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    11 views29 pages

    AnnualReport 2011

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    Rubbish1234Name

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    of 29
    & Kuwalt Foreign Petroleum Exploration Co. .8.C. ‘Asus KuwallPevoleum Corporation Delivering Green Growth 30Annual Report -20 1] KUFPEC Delivering Green Growth "The inspiring front cover visual of small. prismatic raindrops gradually falling on fertile gardenlike green fields is a simple emblem of consistent, progressive and sustainable development, yet quite reminiscent of the tiny drops of water that makes the mighty ocean, ‘and also serves as a fitting metaphor for KUFPEC's strategy of Green Growsh that focuses on delivering business value through, fosiering economic growth ‘while ensuring that natural assets continue to provide the resources and environmental services on which ‘our wellbeing relies. A strategy in which Green and Growth go hand in hand." H. H. Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah Amir of The Stote of Kuwait = H. H. Sheikh Nawaf Al-Ahmad Al-Jaber Al-Sabah Crown Prince of The State of Kuwait H. H. Sheikh Jaber Mubarak Al Hamad Al-Sabah ‘The Prime Minister of The State of Kuwait About Us KUFPEC Mission, Vision, and Values are shared with KPC upstream sector and aligned with KPC strategic direction reflecting our aggressive ambition in the business. KPQ\Upstream Mission i To explore, develop and produce hydrocarbons within the State of Kuwait the divided zone and Internationally and so to be a secure and reliable supplier to our customers, promote the care and development of our people and deliver on our commitment fo our stakeholders in a compliant, sofe and environmentally responsible manner KPC Upstream Vision To achieve a leading global position in upsiream oil dnd gas os.an integrated, value-driven enierprise, by: + Maximizing he strategic volue from cil + Realizing the potential of gas *+ Growing reserves for a sustainable future * Being an employer of choice + Realizing value from technology + Strengthening our commitment to HSSE « Striving for excellence in performance © Contributing to the Enterprise and State Values Excellence, Flexibility, Partnership, Motivation, Commitment to HSSE and Society, One Identity and Integrity. KUFPEC Strategie Targets: + Achiove crude cil and gas Production/Reserves targets of: a = 80 mboepd net production target by 2010 supported by a nét reserve base of 350 mmboe, - 130 mboepd net production target by year 2015 supported by a net reserve base of 430 mmbce, = 200 mboepd net preduction target by year 2020 supported by a net reserve base of 650 mmboe ‘and maintain it through 2030 . + Preference for investments which facililale technology and capabilily transfer between domestic and international upstream businesses ¥ + Achieve ond minlain oplimal ralio of oil & gas in infernalionel upstream portfolio ® Become operator of international upstream assets: = 5% of daily production under operatorship by 2015 = 10% of daily production by 2020 - 15% of dally production by 2025, = 20% of daily production by 2030 Fe Board Of Directors From Left to Right Mr. Nizar M. Al-Adsani ‘Mr. Ali D. Al-Shammari Mrs. Khawla H. Al-Jassem Mr. Mohammed R. Jasem Mr. Ahmad M. Al-Rasheed Mr. Khalid A. Al-Sumaiti Management From Left to Right Mee Nizar M: Al-Adsani Chairman and Managing Director Mr. All_D. Al-Shammati Deputy Cheirman & Deputy Managing Director = Thy Operations East x Mr. A.Naser ¥. Al-Fulaij a Deputy Managing Director - Operations West Kw Me: Khaled A. Al-Qaoud f E Deputy Managing Director - Finance & Admin From Left to Right Mrs, Ghado Al-Amer Manager, Corporate Planning Mr. Ahmed Al-Awadhi Manager, Management Support Mr. Abdulla N. Malek Manager, Finance Mr. Graham Whitehead Manager, South-East Asia Region Mr. Tareq Ebrahim Manager, Far-East Asia Region Mr, Mezyad Al-Mutoiri Manager, Human Resources Mr, Abdulrahman Al-Bedaiwi Manager, Public Relations & Services Mr. Royal MacBeath Manager, Africa Region Mr. Humoud Al-Baloul Manager, Commercial Mr. Syed Bokhari Manager, Middle East Region Mr. Gavin Daniel Manager, Legal Affairs Message from The Chairman and Managing Director It gives me great pleasure, on behalf of my fellow board members and my own behalf, to introduce, for the first ime since having assumed my responsibilies 608 Chairman and Monaging Director; the thifith cennval report on the activities of Kuwait Foreign Petroleum Exploration Company (KUFPEC), together with the annual accounts for the calendar year ending 31st December 2011 The year 2011 will be remembered as a pivotal year in KUFPEC’s history for at least three reasons. We produced outstanding financial results, celebrated the 30th Anniversary ofthe establishment of KUFPEC, and actively joined the people of Kuwait in the commemoration and celebration of a historical milestone, namely the 50th Anniversary of the Independence of the State of Kuwait, the 20th Anniversary of Liberation and the Sth Anniversary of ‘accession of His Highness the Amie Sheikh Sabah A\-Ahinad Al-Jaber Al-Sabah, an occasion that filed ‘veryone with pride and distinction and provided on portunity for Kuwcit fo pause and think about how tar we have come as « hation 6) Annial Report 2011 Today, we look back with pride a the glorious evolutionary journey KUFPEC has made over the past 30 years. The reclis thal have been achieved so far had set o solid foundation for pursuing our ambitious strategic goal of delivering long-term sustainable: value for our stakeholder while remaining commited to-our-core value and broad vision of corporate: responsibilty best encapsulcted in the concept of Green Growth. Financially, KUFPEC continued fo deliversirong performance and ended the year with a significant ‘net cash position and o strong balance sheet. The Company's financial statement for the year 2011 reported an ater tax net profit of US$ 273 million, which is 91% higher than previous year's profil of USS-143 million, while year-end total operating revenues amounted to USS 1.3 billion, an increase of 19% on the previous year's result Although KUFPEC could not maintain the 2010 production level due to multiple operational challenges and events outs its control, KUFPEC successtlly achieved a significant reserve replacement ratio of 260% by adding 142 mmboe of new reserves {oils portfolio, almost doubling previous year bolance. The new reserves additions are mainly from WA-356-P projec in Australia, the largest project fever entered by KUFPEC and widely considered as world class project. The Boord of Directors of Kuwait Petroleum Corporation (KPC) approved increasing KUFPEC’s share copital to KD 1.2 Billion enabling us to meet cour funding requirements for future growth and expansion delivering our 2030 strategic goals. will permit the company to maintain « balanced financial pesition and to secure market confidence cand support, ‘Another mojor development during 2011 wos the signing of the Final Investment Decision (F1D's) ‘agreement for the WA-356-P Julimar / Brunello Development and Wheotsione Liquefied Natural Gas LNG project, which provided an addition of 145 million boe to KUFPEC's reserves in 2011 and 19,000 boepd of future production. Board opproval was granted for KUFPEC to participate in the Balnaves Oil Development in WA-356-P and the Fleicher/ Finucane Oil Development in WA-191-P, both in Western Australia. Furthormore, KUFPEC continues its collaboration with upstream ond international downstream sectors to increase synergy and leverage existing relationships. (One of the most productive results ofthe upstream collaboration wos the inauguration of upstroam “PEER review" sessions in KOC, KUFPEC and KGOC to leverage the knowledge transfer and provide constructive mutual examination for major project performance and future plans. Plans wore progressed to establish centers of excellence to share technical expertise across the KPC upstream subsidiaries. KUFPEC had another very good year with respect to Health, Safety, Security ond Environment (HSSE) performance. During the year, several noteworthy events and programs were initiated, estcblished or supported by the Company to promote awareness cf appropriate hecth and environmental issues throughout its workorce and the community, such as the participation in the Earth Day event and the Blood Donation campaign. Additionally, safety awareness was emphasized by required employee atiendance in defensive driving and frst aid classes. ‘nally Lam grateful ta my fellow Board members, whose quidance, counsel and support have been invaluable, especially at a ‘ime when the company has had to deal with mojor challenges. Furthermore, along with my colleagues on the Board, | would lke 46

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