea. following the twentieth licensing round organized by the Ministry of Petroleum and Energy in Norway. while PetroVietnam Exploration Production (PVEP) would hold the remaining 25% interest. which were located in the Mekong Delta area onshore. TOTAL E&P USA. The South Hook Terminal is owned and operated by South Hook LNG. TOTAL announced that. ExxonMobil (24. within the framework of the Egyptian Natural Gas Holding Company (EGAS) 2008 international bid round organized by the Egyptian authorities. TOTAL acquired an interest in Gevo. was operated by Chevron Corporation. 68%). composed of two trains of 7.5%). alongside partners Talisman Energy (30%) and Hocol (operator. Colombia.3%). Subsequently in April 2009. a Novatek’s wholly-owned subsidiary. Shell (15%) and Partex (2%).35%). signed a production sharing contract with Vietnam Oil and Gas Group (PetroVietnam) for the exploration blocks DBSCL-02 and DBSCL-03. a subsidiary of China Petroleum & Chemical Corporation (Sinopec). This deepwater field. In May 2009. it had been awarded a 90% participation in and the operatorship of Block 4 (East El Burullus Offshore) in conjunction with partner ENEL (10%). entered into several agreements with Cobalt International Energy (an oil and gas exploration and development company) to jointly explore the deepwater Gulf of Mexico. TOTAL’s subsidiary. UK. Subsequently. Further in May 2009. TOTAL announced the inauguration of Qatargas 2. alongside the stateowned company Qatar Petroleum (65%) and ExxonMobil (18. and TOTAL (8. TOTAL signed agreements for a 20 year extension of its 15% participation in Abu Dhabi Gas Industries (Gasco). in which Total owned a 17% interest along with StatoilHydro. In the same month. would be operated by TOTAL with a 75% interest. and solar energy. In the same month. 300 kilometers north east of Bogota. a LNG venture. In the same month. Further in April 2009. sold a 10% interest in the Northern Lights Partnership (NLP) to SinoCanada Petroleum Corporation.5 billion) in France in refining.Company Reports Further in March 2009. In June 2009. a wholly-owned subsidiary of TOTAL. the South Hook LNG re-gasification Terminal. TOTAL E&P Canada (TOTAL Canada). This brief is a licensed product and is not to be photocopied 03/2011 Page 97 . TOTAL signed Heads of Agreement (HOA) with Novatek to acquire a 49% interest in Terneftegas. In the same month. TOTAL announced its plans to invest more than E1 billion (approximately $1. In the same month. TOTAL announced that the Tahiti field located in the Gulf of Mexico had started production.15%). was inaugurated. Global Top 10 Energy Companies Report: Industry. The blocks. GDF SUEZ and TOTAL agreed on a partnership agreement with respective stakes of 75% and 25% to jointly own the 33.7% interest in the second train. 20%). TOTAL’s affiliate. Financial and SWOT Analysis © Datamonitor.33% block of shares plus one share in the company formed to build and operate the EPR in Penly. located in Milford Haven.

Total Exploration & Production Cameroon would operate this block with a 100% participation stake. Hunt Oil Company (17. TOTAL’s subsidiary.7% interest in Train B alongside Qatar Petroleum (65%) and ExxonMobil (18. and BG Group 22. In October 2009. Sonatrach (51%). Subsequently. TOTAL held a 39. and GASSP1 (5%). TOTAL and GDF SUEZ and their common solar cells manufacturing subsidiary. in the deep waters of the Angolan offshore. operated by Chevron and in which TOTAL had a 20% interest. the Yemen LNG liquefaction plant started producing LNG). Further in October 2009. Subsequently. and Cepsa (11. was awarded the Lungahe exploration block in the offshore Rio del Rey basin by the Ministry of Industry. Further in September 2009.73%). owned by TOTAL (37.45%. SK Energy (9. Itau would produce 50 million standard cubic feet per day (1. In the same month. TEPA (Block 17/06). which TOTAL joined as a member in November 2008. Total E&P Vietnam. TOTAL held a 16. the Train B of the Qatargas 2 project started producing liquefied natural gas (LNG). In August 2009. started crude oil production. announced the transfer of a 10% interest in the Kharyaga oil field to state-owned Zarubezhneft of Russia. Photovoltech.88%).3%). TOTAL and the partners of the Bongkot joint venture (PTTEP 44. located between Timimoun and Adrar in southwestern Algeria. an affiliate of TOTAL. Total E&P Russie.25%). operated by the company with 75% equity.33%. Global Top 10 Energy Companies Report: Industry. the Tombua and Landana fields located 80 kilometers offshore Angola. In November 2009.22%) announced that a gas sales agreement was signed with PTT covering all gas production from the Greater Bongkot South (GBS) field in the Gulf of Thailand. GDF Suez 8%) from the 50% held by KMG. In the same month. joined the IMEC Industrial Affiliation Program (IIAP) on next generations of crystalline silicon solar cells. Subsequently.75%).62% interest in Yemen LNG. the Algerian National Oil and Gas Development Agency (ALNAFT) approved the development plan for the Timimoun natural gas project. In September 2009. Total Exploration & Production Cameroon. The commercial production on the project.) discovered oil on Block 17/06. This brief is a licensed product and is not to be photocopied 03/2011 Page 98 . TOTAL signed a HOA establishing the principles of a partnership with KazMunaiGas (KMG) for the development of the Khvalynskoye field. located offshore in the Caspian Sea on the border between Kazakhstan and Russia. Financial and SWOT Analysis © Datamonitor.22%). Korea Gas Corporation (6%). Mining and Technological Development of Cameroon. alongside the state-owned company. a wholly-owned subsidiary of Total. TOTAL 33. TOTAL filed a declaration of commerciality with the Bolivian authorities for the Itau gas field. would begin in 2013. located in the southern part of the block in the Vietnamese offshore.P.Company Reports In July 2009. This agreement valued at $4m over five years was part of the MIT Energy Initiative. In the same month. Hyundai Corporation (5.55%).4 million cubic meters per day). TOTAL signed a research agreement with the Massachusetts Institute of Technology (MIT) to develop new stationary batteries that are designed to enable the storage of solar power. TOTAL and GDF Suez would acquire a participation of 25% (TOTAL 17%. and Sociedade Nacional de Combustiveis de Angola (Sonangol E. The remaining 50% stake and operatorship are held by LUKOIL. and its partners on Block 15-1/05 discovered oil in the Lac Da Nau prospect. Yemen Gas Company (16.

the company announced a plan to repurpose its Dunkirk refinery site as an industrial and technical facility comprising a refining operations support center. Created through the merger of TOTAL Italia and ERG Petroli. Total E&P Iraq held an 18. refining training center. slated to begin initial construction in 2010. In the same month. TOTAL created a public affairs division in February 2010. Subsequently.000 to 110. TOTAL and ERG signed an agreement to create a joint venture with 49% and 51% stakes. Financial and SWOT Analysis © Datamonitor. an affiliate of Tullow Oil.000 meters. alongside the operator PetroChina (37. In January 2010. TOTAL’s subsidiary. and logistics depot. in the Italian marketing and refining business.75% interest in the consortium. TOTAL would also acquire an interest in the company. TOTAL and ConocoPhillips announced the sanction of the Surmont Phase 2 SAGD (Steam Assisted Gravity Drainage) development in Canada. covered an area of approximately 32.000 barrels of bitumen per day. and European Public Affairs was designed to offer TOTAL stakeholders improved transparency and dialogue on all issues related to TOTAL’s activities and reputation in France and worldwide. TOTAL signed an agreement to acquire a 50% interest in Kazakhstan’s concession held by OilTechnoGroup (OTG). The division comprising Public Affairs. This brief is a licensed product and is not to be photocopied 03/2011 Page 99 .Company Reports In December 2009. TOTAL would hold a 47% interest and would appraise and develop the Ahnet finds with partners Partex (2%) and Sonatrach (51%). Subsequently. the Kazakh subsidiary of Poland’s Petrolinvest. In the same month.000 square kilometers in water depths ranging from 2. The project. discovered hydrocarbons in the southern portion of the Oil Prospecting License (OPL) 223 deepwater offshore South-Eastern Nigeria. Total Exploration & Production Nigeria.75%) and the State Partner South Oil Company (25%).000 to 3. respectively. Subsequently. a subsidiary of Chesapeake Energy Corporation. would increase Surmont’s (a 50/50 joint venture between ConocoPhillips Canada and Total E&P Canada) production capacity from 27. TOTAL announces the acquisition of a 25% interest in the Guyane Maritime Permit from Hardman Petroleum France. within the framework of Iraq’s second petroleum bidding round organized by the Iraqi Ministry of Oil in December 2009. EDF and TOTAL signed an agreement for TOTAL to reserve regasification capacity in the planned Dunkirk LNG terminal being developed by Dunkerque LNG. Total E&P USA signed an agreement to enter into a joint venture with US based Chesapeake Exploration. the joint venture (TotalErg) would operate under both the TOTAL and ERG brands. In the same month. International Public Affairs. a wholly owned EDF subsidiary. as part of the second bid round held by ALNAFT. whereby TOTAL would acquire a 25% share in Chesapeake’s Barnett shale gas portfolio located in Texas. the consortium led by PetroChina Company signed a 20 year Development and Production Service Contract with Missan Oil Company for the development of the Halfaya oil field. The permit. located about 150 kilometers off the coast of French Guiana.5%) and partners Petronas Carigali (18. the consortium of TOTAL and Partex was awarded a 49% interest in the Ahnet license. Global Top 10 Energy Companies Report: Industry. Further in January 2010. In March 2010. TOTAL announced that. France and NGOs.

Subsequently. W&T Offshore would receive TOTAL’s 64% interest in Viosca Knoll Blocks 822 and 823 (Virgo) and 100% interest in Mississippi Canyon Block 243 (Matterhorn). TOTAL’s subsidiary Total Gas & Power USA (SAS) acquired a 25. Financial and SWOT Analysis © Datamonitor.2m). the other partners being Qatar Petroleum and Chevron Phillips Chemical Company. the world’s largest concentrated solar power plant and the first of its kind in the Middle East. in June 2010. In May 2010. TOTAL inaugurated the world’s largest olefin cracker based on ethane in Ras Laffan.5% interest in the Arafura Sea and the Amborip VI blocks in the Arafura Sea. Global Top 10 Energy Companies Report: Industry.327 square kilometers from the south of Valence to the region of Montpellier. AEP developed an advanced technology to produce polysilicon for photovoltaic panels.3 million tons of ethylene per year. This brief is a licensed product and is not to be photocopied 03/2011 Page 100 . Total E&P USA announced the transfer of its interests in three federal offshore lease blocks in the Gulf of Mexico to W&T Offshore. Total Petrochemicals. effective January 1. Subsequently. joint ventures with Qatar Petroleum. in the deep waters of the Angolan offshore. through its participations in Qapco and Qatofin. the company acquired an interest in Coskata. an exploration permit granted for a five year period. Subsequently. held 22. a Chicago-based company developing an innovative technology to convert syngas into fuels and chemical products using a biological process.72%) and Hod (25%) fields.) discovered hydrocarbons in the north-eastern area of the deep offshore block 17/06 in Angola. TEPA (Block 17/06) and Sociedade Nacional de CombustIveis de Angola (Sonangol E. the second train of the Yemen LNG natural gas liquefaction plant started production. Masdar. to US-based Jarden Corporation for E335m (approximately $467. TOTAL obtained the Montelimar Permit in France. TOTAL signed an agreement for the sale of its interests in the Valhall (15. covering a surface of 4.4% interest in US startup AE Polysilicon Corporation (AEP). Qatar. in the south of France.P. TOTAL closed the sale of its consumer specialty chemicals business. Mapa Spontex. In the same month. in April 2010. The company also announced the acquisition of the 10% interest in Laggan and Tormore previously held by Chevron North Sea and the 20% interest previously held by ENI UK. Under the terms of the agreement. This increased TOTAL’s interest in this project to 80% alongside partner DONG E&P (UK). to BP. Abu Dhabi’s multi-faceted initiative advancing the development. in the Norwegian North Sea. TEPA (Block 15/06) and its partners made two important oil discoveries in Angola at the Nzanza-1 and Cinguvu-1 wells. In April 2010. TOTAL launched the Laggan and Tormore gas fields development in the offshore frontier region of the West of Shetland.2% of RLOC. TOTAL signed an agreement with ConocoPhillips to acquire a 24. In the same month. In the same month. commercialization and deployment of renewable and alternative energy technologies and solutions. the Ras Laffan Olefin Cracker (RLOC) would feed the new Qatofin polyethylene plant in Mesaieed.Company Reports Further in March 2010. Further in April 2010. appointed the bidding consortium of Total and Abengoa Solar as a partner to own. 2010. Subsequently. With a production capacity of 1. offshore Indonesia. build and operate Shams 1.

5 million standard cubic meters per day plus associated condensates. TOTAL acquired a 36% interest in the Block 72 production sharing agreement in Yemen. TOTAL acquired a 20% interest from Shell in the BM-S-54 license in the Santos Basin. announced a strategic partnership encompassing TOTAL’s investment in Amyris and a wide-spectrum master development and collaboration agreement. Lirio. operated by DNO Yemen and located in the southern part of the Masila Basin. Orquidea. located in Block 3/15 of the UK sector and partly across the median line in Blocks 29/6a and 29/6c of the Norwegian sector. TOTAL launched CLOV Development on Block 17 located approximately 140 kilometers from Luanda and 40 kilometers northwest of Dalia in water depths ranging from 1. offshore Western Nigeria.100 to 1. Global Top 10 Energy Companies Report: Industry. TOTAL received approval from the UK Department of Energy and Climate Change (DECC) and the Norwegian Ministry of Petroleum & Energy (MPE) to develop its Islay gas field in the Northern North Sea.9% interest in Block 1 in the joint development zone (JDZ). In the same month.400 meters. The CLOV development would lead to the four fields namely Cravo. in the Angolan deep-offshore. In August 2010. TOTAL and Amyris. a 20% interest in the Fort Hills mining project in the Athabasca region of the Canadian province of Alberta. In July 2010. TOTAL would operate the block in partnership with Addax Petroleum JDZ 1. This brief is a licensed product and is not to be photocopied 03/2011 Page 101 . coming on stream. Further in June 2010. had estimated reserves of near to 17 million barrels of oil equivalent and an estimated peak gas production rate of 2. 440 kilometers north-east of Aberdeen. the operator of an industrial synthetic biology platform. Total Exploration & Production Nigeria in association with Conoil Producing discovered hydrocarbons in the central portion of the Oil Mining Lease OML 136. TOTAL signed an agreement to acquire Chevron’s 45. and Violeta. Financial and SWOT Analysis © Datamonitor. The Islay field. Further in July 2010. TEPA (Block 15/06) and its partners made a new oil discovery in Block 15/06 with the well Cabaca SE-1.Company Reports In the same month. Shell held the remaining 80% and the operatorship. Subsequently. Total E&P Canada signed an agreement with UTS Energy Corporation (UTS) to acquire UTS Corporation with its main asset. Subsequently. Dangote Energy Equity Resources and Sasol Exploration and Production Nigeria. In the same month.

This brief is a licensed product and is not to be photocopied 03/2011 Page 102 . In Africa.4 billion barrels. Venezuela.8% compared to FY2008. Global Top 10 Energy Companies Report: Industry. respectively. marketing and transportation. Chevron's net crude oil and natural gas production for FY2009 was 1. the company’s net proved reserve of liquids. and other countries averaged 717. a decrease of 56. Africa. and energy services. Texas. Indonesia. Further. a decrease of 36. The operating profit of the company was $18. Its upstream activities in the US are concentrated in California. Kazakhstan. the Gulf of Mexico. refining. the company is engaged in exploration and production activities in Angola. respectively. Colombia. The company’s exploration and production operations also market natural gas. and the Partitioned Zone located between Saudi Arabia and Kuwait.Company Reports Chevron Corporation Company overview Chevron Corporation (Chevron) is one of the leading integrated energy companies in the world. for consolidated operations and affiliated operations was 4.153 billion cubic feet (Bcf) and 3. The net profit was $10.896 Bcf. downstream. Poland. Brazil. The company has operations in more than 100 countries including the US.6 billion barrels and 2. Chevron operates through four business divisions: upstream. the Rocky Mountains. and the UK. Chad. Greenland. and power generation.000 barrels per day. power generation.9% compared to FY2008.000 barrels per day. and Nigeria. chemicals. the Netherlands. and Alaska. 433. and 484. Argentina. geothermal. The company’s net production of natural gas and oil sands for FY2009 was five Bcf per day and 26. Financial and SWOT Analysis © Datamonitor. Chevron is headquartered in San Ramon. Democratic Republic of the Congo.402m in FY2009.000 barrels per day. and all others.044.8 million barrels per day. 1. including crude oil. The company recorded total sales and other operating revenues of $167.000 service station employees). respectively. condensate.483m in FY2009.556m in FY2009. It is also actively involved in mining operations of coal and other minerals. Chevron's upstream business explores for and produces crude oil and natural gas. It has operations in more than 100 countries including the US. The company’s worldwide net oil-equivalent production was approximately 2. Denmark. Norway. At the end of FY2009. worldwide net oil equivalent reserves for consolidated operations and affiliated operations were 8. including exploration and production. respectively.7 million barrels per day in FY2009.3 billion barrels and three billion barrels.000 barrels per day. The company is engaged in every aspect of the oil and natural gas industry. and natural gas liquids. a decrease of 56. Major producing countries in Asia include Azerbaijan. California and employs about 64. Bangladesh. Asia. Faroe Islands. The company’s net oil-equivalent production (including affiliates) from the US. Chevron also has upstream operations in other countries like Australia. respectively. Trinidad and Tobago. mining operations. Canada. Business description Chevron Corporation (Chevron) is a fully integrated energy company engaged in petroleum and chemicals operations. Chevron has production and exploration activities in most of the world’s major hydrocarbon basins. New Mexico.000 barrels per day.2% compared to 2008.000 people (including about 4. The company’s net proved reserves of natural gas for consolidated operations and affiliated operations in FY2009 was 22. chemicals manufacturing and sales. Louisiana.

The company is also engaged in other global marketing businesses. Global Top 10 Energy Companies Report: Industry. Colombia. Texaco. Chevron owns and operates an extensive network of crude-oil. The all others segment includes Chevron’s mining operations. marine vessel. CPC operates a crude-oil export pipeline from the Tengiz Field in Kazakhstan to the Russian Black Sea port of Novorossiysk. and Taro. During FY2009. including those of affiliated companies. Chevron also has a 15% interest in the Caspian Pipeline Consortium (CPC) affiliate. and Belgium. The company also holds interest in 16 fuel refineries and markets its products under the Chevron. France. and rail car. Chevron supplies directly or through retailers and marketers to approximately 12. Meropa. and Caltex. South Korea. South Korea.400 branded service stations. CPC transported an average of approximately 743.000 barrels per day from Russia. the US Gulf Coast extending into Latin America. CPChem has 34 manufacturing facilities in the US. Delo. Southeast Asia.600 branded motor vehicle retail outlets. insurance operations. and Brazil. worldwide cash management and debt financing activities. and Caltex motor fuel and lubricants brands. Chevron Oronite is a fuel and lubricating-oil additives business that owns and operates facilities in the US. Approximately 500 of the outlets are company-owned or leased stations. Brazil. motor equipment.000 retail stations. Financial and SWOT Analysis © Datamonitor.000 airports. Singapore. and the US West Coast. alternative fuels.000 barrels per day from Kazakhstan and 146. concentrated in the mid-Atlantic. Chevron processed approximately 1. southern.9 million barrels of crude oil per day and averaged approximately 3. and natural-gas pipelines and other infrastructure assets in the US. including 597. Downstream’s most significant areas of operations are sub-Saharan Africa. Chemicals operations include the manufacture and marketing of commodity petrochemicals for industrial applications.3 million barrels per day of refined product sales worldwide.000 retail stations. Texaco. The company also markets an extensive line of lubricant and coolant products under brand names that include Havoline. and western states of the US. Ursa. chemicals. The company supplies its products directly or through retailers and marketers to almost 9. Chevron operates in the chemicals segment via its 50%-owned affiliate Chevron Phillips Chemical Company (CPChem) and the wholly-owned Chevron Oronite Company (Chevron Oronite). natural-gas-liquids (NGL). and technology companies. and fuel and lubricating oil additives.Company Reports Chevron's downstream operations comprise refining crude oil into finished petroleum products and marketing crude oil and the many products derived from petroleum. Techron. including those of affiliated companies. This brief is a licensed product and is not to be photocopied 03/2011 Page 103 . and petroleum products by pipeline. Outside the US. refined-product. In FY2009. Singapore. The company sells its products through a network of approximately 22. Chevron markets petroleum products under three brands: Chevron. Chevron markets aviation fuel at more than 1. Saudi Arabia. It sells its products through a network of approximately 22.000 barrels of crude oil per day. including affiliates. and has equity interests in facilities in India and Mexico. The company also has direct or indirect interests in other US and international pipelines. the UK. The company also manufactures a gasoline additive under the brand name. Qatar. natural gas. real estate activities. It also transports crude oil. Japan. power generation businesses. corporate administrative functions. China. the Netherlands.

The company also owns major geothermal operations in Indonesia and the Philippines. This brief is a licensed product and is not to be photocopied 03/2011 Page 104 . The company’s coal mining and marketing subsidiary. Chevron Mining (CMI). the company controlled approximately 193 million tons of proven and probable coal reserves in the US. The company’s power generation business has interests in 13 power assets with a total operating capacity of more than 3. and Kemmerer. including reserves of low-sulfur coal. Financial and SWOT Analysis © Datamonitor. and one underground coal mine. in New Mexico.Company Reports Chevron’s mining operations produce and market coal and molybdenum in both the US and international markets. McKinley. In FY2009.100 megawatts. Chevron's power generation business develops and operates commercial power projects. Global Top 10 Energy Companies Report: Industry. primarily through joint ventures in the US and Asia. owns and operates two surface coal mines. North River. in Alabama. in Wyoming.

alternative fuels. fuels and lubricants marketing. the Middle East. based on market capitalization. financial. Europe. corporate administrative functions. Strong market position in a market with high barriers to entry gives it a competitive advantage. Global Top 10 Energy Companies Report: Industry. Exploration and production (upstream) operations explore for. Chevron's downstream operations undertake refining. Africa. Leading market position Chevron is one of the leading energy companies. Chevron operates across the energy value chain through its four divisions: downstream. and rail car. Refining. management. chemicals. power generation. and produce crude oil and natural gas and also market natural gas. real estate activities. and transportation activities. The company is the second-largest integrated energy company in the US and among the largest corporations in the world. marketing. Chevron’s presence across the energy value chain provides the company with opportunities to optimize its business while minimizing business risks. In 2010. and transportation (downstream) operations transport crude oil.Company Reports SWOT Analysis Strengths Presence across the energy value chain Chevron operates in a wide range of businesses worldwide and commands presence across the energy value chain. Chevron was ranked 20th in the Fortune 500 list of top 2. Chevron also operates in other businesses which include mining operations. mining operations of coal and other minerals. South America. and technology support to the US and foreign subsidiaries engaged in energy services. and petroleum products by pipeline. worldwide cash management and debt financing activities. Chemical operations include the manufacture and marketing of commodity petrochemicals. and trading. chemicals operations. Central and Far East Asia. and technology companies. Financial and SWOT Analysis © Datamonitor. The company provides administrative. and others. plastics for industrial uses. natural gas. Besides the US. the company operates in 100 other countries. upstream. supply. insurance operations. The company engages in fully integrated petroleum operations. motor equipment. and energy services. marine vessel. and Australia. power generation businesses. The company's upstream and downstream activities are conducted in North America. This brief is a licensed product and is not to be photocopied 03/2011 Page 105 . develop.000 companies. and fuel and lubricant oil additives.

Bangladesh. Louisiana. The company divides its geographic divisions as US and international. The company markets aviation fuel at over 1. The company’s global operations and regional brand identity gives it competitive advantage over its competitors and also indicates that the company has a wider scope in increasing its revenues by utilizing its global presence.000 retail outlets. The company supplies directly through retailers and marketers almost 9. The company markets its products under three principal brands: Chevron. Canada.400 branded service stations. The company’s revenue stream is diversified in terms of geographies. its world wide presence reduces exposure to economic conditions or political stability in any on country or region. concentrated in the mid-Atlantic. and Caltex. and western states. Democratic Republic of the Congo. including affiliates outside the US. Brazil. In the US. In Africa. Norway. Chevron also has operations in other countries like Australia. and Taro. Colombia. Chevron also manages other marketing businesses globally.5% of the total sales and operating revenues from the US. The company's strong retail network gives widespread visibility in the market. Delo. In FY2009. Wide geographic presence Chevron has wide presence across various regions. Chad. the company performs its business activities in Angola. the company’s major business operations are concentrated in California. Chevron had an extensive marketing network supporting approximately 22. Additionally. the Netherlands. Indonesia. Texaco. It markets an extensive line of lubricant and coolant products under brand names that include Havoline. the company generated 42. the company markets under the Chevron and Texaco brands. Venezuela. and the UK. and Nigeria. Meropa. southern. the Rocky Mountains. Further.5% of its revenues were generated from its international operations.Company Reports Strong marketing operations Chevron markets petroleum products throughout much of the world through its strong global retail network. As of FY2009. Argentina. Global Top 10 Energy Companies Report: Industry. This brief is a licensed product and is not to be photocopied 03/2011 Page 106 . Greenland. Poland.600 branded motor vehicle retail outlets. Chevron supplies directly or through retailers and marketers to approximately 12. Strong marketing operations enable Chevron to penetrate into new markets and gain a stronghold. Kazakhstan. and the Partitioned Zone located between Saudi Arabia and Kuwait. the Gulf of Mexico. Denmark. and Alaska. Approximately 500 of the outlets are companyowned or leased stations. Financial and SWOT Analysis © Datamonitor. In the US. Texas. Trinidad and Tobago. and the remaining 57. Ursa. New Mexico.000 airports. Major producing countries in Asia include Azerbaijan.

Chevron is also accused of discarding 18 billion gallons of toxic waste into the Ecuador's Amazon rainforest. recording a CARC decline of 3%. the company’s sales from the refinery products have also declined at a CARC of 3. Further. which led to a severe health crisis. Financial and SWOT Analysis © Datamonitor. A coalition of residents and indigenous nationalities has sued the company for dumped toxic waste from its oil production.3 million barrels per day in FY2009. Chevron only tested for gasoline and diesel ranges of total petroleum hydrocarbons and excluded hydrocarbon compounds in crude oil that boil at temperatures above the diesel range. during the environmental trial in Ecuador. and used affiliate transactions to falsely reduce the reported value of gas taken from federal and Indian leases. which began in 2003 and involved several judicial field inspections over several years. The trial.6m to resolve claims.2%. Involvement in environmental disaster in Ecuador Chevron is currently involved in one of the worst environmental disasters in history. is expected to end in 2010. Payment of such settlement by Chevron can have a negative impact on its profitability and overall financial condition. during 2007–09. The significant drop was due to the decline in the sales of gasoline.5%. The test conducted lowered the amount of contamination reported to the court. 4. residential fuel oil. which include cancer. This brief is a licensed product and is not to be photocopied 03/2011 Page 107 . which filtered into the lakes used by several people.Company Reports Weaknesses Underpayment of royalties Chevron and its affiliates violated the False Claims Act by deliberately underpaying royalties owed on natural gas produced from federal and Indian leases during the period 1988–08. birth defects. Such kind of violations could result in severe administrative actions affecting the company's credibility as well as overall financial condition. and miscarriages. jet fuel. at a CARC of 1. Further. it also reported processed gas as unprocessed gas to reduce royalty payments. Further. gas oil and kerosene. respectively. The sales of refinery products have declined from 3. 11. The settlement also resolves claims by the US Department of Justice (DOJ) that Chevron and its affiliates violated the rules by deducting the cost of boosting gas to pipeline pressures from royalty values. during 1964–90.3%. A continuation of this trend is likely to have an adverse impact on the company's revenue growth rates. For instance. 2. The company might have to pay damages of up to $27 billion. and other petroleum products. Strain on sales of refined products Chevron’s downstream division has recorded a consistent decline from its sales of refinery products. Chevron is also accused of using faulty test methods thereby guaranteeing its desired finding of minimal contamination. the company agreed to the allegations and committed to pay nearly $45.2%. to the citizens of Ecuador.4% during 2007–09.7% and 0. Global Top 10 Energy Companies Report: Industry. In January 2010.7 million barrels per day in FY2005 to 3. which violates standard practice in the US and in the industry.

it plans to spend 80%. Strategic initiatives in the area of biofuels and solar power systems Chevron has taken several strategic initiatives in the area of biofuel and photovoltaic solar power systems. The company’s increasing investment in exploration and production activities will boost its returns and will also strengthen Chevron’s position in the industry. Brazil. offshore western Africa. a Chevron subsidiary. China. of its capital expenditure towards exploration and production activities. Moreover. The companies plan to complete the solar thermal plant by FY2010 end. Australia. It also expects natural gas to represent 41% of total volumes by 2017.720 solar panels at Metro's central maintenance facility for buses are designed to produce 1.6 billion towards capital expenditure. Some of the major projects lined up for FY2010 include. Chevron Energy Solutions (CES). Such strategic initiatives could help Chevron in diversifying its product offerings. the company estimates to spend $21. and business customers in the US. Global Top 10 Energy Companies Report: Industry.3 billion. and Thailand. with $13. up from the current share of 31%. Nigeria. Over the past decade. the company’s spending in FY2010 is primarily targeted for exploratory prospects in the US Gulf of Mexico and major development projects in Angola. The 6. development of the Gorgon natural gas project in Western Australia and opportunities in the deepwater US Gulf of Mexico. Further. Canada. or $17. The company expects a substantial production increase in FY2010 due to its plans of shifting its production toward natural gas and Asian markets. Further. during 2010–12. in August 2009. Financial and SWOT Analysis © Datamonitor.2 megawatts of renewable energy. the project is expected to reduce the carbon emissions by more than 3. Wyoming. Chevron Technology Ventures plans to complete a solar photovoltaic power plant in the US. Further. government. and the Gulf of Thailand.Company Reports Opportunities Increasing investment in upstream business Chevron plans to increase its investment in the upstream business to stimulate growth. In FY2010. CES completed one of the largest energy-efficiency and solar electric system at a transit facility for the Los Angeles County Metropolitan Transportation Authority (Metro). This brief is a licensed product and is not to be photocopied 03/2011 Page 108 . is the nation's largest installer of solar energy systems for education institutions. California. in FY2009. and a solar test facility in Bakersfield. Apart from the energy-efficient improvements. to develop a solar-thermal installation at California. Further. Chevron built two renewable energy projects on former refinery sites: a wind farm in Casper. BrightSource Energy entered into a partnership with Chevron. Chevron plans to commence 25 new upstream projects with an investment of at least $1 billion. thereby increasing its revenues.700 metric tons. In FY2009.2 billion of this amount for projects outside the US. the company has developed several projects involving energy efficiency and renewable power for education. In FY2010.

at a projected cost of $14. such as oil sands.000 barrels per day by FY2010 end. Moreover. The company could hence benefit on improving the unconventional resources through these investments and expand its product portfolio. The Canadian Association of Petroleum Producers estimates that Canada’s oil sands deposits have about 175 billion barrels of economically viable oil.Company Reports Exploratory and development activities using alternate energy resources Unconventional energy resources. The company currently holds a 20% stake in the Athabasca Oil Sands Project (AOSP) and operating interests of 60% in the Ells River Oil Sands Project. Global Top 10 Energy Companies Report: Industry.3 billion. due to the diminishing oil and natural gas reserves. Financial and SWOT Analysis © Datamonitor. Canada’s oil sands have one of the largest known reserves of oil. are now observed as a feasible option to conventional oil. This brief is a licensed product and is not to be photocopied 03/2011 Page 109 . Chevron has plans of increasing its total production of oil sands from AOSP to more than 255.

Further. owned by Transocean and leased to BP. The protocol calls on industrialized countries to reduce their greenhouse gas emissions level by 5. According to the rule. in FY2009. ponds and lakes in south-east Louisiana. Environmental regulations Chevron’s businesses are subject to numerous laws and regulations relating to the protection of the environment. which aims to reduce carbon and other greenhouse gas emissions 17% below 2005 levels by 2020.000 barrels every day. the US environmental protection agency (EPA) issued a Clean Air Interstate Rule (CAIR).Company Reports Threats Natural calamities Chevron’s operations may be disrupted by severe weather events and natural disasters. According to the US National Weather Service. the strong winds. demands for new offshore drilling. The explosion and the growing. Mr. the company’s average net oil-equivalent production in the Gulf of Mexico shelf and deepwater areas and the onshore fields in the region were 243. The incident has placed the environmental protection bill in risk. The company is governed by these regulations which could impose new liabilities. This could result in a material decline in Chevron’s profitability in the short term. The level of expenditure required to comply with these laws and regulations is uncertain and is expected to vary by jurisdiction depending on the laws enacted in each jurisdiction. the company’s ability to mitigate the adverse impacts of these events depends substantially on the effectiveness of its rigorous disaster vigilance and business continuity planning. The incident forced the US administration to pass a bill to ban oil drilling in new areas of the US coast and in the Gulf of Mexico. in 2005. the Deepwater Horizon Rig. Chevron’s upstream activities in the US are highly concentrated in the Gulf of Mexico. regulatory standards have been continuously tightened in recent years. Further. One of the most important developments in this area has been the introduction of the Kyoto Protocol for the reduction of greenhouse gases. The bill supported by the US President. Obama. Hence. especially regarding global warming. which could be a threat to the wildlife. exploded in the Gulf of Mexico. For example.2% on an average annual basis during the 2008–12 period. This brief is a licensed product and is not to be photocopied 03/2011 Page 110 . the states have to reduce the allowable sulfur dioxide (SO2) emissions by 70% and reduce Nitrous Oxide (NOX) emissions by 60% by 2015 compared with the 2003 levels. high tides and waves could drive the oil into inlets. uncontrolled oil spill in the Gulf of Mexico have made the path to approval of the bill even more complicated. With rising awareness of the damage to the environment caused by industry. Financial and SWOT Analysis © Datamonitor.000 barrels per day. in April 2010. to reduce the emission levels. Global Top 10 Energy Companies Report: Industry. resulting in oil leakage of about 5. For instance. hurricanes may damage its offshore production facilities or coastal refining and petrochemical plants in vulnerable areas. compared with 1990 emissions levels.

a militant group. in January 2010. This brief is a licensed product and is not to be photocopied 03/2011 Page 111 . Global Top 10 Energy Companies Report: Industry. The company also owns varying interests in deepwater offshore blocks.000 b/d of capacity in Nigeria following disrupt of a pipeline between Makaraba and Otunana in Delta State. Nigeria’s current oil production is about 1. The incident led to a decline in Chevron's daily crude oil production by 11. which owns a 60% interest.2 million barrels a day. Further. The pipeline and plants of Chevron in Nigeria remains prone to severe militant attacks which have led to shut down of operations and crude oil production in the past. Chevron Nigeria (CNL). claimed responsibility for causing damage to two pipelines which linked Chevron's refineries and power stations. Financial and SWOT Analysis © Datamonitor. compared to its average capacity of 3. the violence in the country has affected the industry and the country in terms of output. Further. The prevailing uncertainty of such incidents in the Niger River delta region has declined the oil production in Nigeria. The company operates under a joint-venture arrangement in this region with the Nigerian National Petroleum Corporation. in May 2009. Chevron holds a 40% interest in 13 concessions in the onshore and near-offshore region of the Niger Delta. However.6 million barrels a day on average. For instance. shut down its 20. the Movement for the Emancipation of the Niger Delta (Mend). operator of the NNPC/CNL joint venture.500 barrels per day. The prevailing instability in Nigeria has adversely affected the operations of the company and resulted in supply disruptions.Company Reports Civil unrest in Nigeria threatens crude oil production Nigeria is one of the world’s largest oil exporters. Nigeria.

Chevron Africa Holdings completed the sale of 100% of its shareholding in Chevron Uganda to Total Uganda. and East Side Union High School District of California started the construction of a 3. located in the US Gulf of Mexico. Silvertip. Chevron started crude oil production from its Tahiti Field. Chevron started the Perdido deepwater project. In August 2009. Chevron’s affiliate. In the same month. in May 2009. In the same month. In March 2009. Chevron’s Australian subsidiaries and Nippon Oil Corporation signed a heads of agreement (HOA) for the delivery of 0. in April 2009. The production from the Great White. a unit of Chevron. The Australian subsidiaries of Chevron signed three binding long-term sales and purchase agreements (SPAs) for Chevron's share of LNG from the Gorgon project. In February 2010. The vessel has the capability to drill wells in 12. Africa. In the same month. a consortium led by Chevron’s Venezuelan subsidiary was selected to negotiate its participation in a project composed of three blocks in the Orinoco Oil Belt (Faja) of eastern Venezuela.7 megawatt solar project. Tokyo Gas. In January 2010. In the next month. Chevron Africa Holdings completed the sale of Chevron Nigeria Holdings to Corlay Global. Chevron USA commenced operations on the Discoverer Inspiration. This brief is a licensed product and is not to be photocopied 03/2011 Page 112 .000 feet (12. Chevron‘s Australian subsidiaries signed multiple agreements with Kyushu Electric Power for the delivery of LNG from the Chevron-operated Gorgon and Wheatstone natural gas projects. an ultra-deepwater drillship.000 feet (3. the company discovered an offshore discovery within the Moho-Bilondo license in the Republic of Congo. In the following month. crude oil and natural gas production.650 meters) of water to a total depth of 40. and Tobago fields utilizing the Perdido hub is expected to reach full capacity of 130. Chevron Australia made two natural gas discoveries in the Carnarvon Basin offshore Western Australia. Global Top 10 Energy Companies Report: Industry. in the US Gulf of Mexico. in September 2009. The agreement signed was for a total supply of nearly three million tons per annum (MTPA) of LNG to Osaka Gas. In March 2010. Financial and SWOT Analysis © Datamonitor. Cabinda Gulf Oil Company and its partners.3 million metric tons per year (MTPY) of LNG for 15 years from the Chevron-operated Gorgon Project in Western Australia. Chevron discovered a new deepwater oil discovery at the Buckskin prospect located in the deepwater US Gulf of Mexico. In the same month. Chevron Energy Solutions. made a successful exploration discovery in the Cabinda coastline in Angola.000 barrels of oil-equivalent per day after the drilling of additional wells. and GS Caltex. the deepest producing field in the Gulf of Mexico.200 meters).Company Reports Recent developments In February 2009. two of Chevron’s subsidiaries completed the sale and transfer of their fuels marketing business in Brazil to a subsidiary of Ultrapar Participacoes (Ultrapar).

and marketing of crude oil and petroleum products. northern.000 people. Huabei. The company also has significant crude oil reserves and operations in the area around the Bohai Bay. PetroChina operates through five business segments: exploration and production.444m ($21. and Sichuan basins. Tarim. located in Heilongjiang and Jilin provinces in northeastern China.9m) in FY2009. a decrease of 10. specifically in the Erdos. production.263 million barrels of crude oil and approximately 63. China and employs over 539. accounts for a significant portion of PetroChina’s crude oil production.244 billion cubic feet of natural gas. development.4 million acres and production licenses covering a total area of approximately 16.275m ($149. The net profit was CNY103.3m) in FY2009.387m ($15. PetroChina primarily operates in China. In FY2009. PetroChina is controlled by China National Petroleum Corporation (CNPC). PetroChina's proved natural gas reserves and production are generally concentrated in northwestern and southwestern China.7% compared with FY2008. It is headquartered in Beijing. development.030. and sales. derivative chemical products. including the Daqing and Jilin oil regions. Dagang.Company Reports PetroChina Company Limited Company Overview PetroChina is engaged in production of crude oil and natural gas.2 billion cubic feet of marketable natural gas.1% compared with FY2008.195.7 million barrels of oil equivalent. Global Top 10 Energy Companies Report: Industry. Financial and SWOT Analysis © Datamonitor. and production and sales of crude oil and natural gas. and others.285% equity interest in the company. including 843. and refining. This brief is a licensed product and is not to be photocopied 03/2011 Page 113 . the company’s estimated proved developed and undeveloped reserves were approximately 11. which holds 86.4 million acres.5 million barrels of crude oil and 2. The exploration and production segment is engaged in crude oil and natural gas exploration. and other chemical products. marketing. a decrease of 5% compared with FY2008. principally in northeastern. an integrated international energy company. The company is controlled by China National Petroleum Corporation (CNPC). storage.435. The operating profit of the company was CNY143. The company recorded revenues of CNY1. These activities also include production and sale of basic petrochemical products. southwestern. The Bohai Bay basin includes the Liaohe. The company primarily operates in China. transportation. a decrease of 9. As of December 2009. Business description PetroChina is engaged in a range of activities related to petroleum and natural gas including the following: exploration. refining and chemicals.019. natural gas and pipeline.112. The company holds exploration licenses covering a total area of approximately 446. the total crude oil and natural gas output of the company was 1. and Jidong oil regions. Substantially all of the company's total estimated proved crude oil and natural gas reserves are located in China.157. and northwestern China. The Songliao basin.6m) in FY2009.

In FY2009. household products.868 kilometers of refined product pipeline. The segment owns and operates approximately 28. It also produces synthetic resins. diesel. liabilities. The company's chemical products are distributed to a number of industries that manufacture components used in a range of applications. These operations include the refining. footwear. paper.607 were owned service stations. northwestern. In FY2009. and asphalt. income. storage. including gasoline. and other chemicals (such as urea). which represented the majority of China's onshore natural gas pipelines. respectively. including gasoline. transportation. The chemical plants and sales companies are located in five provinces. and the wholesale.2% in China’s retail sector. southwestern. For FY2009. and natural gas and pipeline operations supply substantially all of the hydrocarbon feedstock requirements for its chemicals operations. and northern regions of China. In FY2009. the company’s refining and chemicals segment had a market share of 38. the company had 17. The company conducts its refining and chemicals operations in China through 26 refineries. The company's refineries are located in eight provinces. Most of the company's chemical plants are co-located with its refineries and are also connected with the refineries by pipelines.20 million tons of gasoline. and benzene. which covers many regions of China. lubricant. and derivative petrochemical products and other chemical products. the corporate center.1. agriculture. diesel. printing. packaging. The company's existing natural gas pipelines form regional natural gas supply networks in northwestern. The natural gas and pipeline segment of the company is engaged in the sale of natural gas and the transmission of natural gas. and two municipalities in China. insulation. of which 16.6 million barrels of crude oil and produced approximately 73. This brief is a licensed product and is not to be photocopied 03/2011 Page 114 . and lubricants. paint.Company Reports The refining and chemicals segment is engaged in the refining of crude oil and petroleum products. 22 regional sales and distribution branch companies. textile. and distribution of both crude oil and refined products. the company’s refineries processed 828. and marketing of crude oil. The other segment comprises the assets. and furniture industries. construction.164 kilometers of crude oil pipeline and 8. medical manufacturing.262 service stations. ethylene. production and marketing of primary petrochemical products. retail. electronics. and central China as well as the Yangtze River Delta. through a network of sales personnel and independent distributors and a broad wholesale and retail distribution system across China.67 million tons. paraffin. Global Top 10 Energy Companies Report: Industry. storage. PetroChina's exploration and production. the company owned and operated 13.595 kilometers of natural gas pipelines in China. financing activities. and one lubricants branch company. The marketing segment is engaged in the marketing of refined products and trading business. synthetic fiber. The segment also has an extensive network for the transportation. Financial and SWOT Analysis © Datamonitor. four autonomous regions and one municipality in the northeastern. each service station having a sales volume of 10. diesel. and refined products. including automotive. As of December 2009. and kerosene. northern. The company produces petrochemicals that include propylene. intermediates (alkylbenzene). and expenses relating to cash management. The company markets a wide range of refined products. and export of refined products. the refining and chemicals segment’s production of ethylene was 2. refining and marketing. and other business services to the operating business segments of the company. synthetic rubber. kerosene. kerosene. electrical appliances. research and development. three autonomous regions. crude oil.

2% in China’s retail sector.Company Reports SWOT analysis Strengths Integrated oil and gas operations PetroChina has vertically integrated operations as it is involved in both upstream and downstream oil and natural gas businesses. In FY2009. transportation. PetroChina’s strong operational performance provides it with a competitive edge. development. diesel. including gasoline. The company's vertically integrated business gives it advantages related to operational efficiencies. As of December 2009. and lubricants. and other chemical products. Global Top 10 Energy Companies Report: Industry. kerosene. kerosene.20 million tons of gasoline. retail. the company’s estimated proved developed and undeveloped reserves were approximately 11. The company accounts for approximately 40% of China's oil refining. PetroChina's vertically integrated operations enable the company to derive synergies across the oil and natural gas value chain.263 million barrels of crude oil and approximately 63. and marketing of crude oil.195. Strong operational performance PetroChina recorded a strong operational performance in FY2009. Further. As of December 2009. In FY2009. and export of refined products.868 kilometers of refined product pipeline. A strong market position in one of the fastest growing economies in the world gives the company a platform for future growth. including gasoline.112.595 kilometers of natural gas pipelines. Financial and SWOT Analysis © Datamonitor. It is also engaged in the refining. the total crude oil and natural gas output of the company was 1.2 billion cubic feet of marketable natural gas. the company owned and operated 13. PetroChina also has a strong pipeline network. This brief is a licensed product and is not to be photocopied 03/2011 Page 115 . and lubricant. PetroChina’s refineries processed 828.244 billion cubic feet of natural gas.7 million barrels of oil equivalent. diesel. in FY2009. The oil reserve replacement ratio of PetroChina in FY2009 was 1.262 service stations. Strong player in China PetroChina is one of the largest crude oil and natural gas producers and sellers in China.164 kilometers of crude oil pipeline and 8. the company owned and operated approximately 28. diesel. It had significant reserves in FY2009.1.32. PetroChina also produces and markets basic petrochemical products. and production.6 million barrels of crude oil and produced approximately 73.05. while the gas reserve replacement ratio was 1. derivative petrochemical products.5 million barrels of crude oil and 2. storage. and the wholesale. the company’s refining and chemicals segment had a market share of 38. The company is engaged in crude oil and natural gas exploration. The company also operates 26 refineries and markets a wide range of refined products. For the same period. and kerosene.607 were owned service stations and sales volume per service station was 10. and the replacement ratio of oil and gas equivalent reserves was 1. including 843. the company had 17. For the same period.97. It is also a natural gas transporter and seller. of which 16.

management. Ownership of the company by CNPC China National Petroleum Corporation (CNPC) owns 86. CNPC could also affect the timing and amount of dividend payments and adopt amendments to certain of the provisions of PetroChina’s articles of association. and affairs. most of PetroChina's refineries and chemical plants are located in the western and northern regions of China. Global Top 10 Energy Companies Report: Industry. CNPC is in a position to control PetroChina’s policies. This ownership enables CNPC to elect PetroChina’s entire Board of Directors without the concurrence of any of the company’s other shareholders. However. CNPC’s interests may sometimes conflict with those of some or all of PetroChina’s minority shareholders. the company incurs relatively higher transportation costs for delivery of its refined products and chemical products to certain areas of the eastern and southern regions from its refineries and chemical plants in western and northern China.Company Reports Weaknesses Lack of operations in eastern and southern China The eastern and southern regions of China have a higher demand for refined products and chemical products than the western and northern regions. While the company continues to expand the sales of these products in the eastern and southern regions of China. The ownership of PetroChina by CNPC limits its operations. Additionally.285% of PetroChina’s share capital. This puts the company at a competitive disadvantage. As a result. Financial and SWOT Analysis © Datamonitor. it faces competition from Sinopec and China National Offshore Oil Corp (CNOOC). Accordingly. This brief is a licensed product and is not to be photocopied 03/2011 Page 116 .

After the acquisition is completed. PetroChina. entry into an agreement with Arrow for the proposed acquisition. Singapore. This was in pursuant to CS CSG (Australia)’s. On successful completion of the acquisition. South Korea. in January 2010. Financial and SWOT Analysis © Datamonitor. In the recent past.51% in Singapore Petroleum Company (SPC). This brief is a licensed product and is not to be photocopied 03/2011 Page 117 . through its indirectly wholly owned subsidiary. and Petroliam Nasional (Petronas) formed a joint operatorship and entered into a development and production contract in respect of the Halfaya Oilfield in Iraq for a term of 20 years. and help to further develop Australia’s LNG sector. Total Exploration and Production Company. and investment in storage facilities in Indonesia.1 billion barrels and its current production output has reached 3. the joint venture would own Arrow’s Queensland coal seam gas (CSG) assets and domestic power business as well as Shell’s Queensland CSG assets and its site for a proposed liquefied natural gas (LNG) plant on Curtis Island at Gladstone. SPC has a 50% interest in Singapore Refining Company.Company Reports Opportunities Acquisition of Keppel Oil and Gas Services’ entire stake in SPC In May 2009. one of the three major petroleum refiners in Singapore. Based on the information provided by the Iraqi Government. oil products. the Board of Directors at Arrow Energy (Arrow) unanimously recommended its shareholders to vote in favor of the joint proposal by PetroChina International Investment Company (a subsidiary of PetroChina) and Shell Energy Holdings Australia (a subsidiary of Royal Dutch Shell) to acquire 100% of Arrow shares. Acquisition of a stake in SPC by PetroChina International (Singapore) will provide a new platform for the implementation of PetroChina’s international strategy and will provide a broader foundation and stable path for development for the company. PetroChina and Shell will facilitate the growth of Queensland’s CSG and LNG industry. This joint venture will enable PetroChina to build an integrated CSG and LNG business in the country. PetroChina. and petrochemicals. The Halfaya Oilfield is located at the Southeast of Iraq. and China. SPC also conducts terminalling and distribution and trading of crude and refined petroleum products. The joint operatorship led by PetroChina has undertaken to increase the production output of the Halfaya Oilfield to 535.000 barrels per day. the 50/50 joint venture company owned by a subsidiary of PetroChina and Shell.100 barrels per day. the company has entered into a number of overseas cooperation projects in this respect. Development of overseas oil and gas resources PetroChina has been steadily implementing strategic plans to develop its overseas oil and gas resources. PetroChina International (Singapore) focuses on trading in crude oil. SPC is a regional energy company with interests in petroleum refining and marketing and in oil and gas exploration and production. PetroChina International (Singapore). Global Top 10 Energy Companies Report: Industry. entered into a conditional agreement with Keppel Oil and Gas Services to acquire its entire shareholding of 45. Agreement reached to acquire Arrow Energy In March 2010. the Halfaya Oilfield has a recoverable reserve of approximately 4. For instance. Vietnam.

for Qatar Block D. PetroChina along with Royal Dutch Shell signed a new exploration and production sharing agreement with Qatar Petroleum. re-processing and interpretation.Company Reports Further. The total term of this agreement is 30 years and starts with a five year first exploration period. on behalf of the Government of Qatar. During the exploration period. Global Top 10 Energy Companies Report: Industry. and drilling a number of exploration wells to the pre-Khuff formation. processing. The Block D concession is for pre-Khuff geological intervals. in May 2010. 2D and 3D seismic acquisition. Development of its overseas oil and gas resources will enable PetroChina to boost the production and reserves of its oil and gas assets and contribute towards the overall business development of the company. This brief is a licensed product and is not to be photocopied 03/2011 Page 118 . Shell and PetroChina will implement a work program including exploration technical studies. Financial and SWOT Analysis © Datamonitor.

Such an intense competition threatens to erode the market share of the company. and chemicals and marketing operations compete with Sinopec and CNOOC. Jiangsu Province. The company’s products also face competition from imported refined products and chemical products. It competes both in China and international markets. As a result. production. Anhui Province. and the northwestern regions of China. As a result of China’s entry into the WTO. Global Top 10 Energy Companies Report: Industry. like those of other Chinese oil and gas companies. the competition is further intensified from foreign producers of refined products and chemical products. regional. and chemical projects. and other activities. Henan Province. Hebei Province. natural gas and petrochemical operations. The company's business could also be adversely affected by future changes in certain policies of the Chinese government with respect to the oil and gas industry. petroleum and petrochemical products. it is subject to numerous national. Tianjin Municipality. including its subsidiary. and environmental and safety standards. including criminal and civil liabilities for serious pollution. In its exploration and production operations. Environmental laws and regulations Together with other companies in the industries in which PetroChina operates. China National Star Petroleum Corporation (CNSPC). to develop or expand its business operations or to maximize its profitability.Company Reports Threats Intense competition PetroChina faces intense competition in the oil and gas industry. PetroChina competes with Sinopec for the acquisition of desirable crude oil and natural gas prospects. and China National Offshore Oil Corporation (CNOOC). The company’s refining and marketing. These laws and regulations require an environmental evaluation report to be submitted and approved prior to the commencement of exploration. Hunan Province. and concentration of various substances that can be released into the environment in connection with drilling and production activities. PetroChina could face significant constraints on its ability to implement its business strategies. The company’s natural gas and pipeline operations compete with the suppliers of natural gas in Beijing Municipality. Hubei Province. Financial and SWOT Analysis © Datamonitor. are subject to extensive regulations and control by the Chinese government. such as exploration and production licensing. quantities. It also restricts the type. Shanghai Municipality. Its main competitors in China are Sinopec. and local environmental laws and regulations concerning its oil and gas exploration and production operations. refining. Such government regulations and control could have a negative impact on the operations of the company. Zhejiang Province. Government regulations and control PetroChina's operations. This brief is a licensed product and is not to be photocopied 03/2011 Page 119 . These regulations and control affect many material aspects of the company's operations. industry-specific and product-specific taxes and fees. The environmental laws and regulations also limit or prohibit drilling activities within protected areas and certain other areas and impose penalties for pollution resulting from oil.

and other facilities that the company owns.Company Reports These laws and regulations could also restrict air emissions and discharges to surface and subsurface water resulting from the operation of natural gas processing plants. disposal. and treatment of solid waste materials. storage. This brief is a licensed product and is not to be photocopied 03/2011 Page 120 . refineries. PetroChina's operations are subject to laws and regulations relating to the generation. transportation. These environmental laws and regulations could therefore have an increasing impact on the company’s operations. It is anticipated that the environmental laws and regulations to which the company is subject to would become increasingly strict. chemical plants. Global Top 10 Energy Companies Report: Industry. Financial and SWOT Analysis © Datamonitor. pipeline systems. In addition. handling.

In June 2009. This brief is a licensed product and is not to be photocopied 03/2011 Page 121 . a wholly-owned subsidiary of PetroChina. and Dalian Construction Investment. a joint venture of CNPC Exploration and Development Company and KazMunayGas. acquired 100% of the common shares of Mangistaumunaigas. Kunlun Gas and Daqing Petroleum Administrative Bureau. Global Top 10 Energy Companies Report: Industry. pursuant to which Kunlun Gas acquired the city gas business from the Daqing Petroleum Administrative Bureau. PetroChina Kunlun Gas (Kunlun Gas). wholly-owned subordinated entities of CNPC. entered into a transfer agreement with each of China Huayou Group Corporation and China Petroleum Pipeline Bureau.Company Reports Recent developments In March 2009. pursuant to which Kunlun Gas acquired their city gas businesses. Further in August 2009. The company. would be responsible for the construction and operation of the Dalian LNG receiving terminal project. the Western Pipeline Branch Company of PetroChina acquired the western pipeline assets from Western Pipeline Company. entered into an asset transfer agreement. Total Exploration and Production Company. PetroChina Amu Darya Natural Gas Exploration and Development (Beijing) Company. In the same month. and Petroliam Nasional (Petronas) formed a joint operatorship and entered into a development and production contract in respect of the Halfaya Oilfield in Iraq for a term of 20 years. PetroChina International (Singapore). pursuant to which PetroChina agreed to acquire from CNPCI the contractual rights under the production sharing contract on the Bagtyiarlyk area at Amu Darya Right Bank in Turkmenistan. Financial and SWOT Analysis © Datamonitor. PetroChina. respectively. pursuant to which PetroChina agreed to acquire refinery equipment assets from the ten subordinated entities of CNPC. co-invested by PetroChina. PetroChina signed a joint venture agreement with its local and foreign partners for the Jiangsu liquefied natural gas (LNG) import terminal project in eastern China. while 20% and 5% of stakes were held by Dalian Port (PDA) and Dalian Construction Investment. and China National Petroleum Corporation International (CNPCI). a wholly-owned subsidiary of CNPC. PetroChina. a wholly-owned subordinated entity of CNPC. In November 2009. In the same month. a subsidiary of CNPC. PetroChina had a 75% stake in PetroChina Dalian LNG Company. In January 2010. PetroChina set up PetroChina Dalian LNG Company. Mangistau Investments. asset transfer agreements were entered into between ten of PetroChina’s branch companies and ten subordinated entities of CNPC (including CNPC Daqing Petrochemical Factory). In December 2009. entered into a contractual rights transfer agreement. The agreements were completed in November 2009.51% in Singapore Petroleum Company. In April 2009. PetroChina acquired the 100% share capital in South Oil from CNPC E&D and CNPC Central Asia Petroleum Company. entered into a conditional agreement with Keppel Oil and Gas Services to acquire its entire shareholding of 45. through its indirectly wholly owned subsidiary. In August 2009. Dalian Port (PDA). In May 2009. a wholly-owned subsidiary of PetroChina.

This brief is a licensed product and is not to be photocopied 03/2011 Page 122 . In May 2010. signed a new exploration and production sharing agreement with Royal Dutch Shell and PetroChina for Qatar Block D. on behalf of the Government of Qatar. Qatar Petroleum. In March 2010. Financial and SWOT Analysis © Datamonitor. The Block D concession is for pre-Khuff geological intervals. PetroChina completed the acquisition of certain oil sands assets from Canada’s Athabasca Oil Sands Corp.Company Reports In February 2010. the Board of Directors at Arrow Energy (Arrow) unanimously recommended its shareholders to vote in favor of the joint proposal by PetroChina International Investment Company (a subsidiary of PetroChina) and Shell Energy Holdings Australia (a subsidiary of Royal Dutch Shell) to acquire 100% of Arrow shares. Global Top 10 Energy Companies Report: Industry.

It operates worldwide with assets and businesses in nearly 40 countries. the UK. midstream. including its share of equity affiliates’ production excluding LUKOIL. and propane. was 187. and markets crude oil. natural gas. The remaining residue gas is marketed to electrical utilities.000 people. The company recorded revenues of $149.858m in FY2009. fuel. China. and polymers businesses. and emerging businesses. The gathered natural gas is then processed to extract natural gas liquids.998m in FY2008.000 barrels per day. It has operations in over 40 countries. Vietnam. In FY2009.000 BOED were produced in the US and production from its international E&P operations averaged 1.005m in FY2009. Australia. compared with a net loss of $16. Proved reserves for ConocoPhillips at year end 2008 were 8. Nigeria. Norway.8% compared with FY2008. Indonesia. Most of the natural gas liquids are fractionated and separated into individual components like ethane. Texas and employs about 30. The net profit was $4. LUKOIL Investment. Business description ConocoPhillips is an international. a decrease of 62.099. averaged about 1. The company conducts its E&P operations in the US. Operations to liquefy natural gas and transport the resulting liquefied natural gas (LNG) are also included in the E&P segment. including its share of DCP Midstream. It also mines deposits of oil sands in Canada to extract bitumen and upgrade it into synthetic crude oil. butane. chemicals. The midstream business purchases raw natural gas from producers and gathers natural gas through extensive pipeline gathering systems. integrated energy company. and natural gas liquids on a worldwide basis.341m in FY2009. industrial users. refining and marketing (R&M).Company Reports ConocoPhillips Company overview ConocoPhillips is the third-largest integrated energy company in the US and the second-largest refiner in the country. or blendstock. DCP Midstream markets a portion of its natural gas liquids to ConocoPhillips and Chevron Phillips Chemical Company under a supply agreement that continues till December 2014. Ecuador. Financial and SWOT Analysis © Datamonitor. Global Top 10 Energy Companies Report: Industry. During FY2009. Canada. The company conducts its midstream business through its 50% equity investment in DCP Midstream.000 barrels-of-oil-equivalent per day (BOED). produces. The company is engaged in the exploration and production of petroleum. a decrease of 38% compared with FY2008. The operating profit of the company was $12. This brief is a licensed product and is not to be photocopied 03/2011 Page 123 . The total natural gas liquids extracted in FY2009. Libya. ConocoPhillips is headquartered in Houston.08 billion barrels of oil equivalent (BOE). a joint venture with Spectra Energy (a North American natural gas infrastructure company). transports. It operates through six segments: exploration and production (E&P). chemicals. offshore Timor-Leste in the Timor Sea. E&P’s worldwide production. natural gas.000 BOED. and gas marketing companies.854. 755. and marketed as chemical feedstock. Algeria. The E&P segment primarily explores for. and Russia.

Through its joint venture operations in Switzerland. markets products in Switzerland under the Coop brand name.2 billion cubic feet per day.200 barrels per day) and a 12. As of December 31. New Mexico. and the UK. R&M had approximately 1.000 barrels per day and its share of fractionated liquids averaged 17.000 barrels per day in FY2009. which owns a natural gas liquids fractionation plant in Mont Belvieu.5% equity interest in a fractionation plant in Mont Belvieu. ConocoPhillips also owns a 39% equity interest in Phoenix Park Gas Processors (Phoenix Park). a 25. 10 natural gas liquids fractionation plants. Texas (with ConocoPhillips net share of capacity at 26. The company also markets aviation fuels. the company’s US natural gas liquids business included. A third gas processing train is currently under construction. and marketed gasoline. and the Asia Pacific Region. East Texas/North Louisiana. South Texas. The company uses the JET brand name to market retail and wholesale products in Austria. diesel. Ireland. 2009. a joint venture principally with the National Gas Company of Trinidad and Tobago. markets. This brief is a licensed product and is not to be photocopied 03/2011 Page 124 . a joint venture in which ConocoPhillips has equity interest. Three refineries are located in the UK. Its facilities include a two billion cubic feet per day gas processing plant and a 70.500 outlets in 49 states of the US. Midcontinent. Europe. and 76 brands. It further included a 40% interest in a fractionation plant in Conway. while two refineries are located in Germany. 2009. DCP midstream’s assets are primarily located in the following producing regions of the US: Rocky Mountains. the R&M segment represented 24% of ConocoPhillips’ total assets. and its gathering and transmission systems included approximately 60.5% equity interest in Gulf Coast Fractionators. R&M had marketing operations in five European countries. DCP Midstream owned or operated 53 natural gas liquids extraction plants. 2009.Company Reports As on December 31. primarily in the US. refines. transportation fuels. Conoco. In FY2009. and transports crude oil and petroleum products. its raw natural gas throughput averaged 6.300 barrels per day). and natural gas liquids extraction averaged 360. Phoenix Park processes natural gas in Trinidad and markets natural gas liquids in the Caribbean.225 marketing outlets in its European operations. At December 31. which increased total processing capacity to two billion cubic feet per day. and Gulf Coast. A third gas processing train was completed in July 2009. Financial and SWOT Analysis © Datamonitor. Europe.000 miles of pipeline. Central America. and Asia. For the same period. As on December 31. R&M owned or had an interest in five refineries outside the US. and marine bunkers to commercial customers and into the bulk or spot market in these countries and Ireland. 2009. In addition. The R&M segment purchases. Outside of DCP midstream. liquid petroleum gases. and the US Gulf Coast. of which approximately 880 were company-owned and 345 were dealer-owned. 2009. It markets its products under the brand names of Phillips 66. as of year-end 2009. Central Texas.000 barrels per day). ConocoPhillips share of natural gas liquids extracted averaged 8. heating oils. At December 31. The segment has operations in US.000 barrels per day. Texas (with ConocoPhillips net share of capacity at 24. It also included a 22.000 barrel per day natural gas liquids fractionator. and Malaysia. the company also has interests in 225 additional sites. Global Top 10 Energy Companies Report: Industry. and aviation fuel through approximately 8. Permian. Germany. R&M owned or had an interest in 12 operating refineries in the US.000 barrel per day capacity natural gas liquids fractionation plant in Gallup. Kansas (with ConocoPhillips net share of capacity at 43.

The emerging businesses segment represents ConocoPhillips’ investment in new technologies or businesses outside its normal scope of operations. as well as styrene-butadiene copolymers. a joint venture near the Sweeny Refinery complex. paraxylene. energy efficiency technologies. Financial and SWOT Analysis © Datamonitor. polypropylene. as well as a 50% operating interest in Sweeny Cogeneration. and other olefin products. aromatics. The segment also manufactures and markets polystyrene. alternative energy. and specialties. catalysts.Company Reports The LUKOIL Investment segment consists of ConocoPhillips’ equity investment in the ordinary shares of LUKOIL. and polyethylene pipe. Activities within this segment are currently focused on power generation and innovation of new technologies.09% based on estimated shares outstanding. Global Top 10 Energy Companies Report: Industry. a variety of specialty chemical products. styrene. in August 2010. ConocoPhillips’ ownership interest in LUKOIL was 20% based on authorized and issued shares. as well as merchant power into the UK market. which are primarily consumed within CPChem for the production of polyethylene. The chemicals segment consists of ConocoPhillips’ 50% equity investment in Chevron Phillips Chemical Company (CPChem). an international. biofuels. This brief is a licensed product and is not to be photocopied 03/2011 Page 125 . and styrenics segment manufactures and markets aromatic products. integrated oil and gas company headquartered in Russia. including organosulfur chemicals. CPChem’s business is structured around two primary operating segments: olefins and polyolefins. the Immingham combined heat and power plant (CHP). and carbon capture and conversion technologies. The technology group focuses on developing new business opportunities designed to provide future growth prospects for ConocoPhillips. mining chemicals. aromatics. solvents. and the environment. Texas. The focus areas include advanced hydrocarbon processes. The olefins and polyolefins segment produces and markets ethylene. the segment owns a gas fired cogeneration plant in Orange. a wholly-owned 730 megawatt (MW) facility in the UK. The specialties. refining. such as benzene. In addition. It provides steam and electricity to the Humber Refinery and steam to a neighboring refinery. and high-performance engineering plastics and compounds. and 20. ConocoPhillips decided to sell its 20% stake in Russian LUKOIL. 2009. The segment focuses on its power business through projects including. such as those related to conventional and non-conventional hydrocarbon recovery (including heavy oil). normal alpha olefins. new petroleum based products. propylene. drilling chemicals. renewable fuels. and styrenics. As on December 31. and cyclohexane. However. a joint venture with Chevron Corporation.

worldwide. Financial and SWOT Analysis © Datamonitor. including its share of equity affiliates’ production excluding LUKOIL. Canada. Norway. As on December 31. Algeria. Global Top 10 Energy Companies Report: Industry. integrated energy company. the company owned or had an interest in 12 operating refineries in the US.000 miles of pipeline. The company’s R&M segment had the second-largest US refining capacity of 18 large refiners of petroleum products. 10 natural gas liquids fractionation plants. a joint venture with Spectra Energy (a North American natural gas infrastructure company). is also a large producer of natural gas liquids in the US. and Russia.500 outlets in 49 states of the US. and aviation fuel through approximately 8. 2009. Australia. This brief is a licensed product and is not to be photocopied 03/2011 Page 126 . and marketed gasoline. The company operates in the upstream segment by exploring and producing (E&P) crude oil. 2009. In FY2009. natural gas. Europe. it ranked fourth among non-government-controlled companies. The company conducts its E&P operations in the US. markets. In addition. diesel. The DCP Midstream. The company operates across the energy value chain through its exploration and production. and transports crude oil and petroleum products. and refining and marketing business segments.000 barrels-of-oil-equivalent per day (BOED).Company Reports SWOT analysis Strengths Strong market position The company has a strong market position. It ranks sixth amongst the non-government-controlled companies in terms of worldwide proved reserves. and natural gas liquids on a worldwide basis. In operates in the midstream segment through its 50% equity investment in DCP Midstream. Vietnam. and Asia. CPChem ranks within the top 10 producers of its major product lines. E&P’s worldwide production. Presence across the energy value chain ConocoPhillips is an international. Libya. As part of its downstream activities. As on December 31.854. it is the third largest integrated energy company. The company's presence across the energy value chain provides it with opportunities to optimize its business while minimizing business risks. DCP Midstream owned or operated 53 natural gas liquids extraction plants. in which the company has a 50% equity investment and which conducts its midstream business. midstream. primarily in the US. averaged about 1. Nigeria. offshore Timor-Leste in the Timor Sea. China. the UK. In the US. Ecuador. and its gathering and transmission systems included approximately 60. In the chemicals segment. the company purchases. refines. Indonesia. Leading market position in a number of its key product lines enhances ConocoPhillips’ brand image.

Vietnam. Norway. large offshore oil development programs in China. Further. offshore gas in Indonesia. Algeria. The company divides its geographic division as US. UK. Among these are natural gas and coal bed methane resources in Australia that support the following: both existing and proposed major liquefied natural gas (LNG) businesses. and Libya.Company Reports Diverse geographic presence ConocoPhillips has wide presence across various regions. This brief is a licensed product and is not to be photocopied 03/2011 Page 127 . a major offshore natural gas production and LNG liquefaction and export facility in Qatar. its world wide presence reduces exposure to economic conditions or political stability in any once country or region. Australia. ConocoPhillips holds substantial interests in key international areas that offer high exploratory potential and access to markets that are experiencing strong energy demand growth. The company’s global operations and regional brand identity gives it competitive advantage over its competitors and also indicates that the company has a wider scope in increasing its revenues by utilizing its global presence. and onshore oil production in the Russian Arctic. Canada. and Kazakhstan. Global Top 10 Energy Companies Report: Industry. and other foreign countries. Financial and SWOT Analysis © Datamonitor.

Company Reports

Weaknesses
Limited ability to manage risk The company’s majority of the operations are through joint ventures in which ConocoPhillips shares control with its joint venture participants. There are various risks involved in carrying put operations through joint ventures including, instances where the joint venture participants have economic, business or legal interests or goals that are inconsistent with those of the joint venture or ConocoPhillips or the joint venture participants are unable to meet their economic or other obligations. Failure by the entity in which ConocoPhillips has a joint venture interest, to adequately manage the risks associated with any acquisitions or joint ventures can have a material adverse effect on the financial condition or results of operations of its joint ventures and also the business and operations.

Opportunities
Increasing demand for refined products in China Over the next 10 years, it is expected that about 60% of the world’s petrochemical demand growth will occur in Asia, with more than one-third in China alone. The demand for refined petroleum products in China is expected to rise sharply in the coming decades. China, despite substantial additions to refining capacity over the next three decades, is expected to remain a net importer of refined products in 2030. The refining capacity in China is forecast to increase from 6.2 million barrels per day in 2006 to 14.6 million barrels per day in 2030. ConocoPhillips has exploration interests in China. For instance, the company has 49% share in the Peng Lai 19-3 field in Bohai Bay Block 11-05, whose production averaged 33,000 barrels of oil per day in FY2009. The company also holds a 49% interest in the nearby Peng Lai 19−9 and Peng Lai 25−6 Fields. Its Xijiang development consists of two fields located approximately 80 miles south of Hong Kong in the South China Sea. The company’s ownership in these fields ranges from 12.3% to 24.5%. Facilities include two manned platforms and a floating production, storage and offloading (FPSO) vessel. Its combined net production of oil from the Xijiang fields averaged 5,000 barrels per day in FY2009. It also has a 24.5% interest in the offshore Panyu field, also located in the South China Sea, which produced 11,000 net barrels of oil per day in FY2009. The company can, therefore, leverage its existing presence in China to export refined products or establish fresh refining capacity and take advantage of the increasing demand for refined products in the country. Increase in demand for natural gas in the US The US Energy Department has projected that the US would become more dependent on natural gas in the next two decades. According to EIA estimates, the total natural gas consumption in the US is projected to increase from around 23.3 trillion cubic feet in 2008 to 24.9 trillion cubic feet in 2035. The increase is attributed to the growth in the demand for natural gas in the transportation sector. The company can exploit the growing demand for natural gas in North America and further enhance its growth.

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Company Reports

Threats
Environmental regulations ConocoPhillips’s businesses are subject to numerous laws and regulations relating to the protection of the environment. With rising awareness of the damage to the environment caused by industry, especially regarding global warming, regulatory standards have been continuously tightened in recent years. One of the most important developments in this area has been the introduction of the Kyoto Protocol for the reduction of greenhouse gases. The protocol calls on industrialized countries to reduce their greenhouse gas emissions level by 5.2% on an average annual basis during the 2008–12 period, compared with 1990 emissions levels. Further, in 2005, the US environmental protection agency (EPA) issued a ’clean air interstate rule’ (CAIR), to reduce the emission levels. According to the rule, the states have to reduce the allowable sulfur dioxide (SO2) emissions by 70% and reduce Nitrous Oxide (NOX) emissions by 60%, by 2015 compared with the 2003 levels. The company is governed by these regulations which could impose new liabilities on the company. This could result in a material decline in ConocoPhillips’ profitability in the short term. Risks associated with conducting business outside the US The company faces risks associated with conducting business outside the US. Approximately 67% of its hydrocarbon production in FY2009 was derived from production outside the US. For the same period, the company’s 64% of proved reserves, as of December 31, 2009, were located outside the US. The company is, therefore, subject to risks associated with operations in international markets. These risks include changes in foreign governmental policies relating to the following: crude oil, natural gas, natural gas liquids; refined product pricing and taxation; other political, economic, or diplomatic developments; and changing political conditions and international monetary fluctuations. Such international political and economic developments could damage the company’s operations and materially reduce its profitability and cash flows. Intense competition ConocoPhillips faces intense competition in the markets it operates in. It competes with private, public, and state-owned companies in all facets of the petroleum and chemicals businesses. Upstream, the company’s E&P segment competes with numerous other companies in the industry to locate and obtain new sources of supply and to produce oil and natural gas in an efficient, cost-effective manner. The company’s midstream segment, through its equity investment in DCP Midstream and the company’s consolidated operations, competes with numerous other integrated petroleum companies, as well as natural gas transmission and distribution companies. Downstream, the company’s R&M segment competes primarily in the US, Europe, and the Asia Pacific region. Some of the major competitors of the company include Chevron, BP, ExxonMobil, Royal Dutch Shell, Hess, Marathon Oil, and Occidental Petroleum. Such intense competition threatens to erode the market share of the company.

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Company Reports

Recent developments
In May 2009, ConocoPhillips and Anadarko Petroleum Corporation (an independent oil and gas exploration and production company) announced the discovery and test production from two wells in the National Petroleum Reserve-Alaska. Both wells were located in the Greater Mooses Tooth Unit, approximately 20 miles southwest of the Colville River Unit development on the North Slope of Alaska. ConocoPhillips was the operator of and held a 78% interest in the Greater Mooses Tooth Unit, while Anadarko Petroleum Corporation held the remaining 22% interest. In June 2009, ConocoPhillips, KazMunayGas, and Mubadala Development Company signed project agreements for the joint exploration and development of the Nursultan Block (N Block) located in offshore Kazakhstan. In July 2009, ConocoPhillips and Abu Dhabi National Oil Company signed the Shah Gas Field joint venture and field entry agreements to develop the Shah Gas field in Abu Dhabi. In November 2009, ConocoPhillips announced a delay in the planned upgrade of its 260,000 barrel-per-day Wilhelmshaven refinery in Germany as a part of the company's capital budget reduction plan for FY2010 to improve financial flexibility and better balance expenditures and resources. In December 2009, the Commonwealth of Kentucky issued a draft air permit for Kentucky NewGas, a planned coal-tonatural-gas facility that would be sited near Central City in Muhlenberg County. Kentucky NewGas would use ConocoPhillips’ proprietary E-Gas technology to produce substitute natural gas that is virtually free of impurities. In January 2010, ConocoPhillips and Statoil entered into a deal for Statoil to acquire a 25% working interest in 50 ConocoPhillips leases acquired in the Chukchi Sea federal OCS lease sale in 2008. In April 2010, ConocoPhillips completed an agreement with POSCO, a Korean steel manufacturing company, to use ConocoPhillips’ E-Gas Technology in POSCO’s Gwangyang coal to substitute natural gas (SNG) project. In the same month, ConocoPhillips decided to end its participation in developing the Shah Gas Field with Abu Dhabi National Oil Company (ADNOC). Further in April 2010, ConocoPhillips decided to end participation in the new refinery project being built in Yanbu Industrial City by the Saudi Arabian Oil Company (Saudi Aramco). In June 2010, ConocoPhillips completed the $4.65 billion sale of its 9.03 % interest in Syncrude with subsidiaries of Sinopec International Petroleum Exploration and Production Company (SIPC). In the same month, ConocoPhillips completed the sale of its 50% partnership interest in the CFJ Properties-Flying J truck stops to Pilot Travel Centers for $626m. In July 2010, ConocoPhillips, Rompetrol Rafinare, and Rominserv announced a license and technical services agreement for the revamp of the existing delayed coker unit at Rompetrol’s Petromidia Refinery in Romania. In August 2010, ConocoPhillips decided to sell its 20% stake in Russian LUKOIL for $ 3.44 billion.

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At the end of December 2009. natural gas distribution. a decrease of 50. field development. The refining and marketing segment undertakes refining of crude oil and marketing of refined products mainly in Italy and in the rest of Europe.862 square kilometers. Eni's subsidiaries proved reserves replacement ratio was 95%. Norway. The segment also conducts liquefied natural gas (LNG) operations in these countries. and engineering industries. It is headquartered in Rome.9% compared with FY2008.090.246 exclusive or shared rights for exploration and development in 40 countries on five continents for a total net acreage of 347.5% compared with FY2008. electricity generation. oilfield services. The company operates in 77 countries. The company recorded revenues of E101. Business description Eni is an integrated energy company. The exploration and production segment is engaged in the oil and natural gas exploration.812.367m (approximately $6.050m (approximately $140.571 million barrels of oil equivalent (mmboe).3% interest in the Schwedt refinery and a 20% interest in Bayernoil in Germany and a 32. in the Czech Republic. engineering and construction. petrochemicals.Company Reports Eni SpA Company overview Eni is an energy company engaged in oil and gas exploration and production. Kazakhstan. petrochemicals. which includes two refineries. Angola.4m) in FY2009.4% stake in Ceska Rafinerska. Russia. Egypt. Refining and marketing operations are predominantly based on Eni's own production capacity. the UK. Eni’s refining system had total refinery capacity (balanced with conversion capacity) of approximately 37. gas and power. and production activities in 40 countries. In FY2009. Congo. oilfield services. In Italy. The operating profit of the company was E12. refining and marketing.9% compared with FY2008.500 people. the company owns five refineries and has a 50% interest in the Milazzo refinery in Sicily. petrochemicals. comprising 6. Libya. and offshore engineering. a decrease of 20. corporate and financial companies. 2009.3m) in FY2009. Nigeria. and Australia. the US. Eni's mineral right portfolio consisted of 1. As of December 31. Financial and SWOT Analysis © Datamonitor. Kralupy and Litvinov. electricity generation. In the rest of Europe. 2009. The net profit was E4. Global Top 10 Energy Companies Report: Industry. The company and its consolidated subsidiaries are engaged in upstream and downstream oil and gas activities. Eni holds an 8.927.3m) in FY2009.055m (approximately $16. As of December 31. Eni's proved reserves totaled 6. The company operates in 77 countries. refining and marketing.3 million tonnes (mmtonnes). a decrease of 34. This brief is a licensed product and is not to be photocopied 03/2011 Page 131 . Eni generates revenues through seven segments: exploration and production. The company carries out exploration and production activities mainly in Italy. and other activities. Italy and employs about 78.209 mmboe proved reserves of subsidiaries and 362 mmboe of Eni’ share of reserves of equity-accounted entities.

transport. The gas and power segment undertakes the supply.322 municipalities through a low pressure network consisting of approximately 49. and engineering activities through its subsidiary Saipem and its controlled entities.400 kilometers made up of high pressure pipelines to import gas from Russia.474 service stations in Italy and 1. Mantova. Eni conducts its electricity generation activities through its wholly owned subsidiary. The company sells refined products across Europe. The network comprises high and medium pressure pipelines for natural gas transport of approximately 31. which owns and manages power stations with an installed capacity of 5.973 kilometers of pipelines. basic intermediate products.17 bcm of sales made directly by the Eni’s exploration and production segment in Europe and the US. the company undertakes natural gas storage activities in Italy through eight storage fields. Snam Rete Gas. The company’s petrochemical operations are concentrated in Italy and other countries in Western Europe. Retail sales of refined product at operated service stations totaled 12. These plants manufacture finished and fatty lubricants. Eni operates a re-gasification terminal in Italy and holds interests in a number of LNG facilities in Europe.Company Reports In FY2009. construction. 2009. and onshore construction. in Italy. and the US. Brindisi. and the Far East.531 kilometers in length. Taranto. of which 26. 2009.45 bcm.91% interest in Saipem.3 gigawatts (GW). polyethylene. Global Top 10 Energy Companies Report: Industry. storage. Financial and SWOT Analysis © Datamonitor. distribution. The segment provides services including offshore construction. The company sold 45. they distributed natural gas to 1. Ferrera Erbognone. refining. Stoccaggi Gas Italia. The natural gas transport network of the company in Italy is operated by its subsidiary. Through its wholly-owned subsidiary. The company sold around 103. electricity.512 in the rest of Europe. subsea pipe laying and floating production systems. Eni holds capacity entitlements on a network of European pipelines extending for approximately 4. as of December 31.59 mmtonnes of refined products in FY2009. The segment also includes power generation activities that are ancillary to the marketing of electricity. The company produces electricity and steam at its operated sites of Livorno. and North European production basins to European markets.68 mmtonnes were sold in Italy. and marketing of natural gas. and petrochemical industries. Ravenna. polystyrenes. Italgas and other subsidiaries.5% in FY2009. Eni owns a 42. Europe. In FY2009. Eni operates seven (owned and co-owned) blending plants. North and South America. The retail market share of Eni in Italy through its Agip-branded network of service stations was 31.72 billion cubic meters (bcm) of natural gas in FY2009. Snam Rete Gas distributes natural gas in Italy through its wholly owned subsidiary. operating 4. Eni conducts the oilfield services. Sales in Italy totaled 40. the company sold 33. re-gasification. As of December 31. Libya.96 terawatt-hours (TWh) of electricity. the company processed 34. Egypt.3 mmtonnes of petrochemical products. In FY2009. Eni produces olefins and aromatics. Algeria. and Ferrara.55 mmtonnes of crude oil and other feedstock. It also provides offshore and onshore drilling services and engineering and project management services to the oil and gas. including Italy and the rest of Europe. particularly fixed platform installation. Outside Italy. This included 6.04 bcm. Eni also sells liquefied petroleum gas (LPG) and oxygenats. while sales in other European markets totaled 55. and elastomers. the company sold 4. Eni conducts all of its electricity generation in Italy and sells the bulk of the energy it produces directly to distributors. EniPower. This brief is a licensed product and is not to be photocopied 03/2011 Page 132 . and liquefied natural gas (LNG).02 mmtonnes.

and Eni Insurance. Syndial. Through Eni Adfin. factoring. business support. real estate. principally on an intercompany basis. international affairs. legal affairs. finance. Eni International. Eni Corporate University. Eni’s headquarter is the department of the parent company and performs group strategic planning. information technology. human resources management. and other general and business support services. and general purposes services to group companies). and corporate research and development functions. AGI. the company carries out lending.Company Reports The corporate and financial companies segment constitutes Eni’s headquarter and certain Eni’s subsidiaries engaged in treasury. and insurance activities. administration. finance. which runs minor petrochemical activities and reclamation and decommissioning activities pertaining to certain discontinued businesses. The other activities segment encompasses results of operations of Eni’s subsidiary. leasing. EniServizi. Global Top 10 Energy Companies Report: Industry. This brief is a licensed product and is not to be photocopied 03/2011 Page 133 . and other minor subsidiaries are engaged in providing group companies with diversified services (training. Financial and SWOT Analysis © Datamonitor. financing Eni’s projects around the world.

Presence across the energy value chain Eni operates in a wide range of businesses worldwide and commands presence across the energy value chain through its subsidiaries. the Gulf of Mexico. the Middle and Far East. In the downstream segment. Turkey. The company engages in fully integrated petroleum operations. West Africa (Angola. North Africa (Algeria. Eni is engaged in the distribution and sale of natural gas to residential and commercial customers. linking key consumption basins with the main producing areas (North Africa. Moreover. Eni processes and markets refined products. and sale of natural gas. as well as with stable and robust cash flows. Norway. GNL Italia. power generation. Financial and SWOT Analysis © Datamonitor. primarily in Italy. Eni's strong market position in the fast-growing European gas market provides the company with a strong platform for future growth. Libya. This brief is a licensed product and is not to be photocopied 03/2011 Page 134 . The company operates the only LNG regasification terminal in Italy through its subsidiary. Eni’s presence across the energy value chain provides the company with opportunities to optimize its business while minimizing business risks. with a strong market position in domestic market. It is also involved in the power generation and distribution business in Italy through its subsidiary. In Italy. The company has built this position leveraging on its unique and diverse portfolio of equity and contracted gas from different countries and growing integrated LNG business with access to both liquefaction and regasification plants. and Alaska. transport. Congo. In Italy. and Germany. Global Top 10 Energy Companies Report: Industry. In the upstream segment. It also operates in areas with great exploration and production potential such as the Caspian Sea. In the midstream segment. Russia. and elastomers and styrenics through its subsidiary. and Tunisia). India. and the UK).88 million. Eni also produces basic chemicals. and energy services. and Nigeria). coal mining operations. and the North Sea). EniPower. it serves a strong customer base of approximately 6. Eni operates a large network of integrated infrastructures for transporting natural gas in Europe. Eni operates in the supply. and in the field of engineering services to the oil. It leads the Italian market through the Agip brand. In addition. refining. and Australia.Company Reports SWOT Analysis Strengths Strong market position in the European natural gas market Eni is one of the leading players in the European market in terms of gas sales. chemicals operations. as well as in highly attractive markets such as the Iberian Peninsula. distribution. the company operates in the exploration and production of hydrocarbons in Italy. and petrochemical industries. Polimeri Europa. Egypt. polyethylene. Eni operates in offshore and onshore drilling and construction. Eni operates almost all the national transport network. The company has access to a very large set of transportation and storage assets domestically and across Europe. Rest of Europe (Croatia.

Financial and SWOT Analysis © Datamonitor. The company has also developed technologies for conversion of heavy crude into lighter products (oil upgrading). To tackle environmental issues. and environment and efficiency.6m) in FY2008 and E208m (approximately $290. This program aims to identify and develop research projects on the most advanced aspects of large scale use of renewable energy sources and energy efficiency. This brief is a licensed product and is not to be photocopied 03/2011 Page 135 . Eni has developed numerous advanced exploration techniques such as depth velocity analysis and coil shooting and drilling technologies such as dual casing running and radial drilling.1m) in FY2007. Through this program.Company Reports Strong research and development (R&D) capabilities Eni has strong research and development (R&D) capabilities. Eni filed 106 applications for patents in FY2009. It spent E207m (approximately $288. monetizing stranded gas. R&D expenses in previous years were E217m (approximately $302. The company conducts research to develop technologies to tackle the environmental issues and climate change to overcome limits in accessing hydrocarbon resources. and protecting the environment. Through its strong R&D capabilities.7m) on R&D in FY2009. Eni plans to invest approximately E1. renewable energy sources. Eni has launched the ‘Along with Petroleum’ program. The company's strong R&D capabilities provide it with a competitive advantage and help it to improve the efficiency of its products and processes. Eni focuses its research and development activities on reducing the costs of finding and recovering hydrocarbons.9 billion) in technological research and innovation activities. Eni focuses on exploitation of solar energy and the production of biofuels. upgrading heavy oils. The research activities of the company are also focused on strengthening partnerships with producing countries and developing renewable sources of energy.4 billion (approximately $1. Eni has also delivered innovations in the areas of petrochemicals. Global Top 10 Energy Companies Report: Industry.

the charges against Snamprogetti Netherlands will be dismissed. The inspections were intended to verify Eni’s limiting access to the Italian wholesale natural gas market or at sharing the market with other companies active in the sale or transport of natural gas. could also lead to tightened surveillance of the company’s business operations by the authorities. Financial and SWOT Analysis © Datamonitor. Eni filed with the European Commission a number of structural remedies with a view to resolving the proceeding without the ascertainment of the illicit behavior and consequently without sanctions. This brief is a licensed product and is not to be photocopied 03/2011 Page 136 . Global Top 10 Energy Companies Report: Industry. These in turn could significantly affect Eni’s business operations as well as profit margins. Snamprogetti Netherlands. the ordinary antitrust proceeding would resume. In March 2009. and in the Austrian TAG gas pipelines. in addition to huge penalties. Snamprogetti and others faced charges from the US authorities for a series of contracts to build liquid natural gas facilities in Bonny Island. connected with the Italian gas transport system. in the Swiss Transitgas. Eni has committed to dispose of its interests in the German TENP. If the Commission rejects Eni’s remedies or the company decides to withdraw those remedies. a former indirect subsidiary of Eni and current subsidiary of Saipem. TENP/Transitgas (Germany/Switzerland) pipelines. The European Commission has announced its intention to submit those remedies to a market test. Eni received a statement of objections by the European Commission concerning an alleged unjustified refusal to grant access to the TAG (Austria). the DOJ filed charges against Snamprogetti Netherlands including a count of conspiracy and violating certain provisions of the US Foreign Corrupt Practices Act. Such violation of laws. Eni and Saipem have also agreed to guarantee the obligations of Snamprogetti Netherlands towards the DOJ. This could result in a huge penalty and/or unfavorable structural remedies for Eni. Pursuant to the agreement.Company Reports Weaknesses Violation of anti-corruption laws Eni and its subsidiaries have been found guilty of engaging in corrupt practices. In July 2010. Snamprogetti Netherlands agreed to pay a criminal penalty of $240m. Nigeria. Eni after the completion of the assessment of the allegations set forth by the Commission in Statement of Objections submitted its response. Nigeria. The Commission in the statement envisaged the possible imposition upon Eni of structural remedies and a fine. If it satisfies the terms of the agreement. In February 2010. entered into a deferred prosecution agreement with the US Department of Justice (DOJ) to resolve an investigation into Snamprogetti Netherlands's activities in connection with contracts to build liquid natural gas facilities on Bonny Island. Violation of competition rules in Europe The European Commission has conducted an inspection of Eni and its subsidiaries for a possible violation of its competition rules.

During 2010–13.000 boe/day of new production in 2013. an increase of approximately 8% compared with the 2009–12 strategic plan. In refining and marketing. In E&P. the improvement in the quality of its marketing activities. the company. such as Africa. This strategic plan for the next four years will help the company deliver robust long-term hydrocarbon production growth superior to the average growth of its peers. In line with this. the company will focus on organic development. and further strengthen its leadership in the European gas market. Eni will take on stream 41 new fields.8 billion (approximately $73. Eni will further strengthen its European gas business by leveraging on its commercial strength enhanced by the Distrigas acquisition. production growth will be focused on new high potential areas. and on the access to international transport facilities. The company intends to pursue these objectives by leveraging its integrated business model while maintaining a strong balance sheet. This brief is a licensed product and is not to be photocopied 03/2011 Page 137 . particularly Iraq. announced its strategic plan for 2010–13. targeting annual gas sales of 118 billion cubic meters and market share in Europe of more than 22% by 2013. the Caspian region. This will result in about 560. long term relations with supplying countries. Apart from the areas in which Eni has a consolidated presence. 75% of which will be operated by Eni. in March 2010.6 billion) during 2010–13. which will contribute to Eni's production growth in the four-year period and beyond. The company plans to achieve a 34% market share in Italy by 2013 more than two points higher than in 2009.5% for the 2010–13 period. particularly in Iraq and Venezuela. This increase will be driven entirely by the exploration and production (E&P) sector for the development of new projects. and the widespread increase in operating efficiency. and OECD countries. Financial and SWOT Analysis © Datamonitor. Eni plans to invest E52. Global Top 10 Energy Companies Report: Industry. To achieve this. In the next four years. Eni's intends to focus on the selective strengthening of its refining system. Eni aims to achieve production growth with an average annual rate of more than 2.Company Reports Opportunities Strategic plan 2010-13 Eni aims to significantly increase its hydrocarbon production in the long term and strengthening its leadership in the European gas market. Eni plans to grow its international gas sales by an average higher than 3% a year.

This brief is a licensed product and is not to be photocopied 03/2011 Page 138 .6% share in the proprietary joint venture for logistical assets at the Vienna airport. including the 28. In the medium-term. Eni plans to achieve sales volumes in Europe (excluding Italy) of approximately 59 bcm by 2013. The company signed a sale and purchase agreement for the sale of shares of Mobil Oil Austria and Esso Austria. to Agip Austria and to Eni International. driven by rising consumption in the power generation sector. Over the long-term. A new LNG terminal with a capacity of eight bcm per year commenced operations late in 2009. stressing European dependence on producing countries. Increasing demand for liquefied natural gas (LNG) In Europe. and the aviation business at the Vienna and Linz airports. Eni finalized plans to upgrade the import capacity of its two main pipelines from Russia and Algeria increasing capacity by an overall amount of 13 bcm per year (the gas pipelines TAG and TTPC). The transaction also includes the supply and distribution business with its 33. Agip Austria. expand its marketing capabilities. Most of the European gas requirement is expected to be satisfied by imports via pipeline. reaching 600 billion cubic meters (bcm). Financial and SWOT Analysis © Datamonitor. In FY2009. The company is in an ideal position to exploit growing demand for LNG. Eni expects gas demand to grow at a compounded average growth rate of 1. with new capacity entirely sold to third parties. European gas imports will cover at least 80% of consumption from the current level of 60%. Eni currently operates in Austria through its affiliate. the company expects Italian gas demand to increase at an annual rate of slightly lower than 2% through 2020. Global Top 10 Energy Companies Report: Industry. Eni intends to grow international sales and increase operational efficiency to develop a global LNG business. the industrial and wholesale business (with 36 additional Esso branded retail service stations owned by industrial and wholesale resellers). due to domestic production decrease.Company Reports Acquisition of downstream activities in Austria Eni signed an agreement to purchase ExxonMobil downstream activities in Austria in January 2010. reaching an amount of 94 bcm in 2020. and complement its logistic and storage activities. Eni plans to increase worldwide gas sales targeting a volume of 118 bcm by 2013 with an average annual growth rate higher than 3% in the 2010–13 period. is excluded from the transaction.5% by 2020.3% participation in the Salzburg terminal joint venture. The usage of gas in power generation is expected to drive the growth. operated by a consortium of competitors. The assets include a retail network with 135 service stations. The addition of these assets will strengthen the downstream business of Eni in Austria. however. The lubricants and specialties business. with an annual growth rate of 6% from 2009. Overall. respectively.

Global Top 10 Energy Companies Report: Industry. was awarded the license for the development of the Zubair giant field in Iraq. was awarded a 37.Company Reports Expansion of exploration and production operations The company has entered into several agreements and partnerships for oil and gas exploration projects. Eni signed a farm-in agreement with UK-based Surestream Petroleum to acquire 55% and operatorship in the Ndunda block located in the Bassin Cotier along onshore region of the Lower Congo Basin. In October 2009. In May 2010.8% stake in Sanga Sanga. Eni and PDVSA signed an agreement to develop Junin 5 heavy oil field. In September 2009. Financial and SWOT Analysis © Datamonitor. located in the Sindh province north of Karachi. an Eni-led consortium (with Eni as operator). through its joint venture affiliate VICO CBM. Eni entered into an agreement with Heritage to purchase its 50% interest in blocks 1 and 3A located in the Lake Albert basin in Uganda. In January 2010. in Indonesia. These investments aim to develop its production assets and thereby increase the company’s production capacity. Eni expanded into Ghana through the acquisition of majority stakes in the offshore cape three points (OCTP) and offshore cape three points south (OCTPS) exploration licenses. This brief is a licensed product and is not to be photocopied 03/2011 Page 139 . In the same month. Eni won the bid tender for the exploration license of onshore Sukhpur block. In August 2010. In the same month. located in the Orinoco oil belt (Faja) in Venezuela. consisting of the US Occidental Petroleum Corporation and Korea Gaz Corporation. in joint venture with Pakistan Petroleum and Royal Dutch Shell. Eni. Eni and KazMunayGas (KMG) entered into an agreement to jointly study the Isatay and Shagala exploration areas located in the Caspian Sea. In November 2009. a new coal-bed methane (CBM) production sharing contract (PSC).

Therefore. 2008. One of the most important developments in this area has been the introduction of the Kyoto Protocol for the reduction of greenhouse gases. The attacks stemmed from a ‘community dispute’ with foreign oil companies. regulatory standards have been continuously tightened in recent years. The protocol calls on industrialized countries to reduce their greenhouse gas emissions level by 5. Consequently. the President of the US is authorized to initiate an investigation into the possible imposition of sanctions against persons to have knowingly made investments of $20m or more in any 12 month period in the petroleum sector in Iran. The pipelines feed the Brass terminal. The company is governed by these regulations which could impose new liabilities.000 barrels a day of production after two pipelines attacked suffered a sudden loss of pressure. The company continues to experience continuing social unrest in Nigeria leading to a number of disruptions at certain of its oil producing facilities in the country. Eni’s pipelines in Nigeria were attacked in July 2008. This could result in a material decline in the company’s profitability in the short term.2% on an average annual basis during the 2008–12 period. the country's main oil-export terminal. The company’s oil and gas production in FY2009 declined with security problems impacting the operations. compared with 1990 emissions levels. With rising awareness of the damage to the environment caused by industry. Such disruptions could force the companies operating in the country to declare force majeure on their shipments. The act was amended to concern only business in Iran and renamed the Iran Sanctions Act (ISA). As per this amendment. This brief is a licensed product and is not to be photocopied 03/2011 Page 140 . Following the attack. Eni has incurred capital expenditures in excess of $20m in Iran in each of the last 10 years. Disruptions in Nigeria Nigeria is the world's eighth-biggest oil exporter. Residents in Nigeria's restive Niger Delta blew up the pipeline linking the Tebidaba flowstation and Brass River export terminal on July 16.Company Reports Threats Environmental regulations Eni’s business is subject to numerous laws and regulations relating to the protection of the environment. The company may invest amounts significantly in excess of $20m per year in the country in the future. and increasing the oil prices. especially regarding global warming. Eni shut 47. Regulations concerning Iran In 2006. operations in Iran amid the mounting tensions over Iran’s nuclear program could increase political risks for the company. The US has intensified its push for tougher sanctions on Iran over the country's nuclear program. However. the US legislation implementing sanctions against Iran and Libya was amended and extended until December 2011. Financial and SWOT Analysis © Datamonitor. Global Top 10 Energy Companies Report: Industry. the company could be affected with defaults in fulfilling its contractual obligations to clients. the violence in the country has affected the industry leading to a decline in the output since early 2006. Iran and Libya Sanction Act (ILSA).

through its 100% controlled subsidiary. Consequently. and Stroytransgas. Subsequently. This brief is a licensed product and is not to be photocopied 03/2011 Page 141 . Eni expects these antitrust thresholds to be renewed when they expire in 2010. 2010. Therefore. Eni completed the acquisition of Distrigas. an independent US natural gas producer. Inter Rao UES. Eni has been experiencing rising competition in its natural gas business since the liberalization process of the Italian natural gas market. Eni would start a wide program of strategic cooperation involving different activities in the energy field with these companies. These antitrust thresholds are effective until December 31. Snam Rete Gas. Eni signed under the patronage of the Russian government. In the same month. Transneft. The decree introduced rules which could significantly impact Eni’s operations. Recent developments Eni and Angola's state oil company. several cooperation agreements in Russia and abroad with the main Russian energy companies Gazprom. located between the cities of Fort Worth and Dallas in Northern Texas.Company Reports Liberalization of the Italian natural gas market The Italian natural gas market was liberalized by passing a decree in January 2003. Gazprom received permission from Federal Antimonopoly Service to purchase a 20% stake in Gazprom Neft from Eni. To comply with the regulatory thresholds relating to volumes supplied through the national transport network and sales volumes in Italy.5% interest in the Alliance area.8 million cubic meters of gas and 850 condensed barrels per day. Eni’s results of operations and cash flows could be adversely affected. Rosneft. entry of new competitors into the Italian market and capital projects to expand the transport capacity of import pipelines to Italy and to build new import infrastructures. Eni discovered a new hydrocarbons deposit on the concession of Abu Qir in Egypt that would allow a growth in the production of gas in the order 30% corresponding to 1. Global Top 10 Energy Companies Report: Industry. to acquire a 27. Eni executed a strategic alliance with Quicksilver Resources. Eni Gas & Power Belgium (Eni Belgium). Eni expects its margins on gas sales in Italy to remain under pressure in the future considering Eni’s gas availability under its take-or-pay supply contracts. In April 2009. represent risk with regards to the gas sales margins. liberalization of the Italian natural gas market and the evolution of Italian regulations in the natural gas sector. Eni completed the sale of 20% stake of Gazprom Neft to Gazprom. as part of its effort to exit these regulated activities. in February 2009. Eni sold the Stogit and Italgas units to the natural gas grid company. Italian customers are free to choose their supplier of natural gas. Eni was awarded the operatorships and participating interests in two exploration licenses in the Barents Sea. In addition. Eni sold part of its gas availability under its take-or-pay supply contracts to third parties importing to Italy and marketing them to Italian customers. Financial and SWOT Analysis © Datamonitor. In March 2009. In the same month. particularly LNG terminals would add to the pressure. Consequently. Sonangol. build-up of Eni’s supplies to the competitors. offshore Norway. In the same month. In the same month. Eni has a presence across all the phases of the natural gas chain. and a participating interest in another license in the same area. signed three deals aimed to boost hydrocarbon exploration and energy infrastructure of the African country. This resulted in lower sales margins for the company. Some of its competitors are supplied by the company itself on the basis of long-term contracts. in May 2009.

located in the Sindh province north of Karachi. the company started up sub-sea gas production in North Bardawil field. The field was estimated to have a reserve potential higher than the 6 trillion cubic feet of gas (1 billion of barrels of oil equivalent). in the Gulf of Venezuela. in joint venture with Pakistan Petroleum and Royal Dutch Shell. would deliver gas to the Northern Territory’s Power Water Corporation for over a period of 25 years. Subsequently. In the same month.35 billion. located in the Cardon IV block. Subsequently. Financial and SWOT Analysis © Datamonitor. Eni signed a cooperation agreement with state oil company of Kazakhstan KazMunayGas on exploration and production activities and strategic industrial facilities in Kazakhstan. In August 2009. Eni won the bid tender for the exploration license of onshore Sukhpur block. In the same month. In the same month. started gas production from six wells of Annamaria. in Uganda for $1. This brief is a licensed product and is not to be photocopied 03/2011 Page 142 . Eni made a gas discovery at its Perla field. in October 2009. Italgas and Stogit to Snam Rete Gas for E4. the company started production from the Blacktip gas field. In October 2009. In November 2009. Eni signed a cooperation agreement with the Republic of Turkmenistan to promote and strengthen cooperation in the development of the country’s petroleum industry. was awarded the license for the development of the Zubair giant field in Iraq. offshore Angola. in line with previously established agreements announced in April 2007 and May 2009. 60 miles off the Louisiana coast. Eni signed a strategic agreement with the Democratic Republic of Congo to cooperate in the exploration and development of the significant hydrocarbon resources in the Cuvette basin and in the eastern regions of the country (great lakes. Further in November 2009. Global Top 10 Energy Companies Report: Industry. Subsequently.Company Reports In June 2009. Further in September 2009. Eni and Sonangol announced an important oil discovery at the Cabaca Norte-1 well. Mississippi Canyon Blocks 502/546.6 billion). consisting of the US Occidental Petroleum Corporation and Korea Gaz Corporation. Gazprom completed the acquisition of the 51% stake in SeverEnergia from Eni and Enel. approximately 145 miles southeast of New Orleans in 1700 meters of water depth. Subsequently. through the joint operator INAgip. within the North Bardawil Concession. Eni started crude oil production at the Tombua-Landana project. Eni started production from its Longhorn gas field located in the Gulf of Mexico. an Eni-led consortium (with Eni as operator). located in the southern Bonaparte Gulf. northern Kivu and Tanganika lake). The field. a platform located in the Croatian waters of the Adriatic Sea.5 billion (approximately $5. 350 km North of Luanda. located in the Mediterranean offshore of Egypt. 100% owned and operated by Eni. In July 2009. Eni started production from the Thunder Hawk oil field located in the US Central Gulf of Mexico in Mississippi Canyon Block 734. Eni entered into an agreement with Heritage to purchase its 50% interest in blocks 1 and 3A located in the Lake Albert basin. Eni completed the sale of its 100% stake in the joint stock of the companies. Eni expanded into Ghana through the acquisition of majority stakes in the offshore cape three points (OCTP) and offshore cape three points south (OCTPS) exploration licenses. offshore Northern Territory in Australia. Subsequently. Eni and the Croatian oil and gas company INA. located 80 kilometers (50 miles) offshore Angola in September 2009.

Company Reports Later in November 2009. near Basra in southern Iraq. Nigerian Agip Exploration. Allied Energy (57. located in the Niger Delta Deep offshore. Gazprom completed the payment of $1. respectively to Agip Austria and to Eni International. in the shallow water of the Gulf of Venezuela. the national council of researches. including the first tranche paid in September 2009. with potential for further improvement. This brief is a licensed product and is not to be photocopied 03/2011 Page 143 . Eni and PDVSA signed three strategic agreements that included an agreement for the development of Junin 5. Eni committed to dispose of its interests in both the German Tenp gas pipeline and in Switzerland’s Transitgas pipeline. Eni and Sonangol made two new oil discoveries in Block 15/06 with the exploration wells Nzanza-1 and Cinguvu-1.182 billion to Artic Russia (in which Eni held 60% and Enel 40%) as the second and final tranche owed by Gazprom in respect of the sale and purchase agreement of a 51% participation interest in SeverEnergia. Subsequently. Eni started production on its offshore gas platform Annamaria B in the A. In the same month.C11. Eni and the Consiglio Nazionale delle Ricerche (CNR). located in the Cardon IV Block. a new coal-bed methane (CBM) production sharing contract (PSC). signed a framework agreement for strategic co-operation in the field of scientific and technologic research. totaled approximately $1. started the production of the Oyo oil field. was awarded a 37.AG concession (Eni operator 90%. in Indonesia. The total consideration paid by Gazprom. Eni and Gazprom signed an agreement to allow the entry of EDF in the South Stream project. through its joint venture affiliate VICO CBM. Eni. In March 2010. about 75 kilometers off the Nigerian coast. Occidental Petroleum Corporation and Korea Gas Corporation signed a contract with Iraq's state-owned South Oil Company and Missan Oil Company. Subsequently. In April 2010. Eni signed an agreement to purchase ExxonMobil downstream activities in Austria. in January 2010. In the same month. Further in January 2010. changed its name to Eni Suisse. With prior agreement from its partners.5%) and Eni (40%). The results largely exceeded pre-drill expectations. Further in March 2010. to redevelop the Zubair field. Financial and SWOT Analysis © Datamonitor. Eni presented a set of structural remedies related to some international gas pipelines to the European Commission in February 2010. Eni successfully drilled the Perla 2 well. Global Top 10 Energy Companies Report: Industry. a technology agreement and an MoU for the construction of a 1 GW power plant in the Guiria peninsula. Subsequently.8% stake in Sanga Sanga. through its affiliate. increasing the initial resource estimations by 30%. Agip (Suisse). The company signed a sale and purchase agreement for the shares of Mobil Oil Austria and Esso Austria. Ligestra 10%). offshore Angola. Eni. the Swiss subsidiary of Eni. which would link Russia to the European Union across the Black Sea and significantly contribute to improving the security of energy supply for Europe. In December 2009.6 billion (Eni’s share $940m). signed in June 2009.

located offshore Angola.1m). approximately 250 kilometers south of the Timor-Leste capital of Dili and 500 kilometers north of Darwin. and several industrial initiatives including a gas sweetening plant. In May 2010. in the Muara Bakau PSC. a company engaged in marketing and distribution of natural gas in Brazil. In the same month. Subsequently. Further in June 2010. a subsidiary of Petroleo Brasileiro for $250m. The agreement covered the development of joint initiatives in the fields of exploration. Eni reached an agreement with Gas Plus to sell its 100% stake of Padana Energy. Eni signed a farm-in agreement with UK-based Surestream Petroleum to acquire 55% and operatorship in the Ndunda block located in the Bassin Cotier along onshore region of the Lower Congo Basin. Eni started the development of the Kitan oil field. Eni and KazMunayGas (KMG) entered into an agreement to jointly study the Isatay and Shagala exploration areas located in the Caspian Sea. formed to build the infrastructure across the Black Sea. a multi-utility company working in the Province of Gorizia. Subsequently. Further in July 2010. located in the permit 06-105 of the joint petroleum development area (JPDA) between Timor-Leste and Australia. Eni started oil production from the new Arcadia field. 45 days after its discovery. East Kalimantan. Eni signed a strategic framework agreement for cooperation with two Egyptian state oil and gas companies EGPC and EGAS. Eni successfully appraised the Jangkrik gas discovery in offshore Indonesia. Subsequently. to Petrobras Gas. Massachusetts Institute of Technology (MIT) and Eni opened the Eni-MIT Solar Frontiers Center (SFC). Eni and Gazprom signed a MoU permitting EDF to enter South Stream. This brief is a licensed product and is not to be photocopied 03/2011 Page 144 .Company Reports Further in April 2010. Global Top 10 Energy Companies Report: Industry. Eni and AcegasAps executed an agreement for the take-over of the power business of IRIS – Isontina Reti Integrate e Servizi ((Eni-70% and AcegasAps-30%. Kutei Basin. located in the Mediterranean off the coast of Egypt. Eni launched a strategic partnership with Columbia University's Earth Institute to promote sustainable development in Africa. a drydock shipyard and the upgrading of the Pavlodar refinery. In August 2010. EDF would acquire a stake in the Italian-Russian joint venture. the optimization of gas usage in the Republic of Kazakhstan. In July 2010. Eni (35% working interest and Operator) and Sonangol announced a new major oil discovery in Block 15/06. a gas turbine power plant. within the Temsah Concession. to promote research in advanced solar technologies through projects ranging from new materials to hydrogen production from solar energy. In the same month. The well encountered more than 80 m of net gas pay in excellent quality reservoir sands of Pliocene age. Eni reached an agreement to sell its 100% participation interest in Gas Brasiliano Distribuidora. a company that held exploration permits and concessions for development and production of hydrocarbons in Northern Italy. for E175m (approximately $244.). Eni started gas production from the Tuna field (Eni held 50% participating interest). production and transportation of hydrocarbons. In June 2010. located in the Meleiha Concession (in which Eni owned 56% participating interest) in the Western Desert of Egypt. In the same month. Australia. Subsequently. Financial and SWOT Analysis © Datamonitor.

and those being explored .1 million tons of condensate. Gazprom produced 461. Gazprom primarily operates in Europe. Business description Gazprom is a vertically integrated energy company. electric and heat energy generation and sales. gas condensate production in Russia totaled 10. and increase in oil reserves totaled 57. those ready for the development .912m (approximately $27. The operating profit of the company was RUR856. as well as refining and production of crude oil and gas condensate.Company Reports OAO Gazprom Company overview Gazprom is one of the largest gas producing companies in the world.6 trillion cubic meters (tcm). 1. and marketing of natural gas. Russia and employs about 386.5% of global output. It operates Russia's domestic gas pipeline network and delivers gas to countries across Central Asia and Europe.4m) in FY2009.the Urengoyskoye.971m (approximately $94.5 million tons.the Bovanenkovskoye. transport. The net profit was RUR779.990.1 million tons whereas oil production totaled 31. distribution of gas.5 million tons. processing. Major natural gas reserves (over 90%) are concentrated in the 14 largest fields: those being developed . The company’s core activities include exploration. transportation. For FY2009. The company primarily operates in Europe.4m) in FY2009. and 1. Orenburgskoye. It is engaged in gas exploration. and other.6 million tons. the company had natural gas reserves of 33. gas storage. It is the world's largest company in terms of natural gas reserves. Gazprom relies heavily on Western exports.the Severo-Kamennomysskoye and Kamennomysskoye-more fields. Gazprom is involved in the exploration and production of natural gas and hydrocarbons. refining.7 million tons of gas condensate and 19.8 bcm.5 bcm of natural and associated gas in FY2009.933. transportation of gas. Zapolyarnoye.744m) in FY2009.9% over FY2008. This brief is a licensed product and is not to be photocopied 03/2011 Page 145 . The company is also involved in the refining and production of crude oil and gas condensate.585m (approximately $24. Komsomolskoye. and marketing. a decrease of 32% compared with FY2008.9 million tons of oil produced by Gazprom Neft’s associated companies) in 2009. a decrease of 9% compared with FY2008. production of crude oil and gas condensate. The natural gas production of Gazprom accounts for about 14. Medvezhye. Financial and SWOT Analysis © Datamonitor. The incremental increase in reserves of natural gas due to the geologic exploration work totaled 468. The company’s operates through eight business segments: production of gas. and YuzhnoRusskoye fields.785 million tons of oil. Astrakhanskoye. Kharasaveyskoye. Yamburgskoye.325. processing.000 people. Global Top 10 Energy Companies Report: Industry. It is headquartered in Moscow. Yamsoveyskoye. The associated companies’ production equal to the share owned by Gazprom amounted to 0. The company recorded revenues of RUR2.198.1 million tons of oil (including 16. and Shtokmanovskoye fields. During the year. increase in reserves of condensate totaled 38. production. an increase of 4.

Gazprom refines its hydrocarbon raw materials using the facilities of the group's gas production and gas refining subsidiaries and Gazprom Neft's companies. 67. Gazprom owns the world's largest gas transportation system capable of long-distance transportation of natural gas to consumers in Russia and abroad. and 167. The company's gas transportation system includes a vast network of trunk pipelines. Gazprom sells gas in the domestic and foreign markets. Gazprom operates the following six refineries: the Astrakhan Gas Refinery. Gazprom Neft operates crude oil refining facilities. 2009.7 bcm of natural gas were pumped into and 30 bcm were withdrawn from UGSF in Russia.2 bcm of gas. and UGSFs. It is the only supplier of natural gas to the regulated domestic market.5 bcm of natural gas and 75.2 million tons per year). The company had 215 compressor stations in operation and which were used for gas transportation. Gazprom’s gas distribution subsidiaries own and maintain over 462. Gazprom Neft also controls 38. which transport 168. excluding FSU Countries). Financial and SWOT Analysis © Datamonitor. the Orenburg Helium Plant. The average transportation distance in FY2009 was 2.675 gas pumping units is 42. the length of Gazprom's gas trunk pipelines was 160. It also has a 50% shareholding in Slavneft-Yaroslavnefteorgsintez (50%) and the D.I. Gazprom's gas transportation system received 589. Gazprom's aggregate hydrocarbon processing and refining capacity comprised 52. the company sold 262.7 bcm of natural gas. The installed capacity of the company's 3. and the Surgut Condensate Stabilization Plant.5 million tons of crude oil per year. the Sosnogorsky Gas Refinery. As on December 31. compressor stations. The company sells over 50% of its natural gas in the domestic market. In FY2009. 2009.4 million tons of unstable gas condensate and oil (including the capacity of Gazprom Neft) per year.7 bcm of gas in the FSU countries (Republics of the former USSR.6 bcm of gas in far abroad countries (foreign countries. the Urengoi Condensate Preparation Plant. Its major refinery is Omsk Oil Refinery with the installed capacity of 19. Gazprom performs primary refining of purchased hydrocarbon raw materials and produces final products based on processing agreements signed with various refining organizations. Mendeleyev Yaroslavl Oil Refinery (50%). The company transported 60 bcm of natural gas to companies outside the Gazprom group in FY2009.4 thousand km which included 46 thousand km of pipeline branches.2 bcm as of December 31. except for the Russian Federation).63% of shares in Moscow Oil Refinery (with the installed capacity of 12.504 kilometers (km) for gas supplied to Russian consumers and 3.000 megawatts (MW). 15. This brief is a licensed product and is not to be photocopied 03/2011 Page 146 . which transport 49. 2009.2 bcm of natural gas. As on December 31.292 km for gas export supplies.100 km of gas distribution pipelines. Global Top 10 Energy Companies Report: Industry. while its associated gas distribution subsidiaries own and maintain 149.5 bcm of gas in Russia. the Orenburg Gas Refinery. In FY2009.Company Reports Gazprom operates 25 underground gas storage facilities (UGSF) in Russia with an aggregate active capacity of 65. In FY2009.000 km of gas distribution pipelines.

313 MW as of December 31. OGK-6 (with a generating capacity of 9.Company Reports Gazprom operates in the power generation sector through Mosenergo (with a generating capacity of 11. Gazprom's electricity generation capacity was 36. and Kaunasskaya teplofikatsionnaya elektrostantsiya (with a generating capacity of 170 MW in Lithuania). At the end of December 2009.4 million gigacalorie (Gcal) of heat in FY2009.052 MW). OGK-2 (with a generating capacity of 8.5 billion kilowatt-hour (KWh) of power and 73.695 MW). 2009).918 MW).556 gigacalorie per hour (Gcalh). Gazprom also owns a 51.79% shareholding in OAO TGK-1. Global Top 10 Energy Companies Report: Industry. The company generated 138. This brief is a licensed product and is not to be photocopied 03/2011 Page 147 .148 MW and heat generation capacity was 54. Financial and SWOT Analysis © Datamonitor. the third largest territorial generating company in Russia in terms of its installed capacity (6.

4 thousand kilometers (km). Global Top 10 Energy Companies Report: Industry. This brief is a licensed product and is not to be photocopied 03/2011 Page 148 . and throughout Eastern Europe. and pumps the oil-and-gas equivalent of the entire Saudi Arabian petroleum output. Gazprom's gas transportation system received 589. it has 215 compressor stations which are currently in operation and which are used for gas transportation.48 billion cubic meters (bcm) per year at the second trial area of the Achimovsk formations of the Urengoyskoye field. The length of Gazprom’s gas trunk pipelines is 160. The company's strong market position in the natural gas market gives it significant competitive advantage.7 bcm of natural gas. The installed capacity of the company’s 3.2 thousand meters of gasproducing wells were drilled. accounting for about 14. two compressor stations with an aggregate capacity of 48 megawatt (MW) designed to utilize the associated petroleum gas (APG). The company’s exploration and production activities account for about one-fifth of natural gas reserves and production globally. In FY2009. which includes 46 thousand km of pipeline branches. Furthermore. Strong gas transportation network Gazprom owns the world’s largest gas transportation system. Gazprom owns both natural gas fields and oil wells. The company transported 60 bcm of natural gas to companies outside the Gazprom group in FY2009. and underground gas storage facilities (UGSF). Belgium. Gazprom is the largest natural gas producer in Russia accounting for 80% of Russia’s natural gas production. 64 new gas-producing wells. the Unified Gas Supply System (UGSS) of Russia. Gazprom is also active in distribution markets in Austria. Gazprom drilled 358. and 115 previously idle gas-producing wells. compressor stations.675 gas pumping units is 42. the Netherlands. the company commissioned one comprehensive gas processing unit (CGPU) with a capacity of 3. Financial and SWOT Analysis © Datamonitor.5% of global output. and provides it with a platform for growth. Moreover.Company Reports SWOT analysis Strengths Strong market position in the natural gas market Gazprom has large natural gas and hydrocarbon reserves. The company’s gas transportation network allows it direct control over its natural gas distribution and transportation activities. the company leverages its pipeline network to trade its natural gas in European markets. Gazprom’s gas transportation system includes a vast network of trunk pipelines. Gazprom produced 461.5 bcm of natural and associated gas in FY2009. In FY2009.000 MW.

which equals to export revenues of $1 trillion at current prices. The terms and conditions of the contract prevent unilateral termination of contracts except for cases of long-lasting force majeure circumstances.1 trillion cubic meters (tcm) of natural gas at a minimum level of obligations to far abroad countries for the period until the expiration of the contracts. the buyer can take them later after procuring the minimum annual volumes provided in the contracts for the respective year and making relevant additional payment. The company’s long-term contracts portfolio (excluding the potential volumes to be supplied through the South Stream gas pipeline) currently provides the sales of 3.Company Reports Strong long term contract portfolio Gazprom sells natural gas in Europe under long-term contractual obligations. Global Top 10 Energy Companies Report: Industry. Financial and SWOT Analysis © Datamonitor. These contracts are entered into considering a pricing formula. However. The company’s strong long term contract portfolio ensures consistent revenues in the medium term. which takes into account changes in prices for oil products for the previous six to nine months. The take-or-pay conditions cover a significant volume of contracts and imply that a buyer pays for the volumes not taken during the year. This brief is a licensed product and is not to be photocopied 03/2011 Page 149 .

Gazprom invested RUR36. Maturing gas fields The company’s natural gas production from its major fields in Western Siberia (Urengoyskoye.8% of trunk pipelines are aged less than 10 years. In FY2009. 18. 27. About 44. Financial and SWOT Analysis © Datamonitor. The refurbishment of these pipelines calls for additional capital expenditure. the maturing fields will impact Gazprom’s gas production in the near term. Global Top 10 Energy Companies Report: Industry.5% of the company’s pipelines are aged between 21 and 33 years.5 billion (approximately $1. and 9.4% are aged over 33 years. Yamburgskaya and Medvezhye) has been declining over the past few years.3% are aged between 11 and 20 years.Company Reports Weaknesses Aging of pipelines Gazprom needs to replace its pipelines since it is over dependent on pipelines aged between 21 and 33 years and above 33 years for transporting the gas. The decrease in natural gas production at the Urengoyskoye and Medvezhye fields and the Yamburgskaya area was caused both by the natural decrease in production and the limited natural gas withdrawal. The additional capital expenditure on refurbishment of pipeline impacts the expansion plans and would add to the margin pressures for the company. This brief is a licensed product and is not to be photocopied 03/2011 Page 150 . Despite the fact that the company has been investing heavily in developing new fields.2 billion) towards the reconstruction and technical refurbishment of its Unified Gas Supply System (UGSS).

Gazprom Dobycha Kuznetsk. The Taldinskoye field was discovered within the licensed area in 2009. The methane extraction project at Kuzbass field is being implemented by the company’s subsidiary. which is comparable with that at natural gas fields in the Northern areas of the Tyumen Region. the availability of infrastructure. whose licensed mining area contains about 6 tcm of methane resources located in coal beds. Financial and SWOT Analysis © Datamonitor. the density of methane resources reaches up to 3 bcm per square km.Company Reports Opportunities Investment in methane extraction One of the major directions in implementation of Gazprom’s strategy for the expansion of its resource base is to establish a new industry of methane production at coal fields in Russia. Global Top 10 Energy Companies Report: Industry. The investment in methane extraction would materially diversify the company’s product base and enhance the overall competitiveness of Gazprom’s products. Its advantages in geologic and production parameters. The company drilled seven exploration wells in 2009 as part of the project and their trial operation began. and natural gas consumers located as close as 15 to 150 km from the Kuzbass field determines the economic efficiency of commercial production of methane there. In some areas of Kuzbass. The Kuzbass field with its forecast methane resources of 13 tcm is currently the most suitable for commercial production. with the gas being utilized at automobile CNG filling stations. The wells have an aggregate daily output of about 10 million cubic meters (mcm). This brief is a licensed product and is not to be photocopied 03/2011 Page 151 . Forecast annual production volumes at the available licensed area may reach up to 5 bcm in the period from 2010 through 2012 and up to 20 bcm after 2020. Estimates show that forecast methane resources located in coal beds in Russia are comparable with traditional natural gas fields in terms of their volumes and amount to 50 trillion cubic meters (tcm). Gazprom has been carrying out experiments since 2003 testing technologies for methane production from coal beds.

In December 2009. Gazprom Energoholding acquired a 23. Gazprom and Kogas signed an agreement to jointly explore a gas supply project. Gazprom and the Nigerian National Petroleum Corporation signed an agreement on setting up a joint venture to execute large-scale projects in hydrocarbon exploration. the company and MFB (Hungarian Development Bank) signed a basic cooperation agreement for the construction of a gas pipeline and transit of natural gas across Hungary within the South Stream project. particularly. production. OAO TGK-1 is the leading electric and thermal power producer and supplier in the North-Western region of Russia and the third largest territorial generating company in Russia in terms of its installed capacity. construction and engineering of an associated gas gathering and processing system and building of power generation facilities in Nigeria.000 tons of lubricants per year. Global Top 10 Energy Companies Report: Industry. for constructing a gas storage near Bernburg (Katharina UGS facility).787%. The agreements included the purchase of liquid natural gas (LNG) by both Shell Eastern Trading and Gazprom Global LNG from Sakhalin Energy Investment Company.63 % interest in the Moscow Oil Refinery and controls a network of 134 gasoline stations in the Moscow region. In the same month.Company Reports Prudent acquisitions Gazprom follows an aggressive acquisition strategy. In June 2009. The unit is to be installed at the Portovaya compressor station (CS) of the Nord Stream gas trunkline. Gazprom and Royal Dutch Shell signed LNG and natural gas supply contracts in April 2009. Gazprom and StatoilHydro signed a MoU to jointly engage in geological exploration. Gazprom acquired a 51% stake in SeverEnergia worth approximately $1. production and transportation. SeverEnergiya controls a number of companies that hold licenses for the development and production of hydrocarbons in Western Siberia. established to implement oil production projects in Latin America by five large Russian oil companies with equal shareholdings. In March 2009. Gazprom Neft also acquired a controlling shareholding in a diversified oil company NIS (Serbia). Gazprom and Verbundnetz Gas signed an agreement to set up a consortium as part of the joint venture creation project for dealing with natural gas storage. In September 2009. Its production assets are located in the Khanty-Mansiisk autonomous region. ENI and Enel.09% shareholding in TGK-1 increasing its stake to 51.71 % interest in Sibir Energy in 2009. Gazprom Neft acquired a 54. refining and sales of hydrocarbons and refined products. acid gas removal and ecological purification) signed an engineering and construction contract for a gas treatment unit (GTU). This brief is a licensed product and is not to be photocopied 03/2011 Page 152 . Such prudent acquisitions significantly strengthen the company’s product portfolio and would drive the top line growth in the coming years.6 billion from the consortium of Italian companies. It acquired an oils and lubricant plant from Chevron Global Energy in the city of Bari (Italy) with a capacity of 30. they will diversify the company’s geographical presence by expanding its international operations. Gazprom Neft acquired a 20% shareholding in Russian National Oil Consortium.000 tons of oils and 6. Subsequently. It also owns a 38. In the same month. In May 2009. Further in 2009. Growth through alliances and joint ventures Growth through joint ventures and alliances acquisitions and alliances has long been a strategy of Gazprom. Gazprom and Siirtec Nigi (an Italian company dealing with the adoption of proper and attracted technologies for sulfur recovery. Financial and SWOT Analysis © Datamonitor. Sibir Energy engages in exploration. development and production of hydrocarbon resources in northern regions. In addition.

and EuRoPol GAZ signed a long-term agreement of cooperation in gas sector. Financial and SWOT Analysis © Datamonitor. PGNiG. The agreement included extending the contract for natural gas supply from the Russian Federation to Poland until 2037 as well as potentially increasing natural gas supplies to Poland starting 2010 up to 11 bcm per year depending on the Polish market demand. Gazprom and Sovcomflot signed a cooperation agreement on marine transportation of the Shtokman field LNG. The company's joint ventures and alliances would allow it to further strengthen its existing business as well as help Gazprom to gain a strong foothold in new sectors and markets.Company Reports Further in January 2010. Further in June 2010. Global Top 10 Energy Companies Report: Industry. Gazprom. This brief is a licensed product and is not to be photocopied 03/2011 Page 153 . Gazprom and Siemens signed a MoU on cooperation in the field of liquefied natural gas (LNG). In the same month.

Furthermore. This could result in an increase in the actual costs than expected. Therefore. the development of fields on the Yamal Peninsula and the continental shelf of Russia are being carried out in even more severe climate conditions. pricing decisions and production quotas of OPEC. regulation by the government could pose the risk of unfavorable pricing policies resulting in loss for the company. The government through its representatives on the company’s board exercises control over its cash flows. In periods of sharply lower commodity prices. Decline in crude oil and natural gas prices and the corresponding declining demand could affect Gazprom's level of production and lead to decline in overall topline growth for the company. Financial and SWOT Analysis © Datamonitor. Global Top 10 Energy Companies Report: Industry. Natural gas prices also continue to be highly volatile. despite the current liberalization. and charges for procurement and sale services. Crude oil prices continue to be affected by political developments worldwide. the government’s control over the company could come in the way of the company’s growth plans with the consumers’ interest being the primary concern of the government. and volatile trading patterns in the commodity futures markets. tariffs for transportation services via gas distribution networks. Weather sensitivity Gazprom produces a significant portion of its gas in Western Siberia. as well as retail prices for gas. This brief is a licensed product and is not to be photocopied 03/2011 Page 154 . In accordance with the Federal Law ‘On Natural Monopolies’ the Gazprom’s gas transportation via pipelines is regulated as natural monopoly operations. and the investment program. operational results and financial condition of the company. tariffs for trunk pipeline transportation services provided to independent producers. This has resulted in higher gas transportation costs for the company. Fluctuations in crude oil and natural gas prices Gazprom's operations could be affected by changes in crude oil and natural gas prices. The Russian Government regulates wholesale prices for gas which Gazprom applies to the major portion of domestic sales. Therefore. The fields in Western Siberia that are being developed by Gazprom are located at a large distance from its sales regions. Additionally. as well as delay or defer drilling wells in certain areas because of lower cash flows. Gas retrieval and Gazprom's revenues denominated in foreign currency can be considerably influenced by weather conditions both within a short-term period (within one year) and in the long-term outlook. the state is still regulating part of tariffs at electricity market. financial plan.Company Reports Threats Regulation The Russian Federation controls 50. where a severe climate complicates production and increases the cost of natural gas. extensive regulation could affect the growth plans. In addition.002% of Gazprom’s shares. Gazprom could curtail production and capital spending projects.

particularly. In the same month. Gazprom and Verbundnetz Gas signed an agreement to set up a consortium as part of the joint venture creation project for dealing with natural gas storage. Financial and SWOT Analysis © Datamonitor. Pursuant to the agreement the parties would continue comprehensive development of the Leningrad Oblast gas supply system with due regard of the Nord Stream gas trunkline project.ON Ruhrgas signed an asset exchange agreement in the area of gas production and trade. and exploiter of the national gas transportation system in Greece) and Gazprom signed a basic cooperation agreement on implementation of the South Stream project on the territory of Greece. Further in May 2009.93% ownership stake in Gazprom got transferred fully from E. and ecological purification) signed an engineering and construction contract for a gas treatment unit (GTU). Gazprom and Siirtec Nigi (an Italian company dealing with the adoption of proper and attracted technologies for sulfur recovery. the company launched the drilling of first exploration in the eastern area of the Talda coalbed methane (CBM) field. Gazprom and MFB (Hungarian Development Bank) signed a basic cooperation agreement for the construction of a gas pipeline and transit of natural gas across Hungary within the South Stream project. The agreement was signed as an extension to the Intergovernmental Agreement of Cooperation in the gas sector and the MoU on natural gas supplies from Russia to Korea between Gazprom and Kogas. in February 2009. Gazprom and StatoilHydro signed a MoU to jointly engage in geological exploration. Gerosgaz’s 2.ON would receive 25% of the charter capital of Severneftegazprom by the end of the year. Gazprom and Bulgarian Energy Holding signed a cooperation agreement with regard to a gas pipeline for natural gas transit through the territory of Bulgaria as part of the South Stream project. In the following month. Gazprom and Kogas signed an agreement to jointly explore a gas supply project. Through this agreement. The joint venture would execute large-scale projects in Global Top 10 Energy Companies Report: Industry. The agreements included the purchase of liquid natural gas (LNG) by both Shell Eastern Trading and Gazprom Global LNG from Sakhalin Energy Investment Company. Subsequently. for constructing a gas storage near Bernburg (Katharina UGS facility).Company Reports Recent developments An agreement was signed between Gazprom and the Leningrad Oblast Government for 2009. signed the contract for manufacturing and delivering two Yamal-400 new generation communications satellites. Gazprom and E. Kemerovo Oblast. E. Gazprom and the Nigerian National Petroleum Corporation signed an agreement on setting up a joint venture on a parity basis. signed a basic cooperation agreement on implementation of the South Stream project on the territory of Serbia. The unit would be installed at the Portovaya compressor station (CS) of the Nord Stream gas trunkline. transferring 49% of Gerosgaz to Gazprom.ON Ruhrgas to Gazprom. In the same month.5 billion. Subsequently. In the same month. In May 2009. In June 2009. DESFA (operator. development and production of hydrocarbon resources in northern regions. In the same month. Further in May 2009. Gazprom and Royal Dutch Shell signed LNG and natural gas supply contracts in April 2009. developer. This brief is a licensed product and is not to be photocopied 03/2011 Page 155 . Enel and Eni agreed to sell a 51% stake in Russian company SeverEnegia to Gazprom for about $1. Gazprom and Srbijagas. In the same month. acid gas removal. Further in June 2009. In return. Gazprom and Thales Alenia Space (European leader in satellite systems and a major player in orbital infrastructures).

According to the contract. exploration and production of hydrocarbons. DONG Energy starting from 2012 would additionally receive 1 billion cubic meters of gas per annum within a period of 18 years via the second string of the offshore gas pipeline. Gazprom would initially purchase 500 million cubic meters with a subsequent increase according to the Azerbaijani party’s export potential. In the same year. The YaNAO Administration would assist Gazprom and its subsidiaries in the geological investigation of subsurface resources. The Dzuarikau – Tskhinval gas pipeline was commissioned in August 2009. production and transportation. Subsequently. Phase 1 – Gas Supply to Petropavlovsk-Kamchatsky project.Company Reports hydrocarbon exploration. and facilitation of the land allocation procedure by the local authorities. Gazprom and Murmansk Oblast Government signed a six-year agreement of cooperation promoting the bilateral relations within Gazprom’s strategic projects in the Murmansk Oblast including. In the beginning of October 2009. The drilling operations were a part of the Gas Supply to the Kamchatka Oblast. Gazprom and DONG Energy signed a contract for the supply of additional Russian gas volumes to Denmark through the Nord Stream pipeline. the company launched drilling of the first production gas well in the Nizhne-Kvakchinskoye gas condensate field (GCF) located near the settlement of Sobolevo on the western coast of the Kamchatka Peninsula. TGC-1. Further in September 2009. Gazprom commenced exploration drilling in the Kirinskoye field offshore the Sakhalin Island. Global Top 10 Energy Companies Report: Industry. in which Gazprom owned a strategic shareholding. Financial and SWOT Analysis © Datamonitor. Gazprom signed a memorandum of cooperation to support execution of the Russian Energy Strategy until 2030 in the Urals Federal Okrug.6 billion. Subsequently. The project was part of Gazprom’s Action Plan aimed at supplying the Kaliningrad Oblast with 2. the Shtokman gas condensate field (GCF) comprehensive development project. Gazprom launched the construction of Dzhubga – Lazarevskoye – Sochi gas pipeline and the Adler Combined Heat and Power Station (CHPS) in Russia. This brief is a licensed product and is not to be photocopied 03/2011 Page 156 .5 billion cubic meters of natural gas by 2010. Gazprom completed the second string of Minsk – Vilnius – Kaunas – Kaliningrad gas pipeline in September 2009. commissioned a new turbine unit with the capacity of 50 MW (100 Gcal/hr) at the Vasileostrovskaya combined heat and power plant (CHPP). In the same month. Subsequently. Gazprom and its subsidiaries would secure reliable supplies of natural gas and hydrocarbon feedstock products to the regional consumers. In the same year. Gazprom completed the acquisition of a 51% stake in SeverEnergia worth approximately $1. in compliance with the Russian Federation Government orders. Gazprom launched the construction of Sakhalin – Khabarovsk – Vladivostok gas transmission system. Subsequently. Pursuant to the long-term contract. construction and engineering of an associated gas gathering and processing system and building of power generation facilities in Nigeria. Gazprom and the State Oil Company of Azerbaijan Republic (SOCAR) signed a natural gas purchase and sale contract. survey and construction activities in the Okrug. Gazprom and Yamal-Nenets Autonomous Okrug (YaNAO) signed an agreement of cooperation for 2010. In July 2009. Further in September 2009. construction of an offshore gas pipeline and gas processing facilities.

to deal with engineering. the Pochinki – Gryazovets gas pipelines and the Ukhta – Torzhok gas trunkline system. Later in October 2009. Gazprom and E. construction and operation of the South Stream gas pipeline in Serbia. developing capacities to utilize natural gas as a motor fuel. In the same month. This brief is a licensed product and is not to be photocopied 03/2011 Page 157 . construction and reconstruction of heat supply systems in the Kurortny. In addition. The agreement covered cooperation between the parties in the region for securing stable gas supplies to consumers. Subsequently. Financial and SWOT Analysis © Datamonitor. Gazprom and Samara Oblast Government signed an agreement of cooperation in December 2009. Petrodvortsovy and Petrogradsky districts of the city. the Gryazovets – Vyborg. Subsequently. Gazprom and state-owned Srbijagas signed an agreement to set up a joint engineering company (JEC). Gazprom and Eni signed a MoU allowing EDF accession to the South Stream project. In November 2009. Subsequently. Gazprom brought onstream an inter-settlement gas pipeline from the Osinovka gas distribution station (GDS) to the settlement of Gidrostroitel. promoting sci-tech cooperation in the area of gas-pumping equipment design and production at local enterprises. South Stream Serbia (Gazprom . they resolved the issues relevant to EuRoPol GAZ management and its tariff policy when transmitting Russian hydrocarbons. and providing environmental security. gas and condensate field to Gazprom Neft. Gazprom and Vologda Oblast signed an agreement of cooperation confirming their mutual interest in performing Gazprom’s strategic projects in the region. In the same month. as well as execution of the gas supply program for Saint Petersburg over 2007 to 2015 with a potential extension till 2025. Further in December 2009. the company commissioned the Kasimovskoye UGS – Voskresensk CS gas trunkline in the Voskresensk District.22 (CGTU-22) into pilot operation to develop the Achimov deposits in the Urengoy oil and gas condensate field. Gazprom and Srbijagas created South Stream Serbia joint venture to implement the South Stream project in Serbia. gasifying population centers. Gazprom and GDF SUEZ signed an agreement of cooperation in personnel training. They include construction of the Northern Tyumen Regions – Torzhok (SRTO – Torzhok). Moscow Oblast. Gazprom resolved to transfer the rights to use the subsurface resources of the Novoportovskoye oil. The company brought comprehensive gas treatment unit No. Subsequently.ON closed the asset swap deal. designing and adopting gas-saving technologies. In the same month. During the same period. The parties agreed to increase the volumes of Russian gas supply to Poland and to extend the existing supply contract until 2037. Gazprom launched its first stand-alone project on gas production from the Achimov deposits. Gazprom and Saint Petersburg signed an agreement of cooperation to cooperate in the following fields: comprehensive development of the Saint Petersburg gas distribution system. Global Top 10 Energy Companies Report: Industry. Gazprom and PGNiG settled the Russian-Polish cooperation issues in the gas sector.Company Reports Further in October 2009. covering the training and probation programs for their employees in Russia and France. Gazprom and Petrovietnam signed an agreement of strategic partnership to continue joint activities in the blocks of Vietnam’s continental shelf as part of the previously signed oil and gas contracts and explore the possible ways of cooperation with Vietnam in free licensed blocks. Bratsk.51% and Srbijagas – 4%). gas and condensate field and the Eastern block of the Orenburg oil. Towards the end of October 2009.

The railroad would allow transportation of up to 3 million tons of cargoes per annum. Gazprom. In the same month. gasifying population centers. Gazprom’s portfolio would additionally receive 15. Subsequently.5 billion cubic meters of additional gas per year would be supplied to GDF SUEZ from 2015 via the Nord Stream. Financial and SWOT Analysis © Datamonitor. Gazprom launched Russia’s first facility for CBM production in the Taldinskoye field in February 2010. PGNiG and EuRoPol GAZ signed a long-term agreement of cooperation in gas sector. Subsequently. Subsequently. This brief is a licensed product and is not to be photocopied 03/2011 Page 158 . Global Top 10 Energy Companies Report: Industry. among other objectives. Gazprom launched regular operation of Obskaya – Bovanenkovo railroad on Yamal. Gazprom and MFB created South Stream Hungary Zrt joint venture company to implement the South Stream project in Hungary. The agreement included extending the contract for natural gas supply from the Russian Federation to Poland until 2037 as well as potentially increasing natural gas supplies to Poland starting 2010 up to 11 billion cubic meters per year depending on the Polish market demand. Gazprom and the Russian Technologies State Corporation signed an agreement to coordinate the development. a part of the Gryazovets – Vyborg gas trunkline. Under the agreement. In the same month. In the same month. Gazprom and Governor of the Perm Krai signed an agreement of cooperation to arrange steady gas supply to consumers. In January 2010. the company began the construction of the Portovaya compressor station (CS). In March 2010. up to 1. Gazprom and GDF SUEZ signed a memorandum on additional supplies of Russian natural gas and on the entry of GDF SUEZ into the Nord Stream project.5 billion cubic meters of Uzbek gas in 2010. Gazprom established a new department to coordinate the execution of South Stream project.Company Reports Towards the end of December 2009. Gazprom and Uztransgaz entered into a gas purchase and sale agreement for 2010. Gazprom and ONGC signed an addendum to MoU to cooperate within the integrated LNG project based on the Yamal Peninsula fields located in the Russian Federation. Gazprom and Leningrad Oblast Government signed an agreement of cooperation for the development of the Leningrad Oblast gas supply system and execution of the Gryazovets – Vyborg gas pipeline project in the region. as well as to construct and operate the Bovanenkovo – Ukhta gas trunkline system. and develop and improve the sustainable gas supply system. Gazprom and SAP signed a corporate license agreement aimed at optimizing the total ownership cost of SAP software solutions and ensure flexibility in fulfilling the key initiatives of the Gazprom Informatization Strategy. Further in January 2010. including materials required to develop the Bovanenkovo and other fields on Yamal. production and supply of modern high-tech import-substituting equipment and other products by the Russian Technologies Group of companies for Gazprom. Subsequently. In the same month.

Health. Gazprom and the Orel Oblast Government signed an agreement to initiate a set of actions in the region to increase the number of utility service. increasing the annual contract volume of gas in 2010 to 36. and executing a program for the use of gas as a transport fuel. technologies and equipment for the hydrocarbons transportation. In the same month. financing. established on parity basis by both the companies for the implementation of the Greek section of the South Stream project. and underground storage and processing. environmental protection of the Northern seas and territories. Further in April 2010. Further in June 2010. BASF/Wintershall. Subsequently. Subsequently. Safety and Environment issues under northern conditions. amongst others. In June 2010. E. The companies would cooperate in such areas as geological exploration and development of hydrocarbon fields. Nord Stream together with its shareholders in the consortium. gasifying population centers. In April 2010. In the same month. Gazprom and OMV signed a framework agreement of cooperation under the South Stream project on the territory of the Republic of Austria.Company Reports Further in March 2010. This was followed by another agreement with Foundation Project Delta Group for cooperation in the energy sector. project management and corporate governance. This brief is a licensed product and is not to be photocopied 03/2011 Page 159 . Gazprom and Novatek signed a cooperation agreement for LNG production on Yamal Peninsula.ON Ruhrgas and Nederlandse Gasunie announced the successful signing of Phase I financing of the pipeline project. The E3. Gazprom. hydrocarbons production and treatment before transportation. Subsequently. In the same month. Gazprom and Transbaikal Krai Government signed an accord to jointly develop and implement the Transbaikal Krai gasification program. Gazprom began the construction of the offshore section of the Dzhubga – Lazarevskoye – Sochi gas pipeline in the Black Sea near the city of Tuapse. and other motor vehicles powered by natural gas. Gazprom and the company DESFA (Hellenic Gas Transmission System Operator) signed a charter of the joint venture company South Stream Greece. gas processing. Gazprom commenced drilling of the first prospecting well (Rhourde Sayah-2) in Africa within the El Assel license area of Algeria’s Berkine basin. Subsequently in June 2010.9 billion financing for Phase I totaled would pave the way for construction of the first line of Nord Stream. the company began the construction of Nord Stream gas pipeline in the Baltic Sea. Financial and SWOT Analysis © Datamonitor. construction and operation of Austria’s section of South Stream with a minimum annual capacity of 5-10 billion cubic meters. Global Top 10 Energy Companies Report: Industry. Gazprom and Siemens signed a MoU on cooperation in the field of liquefied natural gas (LNG). In the same month. agricultural. Gazprom and OMV would set up on a parity basis a JEC for design. Gazprom and Tyumen Oblast signed a cooperation agreement to ensure uninterruptedly gas supply to consumers. in compliance with its obligations under the contract with the Algerian National Agency for the Valorization of Hydrocarbon Resources (ALNAFT). renewable energy sources. Gazprom and Statoil signed an agreement on scientific and technical cooperation. including gas production. In the same month. energy saving. transportation. Gazprom signed addenda to contract on gas supply to Ukraine. Gazprom and Sovcomflot signed a cooperation agreement on marine transportation of the Shtokman field LNG.5 billion cubic meters.

Subsequently. Gazprom komplektatsiya. In the same month. Subsequently. Further in June 2010. Both the parties would continue the comprehensive development of the Yaroslavl Oblast. and construction of the Nord Stream gas pipeline to ensure reliable and efficient delivery of necessary volumes of gas to European consumers. The gas pipeline would gasify 62 population centers in the Khunzakh and Gumbet Districts of the Republic. The field would serve as the basis for shaping the Yakutia gas production center within the Eastern Gas Program. underground gas storage. Gazprom and Yaroslavl Oblast Government signed a partnership agreement for 2010–14. This brief is a licensed product and is not to be photocopied 03/2011 Page 160 . Eni and EDF signed a MoU on South Stream project facilitating EDF’s entry into the project through a reduction in Eni’s stake in the joint venture. Subsequently. Gazprom approved the development plan for Yakutian Chayanda field. signed an agreement of intent to purchase 10 Sukhoi Superjets from Sukhoi Civil Aircraft Company between 2012 and 2015. a subsidiary of Gazprom. Gazprom and Gasunie signed a MoU on strategic cooperation in the areas of gas transmission infrastructure. The company opened a representative office in Latvia in July 2010. Global Top 10 Energy Companies Report: Industry. Gazprom. and would partner in the regional gasification according to the annually approved schedules.Company Reports Further in June 2010. GDF SUEZ joined Nord Stream project. Gazprom brought onstream first stage of gas lateral to Khunzakh settlement in Dagestan Republic. Gazprom and GDF SUEZ signed a MoU to cooperate in energy saving and energy efficiency areas. as well as to promote the use of natural gas as a transportation fuel. Further in July 2010. Financial and SWOT Analysis © Datamonitor. In the same month.

817.500.467.941.323.015.0) (27.6% 18.1 79.307.800.0 (87.2% 40.244.7% 41.9 5.106.107.5 5.0 358.0 56.0 122.0 34.0 68.0 (15.0 113.5% 39.0 4.0 52.6 83.087.0) 60.0 $ $ $ $ $ Million Million Million Million Million 55.9 NA NA NA % % % 37.615.130.0 76.5% Global Top 10 Energy Companies Report: Industry.0 36.5% 37.0) 152.693.947.1 80.3% NA NA % % 17.0 39.810.186.270.283.6% 32.0) (26.027.0 48.0 NA $ NA NA Absolute Absolute Absolute Absolute 16.479.852.345.4% 10.0 121.1% 35.0 (95.149.879.0 48.0 228.0 111.069.1 3.1 6.3% 18.210.342.0 459.0 (232.7% 16.438.0) 33.0 (9.490. Financial and SWOT Analysis © Datamonitor.1% 40.0) 113.407.0 (104.138.5% 38.500.3% 19.981.0 45.0 5.7 4.100.610.419.951.3 82.2 344.3 1.0 110.728.0) 28.082.8 1.777.0 (22.920.0 36.1 379.2 9.0 (14.0 97.762.0 46.9 4.382.754.266.100.0) 35.0 (187.2 322.0 (96.5% 47.273.0) (44.1 6.769. 2005–09 ($m) Parameters Income Statement Total Revenue Cost of Goods and Services Gross Profit Operating Expense Operating Income Net Income Balance Sheet Total Current Assets Total Assets Total Current Liabilities Total Liabilities Total Shareholders Equity Cash Flow Cash from Operating Activities Cash from Investing Activities Cash from Financing Activities Closing Cash Balance Key Statistics Total Common Shares Outstanding Year-end Share Price Market Capitalization Enterprise Value Number of Employees Free Cash Flow Key Ratios P/E Ratio Earnings per Share (EPS) EV/EBITDA EV/Sales Profitability Ratios Gross Margin Operating Margin Net Income Margin Resource Management Return on Equity Return on Capital Employed Currency Unit 2009 2008 2007 2006 2005 $ $ $ $ $ $ Million Million Million Million Million Million 301.0) 69.3 422.9 0.0 NA $ $ $ NA $ Million Absolute Million Million Absolute Million 4.824.0 40.499.299.729.0 242.0 93.0 112.1 8.0 (213.9% 10.0 6.133.8 397.7% 11.0) 31.5 5.579.234.0 219.0) 84.727.337.0 33.070.061.407. This brief is a licensed product and is not to be photocopied 03/2011 Page 161 .0 (288.953.280.2% 18.002.0 59.0 105.4 7.0 52.671.854.0 75.0 5.3% 10.220.900.821.0 73.955.8 12.0 390.0 79.7 504.646.320.0) (38.476.0) 28.0 58.437.0 233.0 $ $ $ $ Million Million Million Million 28.844.9% 11.1 326.2 11.9 1.230.0 72.6 439.0) (36.0) 71.6 484.0 40.255.052.5% 37.312.6 327.0 (99.727.1% 40.700.0 5.569.0) 170.325.780.002.235.0 49.965.0) 157.286.7% 6.328.239.0 115.0% 34.8 9.976.013.171.0) 145.Financial Analysis FINANCIAL ANALYSIS Exxon Mobil Corporation Table 9: Exxon Mobil Corporation: financial and operational highlights.725.0 85.700.0 (213.0 120.0 365.334.0 208.0 19.0 49.0 (10.6 80.335.0) 10.212.6 0.963.

0 35.8 64.0 14.830.368.113.0 16.059.0 Source: Datamonitor.388.847.553.0 32.3 105.653.113.0 112.0 28.6 1.0 21.0 36.3 179.751.787.1 502.0 22.0 26.0 25.284.0 20.816.054.0 121.0 249.4 122.4 4.4 NA $ % Million 7.9% 15387 4.591.281.9% 13839 $ $ $ $ Million Million Million Million 24.0 $ $ $ $ $ $ $ Million Million Million Million Million Million Million 89.0 28.0 481.287.764.1 1.7 3.1 1.826.599.288.0 12.2% 19318 3.0 20.0 38.0 30.0 37.6 25.0 26.839.3% NA NA NA Absolute Absolute Absolute 0.0 27.144.146.0 1.0 21.7 15.126.1 NA NA NA $ $ Absolute Absolute Absolute Absolute Absolute 1.0 29.590.0 11.0 16.451.0 25.0 17.0 34.909. This brief is a licensed product and is not to be photocopied 03/2011 Page 162 .0 22.0 19.0 21.875.7 0.445.736.9 0.0 30.5 5. company reports NA – Not Applicable.0 24.805.2% 15462 3.792.5% 17.271.7 14.042.7 16.957.646.0 30.4 0.0 110.0 297.4 238. Financial and SWOT Analysis © Datamonitor.054.0 18.293.0 18.Financial Analysis Return on Assets Financial Strength Quick Ratio Interest Coverage Ratio Debt to Equity Ratio Operational Efficiency Asset Turnover Ratio Receivable Turnover Ratio Inventory Turnover Ratio Revenue per Employee Net income per Employee Other Capex to Revenues Capex Revenue by Segment Upstream Downstream Chemical Corporate and financing Revenues by Geography The US Canada Japan The UK Belgium Germany France NA % 8.1 1.550.0 20.098.3 4.530.186.486.677.0 33.2 2.9 4.660.0 382. DATAMONITOR Global Top 10 Energy Companies Report: Industry.9 21.399.0 31.2 124.0 14.4% 19.5 565.120.7 0.412.963.2% 17.1 1.060.6% 18.151.656.0 21.3 14.0 24.2 431.0 13.4 1.927.842.281.847.761.0 28.615.5 0.0 39.0 137.0 324.857.457.0 25.7 14.537.0 18.5% 22491 4.0 27.0 14.458.680.0 298.871.

52 8.23 6.67 1.42 7.42 39.75 0.01 8.3% 32.55 4.9% Source: Datamonitor.5% 0.05 0.0% 0.9% 1.72 22.04 0.6% 0.20 5.04 0.19 6.74 5.05 0.07 105.05 0.75 3.6% 34.18 4.5% 11.9% 1.58 0.96 25.3% 1.92 16.94 4. This brief is a licensed product and is not to be photocopied 03/2011 Page 163 .2% 18.52 3.04 0.33 0.08 124.05 0.09 3.33 6.05 0.53 37.06 0.20 14.70 4.89 3.07 122.25 4.2% 2005 1. 2005-09 Financial Ratios Current Ratio Quick Ratio Net Working Capital Ratio Return on Asset Return on Equity Net Income Margin Operating Margin (Return on Sales) Asset Turnover Ratio Inventory Turnover Ratio Receivable Turnover Ratio Debt to Equity Ratio Interest Coverage Ratio Dividend Per Share Earning Per Share Market to Book Ratio Price Earning Ratio Return on Capital Employed Long Term Debt Ratio Total Debt Ratio Dividend Yield Dividend Payout Enterprise Value / EBIT Enterprise Value / EBITDA CAPEX to Revenues 2009 1.47 1.42 9.28 0.58 1.92 1.5% 10.14 12.4% 17.5% 2008 1.84 0.98 0.11 40.89 3.2% 38. Financial and SWOT Analysis © Datamonitor.2% 2007 1.02 0.43 1.5% 35.17 5.61 3.38 0.7% 18.08 2.7% 1.86 11.11 17.04 0.5% 10.5% 10.10 19.23 0.36 13.4% 1.29 14.47 1.70 1.05 0.39 4.3% 6.13 17.1% 18.08 179.02 0.78 47.85 15.55 1.71 21.41 18.69 21.9% 2006 1.72 19.31 16.19 6.02 0.04 0.1% 0.Financial Analysis Table 10: Exxon Mobil Corporation: key industry-specific ratios.09 64.94 0.02 0.12 5.90 7.46 1. company reports DATAMONITOR Global Top 10 Energy Companies Report: Industry.02 0.1% 11.5% 0.12 18.3% 16.10 9.62 9.

780.0 (26.0% 11.3 109.550.510.3 5.9 324.730.861.570.0 145.0) 9.8% 9.2% 11.0) 11.8% 12.570.582.276.2% 9.0) (18.082.0 76.915.331.8 333.457.028.Financial Analysis Royal Dutch Shell Plc Table 11: Royal Dutch Shell: financial and operational highlights.191.0 8.741.0 (35. This brief is a licensed product and is not to be photocopied 03/2011 Page 164 .2% 4.116.308.034.3 NA NA NA % % % 17.113.5 17.750.1 101.3 533.1 1.3 104.592.741.2 522.488.0 (228.0 235.0 (8.000.384.0 8.152.0) 44.0 25.0 155.210.285.0 (5.4 2.4% 20.5 15.0 (285.529.0) (9.0 8.0 (17.6% 16.0 $ $ $ $ $ Million Million Million Million Million 96.0 (385.0 34.885.0) 15.964.7 70.4 1.0 (252.0) 54.8 102.7 3.0 61.0 31.8 446.121.0 (32.0 (28.0 129.0 (20.0 94.0 (262.7 52.0) 9.9% 28.063.5% 10.0) (829.892.9 7.470.8% 14.408.4% 25.0 31.1 1.401.726.0 116.3% 28.0 12.0) (13.4 12.104.7% Global Top 10 Energy Companies Report: Industry.618.885.356.0 8.812.525.787.3 4.0 14.181.3 60.394.3 84.2% 28.516.518.0 (19.0 136.7% NA NA NA % % % 9.0) 44.0 26.719.2 0.0) 49.222.782.0) 50.442.0) 70.0 NA $ $ $ NA $ Million Absolute Million Million Absolute Million 6.697.0 155.772.000.1% 5.002.573.000.924.789.0 6.188.0 458.209.5% 27.618.1 368.9 108.197.397.744.3 409.0 25.853.2 1.029.0 30.474.361.7 16.461.907.3% 11.6% 8.000.0 (14.0 355.3% 17.0 115. 2005–09 ($m) Parameters Income Statement Total Revenue Cost of Goods and Services Gross Profit Operating Expense Operating Income Net Income Balance Sheet Total Current Assets Total Assets Total Current Liabilities Total Liabilities Total Shareholders Equity Cash Flow Cash from Operating Activities Cash from Investing Activities Cash from Financing Activities Closing Cash Balance Key Statistics Total Common Shares Outstanding Year-end Share Price Market Capitalization Enterprise Value Number of Employees Free Cash Flow Key Ratios P/E Ratio Earnings per Share (EPS) EV/EBITDA EV/Sales Profitability Ratios Gross Margin Operating Margin Net Income Margin Resource Management Return on Equity Return on Capital Employed Return on Assets Financial Strength Currency Unit 2009 2008 2007 2006 2005 $ $ $ $ $ $ Million Million Million Million Million Million 278.0% 8.0 292.431.0 6.0 269.0 219.696.918.178.0 282.9% 7.0 91.0) 73.5 401.0 127.011.234.0 NA $ NA NA Absolute Absolute Absolute Absolute 29.393.0 $ $ $ $ Million Million Million Million 21.960.845. Financial and SWOT Analysis © Datamonitor.0) 56.0 318.0 9.731.6% 4.0 43.592.0) 9.000.7 5.0 6.0) (19.1 395.0 105.9% 28.0) 6.308.2% 33.989.0 84.358.122.0 90.0 (33.0 105.0 306.0 97.0 123.0 128.0% 17.0) 50.0 11.6 4.748.8% 14.8% 14.656.376.600.761.8% 19.9 462.188.0 84.0) 21.459.277.

548.645.0 61.0 32.0 39.0 3.0 80.9 43.2 2.014.018.210.4 10.4 10.0 51.7% 35065 6.750.004.1 NA NA NA $ $ Absolute Absolute Absolute Absolute Absolute 1.5% 26516 7.0 36.1 0.0 120.975.5 235.684.845.259.9% 24576 7.6 257.424.Financial Analysis Quick Ratio Interest Coverage Ratio Debt to Equity Ratio Operational Efficiency Asset Turnover Ratio Receivable Turnover Ratio Inventory Turnover Ratio Revenue per Employee Net income per Employee Other Capex to Revenues Capex Revenue by Segment Exploration and production Gas and power Oil sands Oil products Chemicals Corporate Upstream Revenues by Geography Europe The US Other Americas Rest of the world Africa. This brief is a licensed product and is not to be photocopied 03/2011 Page 165 .0 248.0 31.0 21.307.6 NA $ % Million 9.3 123.035.996.493.974.141.308.0 - 23.420.0 - 122.7 2.0 57.0 101. Asia.721.766.9 0.0 - $ $ $ $ $ Million Million Million Million Million 103.7 5.027.8 301.0 237.0 138.0 24.0 80.4 6.089.351.0 40.0 60.898.0 100.9 39.045.9 41.0 1. Australia/Oceania NA NA NA Absolute Absolute Absolute 0.0 27.9 235.1 1.8 10.574.3 0.0 767.952.818.0 16.5 0.0 87. Financial and SWOT Analysis © Datamonitor.735.0 136.8 39.388. company reports DATAMONITOR Global Top 10 Energy Companies Report: Industry.0 - Source: Datamonitor.1 0.940.0 16.9 15.0 184.5 2.0 90.666.809.0 45.9 45.980.754.2 0.0 33.814.2 1.889.2% 23096 5.268.970.6 1.306.398.8 1.9 9.0 14.1 0.5 12.159.2% 15916 $ $ $ $ $ $ $ Million Million Million Million Million Million Million 88.0 13.3 12.6 4.2 0.617.581.4 3.0 0.0 76.336.

33 8.03 4.14 41.77 3.32 10.0% 14.38 6.4% 9.7% 14.14 0.08 0.89 0.07 0.05 4.02 0.92 0.04 4.16 7.2% 0.5% 4.41 9.Financial Analysis Table 12: Royal Dutch Shell: key industry-specific ratios.29 10.62 3.70 29.74 10.1% 1.10 0.54 1.5% 20.33 28.93 4. Financial and SWOT Analysis © Datamonitor.43 6.22 17.2% 25.66 15.02 0.8% 0.8% 11.20 0.92 0.26 39.7% 2007 1.2% Source: Datamonitor.69 28.40 12.8% 0.45 5.19 10.29 4.97 9.10 0.2% 0.14 7.15 5.40 10.49 0.2% 1.4% 27.3% 9.2% 2005 1.55 12.65 11.57 8.81 0.55 28.06 7.66 33. This brief is a licensed product and is not to be photocopied 03/2011 Page 166 .3% 14.6% 1.41 10.9% 2006 1.03 0.17 0. Company reports DATAMONITOR Global Top 10 Energy Companies Report: Industry.2% 8.5% 2008 1.76 0.13 0.7% 28.17 1.03 0.94 0.97 1.09 9.29 2.10 0.06 0. 2005-09 Financial Ratios Current Ratio Quick Ratio Net Working Capital Ratio Return on Asset Return on Equity Net Income Margin Operating Margin (Return on Sales) Asset Turnover Ratio Inventory Turnover Ratio Receivable Turnover Ratio Debt to Equity Ratio Interest Coverage Ratio Dividend Per Share Earning Per Share Market to Book Ratio Price Earning Ratio Return on Capital Employed Long Term Debt Ratio Total Debt Ratio Dividend Yield Dividend Payout Enterprise Value / EBIT Enterprise Value / EBITDA CAPEX to Revenues 2009 1.29 0.55 4.15 0.9% 8.92 1.72 2.15 45.40 12.3% 0.9% 5.6% 0.0% 1.08 12.15 0.22 16.18 43.06 11.06 11.89 0.04 2.22 0.03 0.21 5.41 15.10 0.6% 7.04 9.84 18.06 0.15 38.36 6.87 0.55 5.07 1.

6 179.43 0.0) 55.937.0) (9.0) 27.0) 59.653.0 77.0 (224.0 (1.0) 2.5% 27.0 75.6 142.90 10.0 (31.2% 9.0 93.0 18.6 206.578.000 10.9% 22.0 75.Financial Analysis BP Plc Table 13: BP: financial and operational highlights.5% 23.071.0) 33.355.320.0) 2.6% 25.0 236.3 232.729.923 12.026.1 5.730 7.202.837.738.22 0.56 0.2 238.2 96.174.977.076.72 1.0 (22.92 9.241.0 127.0 (9.906.0 235.347.0) 3.0 (18.0 361.0 NA $ NA NA Absolute Absolute Absolute Absolute 10.436.0) 55.1 260.0 84.430.0% 14.012.035.0 91.997.0 66.352.7% 10.7 221.0 24.0 $ $ $ $ Million Million Million Million 27.0) 8.572.339.0 (184.968.974.0 18.601.0 26.2% 15.935.74 1.6 80.767.1% 6.0 217.384.462.0) 52.1 5.0 (186.0 284.709.649. 2005–09 ($m) Parameters Income Statement Total Revenue Cost of Goods and Services Gross Profit Operating Expense Operating Income Net Income Balance Sheet Total Current Assets Total Assets Total Current Liabilities Total Liabilities Total Shareholders Equity Cash Flow Cash from Operating Activities Cash from Investing Activities Cash from Financing Activities Net Change in Cash Key Statistics Total Common Shares Outstanding Year-end Share Price Market Capitalization Enterprise Value Number of Employees Free Cash Flow Key Ratios P/E Ratio EPS EV/EBITDA EV/Sales Profitability Ratios Gross Margin Operating Margin Net Profit Margin/(loss) Resource Management Return on Equity Return on Investments Currency Unit 2009 2008 2007 2006 2005 $ $ $ $ $ $ Million Million Million Million Million Million 239.509.0 16.374.2 92.0) 67.0 (293.81 0.303.095.0 21.590.9% 23.0 239.172.716.409.1% 8.690.0 265.47 11.898.845.252.9% 11.0 75.315.0 80.760 9.046.0) 34.793.386.476.661.365.99 NA NA NA % % % 21.15 1.0) 36.298.0 206.0 22.0 38.300 7.941.0 (210.9% 11.068.100 4.56 0.7% 7. Financial and SWOT Analysis © Datamonitor.405.000 7.624.0) (10.1 216.0) 34.0 19.8% 13.0 71.339.960.0) 8.721.0% 20.0 (32.991.657 10.4% 20.562.1 3.5% 22.284.881.0 22.407.0 69.792.551.395.143.0 20.1 5.198.2% 24.0 136.0 228.86 6.0 (14.261.0 (36.3% Global Top 10 Energy Companies Report: Industry.0 132.0 79.253.0 101.4% 7.0% 27.0 134.0 (28.0 NA $ $ $ NA $ Million Absolute Million Million Absolute Million 18. This brief is a licensed product and is not to be photocopied 03/2011 Page 167 .272.232.238.0% 18.0) (9.7 239.200 12.258.4% 21.0 28.0 $ $ $ $ $ Million Million Million Million Million 67.0) (19.914.157.618.133.1 98.0 (26.360.197.3% NA NA % % 17.05 1.510 11.518.613.7 97.95 0.0 142.0 59.0 20.084.2 168.9 5.231.290.303.171.0) (23.

319.4 206.555.149.031.34 0.773.0 155. Company reports DATAMONITOR Global Top 10 Energy Companies Report: Industry.0 93.25 8.34 2.975.8 229.0 230.24 NA NA NA $ $ Absolute Absolute Absolute Absolute Absolute 1.16 7.1% 9. power and renewables Innovene operations Revenues by Geography UK Rest of Europe US Rest of world Non US NA % 7.5% 10.0 - 61.086.0 22.309.5 1.0 212.76 24.28 0.89 0.779.960. Financial and SWOT Analysis © Datamonitor.5% 30.725.967.0 54.93 13.65 0.925.0 - 49.0 19.6% NA NA NA Absolute Absolute Absolute 0.231.0 1.0 3.903.05 10.0 - 40.79 0.0 5.307.641.342.0 - 16.239.652.0 6.0 - 14.0 2.604.085.60 0.0 81.467.376.898.0 73.50 0.25 8.Financial Analysis Return on Assets Financial Strength Quick Ratio Interest Coverage Ratio Debt to Equity Ratio Operational Efficiency Asset Turnover Receivable Turnover Inventory Turnover Revenue per Employee Net income per Employee Other Capex to Revenues Capex Revenues by Segment Exploration and production Refining and marketing Other businesses and corporate Gas.0 2.0 $ $ $ $ $ Million Million Million Million Million 25.0 (12.0 43.0) $ $ $ $ $ Million Million Million Million Million 83.0 1.783.700.982.364.88 2.0 54.601.0 61.0 13.0 - 33.657.290.3 228.044.0 228.051.52 9.2% 10.90 2.919.14 9.229.33 0.640.56 12.429.71 23.0 8.0 7.487.299.36 0.149.947.726.03 10.979.5 2.8 212.401.3% 20.492.0 82.689.77 44.044.741.576.0 102.0 - 54.011.0 318.48 1. This brief is a licensed product and is not to be photocopied 03/2011 Page 168 .0 94.5% 17.450.69 9.75 48.009.69 23.4 NA $ % Million 8.0 - Source: Datamonitor.0 201.0 123.5% 20.480.0 54.0 248.121.0 66.54 1.1% 9.9% 14.3 1.957.

56 6.13 1.48 11.60 0.76 10.06 0. 2005–09 Financial Ratios Current Ratio Quick Ratio Net Working Capital Ratio Return on Asset Return on Equity Net Income Margin Operating Margin (Return on Sales) Asset Turnover Ratio Inventory Turnover Ratio Receivable Turnover Ratio Debt to Equity Ratio Interest Coverage Ratio Dividend Per Share Earning Per Share Market to Book Ratio Price Earning Ratio Return on Capital Employed Long Term Debt Ratio Total Debt Ratio Dividend Yield Dividend Payout Enterprise Value / EBIT Enterprise Value / EBITDA CAPEX to Revenues 2009 1.79 0.03 0.05 0.4% 1.15 21.76 0.50 0. Financial and SWOT Analysis © Datamonitor.07 2.6% 27.5% 2008 0.05 25.9% 6.77 0.34 6.2% 23.63 7.4% 11.00 10.54 12.90 8.78 10.08 0.63 3.25 9.53 5.33 6.3% 2006 1.03 0.5% 2007 1.14 0.43 1.5% 0.6% 9.39 1.95 7.39 7. company reports DATAMONITOR Global Top 10 Energy Companies Report: Industry.55 1.49 4.75 0.9% 0.25 10.2% 8.0% 0.65 0.56 9.2% 7.88 1.3% 0.3% 14.21 0.4% 7.0% 11.89 0.03 9.56 8.95 0.20 0.43 6.5% 13.52 0.14 0.99 5.Financial Analysis Table 14: BP: key industry-specific ratios.5% 2005 1.34 7.08 0.10 2.17 0.72 24.71 -0. This brief is a licensed product and is not to be photocopied 03/2011 Page 169 .56 5.74 22.04 7.9% Source: Datamonitor.05 0.5% 0.48 10.20 0.36 1.00 0.24 44.88 8.14 0.69 0.93 0.1% 17.5% 27.1% 1.36 23.1% 22.2% 1.34 24.28 48.01 9.0% 10.56 0.7% 1.07 0.01 9.84 5.56 13.33 23.02 10.81 15.22 8.1% 1.04 0.10 0.14 2.85 5.11 0.04 0.69 0.14 0.16 9.

1) 11.702.7 NA $ $ $ NA $ Million Absolute Million Million Absolute Million 86.377.976.128.187.1 172.4 0.9% 1.702.203.662.4 86.829. 2005–09 ($m) Parameters Income Statement Total Revenue Cost of Goods and Services Gross Profit Operating Expense Operating Income Net Income Balance Sheet Total Current Assets Total Assets Total Current Liabilities Total Liabilities Total Shareholders Equity Cash Flow Cash from Operating Activities Cash from Investing Activities Cash from Financing Activities Closing Cash Balance Key Statistics Total Common Shares Outstanding Year-end Share Price Market Capitalization Enterprise Value Number of Employees Free Cash Flow Key Ratios P/E Ratio Earnings per Share (EPS) EV/EBITDA EV/Sales Profitability Ratios Gross Margin Operating Margin Net Income Margin Resource Management Return on Equity Return on Capital Employed Currency Unit 2009 2008 2007 2006 2005 $ $ $ $ $ $ Million Million Million Million Million Million 192.9 (126.4 135.9) 25.005.0% 5.3 0.027.7 24.1 (38.5 7.7 128.0 32.100.528.7 117.6 48.884.8% 16.724.0) (778.658.9 14.1 8.4 73.333.477.3 115.0 114.0 21.8 0.0 1.560.9 (20.6) (711.1 5.3% 17.Financial Analysis China Petroleum & Chemical Corporation (Sinopec) Table 15: China Petroleum & Chemical Corporation (Sinopec): financial and operational highlights.2% Global Top 10 Energy Companies Report: Industry.4% 4.012.0 (18.5) (5.8 1.3) 421.1 (16.9 89.7 86.118.4% 21.365.886. This brief is a licensed product and is not to be photocopied 03/2011 Page 170 .304.8) 1.9 9.928.5 11.157.5 (15.0 6.8 9.700.950.1 4.9 371.0% 9.072.3% 19.562.653.5 8.1 38.315.071.5) 86.378.4 47.7 62.903.702.9 0.5) 20.7 NA NA NA % % % 23.162.179.2) 46.182.7 $ $ $ $ $ Million Million Million Million Million 29.9 1.858.7 0.6% 15.8 38.3 115.026.554.8% 5.166.132.926.054.8% 18.3% 5.610.8 21.6 35.4 1.104.4 (25.0 NA $ NA NA Absolute Absolute Absolute Absolute 19.4 42.6% NA NA % % 17.1 319.7 364.7% 8.0 80.4 358.1 21.8 55.5) 12.5% 18.3 50.409.702.3 13.9 (15.169.4 3.811.3 151.261.0 (6.790.1 10.3% 7.0 10.5 6. Financial and SWOT Analysis © Datamonitor.7 59.757.7 (17.062.494.7 (189.821.4 45.4) 12.467.1 31.277.568.234.722.752.412.235.4 (96.0 89.9 (143.1 0.3 205.139.4 17.5% 5.766.8 25.1 45.754.3 (146.415.6 207.533.288.8 86.509.4 2.2) 6.3 78.9 340.035.5) 1.3 0.128.8 27.9% 8.4 297.9 1.249.6 66.624.189.9% 6.511.588.702.861.0) 28.124.234.062.2) 10.077.2) 2.1 16.8 0.075.9 107.7 334.538.8 $ $ $ $ Million Million Million Million 22.1 179.295.4 1.774.0 (11.424.4 9.4% 18.0 1.7 (16.8 0.7% 7.027.9% 20.800.0 2.282.352.148.0% 16.4 1.476.2) 3.3) 17.4% 1.

7% 15.8 (217.3 17.9 1.237.9 $ $ $ $ $ Million Million Million Million Million 2.4 0.2 117.256.8 86. company reports DATAMONITOR Global Top 10 Energy Companies Report: Industry.3 2.4% 9.021.2 2.3 11.1 11.3 24.6) (317. This brief is a licensed product and is not to be photocopied 03/2011 Page 171 .251.922.213.7 14.5 8.835.9 31.0 16.3 321.2 (518.9 (175.384.9 3.672.033.870.2 0.1 (3.6% NA NA NA % % % 0.1 114.095.1 1.880.3 1.5 0.7 (9.0 7.950.021.0% 9.5 54.8 16.6 34.8 23.8% 8.3 1.336.4 2.6 24.089.4 0.7 0.442.6 23.1 17.7 28.0 3.9 23.3 (1.4 11.6 9.671.432.6 7.044.190.053.301.517.7 61.787.8 69.338.9 19.7 (224.Financial Analysis Return on Assets Financial Strength Quick Ratio Interest Coverage Ratio Debt to Equity Ratio Operational Efficiency Asset Turnover Ratio Receivable Turnover Ratio Inventory Turnover Ratio Revenue per Employee Net income per Employee Other Capex to Revenues Capex Revenue by Segment Exploration and production Refining Marketing and distribution Chemicals Corporate and others Operating Income by Segment Exploration and production Refining Marketing and distribution Chemicals Corporate and others NA % 7.6 66.383.9 1.6 12.769. Financial and SWOT Analysis © Datamonitor.2 578.8 NA $ % Million 8.4) 1.550.933.2 11.3 4.759.140.696.4 0.1% 12.739.665.196.5% 3.691.149.2 11.647.6 2.880.8 67.532.3) 4.5) 5.5 9.455.3 $ $ $ $ $ Million Million Million Million Million 2.572.8 8.6 (1.086.996.870.3 11.2 2.4 0.3) 9.336.129.3 514.5 0.4% 16.996.3% 16.8 1.819.9 28.9 96.9 33.1 (323.0 2.7) 7.9 78.119.1 12.0 32.898.4) 9.4 0.329.4) 5.5 9.0 8.263.383.209.4 519.2% 7.6) 7.701.5 NA NA NA $ $ Absolute Absolute Absolute Absolute Absolute 1.123.6) Source: Datamonitor.4 445.

33 -0.93 18.46 7.75 20. company reports DATAMONITOR Global Top 10 Energy Companies Report: Industry.44 29.3% 2006 0.45 11.25 25.50 11.8% 5.82 5.21 78.3% 1.01 0.6% 18.16 0.4% 1.02 0.1% 2005 0.4% 2008 0.78 9.09 8.42 11.6% 4.02 0.36 0.10 6.85 9.0% 7.9% 5.30 0.99 14.57 0.8% 9.03 0.84 0. Financial and SWOT Analysis © Datamonitor.63 10.78 15.19 -0.02 0.31 61.2% 21.05 1.34 5.49 0.87 12.10 3.07 1.35 69.21 11.4% 0.01 0.34 0.58 0. 2005–09 Financial Ratios Current Ratio Quick Ratio Net Working Capital Ratio Return on Asset Return on Equity Net Income Margin Operating Margin (Return on Sales) Asset Turnover Ratio Inventory Turnover Ratio Receivable Turnover Ratio Debt to Equity Ratio Interest Coverage Ratio Dividend Per Share Earning Per Share Market to Book Ratio Price Earning Ratio Return on Capital Employed Long Term Debt Ratio Total Debt Ratio Dividend Yield Dividend Payout Enterprise Value / EBIT Enterprise Value / EBITDA CAPEX to Revenues 2009 0.11 9.25 7.11 8.75 9.5% 5.51 2.0% Source: Datamonitor.35 16.65 0.21 0.02 0.8% 1.61 35.25 19.05 7.44 0.2% 0.13 7.9% 6.40 8.85 7.0% 0.35 54.30 0.68 0.92 10.24 -0.26 -0.74 0.18 0.09 2.16 3.48 0.52 0.3% 0.30 0.7% 2007 0.3% 7.34 8.86 21.63 0.19 0.02 0.9% 1.5% 17. This brief is a licensed product and is not to be photocopied 03/2011 Page 172 .45 11.5% 1.02 0.22 16.80 9.70 0.18 0.0% 1.46 8.6% 8.Financial Analysis Table 16: China Petroleum & Chemical Corporation (Sinopec): key industry-specific ratios.01 0.19 0.64 0.43 66.27 0.59 8.8% 1.4% 19.4% 0.75 18.24 -0.

514.0 191.883.806.070.6 14.7 67.3 (15.4 (14.476.274.9 (155.5 (61.1) 21.1 72.2% 11.232.9% 22.6% 16. Table 17: TOTAL S.652.3) 94.6 73.619.0 4.8 54.998.105.959.457.9% 13.: financial and operational highlights.8) 16.999.0 (1.8 90.0 7.1% 17.8 (14.346.999.0 146.5 5.1% 30.6% 28.2 184.684.7) 33.6 46.4% 11.019.8 112.412.0 64.177.7 49.264.2 26.9% 49.4) 97.3 NA NA NA % % % 45.8% 15.425.6 (60.3 6.5% 45.310.496.5 164.4 96.9) 95.706.442.9 56.5 0.986.1 (64.5 18.3) 2.8 1.672.8 17.3 95.9 (97.665.3 96.8 20.862.4 104.4 95.1% 15.655.6 2.183.870.7 4.8 5.373.1 1.5) (7.3 $ $ $ $ $ Million Million Million Million Million 69.1 221.844.8 76.515.031.6 214.533.5% 6.3 (123.9 8.1) (3.1% 30.9) 8.034.382.1) 83.3 189.2) (10.330.2 158.092.379.4 62.9 (62.325.0 22.5 0.3 59.5 96.0 8.8 44.3 7.560.718.0 615.877.7 6.1% 33.747.497.6 210.1% 44.9 11.750.2 148.2 3.022.6% 9.2 (13.348.6 27.3 146.9 61.4 250.285.320.910.6% Global Top 10 Energy Companies Report: Industry.116.2% 6.186.168.3 209.433.3 56.399.6) (1.4 16.073.0 5.065.660.8 147.2% 6.2 47.036.0 5.6 10.7 $ $ $ $ Million Million Million Million 17.2% NA NA NA % % % 16.673.5 0.400.4 62.013.865.208.6% 37.6 (14.2 24. This brief is a licensed product and is not to be photocopied 03/2011 Page 173 .222.2 46.097.2% 9.6 (100.628.2% 33.6 2.0 68.6 178.351.062.5 79.0 (62.7) 98. Financial and SWOT Analysis © Datamonitor.8) (4.A.347.787.Financial Analysis TOTAL S.5 169.9 96.371.0 NA $ $ $ NA $ Million Absolute Million Million Absolute Million 2.9% 8.681.9) 17.317.780.290.1% 29.7 47.735.873.688.9% 32.7% 11.417.0 2.5% 12. 2005–09 ($m) Parameters Income Statement Total Revenue Cost of Goods and Services Gross Profit Operating Expense Operating Income Net Income Balance Sheet Total Current Assets Total Assets Total Current Liabilities Total Liabilities Total Shareholders Equity Cash Flow Cash from Operating Activities Cash from Investing Activities Cash from Financing Activities Closing Cash Balance Key Statistics Total Common Shares Outstanding Year-end Share Price Market Capitalization Enterprise Value Number of Employees Free Cash Flow Key Ratios P/E Ratio Earnings per Share (EPS) EV/EBITDA EV/Sales Profitability Ratios Gross Margin Operating Margin Net Income Margin Resource Management Return on Equity Return on Capital Employed Return on Assets Financial Strength Currency Unit 2009 2008 2007 2006 2005 $ $ $ $ $ $ Million Million Million Million Million Million 183.706.095.152.4) 35.3 128.9 (116.0) 3.7 91.4) 33.902.8 0.399.8) 33.6 65.2) 6.A.395.769.877.352.392.9 NA $ NA NA Absolute Absolute Absolute Absolute 12.987.4 11.079.387.237.7% 7.

2 1.0 14.8 1.616.702.8 2.0 5.0 19.022.5 8.5 6.199.5 140.0 1.7 6.5 172.8) 32.0 1.5 1.3 24.0 (627.299.1) 25.683.8 102.801.9 19.3 7.900.922.727.1 1.482.220.101.381.986.5 8.620.6) 28.7 0.700.1 23.5 60.347.633.2 152.256.295.7% 16.5 1.529.8 4.152.4 28.6% 19.2 115.414.371.6 18.4 NA NA NA $ $ Absolute Absolute Absolute Absolute Absolute 1.7 151.6 166.199.7 1.0 28.6 10.722.131.323.537.320.807.2% 18.9 2.924.4 52.2 2.729.4% 16.7 17.9 7.844.8 7.560.421. company reports DATAMONITOR Global Top 10 Energy Companies Report: Industry.7 1.4 0.237.3 15.7 - 47.8 37.6 40.5 6.5 27.Financial Analysis Quick Ratio Interest Coverage Ratio Debt to Equity Ratio Operational Efficiency Asset Turnover Ratio Receivable Turnover Ratio Inventory Turnover Ratio Revenue per Employee Net income per Employee Other Capex to Revenues Capex Revenue by Segment Upstream Downstream Chemicals Corporate Operating Income by Segment Upstream Downstream Chemicals Corporate Revenues by Geography France Rest of Europe North America Africa Asia Pacific and rest of world Rest of world NA NA NA Absolute Absolute Absolute 1.389.828.3 11.3 122.5 1.176.5 0.8 28.9 $ $ $ $ Million Million Million Million 17.588.3 74.1 8.185.407.1 189.9) (765.9 - Source: Datamonitor.5 33.873.7 1.107.608.2 3.655.0 32.863.005.1% 15.5 0. This brief is a licensed product and is not to be photocopied 03/2011 Page 174 .3 33.2 8.9 29.2 31.1 (760.9 99.0 139.5 7.678.447.6 27.505.6 (651.929.0 27.6 83.8 64.6 17.066.9 0.0 23.9 $ $ $ $ Million Million Million Million 22.0 (80.2 0.9 13.630.828.830.612.3 6.5 1.932.119.269.4 190.815.2 26.256.581.4 20.6 27.5 9.690.093. Financial and SWOT Analysis © Datamonitor.173.527.2 51.179.9 13.636.3) $ $ $ $ $ $ Million Million Million Million Million Million 45.7) 27.2 (730.5 NA $ % Million 10.0 14.007.9 0.9 7.2 27.8 771.0 13.983.4 14.2 158.

28 0.34 5.26 5.03 10.51 7.46 0.2% 17.20 0.33 32.02 0.2% 0.2% 2008 1.1% 13.6% 1.03 0.9% 15.95 4.51 16.93 0.19 0.34 6.30 6.03 0.93 0.47 0.03 5.94 2.08 7.2% 9.7% 2005 1.6% 6.31 0.46 6.01 12.9% 16.25 0.53 10.60 8.1% 30.91 6.77 3.09 0.28 0.30 5.92 1.11 12.46 10.11 9.67 3.4% 2006 1.: key industry-specific ratios.43 3.69 2. This brief is a licensed product and is not to be photocopied 03/2011 Page 175 .45 6.11 0.6% 11.54 3.2% 0.47 4.28 0.5% 1.50 13.43 14.1% Source: Datamonitor.82 7.83 0.2% 0. Financial and SWOT Analysis © Datamonitor.63 7.11 8.02 5.24 0.09 11.02 2.19 2.53 8.35 0.1% 22.91 7.19 0.29 11.49 23.6% 6.1% 7.69 0.21 0.37 1.05 0.5% 0.12 6.45 1.2% 1.6% 30.52 7.05 0.A.Financial Analysis Table 18: TOTAL S.55 9.07 6.79 2. company reports DATAMONITOR Global Top 10 Energy Companies Report: Industry.9% 1.19 0.6% 2007 1.83 8.29 1.27 33.96 27.50 28.7% 1.96 0. 2005–09 Financial Ratios Current Ratio Quick Ratio Net Working Capital Ratio Return on Asset Return on Equity Net Income Margin Operating Margin (Return on Sales) Asset Turnover Ratio Inventory Turnover Ratio Receivable Turnover Ratio Debt to Equity Ratio Interest Coverage Ratio Dividend Per Share Earning Per Share Market to Book Ratio Price Earning Ratio Return on Capital Employed Long Term Debt Ratio Total Debt Ratio Dividend Yield Dividend Payout Enterprise Value / EBIT Enterprise Value / EBITDA CAPEX to Revenues 2009 1.9% 8.10 11.93 8.23 1.44 19.7% 0.28 0.31 0.62 33.04 0.5% 15.1% 29.88 8.71 28.

373.165.566.452.323.3 195.0 67.0 $ $ $ $ $ Million Million Million Million Million 37.574.0% 31.0) 18.0 25.440.8 0.0 147.1 0.628.9 2.0) 32.6 10.0 8.8 126.497.2% 13.7% 13.402.2 11.0 33.5% 13.347.7 NA NA NA % % % 39.0 148.716.0) (10.966.6 73.500.3% 15.409.510.4% 33.106.546.0) 8.8% 15.004.0 36.0 193.668.0 32.775.0 18.0) 92. 2005–09 ($m) Parameters Income Statement Total Revenue Cost of Goods and Services Gross Profit Operating Expense Operating Income Net Income Balance Sheet Total Current Assets Total Assets Total Current Liabilities Total Liabilities Total Shareholders Equity Cash Flow Cash from Operating Activities Cash from Investing Activities Cash from Financing Activities Closing Cash Balance Key Statistics Total Common Shares Outstanding Year-end Share Price Market Capitalization Enterprise Value Number of Employees Free Cash Flow Key Ratios P/E Ratio Earnings per Share (EPS) EV/EBITDA EV/Sales Profitability Ratios Gross Margin Operating Margin Net Income Margin Resource Management Return on Equity Return on Capital Employed Return on Assets Financial Strength Currency Unit 2009 2008 2007 2006 2005 $ $ $ $ $ $ Million Million Million Million Million Million 167.090.0 (11.0 2.0) 10.0 161.6% 28.0 (134.0 (12.0 264.517.493.2 74.4% 6.105.832.798.483.515.0 (48.693.1% 15.2% 33.0 (43.023.722.0) 32.711.0 14.0 63.0) 43.3% 26.848.304.0 34.9 6.0 NA $ NA NA Absolute Absolute Absolute Absolute 14.0 11.698.081.0 (172.935.0 86.043.0 125.768.676.0 (100.9% 8.2% Global Top 10 Energy Companies Report: Industry.0 39.216.561.0 91.3% 34.160.0 77.707.088.0 (17.382.572.0 164.0 (128.057.0) 66.0 (13.632.892.0 28.392.749.0 (470.1% 37.0 24.0 74.9 9.400.0 62.3% 9.0 26.9% 16.1% 6.011.8 9.5% 25.377.632.3% NA NA NA % % % 11.2 194.138.9 4.958.7 56.0 71.0 (16.3 4.0) 75.556.4% 29.0) 7.3% 22.995.1 0.3% 7.362.930.0) (11.0 24.641.718.0 20.2% 13.648.0) (3.0 214.459.0 36.0 (57.000.000.933.4% 25.000.Financial Analysis Chevron Corporation Table 19: Chevron Corporation: financial and operational highlights. Financial and SWOT Analysis © Datamonitor.091.3 7.2 65.211.0 (52.7 0.0) 64.2% 8.0) 25.977.914.0 62.085.0 2.9 4.0) (14.931.6 129. This brief is a licensed product and is not to be photocopied 03/2011 Page 176 .935.0 148.5 64.7 5.007.7% 11.4 93.100.219.0 NA $ $ $ NA $ Million Absolute Million Million Absolute Million 2.0) 9.0 (53.0) 10.833.0 2.5 159.0 158.0 63.440.253.299.0 (129.0) 79.0 132.0 10.377.7 77.6 59.2 5.0 204.0 $ $ $ $ Million Million Million Million 19.336.0 68.0 0.621.0 6.0 72.0 154.0 23.0) 2.404.0) (7.232.407.099.714.0 10.688.157.164.4 8.786.5 156.8% 36.0 17.295.0 9.000.6% 11.0 29.

3 3.8% 16.285.954.489.0 (23.5 11.0 178.813.5% 8.0 170.854.272.959.2 NA NA NA $ $ Absolute Absolute Absolute Absolute Absolute 1.0 4.Financial Analysis Quick Ratio Interest Coverage Ratio Debt to Equity Ratio Operational Efficiency Asset Turnover Ratio Receivable Turnover Ratio Inventory Turnover Ratio Revenue per Employee Net income per Employee Other Capex to Revenues Capex Revenue by Segment Upstream Downstream Chemicals All other Intersegment sales Revenues by Geography The US International Intersegment revenues NA NA NA Absolute Absolute Absolute 1.0 195.7 287.328.748.788.799.293.0 3.282.0 1.0 7.0) 65.0 (30.0 1.1 1.318.615.0 10.764.0) $ $ $ Million Million Million 84.0 112. This brief is a licensed product and is not to be photocopied 03/2011 Page 177 .0 (30.6 11.274.0) 59.843.585.1 0.0 (32.0) 133.796.8 29. Financial and SWOT Analysis © Datamonitor.0) 105.1 0.2 53.0) 104.0 166.0 219.707.0 $ $ $ $ $ Million Million Million Million Million 51.1 1.0 1.0 16.0 (32.145.0 2.656.050.167.4% 19.631.9 357.4 1.0 1.0 128.713.0 6.0 1.0 172.0 1.893.969.0 (41.198.278.304.3 31.5 10.0 142.0) Source: Datamonitor.537.1 2.374.9 NA 0.2 3.701.966.969.0 138.2 662.817.0 7.0 (28.606.208.8 28.1 72.701.788.678.3 1.179.507.5 3.374. company reports DATAMONITOR Global Top 10 Energy Companies Report: Industry.0) 82.4 0.0 1.221.0 (28.0 113.0) 108.0 (23.764.7 0.829.938.238.0) 48.1 NA $ % Million 11.285.8 238.482.967.658.181.0 274.597.0 163.5 0.170.1 1.9% 19.7 27.0 (41.7 13.0 1.7 1.666.0 1.578.0 1.7% 13.

6% 8.07 0.20 53.02 0.37 1.23 11.04 13.96 6.94 1.48 1.02 10.93 0.26 4.07 0.03 15.7% 6.92 2.51 8.2% 1.05 0.Financial Analysis Table 20: Chevron Corporation: key industry-specific ratios.11 11.09 195.12 0.51 11.09 4.5% 7.73 7.3% 0.06 2.54 31.88 3.14 72.09 0.20 33.7% 2005 1.0% 8.68 0.07 0.44 28.11 662.99 25. This brief is a licensed product and is not to be photocopied 03/2011 Page 178 .84 0.15 0.5% Source: Datamonitor.28 1.04 0.9% 2008 1.03 7.29 8.00 4.75 13.71 2.81 7.31 2.8% 15.10 NA 2.45 5.03 0.21 0.27 0.42 1.53 10.17 1.3% 1.07 11.3% 26.02 4.77 0.07 0.98 0.31 9.3% 25.2% 9.6% 0.2% 0.1% 16.42 2.69 6.29 31.2% 0.02 8. company reports DATAMONITOR Global Top 10 Energy Companies Report: Industry.9% 1.4% 29.03 0.58 11.3% 13.11 0.68 14.26 6.71 6.94 2.12 0.31 9.01 0. 2005–09 Financial Ratios Current Ratio Quick Ratio Net Working Capital Ratio Return on Asset Return on Equity Net Income Margin Operating Margin (Return on Sales) Asset Turnover Ratio Inventory Turnover Ratio Receivable Turnover Ratio Debt to Equity Ratio Interest Coverage Ratio Dividend Per Share Earning Per Share Market to Book Ratio Price Earning Ratio Return on Capital Employed Long Term Debt Ratio Total Debt Ratio Dividend Yield Dividend Payout Enterprise Value / EBIT Enterprise Value / EBITDA CAPEX to Revenues 2009 1.3% 1.03 16.3% 11.06 0.4% 0.71 28.59 29.03 0.8% 2006 1.1% 1.21 0.44 2.03 0.06 13.64 5.2% 22.52 27.07 6.4% 15.27 5.4% 11.37 13.4% 2007 1.22 3.22 1. Financial and SWOT Analysis © Datamonitor.

7 (38.1 183.888.372.527.0 11.502.1% 25.435.8 88.0 0 0.021.414.0 7.Financial Analysis PetroChina Company Limited Table 21: PetroChina Company Limited: financial and operational highlights.0 4.5 NA $ NA NA Absolute Absolute Absolute Absolute 24.325.1 0.867.8 156.6 (13.285.508.561. Financial and SWOT Analysis © Datamonitor.0) 29.727.955.072.3% 24.3 0.012.517.0 0.0 370.465.511.9 1.0 646.3 34.5 (85.6 837.924.9 38.2 38.5 NA $ $ $ NA $ Million Absolute Million Million Absolute Million 183.311.6% 13.532.783.5 108.2 75.740.136.7 115.9% 28.1 29.0 7.7) 7.1% 22. 2005–09 ($m) Parameters Income Statement Total Revenue Cost of Goods and Services Gross Profit Operating Expense Operating Income Net Income Balance Sheet Total Current Assets Total Assets Total Current Liabilities Total Liabilities Total Shareholders Equity Cash Flow Cash from Operating Activities Cash from Investing Activities Cash from Financing Activities Closing Cash Balance Key Statistics Total Common Shares Outstanding Year-end Share Price Market Capitalization Enterprise Value Number of Employees Free Cash Flow Key Ratios P/E Ratio Earnings per Share (EPS) EV/EBITDA EV/Sales Profitability Ratios Gross Margin Operating Margin Net Income Margin Resource Management Return on Equity Return on Capital Employed Return on Assets Financial Strength Currency Unit 2009 2008 2007 2006 2005 $ $ $ $ $ $ Million Million Million Million Million Million 149.6 2.3) 21.220.7 (27.1 (42.0 1.7 25.9) 28.5 80.203.1 0.781.0 38.6 12.5 539.1 0.4 127.5 0.6 157.855.4) 23.1 41.6 0.9 439.851.021.7 (23.0 114.304.1 (21.0 NA NA NA % % % 49.0 122.5% 14.7 56.0) (6.0 (6.8% 14. This brief is a licensed product and is not to be photocopied 03/2011 Page 179 .3 175.2 $ $ $ $ $ Million Million Million Million Million 43.1) 29.5% 45.090.2% 23.861.1 25.6 183.065.3 6.390.1 86.3 (31.617.8) 58.380.7 (57.8% 15.3) 74.228.947.5 830.6) 11.350.9% 34.394.230.4 477.7% 60.0 3.4 124.174.051.594.2 19.1 7.880.962.8% 17.6 446.0 2.194.1% 10.2 (29.552.024.207.304.6% 17.554.6 (53.6 29.6 294.651.8 26.159.946.1 23.1% Global Top 10 Energy Companies Report: Industry.435.011.045.1 30.1 21.7% 21.6) 553.2 (49.2) 49.8% 28.157.8% 53.5) 183.0 0.8 0.331.979.1) (239.200.407.0 466.6) 7.744.828.7 16.424.788.6) 65.780.5 212.891.6% 57.0 3.7 4.2 29.360.9% 11.0 401.9 183.515.9% 30.0% 17.119.3% NA NA NA % % % 12.0 101.426.043.1 0.979.9 (75.965.8% 25.3 15.860.021.5% 7.1% 15.0 21.2% 25.2 0.1 11.5) (10.1 (31.021.030.0% 18.0) 10.2 (35.502.4 22.9 48.021.415.3 20.0 0 0.1% 10.780.1 59.2 $ $ $ $ Million Million Million Million 38.4 32.7 16.626.3) 71.5 272.477.290.211.254.236.250.533.025.

9) 1.7 4.418.0 0.980.2 0.9 60.1 3.036.0 0.170.8 0.297.5 35.7 5.332.3 77.7) 741.756.317.7 28.084.9 3.6 (2.445.0 0.119.6 4.715.0 0.0 4.3 466.422.8 106.6 21.233.2 20.4) 30.101.504.031.2 0.931.3 (1.3) 480.0 0.6% 21.909.7 55.7 262.0 46.335.6 89.0 $ $ $ $ $ $ $ Million Million Million Million Million Million Million 15.1 97.7 13.6 33.8 118.0 9.6 6.4 184.560.9 61.344.0 0.739.944.7 22.6% 18.9 0.3 24.5 52.1 156.396.2 (13.1 (1.6 0.3 0.0 2.371.721.111.8 0.255.5 6.135.7 0.0 8.1 $ $ $ $ $ $ $ Million Million Million Million Million Million Million 14.8 21.1 1.0 44.7 0.1 NA NA NA $ $ Absolute Absolute Absolute Absolute Absolute 0.761.8 44.3 0.1 73.7 (4.0 (3.981.Financial Analysis Quick Ratio Interest Coverage Ratio Debt to Equity Ratio Operational Efficiency Asset Turnover Ratio Receivable Turnover Ratio Inventory Turnover Ratio Revenue per Employee Net income per Employee Other Capex to Revenues Capex Revenue by Segment Exploration and production Refining and marketing Chemicals and marketing Natural gas and pipeline Other Marketing Refining and chemicals Operating Income by Segment Exploration and production Refining and marketing Chemicals and marketing Natural gas and pipeline Other Marketing Refining and chemicals Revenues by Geography China Other NA NA NA Absolute Absolute Absolute 0.7 119.0 $ $ Million Million 115.537.8 13.5 27.5 0.0 2.7 69.3 3.1% 31.7) 0.534.7 NA $ % Million 25.7 17.0 0.8% 26.7 0.450.8 3.641.7 18.0 46.299.1 0.7 35.3 120.148.436.7 163.0 30.8 4.926.0 32.0 0.8 105.0 107. Financial and SWOT Analysis © Datamonitor.4 (991.7 (375.2 0.515.0 11.1 Source: Datamonitor.845.2 226.275.0) 0.4 182.5 61.882.6 1.1 0.143.7 36.904.1 57.199.0 0.5 329.0 0.173.0 0.354.967.9 (935.0 10.1 10.1 0. This brief is a licensed product and is not to be photocopied 03/2011 Page 180 .6 10.117.792.2 0.148.831.476.4 0.1 96.8 0. company reports DATAMONITOR Global Top 10 Energy Companies Report: Industry.610.640.506.3% 37.628.5) 1.8 2.2) 1.1) 0.807.0 277.120.231.9 0.003.090.

Financial Analysis

Table 22: PetroChina Company Limited: key industry-specific ratios, 2005–09

Financial Ratios Current Ratio Quick Ratio Net Working Capital Ratio Return on Asset Return on Equity Net Income Margin Operating Margin (Return on Sales) Asset Turnover Ratio Inventory Turnover Ratio Receivable Turnover Ratio Debt to Equity Ratio Interest Coverage Ratio Dividend Per Share Earning Per Share Market to Book Ratio Price Earning Ratio Return on Capital Employed Long Term Debt Ratio Total Debt Ratio Dividend Yield Dividend Payout Enterprise Value / EBIT Enterprise Value / EBITDA CAPEX to Revenues

2009 0.76 0.46 -0.06 7.8% 12.6% 10.5% 14.1% 0.77 4.98 44.71 0.28 27.21 0.04 0.08 2.99 24.46 13.5% 0.08 0.22 0.02 0.48 19.08 11.61 25.3%

2008 0.85 0.51 -0.03 10.1% 15.0% 11.8% 14.9% 0.95 6.53 60.64 0.16 52.42 0.04 0.09 2.35 16.26 17.1% 0.04 0.14 0.03 0.46 12.61 7.91 20.1%

2007 1.18 0.74 0.03 15.1% 22.2% 18.6% 24.0% 0.86 4.74 61.83 0.10 55.71 0.05 0.12 7.68 38.61 23.1% 0.05 0.08 0.01 0.44 28.45 21.31 21.8%

2006 0.90 0.48 -0.02 17.2% 25.8% 21.7% 28.7% 0.84 4.18 105.04 0.12 61.48 0.05 0.11 0.00 0.00 28.6% 0.05 0.10 NA 0.48 0.27 0.21 21.6%

2005 1.14 0.74 0.03 17.1% 25.9% 25.3% 34.8% 0.71 3.44 119.27 0.14 69.58 0.04 0.11 0.00 0.00 30.8% 0.07 0.12 NA 0.40 0.11 0.08 22.6%

Source: Datamonitor, company reports

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Financial Analysis

ConocoPhillips

Table 23: ConocoPhillips: financial and operational highlights, 2005–09 ($m)

Parameters Income Statement Total Revenue Cost of Goods and Services Gross Profit Operating Expense Operating Income Net Income Balance Sheet Total Current Assets Total Assets Total Current Liabilities Total Liabilities Total Shareholders Equity Cash Flow Cash from Operating Activities Cash from Investing Activities Cash from Financing Activities Closing Cash Balance Key Statistics Total Common Shares Outstanding Year-end Share Price Market Capitalization Enterprise Value Number of Employees Free Cash Flow Key Ratios P/E Ratio Earnings per Share (EPS) EV/EBITDA EV/Sales Profitability Ratios Gross Margin Operating Margin Net Income Margin Resource Management Return on Equity Return on Capital Employed Return on Assets Financial Strength

Currency

Unit

2009

2008

2007

2006

2005

$ $ $ $ $ $

Million Million Million Million Million Million

149,341.0 (113,954.0) 35,387.0 (26,654.0) 12,005.0 4,858.0

240,842.0 (181,818.0) 59,024.0 (31,878.0) 32,241.0 (16,998.0)

187,437.0 (135,119.0) 52,318.0 (29,594.0) 29,440.0 11,891.0

183,650.0 (130,146.0) 53,504.0 (27,947.0) 30,265.0 15,550.0

179,442.0 (134,148.0) 45,294.0 (24,856.0) 24,360.0 13,529.0

$ $ $ $ $

Million Million Million Million Million

23,519.0 152,588.0 23,695.0 90,121.0 62,467.0

22,816.0 142,865.0 21,780.0 87,700.0 55,165.0

26,606.0 177,757.0 26,882.0 88,774.0 88,983.0

25,066.0 164,781.0 26,431.0 82,135.0 82,646.0

19,612.0 106,999.0 21,359.0 54,268.0 52,731.0

$ $ $ $

Million Million Million Million

12,479.0 (9,935.0) (2,855.0) 542.0

22,658.0 (17,616.0) (5,764.0) 755.0

24,550.0 (8,562.0) (15,340.0) 1,456.0

21,516.0 (29,993.0) 7,065.0 817.0

17,628.0 (11,016.0) (5,684.0) 2,214.0

NA $ $ $ NA $

Million Absolute Million Million Absolute Million

1,525.0 51.1 77,881.7 106,582.7 30,000.0 1,618.0

1,520.9 51.8 78,783.6 106,583.6 33,800.0 3,559.0

1,613.8 88.3 142,502.2 163,906.2 32,600.0 12,759.0

1,690.4 72.0 121,627.2 149,146.2 38,400.0 5,920.0

1,377.8 58.2 80,163.3 91,674.3 35,600.0 6,008.0

NA $ NA NA

Absolute Absolute Absolute Absolute

16.0 3.2 5.0 0.7

(4.6) (11.2) 2.6 0.4

12.0 7.4 4.3 0.9

7.8 9.2 4.0 0.8

5.9 9.8 3.2 0.5

NA NA NA

% % %

23.7% 8.0% 3.3%

24.5% 13.4% -7.0%

27.9% 15.7% 6.4%

29.1% 16.5% 8.5%

25.2% 13.6% 7.6%

NA NA NA

% % %

8.3% 9.3% 3.3%

-23.6% 26.6% -10.6%

13.9% 19.5% 6.9%

23.0% 21.9% 11.4%

25.7% 28.4% 12.6%

Global Top 10 Energy Companies Report: Industry, Financial and SWOT Analysis
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Quick Ratio Interest Coverage Ratio Debt to Equity Ratio Operational Efficiency Asset Turnover Ratio Receivable Turnover Ratio Inventory Turnover Ratio Revenue per Employee Net income per Employee Other Capex to Revenues Capex Revenue by Segment Exploration and Production Midstream Refining and Marketing LUKOIL Investment Chemicals Emerging Businesses Corporate and Other Revenues by Geography US Australia Canada Norway UK Other foreign countries

NA NA NA

Absolute Absolute Absolute

0.8 9.3 0.5

0.8 34.5 0.5

0.8 23.5 0.2

0.8 27.8 0.3

0.7 49.0 0.2

NA NA NA $ $

Absolute Absolute Absolute Absolute Absolute

1.0 11.8 22.7

1.5 17.0 39.0

1.1 12.3 28.8 5,749,601.2 364,754.6

1.4 14.1 29.3 4,782,552.1 404,947.9

1.7 15.0 36.0 5,040,505.6 380,028.1

4,978,033.3 7,125,503.0 161,933.3 (502,899.4)

NA $

% Million

7.3% 10,861.0

7.9% 19,099.0

6.3% 11,791.0

8.5% 15,596.0

6.5% 11,620.0

$ $ $ $ $ $ $

Million Million Million Million Million Million Million

37,097.0 4,892.0 107,233.0 11.0 86.0 22.0

69,818.0 6,564.0 164,230.0 11.0 199.0 20.0

48,154.0 4,861.0 134,201.0 10.0 198.0 13.0

50,166.0 3,424.0 129,877.0 13.0 160.0 10.0

48,525.0 3,086.0 127,280.0 14.0 192.0 13.0

$ $ $ $ $ $

Million Million Million Million Million Million

97,674.0 2,229.0 3,617.0 1,749.0 20,671.0 23,401.0

166,496.0 2,735.0 5,226.0 3,036.0 29,699.0 33,650.0

131,433.0 1,633.0 4,727.0 2,479.0 20,680.0 26,485.0

127,869.0 5,554.0 2,480.0 19,510.0 28,237.0

130,874.0 5,676.0 3,280.0 19,043.0 20,569.0

Source: Datamonitor, company reports

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99 0.19 1.03 0.5% Source: Datamonitor.00 6.74 -0.4% 15.34 6.68 36.93 28.37 1.75 -0.60 11.24 49.31 0.99 0.0% 1.20 1.01 1.50 39.20 0.23 0.01 -10.3% 2008 1.97 8.6% 13.17 0.63 26.57 4.31 2.0% 13.50 34.00 3.7% 1.92 0.01 22.18 1.83 0.22 5.6% -7.3% 0. company reports DATAMONITOR Global Top 10 Energy Companies Report: Industry. This brief is a licensed product and is not to be photocopied 03/2011 Page 184 .05 0.24 23.02 0.82 12.88 -11.65 7.21 0. Financial and SWOT Analysis © Datamonitor.7% 7.22 0.4% 0.99 0.25 16.32 14.3% 8.33 27.09 28.22 0.93 3.98 19.02 0.9% 6.82 1.58 7.13 0.04 -0.Financial Analysis Table 24: ConocoPhillips: key industry-specific ratios.50 1.78 0.58 8.35 29.46 9.84 1.02 0.01 11.20 6.15 0.10 0.52 5.35 9.15 4.48 1.6% -23.03 16.00 7.3% 8.14 0.3% 2006 0.3% 3.03 9.9% 13. 2005–09 Financial Ratios Current Ratio Quick Ratio Net Working Capital Ratio Return on Asset Return on Equity Net Income Margin Operating Margin (Return on Sales) Asset Turnover Ratio Inventory Turnover Ratio Receivable Turnover Ratio Debt to Equity Ratio Interest Coverage Ratio Dividend Per Share Earning Per Share Market to Book Ratio Price Earning Ratio Return on Capital Employed Long Term Debt Ratio Total Debt Ratio Dividend Yield Dividend Payout Enterprise Value / EBIT Enterprise Value / EBITDA CAPEX to Revenues 2009 0.5% 1.6% 0.81 0.95 0.82 21.9% 2007 0.02 15.86 3.0% 8.88 5.5% 2005 0.71 11.19 9.02 12.9% 0.13 0.04 0.5% 16.17 3.31 1.85 0.43 -4.6% 1.76 3.6% 25.4% 23.47 7.12 3.4% 1.5% 0.

5 99.715.431.8 149.0 35.0 12.413.1 4.0 3.8 1.005.3 1.731.509. 2005–09 ($m) Parameters Income Statement Total Revenue Cost of Goods and Services Gross Profit Operating Expense Operating Income Net Income Balance Sheet Total Current Assets Total Assets Total Current Liabilities Total Liabilities Total Shareholders Equity Cash Flow Cash from Operating Activities Cash from Investing Activities Cash from Financing Activities Closing Cash Balance Key Statistics Total Common Shares Outstanding Year-end Share Price Market Capitalization Enterprise Value Number of Employees Free Cash Flow Key Ratios P/E Ratio Earnings per Share (EPS) EV/EBITDA EV/Sales Profitability Ratios Gross Margin Operating Margin Net Income Margin Resource Management Return on Equity Return on Capital Employed Return on Assets Financial Strength Currency Unit 2009 2008 2007 2006 2005 $ $ $ $ $ $ Million Million Million Million Million Million 140.909.6% 10.121.704.430.557.7 4.939.9 61.5 142.3 129.0 10.258.2 123.9) 16.005.8 51.6% 24.4) (10.654.382.9 139.4 23.3) 67.7 10.812.5 4.3 (44.480.6 148.313.665.1 56.490.256.8% 22.1 3.9% 5.1) (7.005.8 47.6 (46.824.285.7 48.710.3% 10.0 10.862.7% 20.0 7.4 12.401.2 4.854.954.7 64.322.6) 1.247.242.417.5% 18.919.8 (80.5 42.5 125.1 41.378.6 30.005.2% 45.1 68.008.859.3% 40.2 4.650.3 93.8% 3.728.522.6 (106.7 130.568.4% 10.2% 14.6 (14.074.640.372. This brief is a licensed product and is not to be photocopied 03/2011 Page 185 .111.0 13.786.2% 26.010.9) 4.4 32.911.4 163.7 31.867.117.6 147.649.948.208.9) 4.070.929.780.0 NA $ $ $ NA $ Million Absolute Million Million Absolute Million 4.5 (28.8 99.1) 26.733.189.7 137.7% 23.417.1% 9.3% 9.927.355.1 167.6 33.5 4.2 23.3 (23.307.499.1 3.254.1 85.4 12.6% 8.6 100.4 73.0 6.504.5) 26.879.2 $ $ $ $ Million Million Million Million 15.880.2 NA NA NA % % % 42.743.3% 29.3% 11.3 6.868.5) 25.4) 23.6 3.0 (39.0 (3.9 72.3 178.519.1 11.0 78.134.0) 2.208.5 51.162.0) 62.0 12.467.4 34.135.874.0) 71.5% 7.1) 59.404.0 $ $ $ $ $ Million Million Million Million Million 43.1 154. Financial and SWOT Analysis © Datamonitor.4 (81.6 20.3 (42.331.547.4 24.5) (9.1% 25.300.3 0.5 (41.095.6% 13.090.971.5% Global Top 10 Energy Companies Report: Industry.313.2 141.9 (67.4 35.027.867.9% 10.8 162.1 (9.Financial Analysis Eni SpA Table 25: Eni: financial and operational highlights.057.692.530.961.5 65.8) 2.2 42.6 1.3 116.2 21.2 (9.1 75.830.4 NA $ NA NA Absolute Absolute Absolute Absolute 16.0) 67.4 1.3 (81.5% 45.7 3.8 78.1 10.0 2.3% 47.833.572.005.177.359.7 1.8% 27.6 54.549.4% 17.5) (1.9% NA NA NA % % % 9.7) 5.897.0 4.8% 18.

631.235.620.2) 18.680.2 6.685.734.3 7.585.614.172.1 217.7 (532.4 6.5 45.561.0 77.797.302.336.5 11.0 1.3 1.1 312.0 377.5) (412.5 12.6 13.9) (1.6 2.4 444.1 4.270.0% 14.1 40.0 4.3 50.5) (1.520.991.281.919.666.4 442.296.960.8 $ $ $ $ $ $ $ Million Million Million Million Million Million Million 14.411.3) (941.8 41.657.142.9 2.2 8.1 6.8 9.1 6.5 51.1) 21.3 (619.2 (1.302.334.932. company reports DATAMONITOR Global Top 10 Energy Companies Report: Industry.5 19.936.7 10.439.705.167.647.001.Financial Analysis Quick Ratio Interest Coverage Ratio Debt to Equity Ratio Operational Efficiency Asset Turnover Ratio Receivable Turnover Ratio Inventory Turnover Ratio Revenue per Employee Net income per Employee Other Capex to Revenues Capex Revenue by Segment Exploration and Production Gas and Power Refining and Marketing Petrochemicals Engineering and Construction Other activities Corporate and financial companies Operating Income by Segment Exploration and Production Gas and Power Refining and Marketing Petrochemicals Engineering and Construction Other activities Corporate and financial companies Revenues by Geography Italy Other European Union Rest of Europe Americas Asia Africa Other areas NA NA NA Absolute Absolute Absolute 0.838.7 8.434.643.1 0.0% 10.9 4.1 8.0 11.011.5 17.9 33.5 1.259.4) 1.7 Source: Datamonitor.7 184.4% 20.5 0.6 10.0 5.0 27.3 0.2 9.144.8 281.808.5 8.3 NA NA NA $ $ Absolute Absolute Absolute Absolute Absolute 0.7 298.6 1.0 8.2 13.227.576.515.4 12.7 1.979.470.6% 19.7 11.8 14.447.6 1.2 48.9 704.529.797.955.803.1 7.228.0 45.7 139.924.8) $ $ $ $ $ $ $ Million Million Million Million Million Million Million 38.3 31.5) 1.066.9 6.0 1.874.9 9.2 10.036.2) (435.171.9 422.1) 22.7 10.5 NA $ % Million 13.699.4 (482.7 7.2 8.1 10.6) (525.717.7) (661.3 178.0 (142.0 9.3 8.7 7.6 255.4% 10.197.5 0.8 13.164.2 5.2 4.8) 17.4 $ $ $ $ $ $ $ Million Million Million Million Million Million Million 12.3 1.9 0.1 14.9 239.153.184.8 2.589.179.5 1.4 5.339.511.3 1.8 1.1 50.9 37.913.456.178.7 42.9 59.8 8.144.5 52.2 169.727. This brief is a licensed product and is not to be photocopied 03/2011 Page 186 .099.457.705.2 7.475.4 553.8 0.7 428.2 174. Financial and SWOT Analysis © Datamonitor.308.716.2 1.377.728.3 60.7 8.3 11.2 429.237.3 (867.719.3 38.9 4.9 0.2 156.3 32.2 2.040.400.0 7.1 242.647.0 956.7 7.695.6 214.029.8 89.6 11.750.1 1.773.454.4 (1.189.3 5.097.770.1 6.235.135.0 33.4 7.836.9 11.

4% 2005 1.17 0.76 0.8% 0.17 13.8% 9.21 2.61 3.11 13.34 11. company reports DATAMONITOR Global Top 10 Energy Companies Report: Industry.9% 0.3% 1.07 29.95 8.58 6.2% 17.05 0.20 0.13 0.17 4.12 0.05 0.5% 23.75 4.9% 18.28 4.9% 0.8% 7.90 0.45 1.54 1.05 0.75 0.86 1.6% 2008 1.33 13.25 0.06 2.68 27.88 0.2% 10.Financial Analysis Table 26: Eni: key industry-specific ratios.71 3.19 6.6% 1.07 10. 2005–09 Financial Ratios Current Ratio Quick Ratio Net Working Capital Ratio Return on Asset Return on Equity Net Income Margin Operating Margin (Return on Sales) Asset Turnover Ratio Inventory Turnover Ratio Receivable Turnover Ratio Debt to Equity Ratio Interest Coverage Ratio Dividend Per Share Earning Per Share Market to Book Ratio Price Earning Ratio Return on Capital Employed Long Term Debt Ratio Total Debt Ratio Dividend Yield Dividend Payout Enterprise Value / EBIT Enterprise Value / EBITDA CAPEX to Revenues 2009 1.60 22.34 6.1% 20.5% 14.55 10.7% 24.55 16.84 0.02 26.77 3.61 11.3% 9.21 0.0% Source: Datamonitor.05 0.60 0.02 8.4% 0.08 4.39 4.6% 5.48 10.06 0.06 0.95 0.07 0.04 10.56 4.03 10.3% 18.37 4.73 13. Financial and SWOT Analysis © Datamonitor.6% 0.60 3.0% 2006 1.80 8.96 0.12 11.26 1.07 1.7% 9.12 0.5% 1.52 1.63 6.23 13.01 3.6% 25.50 5.86 10.4% 2007 1.65 10.11 1.36 7.86 3.3% 0.26 1.3% 11.83 7.20 0. This brief is a licensed product and is not to be photocopied 03/2011 Page 187 .1% 1.02 0.16 0.17 0.87 1.11 0.49 2.47 4.81 1.28 0.46 6.33 4.47 2.51 7.27 0.

295.8 22.0 2.600.6 43.008.5 186.202.232.0 36.364.4 9.8) 2.621.0% 29.0 27.398.1 137.4 168.197.581.3) 14.5% 78.4 81.9% 21.7 1.5 9.048.628.8% 22.244.4% 20.9 (20.3 18.900. Financial and SWOT Analysis © Datamonitor.1 402.624.5% 65.3 0.2 456.9% 7.4 (39.3 (28.0 6.3) (2.000.4 24.000.950.927.1 (30.914.2 141.298.7 (23.6% 32.5 246.308.0% 17.1 8.0) 7.4 20.3) 59.1 215.924.1 19.9 NA NA NA % % % 58.281.467.7) 10.8% NA NA NA % % % 15.0% 28.673.002.2% 38.2) 13.0 11.710.7 227.7% 11.426.4 23.875.017.0 146.0 47.913.900.416.858.6 67.3% 17.4 (28.201.4% 23.3) 27.900.996.913.4 386.1) 25.4 (16.744.6 14.9 10.4 101.2 12.0 54.5 (37.198.2 440.5 (28.3% 10.1 $ $ $ $ $ Million Million Million Million Million 53.830.3 23.989.7% 10.8 122.1 3.0 31.6% 26.0 5.6 (28.165.775.7 34.7 (31.000.266.715.117.448.8 133.475.258.0) 55.4 1.985.0 53.530.9 445.265.0 104.361.3 0.7 125.1) 22.185.519.4% 12.517.3 96.4) 40.4 33.661.000.325.8% 36.0 3.6 NA $ NA NA Absolute Absolute Absolute Absolute 5.886.580.3 (36.063.933.947.269.105.6% 28.1 23.6 219.2 8.3 3.905.6% 86.4 1.6% 18.0 (13.166.6% 29.0 10.839.521.9 169.1 68.5 $ $ $ $ Million Million Million Million 28.0 3.8 (16.274.5 170.319.7 31.2% Global Top 10 Energy Companies Report: Industry.9 8.423.7 8.0) 38.4 2.9) 55.7 4.3 0.1 306.8) 67.2 81.7) 9.545.7% 12.7 90.739. This brief is a licensed product and is not to be photocopied 03/2011 Page 188 .600.1 5.608.7% 12.913.6 49.8 16.335.7 (5.7% 80.1% 11.1 55.5 NA $ $ $ NA $ Million Absolute Million Million Absolute Million 22.729.4 80.384.537.000. 2005–09 ($m) Parameters Income Statement Total Revenue Cost of Goods and Services Gross Profit Operating Expense Operating Income Net Income Balance Sheet Total Current Assets Total Assets Total Current Liabilities Total Liabilities Total Shareholders Equity Cash Flow Cash from Operating Activities Cash from Investing Activities Cash from Financing Activities Closing Cash Balance Key Statistics Total Common Shares Outstanding Year-end Share Price Market Capitalization Enterprise Value Number of Employees Free Cash Flow Key Ratios P/E Ratio Earnings per Share (EPS) EV/EBITDA EV/Sales Profitability Ratios Gross Margin Operating Margin Net Income Margin Resource Management Return on Equity Return on Capital Employed Return on Assets Financial Strength Currency Unit 2009 2008 2007 2006 2005 $ $ $ $ $ $ Million Million Million Million Million Million 94.409.722.897.186.9 4.931.3% 10.7 22.599.5 76.595.Financial Analysis OAO Gazprom Table 27: OAO Gazprom: financial and operational highlights.786.9 17.718.456.4 32.371.0 17.3) (91.652.4 265.996.4 49.3 30.0 9.9 256.

3 1.657.5) (206.135.4 1.8 178.1 2.822.878.314.3 55.1 24.9 14.4 4.155.4 245.6% 25.3) 795.8 12.5 1.7 (10.5 4.0 17.739. Financial and SWOT Analysis © Datamonitor.807.3) - 37.452.670.3 2.6 496.466.2 6.5 0.9) - 14.5 66.1 32.655.331.4 228.4 172.7 0.2 (1.647.669.0 30.1 5.248.390.2 9.7 $ $ $ $ $ $ $ Million Million Million Million Million Million Million 433.6 1.934.7 2.5 27.0 9.1 4.0 13.7 11.450.8 Former Soviet Union (excluding Russian $ Federation) Europe and other countries Excise tax.5 10.8 4.238.7 (10.0 1.3 4.1 0.745.173.3 2.232.687.5 10.708.9 66.1 512.932.169.7 0.Financial Analysis Quick Ratio Interest Coverage Ratio Debt to Equity Ratio Operational Efficiency Asset Turnover Ratio Receivable Turnover Ratio Inventory Turnover Ratio Revenue per Employee Net income per Employee Other Capex to Revenues Capex Revenue by Segment Production of gas Transport Distribution Production of crude oil and gas condensate Refining Gas storage Electric and heat energy generation Operating Income by Segment Production of gas Transport Distribution Production of crude oil and gas condensate Refining Other Unallocated operating expenses Revenues by Geography Russian Federation NA NA NA Absolute Absolute Absolute 1.2 795.0 62.724.5 64.3) 665.7 846.324.4 5.8 48.4 - 111.3 1.0) 638.004.6 16.8 5.0 4.685.3 1.080.7 0. This brief is a licensed product and is not to be photocopied 03/2011 Page 189 .102.3 3.0 3.103.885.680.905.0 2.1 0.6 6.6 (1.8% 8.5 6.739.552.8 370.754.2 155.818.2) - 28.7 6.711.025.2 46.564.9 3. Customs duties Gas transportation sales Other revenues $ $ $ $ Source: Datamonitor.670.4% 17.736.2 896.310.1 51.267.8 (8.095.7 2.7 20.997.243.780.4 NA NA NA $ $ Absolute Absolute Absolute Absolute Absolute 0.439.8 5.599.253.268.244.2 13.2 4.823.081.9 0.3 1.976.7 13.806.3 2.355.324.935.3 (109.5 0.457.0 44.4 1.4 5.840.770.4 - 134.3 4.4 4.2) 439.6 12.245.8 (699.1 109.6 26.8% 22.0 0.6 4.8 (9.5 44.0 46.3 1.6 21.249.124.727.9 NA $ % Million 26.658.324.2 20.5 18.941.3 1.1 - $ $ $ $ $ $ $ Million Million Million Million Million Million Million - 1.7 (14.5% 13.0 22.5) $ Million Million Million Million Million Million 36.2 1.730.4 19.4) - 23.8 46. company reports DATAMONITOR Global Top 10 Energy Companies Report: Industry.

company reports DATAMONITOR Global Top 10 Energy Companies Report: Industry.55 3.00 0.39 4.3% 0.4% 0.5% 38.5% 28.72 1.3% 0.30 12.7% 0.94 0.83 9.51 0.29 3.42 20.7% 0.85 2.45 -26.45 2.1% 22.7% 29.36 12.06 0.6% 0.Financial Analysis Table 28: OAO Gazprom: key industry-specific ratios.35 4.89 2.79 5.9% 0.16 0.44 1.87 8.6% 17.38 6.19 4.34 0.38 11.22 0.69 0.22 0.02 0.30 17.6% 0.32 11. Financial and SWOT Analysis © Datamonitor.8% 2007 1.91 -22.47 4.15 0.17 0.30 1.86 5.05 12.09 13.7% 21.12 12.34 0.19 0.08 0.01 0.8% 32.00 0.17 11.8% Source: Datamonitor.4% 23.40 2.06 9.4% 2006 1.24 0.01 6.05 0.6% 2008 1.32 1.4% 28.8% 0. 2005–09 Financial Ratios Current Ratio Quick Ratio Net Working Capital Ratio Return on Asset Return on Equity Net Income Margin Operating Margin (Return on Sales) Asset Turnover Ratio Inventory Turnover Ratio Receivable Turnover Ratio Debt to Equity Ratio Interest Coverage Ratio Dividend Per Share Earning Per Share Market to Book Ratio Price Earning Ratio Return on Capital Employed Long Term Debt Ratio Total Debt Ratio Dividend Yield Dividend Payout Enterprise Value / EBIT Enterprise Value / EBITDA CAPEX to Revenues 2009 1.06 2.9% 18.14 -20.58 0.39 0.30 18.5% 2005 1.0% 0.54 0.99 0.43 1.31 0.10 4.01 1.08 3.90 1.40 5.03 0. This brief is a licensed product and is not to be photocopied 03/2011 Page 190 .28 -19.00 0.07 10.08 0.08 1.73 14.65 -21.01 0.2% 12.61 1.22 0.3% 29.63 1.6% 36.7% 26.77 10.01 0.26 0.22 0.11 7.08 11.0% 15.38 9.08 10.08 10.48 0.12 0.15 0.

all aggregated. which can then be refined according to specific competitive. Extensive secondary research activities ensure we are always fully up-to-date with the latest industry events and trends. analyzed. Modeling & forecasting tools – Datamonitor has developed powerful tools that allow quantitative and qualitative data to be combined with related macroeconomic and demographic drivers to create market models and forecasts. Datamonitor aggregates and analyzes a number of secondary information sources. The parameters of each definition are carefully reviewed at the start of the research process to ensure they match the requirements of both the market and our clients. which enable our researchers to build an accurate market overview. Global Top 10 Energy Companies Report: Industry. • Definitions – market definitions are standardized to allow comparison from country to country. accurate and up-to-date. Datamonitor’s inhouse databases provide the foundation for all related industry profiles. This brief is a licensed product and is not to be photocopied 03/2011 Page 191 . regulatory and demand-related factors. company annual reports. company profiles and macroeconomic & demographic information.APPENDIX APPENDIX Methodology Datamonitor Industry Profiles draw on extensive primary and secondary research. cross-checked and presented in a consistent and accessible style. analyst commentary. Continuous quality control ensures that our processes and profiles remain focused. Financial and SWOT Analysis © Datamonitor. business information libraries and databases. international data (official international sources). including: • • • • • • national/governmental statistics. • Preparatory research – Datamonitor also maintains extensive in-house databases of news. national and international trade associations. • Review of in-house databases – created using 250.000+ industry interviews and consumer surveys and supported by analysis from industry experts using highly complex modeling & forecasting tools. broker and analyst reports.

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