Global energy demand is projected to grow 50% by 2030, met primarily through fossil fuels. This will require $52 trillion in investments across the power, oil, and gas sectors. Emerging markets will see twice the growth of developed markets. National oil companies control 80% of oil reserves but international oil companies can access reserves through partnerships. Both will need to invest in new technologies and reduce costs to meet escalating demand and higher prices. Downstream strategies should focus on high growth emerging markets and efficiency in mature markets.

1. Global Energy Outlook 2010-2030
Emerging Markets, Challenges, Opportunities & Winning
Strategies for Energy Companies and GE
By Shahzad Paracha
By Shahzad Paracha

2. 2009 Review
 Primary Energy Consumption Growth +7.2% -2.8%
China USA
-0.6%
 Global oil consumption Growth
• First Decline since 1993
• Global Oil Production Growth +0.4%
• Oil production outside OPEC -1.4% or 610K b/d, the largest decline since 1992
 Global Refining Capacity Additions +2.8%
• Led by Asia Pacific (China)
 Refining Capacity Utilization
• Consistent Decline since 2003 85%
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3.  Global Natural Gas Consumption +2.5%
• Below 10 years Historical Average
+16%
• Middle East led Above Average 3.1% growth BUT China led..............
 Global Gas Production above 10 years Average (3%) +3.5%
• Output Led by USA +7.5%
• 10 times than 10 year Average
 Natural Gas
+24.1%
• Highest Share of energy consumption
• LNG & LPG share 15%
• 2020 LNG & LPG Demand/Share 30%
 Other Fuels: +3.1%
 Global Coal consumption growth
• Worlds fastest growing fuel
• China with 43% consumption share led with 7% growth equivalent to 85% global growth
 Renewable Energy Stronger Growth
• Wind & Solar Capacity rise of 30% & 70%
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• Driven by 50% rise in USA Wind Capacity surpassing Germany

4. World Primary Fuel Mix 2009
EIA – September’09 4

5. 5

6. 6

7. Total Proved Oil Reserves & Segmentation
Total Proved Oil Reserves Distribution of Proved Oil Reserves (%)
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8. Total Proved Gas Reserves & Segmentation
Total Proved Gas Reserves Distribution of Proved Gas Reserves (%)
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9. Reserves to Production Ratios (R/P)
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10. Global Coal Demand & Supply
Production Consumption
Million Tonnes Oil Equivalent Million Tonnes Oil Equivalent
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11. Opportunities & Challenges
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12. Global Supply & Demand Challenges
 Surplus Reserves in Middle  Oil Reserves
1. S. Arabia (20% of Global Oil Reserves)
East, Russia & Africa.
2. Canada
3. Iraq
 Cost US$ 15 Trillion in 4. Iran
 Infrastructure: Exploration,
 Gas Reserves & Producers
Production & Transportation
1. Russia
2. Iran
3. Qatar
4. S. Arabia
• Major Oil Exporters:
S. Arabia (15% of Total Exports & 2. Russia
• Gas Reserves & Producers (GR&P):
Top 4 constitutes 60% of Total GR&P. 12

13.  50 % Global Energy Demand Growth by 2030
• Met by 80% Fossil Fuel & 20% Alternatives with
 Total Global Investments of 52%, 24% & 21% in Power, Oil & Gas sectors
 LPG & LNG Demand Share 40% including UK & EU
• Developing Countries Growth Twice Vs Developed Ones
• 5Bln New Energy Consumers & New development
 Escalating demand, rising oil & gas prices, tight
refining capacity inducing:
• Cost reductions
• Improvement in Production
• Investment in New Technology for
 Improved Margins & Revenue Growth
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14. Global & Regional
 Power & Gas  Refining (Including Petrochemicals)
• Efficient technology installation in Power generation • Environmental compliance investments
- 52% of Total investments • Capex upgrade investment decisions
• Future gas supply assessment, Storage Capacities & • Constantly changing global markets
role of LNG & Gas to liquid (GTL) • Cost reduction programs to Improve NIAT
1. W. Europe supplier, Norway with 45% EU gas due to potential declining margins.
reserves
2. Investments in EU (UK focus) Gas Storage  Retail
Capacities
• Eroding margins in mature markets
3. 30% Global & EU LNG Supply Growth by 2020
(later stage of market development)
• BRICS : 135% demand growth by 2030
 Upstream (E&P) •Early Stage Markets
• High % of Total Oil & Gas Investments  India, China, Russia
• Increase volume from existing reserves • Transitional Markets
• Reduce cost of producing reserves  Brazil
• Partnering & role of NOC’s  Opportunities
• Cost effective technological solutions from suppliers  Urbanization
 High population & demand growth
 Double Digit Fuels market
development
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15. NOC’s
 Control 80% of global oil reserves
 Opportunities & Challenges
 50% in Top 100 companies
• Acquisition of downstream assets
 High margins & prices inducing:
1. Maximize value/barrel
• Fund growth strategy
2. Economic diversification
• Investment in new technology
from service firms like General 3. Drive domestic industry growth
Electric
 Raised training & recruitment budges to
 Access to Reserves Strategy improve talent pipeline by 2030
• Saudi Aramco allocated $50M pear year
• Transition from PSA’s to PSC’s for
high ROI and control on reserves
* IOC’s: International Oil Companies 15
NOC’s: National Oil Companies

16. Moving Forward
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17. Upstream Strategy
 Regional fit for purpose strategy development
• Minimize over–investment in capacity utilization
• Practice for high ROI:
1. Stringent fuel specifications
2. Degradation of crude oil quality
3. High capacity utilization (>90%)
• Appropriate Investments in Projects with Positive NPV on
right - Oil prices in range $70-95 in 2010-2012.
• Weighted Average Cost stands $45/boe
• High Payback Investments costing $65/boe
• Capacity additions by building green-field refineries
• Expansion in attractive alternative energy
• US$ 1 Trillion investment by 2030
• Penetration in LNG emerging markets
• US$250 Bln investment to fuel 100% growth by 2020
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18. Downstream Strategy
 Regional market entry strategy development.
 BRIC emerging economies market development.
 Fuel & Non-Fuel Opportunities (Mature Markets):
 Low Fuel Margins, Efficiency Index & 30% network rationalization 1998-2008
 Current Forecourt CR penetration 17% of CR industry.
 Target high margin CR & capitalize projected £30 Billion industry by 2020.
 Customer centric retailing with RCVP development & implementation:
• BSP, VFM, customer loyalty/penetration, Sales density (£/sqm), Avg transaction
value, shopper marketing
• Desired Customer Experience Offer:
• Store concepts, formats, branding, channel management
• Site & network operations, CRM, Supply chain management
• Card Payment & terminals, huge gap in demand vs actual
• Locations : Store footprints on consumer insight not property deals
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19. Regional & UK Gas Demand & Storage
 30% Global & Regional LNG Demand Growth  UK Gas Supply 2016 Proportion:
by 2020  Domestic production 20%, Imports 80%
 EU: 10% & BRIC’s: 50% (Norway 35%, LNG 35%, Continent 10%)
 IOC’s focus on Global & Regional LNG  Current Gas Imports 40%
acquisitions
 UK Supply Cover Storage
 Gas Supplier Qatar meets 30% of EU, US &
 15 days Vs 100 in France & SC/AC only 4%
Russia demand.
 Will meet 20% of UK Gas demand from 2011
 Investments In Gas Storage :
 From 2010-2020 : 14 bcm (SC/AC - 11%)
 UK - 2nd Largest Gas Markets in EU • Will lead Supply Cover Storage – 45 days
 1999 – 2009 Average demand growth 6%
 Gas Fired Power Generation to drive Gas
demand till 2020
Annual Storage Capacity Storage capacity/ Annual
Consumption (bcm) (bcm) consumption (%)
UK 99 4 4
Germany 101 9 19
Italy 86 13 15
France 46 11 25
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20. Few Other Opportunities for Oil, Gas Utilities &
Service Companies
 Investments by Oil & Gas companies in Upstream generating Order Intake for Vetco Business
 Predominantly Surface (On-shore) AND Subsea (Off-shore) Drilling & Production
 Gas Fired Plants Roll-out for Electricity Generation using Combined Cycle Turbines
 Coal Fuelled Carbon Capture Storage (CCS) Plants Roll-out from 2030 *
• Current Efficiency 35% to rise to 55%
• Potential to Meet 25% of UK Gas / Energy Demand
 Oil Refineries :
 IOC’s divestments of EU Assets (Less Margins & 1% Growth) and investments in BRIC’s
 Alternative Energy:
 Huge UK Government Stimulus Packages for 34% CERT by 2020* (Slide 19)
 Concentrated Solar Panel (CSP) Market:
 $20 Bln Global Industry
 Double digit growth in ALL Markets 2010-2030
 Wind Farms (On and Off-Shore) –More Potential as costs cheaper
 Solar Plants (Farms)
* In US Coal accounts for 50% Power Generation but Generates 80% Emissions
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* CERT-Carbon Emission Reduction Target