MGP the “umbrella” function “umbrella” the – chain supply the Managing SCM GROUP MOL OF WORLD THE performance To improve business PROGRAMS HR NEW Petrochemicals

petrochemicals marketplace petrochemicals improvement in its position the in investments and expects considerable Petrochemicals segment with significant MOL Group is strengthening its Think. Create. Move. community bicycle system bicycle community new the Bubi, MOL ROAD THE ON MOL BUBI October2014

Fourth Issue this edition: petrochemicals contents

ISSUE 04 October 2014 mol group Interview 4 MOL GROUP PETROCHEMICALS IN NUMBERS

petrochemicals› Sándor Fasimon and Oszkár Világi Fascinating facts and figures 6 The Group expects considerable improvement in its position in the petrochemicals marketplace 5 WELCOME

interview interview Zsolt Hernádi, C-CEO refinery EXTENDING THE VALUE CHAIN MOL Group is strengthening its Petrochemicals segment with significant investments in feedstock materials like butadiene will also technology will gain vital new skills and fresh In which areas are there synergies between Bratislava and Tiszaújváros. New workplaces will be created in the Group and among our help other industry players such as rubber technical knowledge, since LDPE4 is based Petrochemicals and Downstream’s other production companies and that’ll move the on modern tubular technology that enables activities that can be exploited? suppliers too. While the Group expects considerable improvement in its position in the INTERVIEW WITH broader economy forward. the manufacturing of about 30 kinds of Sándor Fasimon: There are many interesting Oszkár Világi: By investing in LDPE4, we are polyethylene. Those not working at the new intermediate chemicals along the propylene 6 petrochemicals marketplace. Sándor Fasimon, COO – MOL Hungary and Oszkár Világi, Chairman of the Board and CEO – Slovnaft, gave fascinating answers to our questions. demonstrating that we are a responsible unit will still get similar opportunities in other value chain that are currently being revised employer, striving to ensure optimal production areas. Of course, a number of and may prove attractive. However, we employment both at Slovnaft and MOL contractors are going to be working on the wouldn’t enter any derivative business until Group into the future. The employees construction of the unit, again to the benefit the corresponding end-product markets SÁNDOR FASIMON AND OSZKÁR VILÁGI olefin unitS who will be operating this cutting-edge of employment in the region. appear to be more promising on the strategic he Petrochemicals field From the business viewpoint, this will bring is an important pillar new markets and customers, so that we of Group Downstream, fully expect to be among the absolute top The global market for processing a large amount companies in Europe in this field. Extending the value chain plastics is growing, T of refinery products. How will recent investments by MOL Group How does Petrochemicals affect so we believe this change the value chain? Downstream’s generally unfavourable investment will Sándor Fasimon: In line with our strategy, external environment? Will these new contribute in the ldpe unitS these recent investments will extend our investments bear fruit? value chain, which today is fully integrated, Sándor Fasimon: Due to this year’s results future, not only to from crude oil through to plastics. Due to and short-term analyst forecasts, we look Slovnaft’s figures, but the lack of lighter gas feedstock in Central towards the future with cautious optimism. Europe, MOL Group’s petrochemicals Butadiene prices are expected to rise also to those of MOL

business consumes a mixed feedstock of from their current, relatively low levels. OSZKÁR VILÁGI Group as a whole. naphtha, LPG and gas oil. This enables us As a consequence, Butadiene production to obtain heavier ethylene by-products. profitability will be restored to the level that PETROCHEMICALS Significant investments have begun in both made it an attractive investment option in 10 Bratislava and Tiszaújváros. At our site in the first place. As for LDPE4, we hope efficient hdpe unitS the Slovakian capital, we’re modernising operations will allow us to recoup investment the LDPE product line with a new, state-of- expenditures from the very beginning the-art LDPE-4 unit, and we’re constructing through reduced production costs. The science behind Petrochemicals a Butadiene Extraction/Synthetic Rubber Oszkár Világi: The new plastics production (SBR) plant in Eastern Hungary. These steps LDPE4 unit isn’t just about profit, it’s about re- will significantly strengthen MOL Group’s placing obsolete equipment with something Petrochemicals segment. I firmly believe more up-to-date. At the same time, it ad- that we made the right decisions at the right dresses production diversification at Slovnaft, time because these strategic moves will thus underpinning Upstream operations that help us weather the stormy waters of the would otherwise not be justified. The global European Downstream business. market for plastics is growing, so we believe pp unit Oszkár Világi: Long ago, refineries only this investment will contribute in the future, processed crude oil, but fifty years ago not only to Slovnaft’s figures, but also to Through 2017, we’ll hire production was expanded to include those of MOL Group as a whole. more than 130 new plastics. At Slovnaft, both these products colleagues at our sites INsider are closely linked technologically and Are new Petrochemicals operations economically and our objective is to develop having any positive impact on and the impact on our 12 them even further. Ten years ago, we employment in the CEE region? suppliers will be even launched a new polypropylene production Sándor Fasimon: I’d say that Petrochemicals more significant. line, and today we’re building a new LDPE4 is a job creation engine. Through 2017, we’ll plant to produce polyethylene. Once it’s hire more than 130 new colleagues at our We expect to create Managing the supply chain butadiene unit completed, sometime in late 2015 or early sites and the impact on our suppliers will be OSZKÁR SÁNDOR more than 600 new jobs 2016, our production capacity will rise and even more significant. We expect to create VILÁGI FASIMON SÁNDOR FASIMON SÁNDOR during this period. we should be able to produce new types more than 600 new jobs during this period. of polyethylene with better properties. Looking at it from a distance, petrochemicals

6 MOL GROUP Panorama October 2014 7 synthetic rubber plant 14 GROUP NEWS logistics Projects and developments worldwide 16 EUROPEAN WORKS COUNCIL Infographics Behind the letters EWC Petrochemicals 17 in focus 10 An important pillar of the Downstream value chain Processes & Structures for tomorrow

infographics infographics

ETHYLENE CONFERENCE THE SCIENCE BEHIND STORAGE 18 PETROCHEMICALS The largest oil gathering, 2014 MARKET MOL GROUP PETROCHEMICALS UNITS

SOLD ETHYLENE

SN PetChem

SK TVK INTEGRATED H PETROCHEMICALS UNITS • TVK and Slovnaft together are the biggest plastic DID YOU KNOW? • Current annual feedstock transfer of LDPE PLANT raw materials producers in the CEE region LDPE units operate at extremely 1.9 MT from Refining to Petrochemicals… MARKET • The NEW LPDE Plant – 220 ktpa unit at Slovnaft will high pressure: 2-3000 bar • FLAGSHIP NEWS …and 0.45 MT from Petrochemicals to Refining increase ethylene and petchem feedstock demand • MOL Refinery crude supplies are ensured 20 • Sales offices operate in seven countries: Germany, by pipelines from Russia and from the Poland, Italy, France, Austria, Romania and Ukraine Adriatic sea as the alternative

REFINERY Overview of local news and improvements ETHYLENE

SYNTHETIC RUBBER • One car tyre is usually made of 30-40 PROPYLENE HDPE PLANT components, including 10-15 types of rubber with different compositions LPG C4 NAPHTHA MARKET SYNTHETIC RUBBER PLANT (2017) GASOIL DID YOU KNOW? 1 million tons of polymer STEAM CRACKER UNIT were produced in 2013 HR DEVELOPMENT PROPYLENE 22 MILESTONES IN PETROCHEMICALS HISTORY • 1999 – MOL acquires its first TVK shares • 2000 – MOL becomes majority TVK STEAM CRACKER UNITS shareholder with a 33.34% + stake • 2 in Tiszaújváros – 660 ktpa BUTADIENE PLANT (2015) • 2004 – TVK is integrated into MOL Group We are here to imporve business performance • 1 in Bratislava – 200 ktpa – MOL acquires majority stake in Slovnaft – The Petrochemicals Business Unit is established DID YOU KNOW? • 2007 – MOL acquires a majority stake Steam Cracker Units...... highest temperature: +850 °C in TVK of 94.86% SOLD BUTADIENE • 2011 – Petrochemicals Business Unit is ...lowest temperature: -150 °C MARKET integrated into the Downstream Division ...temperature difference: 1,000 °C PROPYLENE POLYPROPYLENE PLANT • 2013 – The foundation stone is laid for STORAGE an LPDE4 polyethylene production unit in Bratislava, Slovakia SOLD PROPYLENE – The foundation stone is laid for a Butadiene Plant in Tiszaújváros, Hungary DID YOU KNOW? INNOVATION In 1975, Steam Cracker Units in both Slovnaft and TVK started operations 25 The new community bicycle PURCHASED PROPYLENE

10 MOL GROUP Panorama October 2014 11 system – MOL Bubi

26 E&P DS efficiency A world-class business approach 28 PROBLEM SOLVING Millions saved Thousands of ideas: EIFFEL and ÖTR 28 Every idea counts – Eiffel & ÖTR

problem solving problem solving 30 CORPORATE RESPONSIBILITY & THOUSANDS OF IDEAS: EIFFEL AND ÖTR SPONSORSHIP Since 2008, employees have submitted 3,000+ ideas in the EIFFEL Downstream Program,

TIBOR ZÁSZLÓS which have contributed nearly EUR 38 million PROCESS TECHNOLOGY EXPERT What we are proud of to Downstream's efficiency improvements. In PÉTER GYÖRKÖS TERÉZ BACSURNÉ KURUCZ 1998, TVK launched the Ideas Support System GROUP FUEL PRODUCTS DS DEVELOPMENT & PRODUCT SALES REPRESENTATIVE DEVELOPMENT ENGINEER (ÖTR), which sometimes resulted in savings of hundreds of thousands of euros.

he EIFFEL Program is One use of micro wax is as a food Downstream’s Group- industry feedstock. In 2009, the lead- level employee idea ing producer asked to buy significant management system. quantities of two types of micro wax. SCIENCE Its goals are firstly to further sup- We had no such feedstock so we had port efficiency improvements and to buy-in the required amounts. We 32 employee motivation through analysed the requirements and our LÁSZLÓ DÁVID REFINING innovations generated and submit- ideas people met Refining to explore OPERATIONS ted by employees and secondly to likely sources. Then, successful pilot SUPERVISOR provide an incentive to strengthen production started in cooperation Racing fuel – we are now racing a cost-awareness mentality. The with DS Development, Refining Program was launched in 2009 and, and Controlling, contracts were

since then, several subsidiaries have signed and, in 2013, we successfully ERNŐ TÓTH BASE OIL AND WAX joined the initiative, in addition to processed 630 tons realising ~EUR VIKTOR GYŐRI PRODUCTION GROUP FUEL PRODUCTS MOL MANAGER MOL and Slovnaft Downstream. 65,000 net profit. In 2014, we will sell SALES REPRESENTATIVE The purpose of the TVK ÖTR Pro- 2kt of these three products to realise gram is to encourage employees for EUR 206,000. Since we have to generate novel and advanta- heard our main competitor, Shell, will geous solutions to resolve various stop base oil production at the end of reactor equipment was analysed Heating oil sold by MOL and B7 ethylene and 6 tons of isobutene. technical, safety and administrative 2015, demand for our products will and production difficulties were quality diesel by Slovnaft used to The idea was simple. Feed this accu- problems. ÖTR follows up and grow. Our maximum possible output found, potentially arising from in- go to the same Austrian market, mulated hydrocarbon mixture back monitors employee ideas from of 15kt could produce a profit of EUR creased charge size, which could be but B7 production was more into the solvent recovery unit using IN DETAIL submission through implementation 1 million per annum. manually monitored by re-installing expensive at Slovnaft. How could a simple cross-connection between 33 to post-appraisal. If the implementa- the sight glass method, which is we change this to meet customer this nitrogen pipeline and and the tion of an idea results in financial critical because the foam phase that requirements if there were a inlet line of the guard filter of the savings then the idea originator is might emerge during reaction can problem with MOL’s heating oil ÖTR Idea (TVK) flash gas compressors. In this way, the recognised financially through the be swiftly detected. Thus the exist- supply? As a first step, we decided Title: Reducing hydrocarbon loss hydrocarbons can be reco-vered and EIFFEL Program and at TVK through ing service can maintain production. to sell normal diesel as heating oil in the PE-1/HDPE-1 plant – already reused. The ethylene fraction is sent MOL Group online communication the ÖTR Program. The idea could produce HUF 3.5 using road tanker cars (RTCs), to implemented back to the Cracker as vent gas and million in savings per year. reduce logistics costs. After selling Idea generator: JÁNOS OROSZ the recovered isobutene is re-used in EIFFEL Idea (MOL – Supply & Sales/ the first 14kt in January 2010, we (PE-1 unit system operator) the plant. The estimated project cost DSD/Refining) EIFFEL Idea (MOL-LUB) distributed heating oil as a norm. Hydrocarbons accumulate in the totalled EUR 8,700 and EUR 83,000 Title: Improving capacity utilisation Title: Improving use of RALOX We met Commercial & Logistics PE-1/HDPE-1 Plant feed prepara- can be achieved in annual savings, in micro wax (BSLO) processing and production equipment and decided to use barges which tion section regeneration nitrogen with a ROI of less than 2 months. platforms reloaded solvent de-waxing in the MEK plant Idea generator: TIBOR KOVÁCS meant higher savings. A pilot pipeline when it is out of use, due and micro-hydro-generation in the (Refining foreman) barge load to Korneuburg was to a lack of tight hydrocarbon MIH plants To reduce energy consumption, successful. Today we ship B7 die- valves. In the past a 2" connecting Idea generators: indicators are a priority, particularly EIFFEL Idea (SLOVNAFT, a.s. – SCM) sel, heating oil, normal quality and pipe was installed between this PÉTER GYÖRKÖS & VIKTOR GYŐRI in the additive production plant, so Title: Loading heating oil on to Slovak quality, in barges. We now nitrogen pipe and a flare pipe for Contributors: the opportunity to introduce higher barges in Port Bratislava produce original heating oil qual- the de-pressurization of the system. TERÉZ BACSURNÉ KURUCZ, charge size emerged when various Idea generator: KARIN TÓTHOVÁ ity and save valuable components. This earlier modification solves the Join the program now, we are counting LÁSZLÓ DÁVID, ATTILA HORPÁCSI, options were analysed using existing (Supply & Distribution The 5-year average benefit is over-pressurizing problem, but causes on your ideas as well - contact your local coordinator! ERNŐ TÓTH , TIBOR ZÁSZLÓS RALOX plant equipment. R-7/1 Planning Expert) EUR 4.3m. a monthly loss of roughly 2 tons of BARREL PER DAY 28 MOL GROUP Panorama October 2014 29 34 Guide to today’s trends and future developments

MOL Group Panorama – The Internal Magazine of MOL Group Published quarterly . Magazine Founder: MOL Group Corporate Communications . Executive Publisher: Dominic Köfner, Vice President - MOL Group Corporate Communications. Magazine Manager: Aranka Kiss . Managing Editors: Anna Hőgyész, Árpád Lipcsei, Virág Váraljai . Contributors: MOL Group HQ Editorial Board, Flagship and Operating Company Representatives . Publisher: HG Media – 1016 Budapest, Lisznyai u. 38. . Design: HG Media, Tamás Tárczy . Photos: Fotógyár English Editor: Jeremy Lovitt-Danks

October 2014 3 Mol Group Petrochemicals in numbers welcome MOL Group Petrochemicals is Dear MOL Group one of Europe’s Colleagues and MGP Readers, TOP10producers 2petrochemicals sites 3 olefin plants In this edition, MGP explores MOL Group Petrochemicals, an important pillar of the and 8 polymer Downstream value chain. Don’t forget, dozens of items we use in our everyday lives at home, units with 1.2mof combined polyethylene/polypropylene tons capacity outside and in the office are made from Petrochemicals, so this is a vital area of our business that affects everyone personally.

Global market Coordinated Sales, Market- Over the last ten years, this area of our operations has also had to contend with presence, with ing and Logistics activities: decidedly adverse market conditions. Last year, sales to nearly however, Petrochemicals was in a position to customers in 10 market report significantly improved results. segments, from Auto- The last two years were very busy for motive to Packaging Petrochemicals. Let me give you two key examples: the Integration of Slovnaft Petrochemicals, s.r.o., into SLOVNAFT, a.s., 1,600 as of 1 January 2013 and the successful recommissioning of the TVK LPDE-2 plant in Sales offices operating Hungary. In addition, this year will be entirely taken up with increasing efficiency, a core task, in seven countries all in accordance with targets set by the New 5countries from Germany, Poland, Italy, France, Downstream program. I’ve purposely left something that I’m most Mexico to China Austria, Romania and Ukraine proud of to the end of this list: the success stories that set an example to all of us and clearly show how MOL Group will have to operate in the future. I’m sure everyone already knows what I’m talking about! I’m referring, of processing refined course, to our recent investments in Slovakia and Hungary. Our new petrochemicals assets products – the Slovnaft LPDE-4 unit, the TVK butadiene 1.9MT extraction unit and our Synthetic Rubber plant, where we took a significant step forward beyond butadiene and expanded the value chain – represent new approaches to the way we operate, that is to say proactively, responsibly and by adding real value. We are only just New investments: beginning, but we are on the right track. So come with me and explore the world of MOL Synthetic New LDPE Group Petrochemicals. MGP, as usual, provides all Butadiene the interesting details you need to know about! rubber Enjoy a good read! plant ktpa unit 130ktpa unit 220ktpa unit commercial 60operations planned from 2017 – at Slovnaft will operations since implemented with experienced global increase Petchem Zsolt Hernádi May 2015 partner Japanese Synthetic Rubber (JSR) feedstock demand Chairman & CEO

4 MOL Group Panorama October 2014 5 interview interview EXTENDING THE VALUE CHAIN

MOL Group is strengthening its Petrochemicals segment with significant investments in feedstock materials like butadiene will also technology will gain vital new skills and fresh In which areas are there synergies between Bratislava and Tiszaújváros. New workplaces will be created in the Group and among our help other industry players such as rubber technical knowledge, since LDPE4 is based Petrochemicals and Downstream’s other production companies and that’ll move the on modern tubular technology that enables activities that can be exploited? suppliers too. While the Group expects considerable improvement in its position in the broader economy forward. the manufacturing of about 30 kinds of Sándor Fasimon: There are many interesting petrochemicals marketplace. Sándor Fasimon, COO – MOL Hungary and Oszkár Világi, Oszkár Világi: By investing in LDPE4, we are polyethylene. Those not working at the new intermediate chemicals along the propylene Chairman of the Board and CEO – Slovnaft, gave fascinating answers to our questions. demonstrating that we are a responsible unit will still get similar opportunities in other value chain that are currently being revised employer, striving to ensure optimal production areas. Of course, a number of and may prove attractive. However, we employment both at Slovnaft and MOL contractors are going to be working on the wouldn’t enter any derivative business until Group into the future. The employees construction of the unit, again to the benefit the corresponding end-product markets who will be operating this cutting-edge of employment in the region. appear to be more promising on the strategic

he Petrochemicals field From the business viewpoint, this will bring is an important pillar new markets and customers, so that we of Group Downstream, fully expect to be among the absolute top The global market for processing a large amount companies in Europe in this field. plastics is growing, T of refinery products. How will recent investments by MOL Group How does Petrochemicals affect so we believe this change the value chain? Downstream’s generally unfavourable investment will Sándor Fasimon: In line with our strategy, external environment? Will these new these recent investments will extend our investments bear fruit? contribute in the value chain, which today is fully integrated, Sándor Fasimon: Due to this year’s results future, not only to i from crude oil through to plastics. Due to and short-term analyst forecasts, we look lág i Slovnaft’s figures, but the lack of lighter gas feedstock in Central towards the future with cautious optimism. also to those of MOL Europe, MOL Group’s petrochemicals Butadiene prices are expected to rise kár v

business consumes a mixed feedstock of from their current, relatively low levels. osz Group as a whole. naphtha, LPG and gas oil. This enables us As a consequence, Butadiene production to obtain heavier ethylene by-products. profitability will be restored to the level that Significant investments have begun in both made it an attractive investment option in Bratislava and Tiszaújváros. At our site in the first place. As for LDPE4, we hope efficient the Slovakian capital, we’re modernising operations will allow us to recoup investment the LDPE product line with a new, state-of- expenditures from the very beginning the-art LDPE-4 unit, and we’re constructing through reduced production costs. a Butadiene Extraction/Synthetic Rubber Oszkár Világi: The new plastics production (SBR) plant in Eastern Hungary. These steps LDPE4 unit isn’t just about profit, it’s about re- will significantly strengthen MOL Group’s placing obsolete equipment with something Petrochemicals segment. I firmly believe more up-to-date. At the same time, it that we made the right decisions at the right addresses production diversification at time because these strategic moves will Slovnaft, thus underpinning Upstream opera- help us weather the stormy waters of the tions that would otherwise not be justified. European Downstream business. The global market for plastics is growing, so Oszkár Világi: Long ago, refineries only we believe this investment will contribute in processed crude oil, but fifty years ago the future, not only to Slovnaft’s figures, but Through 2017, we’ll hire production was expanded to include also to those of MOL Group as a whole. more than 130 new plastics. At Slovnaft, both these products colleagues at our sites are closely linked technologically and Are new Petrochemicals operations economically and our objective is to develop having any positive impact on and the impact on our them even further. Ten years ago, we employment in the CEE region? suppliers will be even launched a new polypropylene production Sándor Fasimon: I’d say that Petrochemicals n more significant. o

line, and today we’re building a new LDPE4 is a job creation engine. Through 2017, we’ll m plant to produce polyethylene. Once it’s hire more than 130 new colleagues at our si We expect to create

completed, sometime in late 2015 or early sites and the impact on our suppliers will be Fa o r more than 600 new jobs oszkár Sándor 2016, our production capacity will rise and even more significant. We expect to create világi Fasimon Sánd during this period. we should be able to produce new types more than 600 new jobs during this period. of polyethylene with better properties. Looking at it from a distance, petrochemicals

6 MOL Group Panorama October 2014 7 interview interview

horizon. Shifting Petchem feedstock, mostly Sándor Fasimon: When thinking about strategic decisions in the coming years. Unit, is a key element for future LDPE4 unit have taken part in the Danube Refinery we have acted on over 400 ideas naphtha, towards lighter composition is petrochemicals developments, we must As for the olefin plants, any modernisa- production. Besides ethylene, the Steam LEAN program to become acquainted with for improvement. Petrochemicals is another possibility. As for raw materials for always bear in mind the capital intensity tion must aim to improve profitability Cracker will produce other products for the best MOL Group practices and to increase no exception. Processes have been olefin production, there might be options of this industry. If modernising an existing through modified feedstock composition Group such as propylene, benzene, while the success of the first wave at Tiszaújváros. effectively put in place to help us other than steam cracking, some of which older plant requires considerably less capital and reduced energy consumption. Since C4 mixture will be processed by the new Through LEAN lenses and fresh minds, three start up LDPE4. As part of LEAN, we could significantly affect Downstream. investment than building a new unit, then these units play a key role in Refinery/ butadiene unit of TVK – giving an example of working streams were launched to generate are dedicating ourselves to obtaining However, an examination of such options will renovations are much more cost-efficient. Petchem integration, evaluation of the multi-site petchem integration. bottom-up ideas. With the involvement of improved efficiency and better shift need to proceed with particular caution. However, product competitiveness must be feasibility and economics of any major blue-collar experts, 49 ideas were identified, worker multi-functionality at the Oszkár Világi: There’s going to be genuine the deciding factor for a revamp – improved change will require intensive study. We have all heard about LEAN – 90% of which have been implemented. Steam Cracker, while simultaneously synergy, particularly when maximising unit cost hardly compensates for disappear- Oszkár Világi: An essential component of the how is Petrochemicals taking its The LEAN philosophy has been firmly planted streamlining the processing of work materials and energy flow interfaces ing demand or declining price levels. entire process is the extensive renovation philosophy on board and how can in the minds of our colleagues to ensure permits, at the same time. The Steam between Downstream and Petrochemicals. In the case of polymer units, this is a of our Steam Cracker, which was built 40 it be applied to its processes? continuous improvement and to challenge all Cracker is at the heart of Petrochemicals This will let us stand on our own two feet. major concern at TVK, since Slovnaft is years ago! The cost of upgrading appears to Sándor Fasimon: LEAN offers a new of our current practices all the time. and we should therefore be operating it The mere existence of Petrochemicals already on the way to having two mod- be roughly EUR 40 million. This investment approach to daily operations by eliminating Oszkár Világi: At Slovnaft we have in tip-top shape. The next LEAN wave is adds flexibility to the whole system. What ern, competitive-scale units, the PP-3 and is vitally necessary since ethylene, the raw non-valuable activities so as to make our incorporated LEAN in our everyday going to focus on better use of energy all this means is that both pillars of our the LDPE-4. At TVK, we will face tough material produced by the Steam Cracker work culture more efficient. Our colleagues lives and over the past two years and output at the Steam Cracker. activities are going to bring the Group even more financial stability. If either part slows How can MOL Group Petrochemicals down, the other will help compensate for compete in light of international trends fluctuations. Don’t forget that there are and challenges? products we both consume and produce. Sándor Fasimon: On the sales side, we’ll Synergy shows that if we didn’t have Petrochemicals feedstock There’s going to be genuine definitely have a very competitive product Petrochemicals, we would have to buy part materials like butadiene synergy, particularly when portfolio, especially of film grades, the of our production in the market place. introduction of which will be supported by will also help other industry maximising materials and extensive pre-sales marketing. If market How will Petrochemicals contribute to the players such as rubber energy flow interfaces analyses are reliable, the European LDPE field success of the New Downstream Program? is the least threatened by competition from Sándor Fasimon: TVK ensures continuous production companies and between Downstream imports. Further penetration of LDPE grades developments by placing a strong emphasis that’ll move the broader and Petrochemicals. into film applications will certainly create on effective New Downstream Program significant market opportunities. Having high management. Steady idea generation has economy forward. This will let us stand on quality products is definitely an advantage resulted in approximately 40 action plans our own two feet. from this viewpoint. The MOL Group being registered in the program and – Polymers area is also very competitive in the due to the Idea Support System – many level of service provided and in its knowledge valuable ideas have also been submitted of CEE markets. In the latest customer by employees. With well-disciplined execu- satisfaction surveys, we found that price isn’t tion, these actions will generate USD 32 Sándor Fasimon Oszkár Világi the only important factor for our customers million, a newly-revised target, by the end when choosing a supplier. Availability and of 2014. Our vision for the future is to con- Since October 2012, Sándor Fasimon In March 2006, Oszkár Világi was quality of materials are as important as price tinue these excellent practices during the has been Chief Operating Officer appointed CEO of Slovnaft. Today or even more important. Since we can’t be next Downstream Program, thus increasing of MOL Hungary. In 2005-2006, he is Chairman of the Slovnaft Board competitive on the cost-side versus Middle the competitiveness of Petrochemicals. In Sándor, apart from managing the of Directors and a Member of MOL East polymer producers, we have to focus on Group’s Executive Board, as well as addition, through successfully cooperating Gas & Power Division, acted as Head the above-mentioned areas. being a Member of the MOL Plc. with the world’s leading Japanese petro- of Upstream Portfolio Development Oszkár Világi: As I have already mentioned, and was then promoted to manage Board of Directors since 1 May, 2011. chemicals company, JSR, we’ve got a great Downstream in our Group is based on two MOL’s activities in Russia. From July He is also a Member of the INA d.d. opportunity to deepen our knowledge in pillars. The plastic business’s economic 2009, he was Senior Vice President Supervisory Board. In 1992, he was this area, thus increasing – Supply & Trading, where he was co-founder of the Csekes, Világi, performance is currently weaker, but our competitiveness. responsible for MOL Group crude Drgonec & Partners law practice. we firmly believe it’s going to improve. Oszkár Világi: I see the new technology’s eco- oil supplies, development of the In 1990-1992, he was a Member of The petrochemicals market is exposed nomic value deriving from a decrease in input energy portfolio, trading platform the Czechoslovakian Parliament. to the global impact of Asian and North materials and lower energy consumption by operations, as well as for natural gas From 1996, he was a member of the American producers. However, we have about 5%. After raw materials, energy is the and energy trading. As Executive Vice supervisory and governing bodies of a competitive advantage here at home Group’s greatest expense. On the other hand, President – Exploration & Production, several leading Slovakian companies. having served our customers for many Oszkár Világi graduated from the this investment also has ecological aspects he has been a member of the MOL years and knowing their requirements Commenius University Faculty of Law, – emissions and the negative impact on the Group Executive Board since June intimately. Modernising our polyethylene 2011 and also continues to be so in Bratislava and received his Doctorate environment are reduced. production lines and constructing new his new position. Sándor Fasimon is in Law (JUDr.) in 1991. He was legal ones such as the butadiene unit will permit the Chairman-CEO’s special envoy to advisor to foreign investors in major What about “old” assets? Are there CIS and the Middle East. Slovakian industrial restructuring us to continue to offer our customers any efficiency or modernisation projects before joining MOL Group. affordable products. That is why we are programs in the works? investing in the coming decades.

8 MOL Group Panorama October 2014 9 infographics infographics

ethylene The science behind storage Petrochemicals MAR mol group KET petrochemicals units

SOLD ETHYLENE

SN PetChem

SK TVK Integrated H petrochemicals units • TVK and Slovnaft together are the biggest plastic Did you know? • Current annual feedstock transfer of LDPE PLANT raw materials producers in the CEE region LDPE units operate at extremely 1.9 MT from Refining to Petrochemicals… MAR • The NEW LPDE Plant – 220 ktpa unit at Slovnaft will high pressure: 2-3000 bar • …and 0.45 MT from Petrochemicals to Refining KET increase ethylene and petchem feedstock demand • MOL Refinery crude supplies are ensured • Sales offices operate in seven countries: Germany, by pipelines from Russia and from the Poland, Italy, France, Austria, Romania and Ukraine Adriatic sea as the alternative

refinery ethylene

Synthetic Rubber • One car tyre is usually made of 30-40 Propylene HDPE PLANT components, including 10-15 types of rubber with different compositions LPG C4 NAPHTHA MAR synthetic rubber PLANT (2017) KET GASOIL Did you know? 1 million tons of polymer steam cracker unit were produced in 2013

MILESTONES IN propylene PETROCHEMICALS HISTORY • 1999 – MOL acquires its first TVK shares • 2000 – MOL becomes majority TVK Steam Cracker Units shareholder with a 33.34% + stake • 2 in Tiszaújváros – 660 ktpa butadiene PLANT (2015) • 2004 – TVK is integrated into MOL Group • 1 in Bratislava – 200 ktpa – MOL acquires majority stake in Slovnaft – The Petrochemicals Business Unit is established Did you know? • 2007 – MOL acquires a majority stake Steam Cracker Units...... highest temperature: +850 °C in TVK of 94.86% SOLD BUTADIENE • 2011 – Petrochemicals Business Unit is ...lowest temperature: -150 °C MAR KET integrated into the Downstream Division ...temperature difference: 1,000 °C propylene polypropylene PLANT • 2013 – The foundation stone is laid for storage an LPDE4 polyethylene production unit in Bratislava, Slovakia SOLD PROPYLENE – The foundation stone is laid for a Butadiene Plant in Tiszaújváros, Hungary

Did you know? In 1975, Steam Cracker Units in both Slovnaft and TVK started operations

PURCHASED PROPYLENE

10 MOL Group Panorama October 2014 11 insider insider MANAGING THE SUPPLY CHAIN There is only one single value-creating Tamás Szabó process in Downstream: taking crude Zuzana Spanova Manager – Group White Róbert Mwasaru Senior Expert – Group SCM Product Line Manager – Group SCM Planning & Optimization Planning & Optimization and converting its hydrocarbon Branislav Vinter Manager – Group Distribution & Scheduling Zoltán Szabó molecules into products like diesel, Béla Kelemen Head – SVP – Group Supply MOL Hungary SCM gasoline, propylene, bitumen, etc. and Chain Management then delivering them to customers.

o manage this process run like a Swiss watch, or even a bit properly and maximize better! One of the most crucial ele- profitability in the short, ments of our DS activities is to have middle and long terms, real market-driven operations. Since the operations of 6 production demand growth has disappeared plants with more than 80 units, and production costs are steadily 25 terminals and 5,000 rail tanker increasing, it is critical to streamline cars and the work of ca. 10,000 supplies to customers, to listen very employees all need to be harmon- carefully to their requirements or to ised to meet the requirements of even predict their requirements. 30,000 customers in 12 countries. That is why product line manage- István Péter Manager – Group Black In this grand game, some 80-90 ment was introduced to maximize Product Line people in global and local SCM earnings all along the product teams work to prepare, year by year, stream and to minimise resources month by month, the best possible used including assets, inventory, Business and Rolling Plans and to and human and financial resources. design, week by week, day by day, They optimize a particular product the best possible schedules to make stream to obtain the shortest route MOL Group Downstream operations and time to the customer.

The 3 pillars of business operations

Keep the balance PROCESS between Rolling Planning, Business Planning, all 3 pillars Strategic Planning, Scheduling, Peter Šrámek Inventory Management Director – Slovnaft SCM Szabolcs Vida Manager – Group LUB Product Line

Krisztina Petrényiné Szabó Manager – Stefano Forte Group Petchem Product Line Director – INA SCM

the Voice of customer

PEOPLE highly knowledge- F = SV * SP – (PV * PP + CostProdLog) TOOLS Did you know? 1 week vs PIMS, ORION, NICE able, globally think- Inventory ‘14 Program This is the basic mathematical formula of PIMS upon which the whole of MOL Group ing and experienced Inventory is generally a symptom of poorly managed processes optimization is based. The ‘F’ function, the difference between income from products sold 4 months colleagues, and the costs of products purchased and product manipulation, has to be maximised. The molecules of one of our most PIMS experts • Review internal process and roll-out actions to find optimum inventory levels 90% attractive products diesel, “travel” • Define challenging average inventory levels for each MOL Plastic is light as a feather but within the MOL Group system. Group companies stronger than steel. Around 50% of 16,000 The fastest ones spend less than • Inventory value in January-July 2014 was USD 290m lower compared an average car is plastic engineering By handling approximately 16,000 pieces of data and creating a matrix with 45,000 a week in transit, but the slowest MORE FROM LESS to the same period in 2011, thanks to lower inventory by 344 kt materials by volume, jumping to columns and 40,000 rows, PIMS, the general tool of Group SCM, sets operational ones sometimes hang around for almost 90% for race cars. targets for the next Rolling Plan period. up to four months.

12 MOL Group Panorama October 2014 13 group news group news

News in brief MOL GROUP FURTHER MOL GROUP DISPATCHES SECOND MOL SLOVENIJA OPENED STRENGTHENS ITS RETAIL SHIPMENT OF RELIEF aid TO NORTH ITS 34TH SERVICE STATION On 1 July, MOL Slovenija opened its POSITION IN THE WAZIRISTAN, PAKISTAN 34th service station – MOL Rožna Dolina CZECH REPUBLIC MOL Pakistan Oil & Gas Company, a MOL Group subsidiary, has put together seven in Nova Gorica. The new station covers truckloads of food parcels, which were presented by Alexander Dodds, EVP – Group E&P MOL Group has entered into an agreement with LUKOIL for 642m² and includes a shop, LPG and to Khaqan Abbasi, Minister of Petroleum & Natural Resources and Abid Saeed, Federal carwash. MOL Slovenija now operates the purchase of LUKOIL’s retail network in the Czech Republic. Secretary. These relief goods meet the needs of 1,000 internally displaced (IDP) families 34 service stations in the country. MLUKOIL’s network consists of 44 service stations with countrywide M for a week. MOL Pakistan, presently working in the TAL Block which consists of the coverage, high average fuel sales per station and a strong districts of Karak, Kohat and Hangu, actively supports Pakistani people in need. FIRST GROUP-LEVEL non-fuels business. Through this acquisition and the recently OHS REPORT PUBLISHED announced purchase of the ENI network, MOL Group will own 318 The 2013 Group Operational Health & stations in the Czech Republic and firmly establish itself as one of Safety (OHS) report has been published in the leading motor fuel retailers in the country. This will significantly line with international industry standards. strengthen the Group’s position in the Czech Republic and The intention here is to provide an contribute to delivering the Downstream strategy of increasing overview of last year’s performance and retail presence within the supply radii of its core refineries. Lars act as a benchmark for our competitors. Höglund, Senior Vice President – MOL Group Retail observed: Despite all efforts so far, we still have a “This acquisition is an important step in further strengthening long way to go to improve our health & our presence in the Czech marketplace and our strategic target safety performance. of being a leading player in the CEE region. We are committed to continuously improving our offer to our customers by delivering NEW MOL GROUP SCIENTIFIC MAGAZINE The magazine is designed to share the best possible products and services at our stations.” information related to the oil and gas industry and report on global world economic issues and long-term technological and economic trends. The THE JOURNEY latest issue features EU-level topics, as CONTINUES! well as MOL Group development activities, Congratulations to best practices and processes. We’re still here for you… OUTLOOK WEB ACCESS (OWA) all GCC participants! IS SET AS DEFAULT FOR EVERY USER The 100-day Global Corporate Challenge team competition is over. OWA permits one to reach one’s Outlook With its daily average of 14,705 steps, MOL Group performed above (e-mail) account from any external the industry average of 12,937 steps and remained among the most device or location, e.g. from home highly active companies all the way. This is thanks to the remarkable START OF computers or internet cafés through number of MOL Group participants. a simple web browser with CCollectively, colleagues went a total distance of 730,191 km. PRODUCTION no VPN connection. This equates to walking around the world 18.22 times whilst burning off a total 191,675,013 kJ of energy. The above results reflect great IN THE MOL GROUP STYLE GUIDE steps towards more active and healthier lifestyles for all. The aim of the MOL Group Style Guide Let’s keep up the good work during the individual challenge as well! IZABELA FIELD is to ensure that we share a common INA and Edison International S.p.A. platform of corporate culture, etiquette started production in the North and language. This publication instructs SAdriatic Izabela field in July, after all MOL Group employees in how best to having resolved the last remaining communicate within the organisation, as well as externally, thus representing MOL LEAN enters the © 2014 Get the World Moving Limited issues and thus meeting all 7th phase at Slovnaft preconditions for commencing gas Group in a uniform way. gettheworldmoving.com In September Slovnaft entered the exploitation. The Izabela gas field 7th LEAN phase in the SCM depart- is located 60 km off Pula. Total gas SUMMER INTERNSHIP AT SLOVNAFT ment – a revamping of the ethylene reserves are estimated at about 12 students from the Slovak Technical plant, electricity distribution and 1.4 billion m³, with an expected University took part in internship L programs at Slovnaft. They then energy supply. Attention will also production of approximately MOL GROUP AGREES to presented their work to refinery be paid to sustainability and trai- 280 million m³ per year. Two management and the university, ning of new staff members entering AKRI-BIJEEL FIELD DEVELOPMENT production platforms have been based on their experiences and fresh the GROWWW program. LEAN has installed at a depth of 37 metres. knowledge gained. The five best already passed the sixth phase, PLAN with the KURDISH MINISTRY Gas will be transported to the students will receive scholarships and be which focused on dry runs. Overall, MOL Kalegran, operator of the Akri-Bijeel block, has agreed its field development Ivana A and Ivana K platforms, selected for Growww based on feedback it was attended by 524 employees plan with the Kurdish Ministry of Natural Resources. The Field Development Plan also located in the North Adriatic, from the trainers, university grade and developed 130 new ideas and (FDP) covers commercial discoveries in the Akri-Bijeel block, as well as the Bijell and where it will be further processed point averages and their desire to be improvements, out of which about Mthe Bakrman areas. Total block production is expected to increase to a minimum and compressed and then released employed at Slovnaft after graduation. 50 have been implemented to date. of 50 mboepd by 2017-18. MOL Kalegran is a 100 % MOL Group subsidiary and has into transmission systems going to been an operator in Kurdistan since 2007. Croatia and Italy.

14 MOL Group Panorama October 2014 15 in review in focus Behind the structures & FOR letters EWC processes TOMORROW The level What is the European Works The aim of the EWC Council and what is it for? is to inform and of control A brief explanation. consult employees and support on all employment- exercised related issues on an Legislative background international scale. by functions The establishment of the European Works needs to Council (EWC) was ordained by a European Parliament and Council Directive and has thus Fast Forward will be aligned entered into EU member state legislation. optimise the operating The Hungarian act governs multinational model of Functional with the companies with headquarters in Hungary aspirations and thus includes MOL Group. The aim of Units so that they best the EWC is to inform and consult employees support value creation of the on all employment-related issues on an international scale. of our businesses. businesses.

Structure e launched a The EWC has 25 ordinary members representing Group-wide the countries in which MOL Group has a program called company employing at least 100 people. Fast Forward in In the Council there are 9 Croatians, W July 2014 with the 8 Hungarians, 4 Slovakians, 1 Austrian, aim of enhancing cooperation between 1 Italian, 1 Romanian, 1 Slovenian and a Serbian MOL Group’s Functional and Business observer. Almost 100% of EWC members are Ernő Bakos Units and to increase the balance of Chairman – trade unionised and the Council has five female MOL Group EWC the organisation between Group and members, which is less in proportion to the Flagships. Our primary goal is to care- total number of female Group employees. fully analyse MOL Group supporting The EWC’s governing body is the Executive The way of cooperation function processes and improve these Committee with a chairman, the two vice- to the greatest possible extent. chairmen and an executive member. Actively cooperates with different committees such as the MOL Group Ethics The key to a successful and profitable Activities Council, the MOL Group HAY Committee, etc., so as to track fair treatment of organisation is that the level of employee rights and also takes an active part in labour relationship development. The MOL Group European Works Council control and support exercised by Dr. Berislav Gašo was established in 2004. Its activities – functions needs to be aligned with Fast Forward Program Director SVP – Group Controlling, the practice of informing and consulting the aspirations of the businesses. Accounting & Tax Provides training for its members and occasionally members from employees – are implemented through an MOL Group has several business one or more other countries participate in training sessions. annual general meeting in Hungary, employee excellence initiatives that require an and to review the nice-to-have and businesses, Group and Flagships. It forums, consultative meetings to inform operating model in which Functional control parts of our activities. This, is our experts and leaders who own people on current issues and consultation Maintains close international relationships with European trade Units can best enable value-creation in turn, could help us further clarify supporting function processes which on any given topic with the relevant senior unions and holds consultations that are also open to trade union in our businesses. Therefore, with Fast accountabilities and then design and makes their engagement crucial. We managers. The Executive Committee generally representatives, active in MOL Group. Forward, we aim to find the answers to set up the right structures necessary will not only consult them but will meets monthly, discusses current issues and a number of pressing questions about for process optimisation. also include both the functional and regularly visits MOL Group companies in business criticality, quality, quantity business perspectives so as to validate EU member states so as to maintain direct Communications channels are direct meetings with members, and the efficiency of our functional Fast Forward’s success lies in the any proposed alignments and we invite electronic correspondence, telephone conversations, company relationships with a wide range of employees, and trade union press and the www.mos/sites/eut intranet page. processes. There is always room to effective cooperation and team work all our colleagues to speak up and to listen to their opinions and remarks. further streamline and simplify these of our colleagues across functions and contribute their suggestions.

16 MOL Group Panorama October 2014 17 conference conference The largest oil gathering, 2014 The World Petroleum Council (WPC) held its 21st Congress in Moscow between 15 and 19 June this year. MOL Group played an active role in the Congress. On the first day, József Molnár, Group CEO gave the keynote address on the topic of “Sustainable financing of the industry”.

ey trends affecting MOL Group call for a disciplined approach to finance and funding. “Over the last few years we’ve K seized a number of opportuni- ties and met a number of challenges. To sum up briefly, our Petchem business has moved into a very profitable phase in spite of an unfriendly environment. Our Downstream business has remained a strong cash con- tributor to the Group. For our Exploration & Production arm, the Russian upstream market is a great place to invest in and we are actively looking for new opportunities here to meet our growth targets. We are already conduct- ing exploration efforts in our current assets and are very much looking forward to positive results. In the CEE Upstream, we maximize production and optimize cash in the short to middle terms, however we cannot change our nature as we experience a low single digit decline in resources every year. In addition, MOL Group has been further in- volved in a technical program whereby com- pany experts conduct research into potential solutions to the problems of overpressure volume growth, targeting a balanced port- and migration when drilling. folio. We are moving forward with an active Facts and figures about WPC We put in place a USD 500 million efficiency WPC elects its first M&A strategy to enter a new league. Our improvement program which already deliv- key principles and goals are rigorous capital • • ered outstanding results in 2013. Hungarian president discipline, improving the portfolio’s overall 1933 dialogue The foundation of the The founders’ goal is to promote dialogue However, the Company has had to comply risk profile, focused geographical diversifica- World Petroleum Council (WPC) between rival parties with much more stringent EU legislation on At the 21st WPC congress, József Tóth tion, establishment of new strategic partner- chemicals that is now in force and is poten- was elected WPC President for the ships like Wintershall and TPAO, potential next three years. The WPC holds its congress, hosted • goal • 69 tially costly in HSE terms for oil and gas com- farm outs, perhaps partial and also possibly To facilitate sustainable supply and The London-based international organisation has at by one of its member countries, as the principal panies in Europe and beyond. In Gas & Power risk sharing and optimisation of project efficient consumption of oil and gas and present 69 member countries. OPEC and non-OPEC meeting place for the global discussion of oil and gas there are regulatory and market challenges. financing. A critical factor in successful M&A other energy carriers for the benefit of countries are members representing both national issues. Dr. Tóth has also served as Executive Chairman the general public. It is the main forum of and independent oil companies To achieve flexible development in regional is talented human capital to revitalise staff of the Board of the Olajterv Oil & Gas Engineering the global oil and gas industry Gas Midstream it is very important to invest Group. He is the founder and current president of the and organisations, to select the right equip- at the right time, but this field is not a growth Hungarian Petroleum Association and also helped to ment, to manage integration, to resist ‘deal • participation • 3 driver at the moment, while developments fever’ and to ensure financial readiness.” In addition to oil companies, universities, WPC Congresses are held every three years in a set up the Hungarian Strategic Petroleum Reserve. research institutes and government agencies member country. The next meeting will be held in the market place have killed off the Energy may also participate in national committees in Istanbul, in 2017 Venture concept and our CCGT projects. József Molnár We are now focusing on value creation over Group CEO

18 MOL Group Panorama October 2014 19 flagship news flagship news

News in brief

MOL GROUP’S CONCEPT INA’S SIGNIFICANT FIRST BURGER KING IN CROATIA SERVICE STATION MODERNIsATION PROGRAM LOCATED AT TIFON SERVICE Due to an intensive modernisation program, INA today operates 190 modernised service STATION AT DRAGANIĆ SOUTH WINS PRESTIGIOUS stations and is therefore by far the largest up-to-date network in Croatia. Following the Tifon, recognised as a top brand in the GREEN AWARD success of the pilot phase, INA is continuing with the project and looking for new partners to Croatian marketplace, always strives to meet the needs of its customers with A very special MOL Group service station has received manage the service stations. In the operational model, the company retains ownership of the Energy Globe National Award (EGNA), presented by all retail assets including concessions, properties, buildings, infrastructure and goods while quality products and services. In July, M Ithe entrepreneur manages these resources, as well as the service station team, for a fee, by the first BURGER KING in Croatia was Ambassador Wolfgang Waldner, Chargé d’Affaires at the Embassy of Austria to Hungary. The award-winning agreement with INA. The Company continued intensive investments in the first six months opened at the Tifon service station in service station in Istenhegyi utca was designed by Zsolt which amounted to HRK 665 million. As in 2013, most of the investments went to upstream Draganić South, located on the motor- Zombori of Europa Studio Architecture in 2012. projects in Croatia, in which almost HRK 440 million were invested. For the first time in the way between Zagreb and Karlovac. This best-in-class service station even beats the past ten years, INA recorded an increase in crude oil production from domestic matured fields efficiency of passive buildings and features a number while an increase of 3% was recorded in total hydrocarbon production. With a further fall in Asset-team operation in TVK of clever solutions and non-typical industry standards, net debt of 18% and by decreasing net gearing from 25.8% to 24.3%, compared to the first six TVK has launched a new operation months of 2013, the Group’s financial position was additionally improved. such as ecological walls and roof, thermal insulation model, called ‘Asset’. Compared to a inside the building and a photovoltaic electrical system. classic, functional organization, the Asset-team concept is a matrix type overlay to a functional organization, which has proven to provide much better cross-functional alignment and accountability for meeting the Production objectives. To obtain the CAMPAIGN FOR MOTOR proper perspective over the entire FUEL QUALITY TVK Production, it is essential for This summer, Slovnaft created a new TV campaign aimed Management to communicate the key at Slovnaft fuel quality. In the campaign, with its motto and primary role of the Production, “Quality Drives Us Forward”, motorists were shown what which is to operate and maintain the Slovnaft’s role and responsibilities were throughout the processing units flawlessly and maximize entire process of research, manufacturing, distribution profitability through optimization and Cand sales at our service stations. The campaign featured capacity creep. These Best Practices international staff and Slovnaft workers in shots of the build on the concept of the Reliability refinery. The TV campaign was supported by print, radio, and Maintenance Management System the Internet and billboards. Whilst television showed and the European Refinery Technical Slovnaft customers the way in which fuels go from the Support Study. refinery to the service station, other media simply asked consumers how to recognize fuel quality. The answer? MOL ROMANIA CELEBRATES By the logo, of course! STYLE & ELAN MAGAZINE’S 10TH ANNIVERSARY In August, MOL Romania celebrated the HYDRAULIC 10th anniversary of its Style & Elan MOL ROMANIA: MORE THAN Magazine. For the occasion, through a EUR 6MN IN NETWORK EXPANSION GROUNDWATER new application, Style & Elan readers MOL Romania has invested over EUR 6.1 million in 7 PROTECTION were invited to become editors and pre- new service stations, thus extending its country-wide pare their own individual front pages. Slovnaft Bratislava has invested almost presence to 154 units. The new stations are located The application is available on the MOL EUR 100,000 this year to improve the in the counties of Constanta, Ilfov, Suceava, Timiș, The MOL RED employee Romania website. unique hydraulic groundwater system Hunedoara, Iași and Bihor. “We are committed to card renewed Hthat protects groundwater at Žitný ostrov SLOVNAFT IS LAUNCHING SAP continuing our investment policy whilst always con- The MOL RED employee card was launched 10 years ago. Its structure has from oil pollution. The restoration of the sidering market opportunities, expanding our service The company is switching off its Oracle been streamlined and updated several times over the past few years, but hydraulic curtain walls will take until 2020 station network and offering quality fuels to local information system and launching SAP. by far the greatest changes were introduced this September. The scope to complete. “Despite the high complex- customers, as well as those enjoying the benefits of This spring and summer, “GoLive” of benefits available to cardholders was enhanced and their basis also ity and cost, the recovery of hydraulic a strong regional network. Accordingly, since the be- Tchanged. Instead of nationwide standardised prices, employees will receive aperture walls is required for the com- required focused work from Slovnaft ginning of the year, we have opened 11 new service discounts on current gasoline or diesel prices prevailing at any given MOL plete protection of the unique drinking employees, MOL colleagues and IBM stations in Romania,” commented Kinga Daradics, service station. The RED card can be used at nearly 3,600 service stations water reservoir. The hydraulic ground- consultants. SAP will bring Slovnaft CEO & Country Chairwoman – MOL Romania. in 10 countries to pay for motor fuel or motorway tolls, including the MOL water protection system, operated by better organization of work processes, network in Hungary, Slovenia, Serbia, Romania, Roth in Austria, Slovnaft in Slovnaft, GEOtest Bratislava and VÚRUP, more efficient work organization and, Slovakia, Slovnaft and PapOil in the Czech Republic, INA and Tifon in Croatia, is being excellently managed,” added last but not least, financial benefits. Energopol in Bosnia-Herzegovina and the IP network in Italy. Milan Fillo, director of VÚRUP.

20 MOL Group Panorama October 2014 21 HR development HR development

Perhaps that’s why MOL Group decided to launch such programs like UPPP. It is progres- sive, and ahead of the industry; we hope it will be recognized by global awards just as We are here to improve Growww and Freshhh are. How does UPPP work? We’re going to use a real site in the online business performance simulation: a field in Pakistan. We will run the game at 27 universities located in areas Interview with Vivien Orosz, Head of Group in which MOL Group operates, including new places like the UK. What we want to happen Capability Development & Strategic HR, is that university undergraduates increase their awareness of MOL Group when looking about the new MOL Group HR programs, at the Company and that they fully compre- Intensity and UPPP. hend what this is all about. This is why we load the game with real data.

Why is UPPP so significant for MOL’s future? Graduates will be involved in a job placement, i.e. they’ll practically join MOL Group. This is, once again, a very special and unique feature in the marketplace. We’ve prepared for them an 18-month program aiming to cut short the period of time needed to reach autonomy and, at the same time, to keep them moti- OL Group is about to launch knowledge and skills are transferred to vated. During this process, they’ll be given two new HR programs as the workplace and results in behavioural serious technical training by the best suppliers part of our efforts to en- change. At every point of measurement, in the oil industry as well as business training, hance organisational capa- participants should discuss with their line all to prepare them for project management. bility: Intensity for managers and UPPP managers how much they have advanced They will also be taught to make executive for talented students and graduates in in developing the capabilities or compe- presentations to top managers, an area in the field of geoscience and petroleum tences which necessitated them registering Building organisational capability in which they obviously have no experience. engineering. Why are these so impor- in the program in the first place. areas such as leadership development There will also be a rotation period of eight tant for MOL Group? Best in class providers will give follow up months on a real site in Pakistan supported Building organisational capability in areas support after the end of the six month period and talent management is among the by local employees who will provide very such as leadership development and talent and hold a session for them to discuss with top priorities for any company. thorough mentoring. They’ll also undergo management is among the top priorities the attendees how they manage issues better four months exposure to HQ, where they’ll for any company. It takes the right skills and and how people working for them accept not only help out: they’ll get to understand competencies of colleagues to make an change more willingly. Can UPPP also be compared the structure of where we all work, key stra- organisation grow. to the very successful Freshhh? tegic directions and overall strategy. After this When will this program be launched? While it’s true that UPPP is an online simula- 18-month period, participants will go into op- Intensity, similar to LEAD, is aimed at It’ll be continuously available from November tion game, it explicitly focuses on the E&P erations, depending on their specialisations. MOL managers. What is the difference? onwards. Participation in more than two business as a core business and the program Intensity is, in certain aspects, the continu- modules per year wouldn’t be worthwhile was developed to meet a business need. What are the plans for the runner-ups? ation of LEAD but there’s one significant because our goal is to ensure that managers This business requires specific competences, Will they be kept in the talent pool? difference: Intensity will be accessible to put into practice what they’ve learned in the capabilities and skills that fresh graduates We will also offer opportunities to those who every MOL manager. This is a modular training sessions and this will take time. We have simply not yet really acquired. Fresh want to study further. In addition, we want leadership development program specifi- should now think about developing ways in graduates need to broaden their skill-sets to organise one-day or two-day workshops cally designed to enhance management which we can regularly offer managers activi- and spend years practicing those skills under in which predefined case studies can be ana- competencies which we’ve defined as ties and forthcoming training courses where supervision before they can become a lysed and conclusions drawn in cooperation being vitally important and in which we they can form communities with others with competent person in the O&G industry. A lot with top management to give them further expect our managers to develop. Potential similar areas to be developed and share their of time is required for fresh degree holders to career assistance. Our goal is firstly to help participants may register based on their in- experiences with them. We can send them acquire the level of skills, knowledge, capabil- them get acquainted with MOL Group and, dividual development plans discussed and podcasts, web-based articles or interesting ity and experience which will allow them secondly, to enable them to obtain a realistic agreed with their managers during annual things that can be quickly and easily digested to work self-reliantly and independently, in picture of what all this means in real life. UPPP performance evaluations. What we orga- or present them with people who have other words, to achieve what we call “au- participants who do not qualify into the Top nise will not be limited to classical two-day already achieved success. It would also be tonomy”. Typically this takes about 7-8 years 10 will also be kept continuously informed training courses. Such two-day trainings important to roll out talent reviews and cali- in petrotechnical jobs such as geosciences about new programs, learning opportunities will be integrated into a six months-long bration sessions, not only to senior managers or engineering. This period might seem very and summer programs, maintaining contact systemic learning journey that ensures that but to other levels too. long to an ambitious go-ahead graduate. with them remains in focus.

22 MOL Group Panorama October 2014 23 HR development innovation Adopting INTENSITY MOL Bubi on the road! Vladimira Senčar such attributes, but available to many Perkov (INA) more participants throughout the Flag- Human Resources ship companies. Intensity will address MOL Bubi – launched in September – is the new for individual transport and freer flow for Sector Director this perfectly due to its high quality the community’s traffic. MOL Bubi will often international suppliers and affordable, community bicycle system in the Hungarian capital. be a faster means of transport than most We are very modular competency-based features. surface transport services and people don’t excited to be able to present Inten- We, as Flagship HR, are already looking OL Bubi was launched on 8 Most people use both cars and bicycles, need to use their own bikes. sity at INA. This targeted, structured forward to promoting this new “pro- September. The network was so supporting two-wheelers can improve leadership program will complement duct” to business teams and decision- put in place for more than MOL’s positive image and might even Community bicycle systems worldwide current development initiatives and making managers. one billion Forints, inclu- have advantageous effects on business Community bicycle systems can be found further enhance our colleagues’ key ding a HUF 900 million EU subsidy. The results too, since those MOL Bubi users all over the world such as in Ljubljana in skills, providing them with invaluable Paola Pillon Budapest Transport Company finances the biking around the city on weekdays will the Central European region. Its system insights and knowledge from all the (IES) system’s operation from pass fee revenues most likely fill up at MOL service stations is called Bicikelj and has operated since areas essential to leaders in our indus- Head of HR and MOL sponsorship. MOL provides an when on the road at the weekend” – said 2011 with 300 bicycles and 31 docks. try. This program will prepare our col- and OD&CG annual HUF 122 million contribution to MOL Hungary Corporate Communica- Rental fees are, in most cases, similar leagues to be drivers of efficiency and the system, which means that MOL contri- tions Director, Domokos Szollár. to those charged in Budapest with a to promote excellence in a modern, Given the trans- butes every second forint. free initial period followed by an expo- dynamic, performance-based formation IES is facing, from Refinery MOL Bubi Benefits nentially increasing rate. However, no culture and, importantly, to lead to Logistics Hub, the development From bicycle points to MOL Bubi At the launch, there were 1,100 apple- other community bicycle system has a TEAM UP WITH YOUR FRIENDS AND RULE THE OIL FIELDS OF PAKISTAN WITH YOUR SUPERIOR KNOWLEDGE by example. and implementation of a new strong- The community bicycle system fits in green, standardised, heavy-duty MOL configuration and equipment base like OF TECHNOLOGYUPPP AND – BUSINESS International STRATEGY. SAY YES TO ADVENTURE! Enroll in our online competition and convince us that you are ready to start building your future at MOL Group! The top 3 teams win a EUR 20,000 prize and the ly sales-oriented mindset will be a very well with MOL’s Bike Program. Since bicycles placed at 76 docks, located some MOL Bubi, which includes an emergency opportunity to ENTER OUR 18 MONTHS’ WORLD CLASS UPPP TECHNICAL PLACEMENT PROGRAM and shape the world with us! This is yourTalent chance to win and join a companyAcquisition that’s RECOMMENDED BY TOMORROW! Program major milestone in successfully estab- REGISTER AT WWW.UPPP.INFO BY 23.10.2014! Erika Burianová 2011, so-called bicycle points have been 300–500 metres’ distance from each other, docking option, card operated hiring and UPPP is MOL Group’s new talent acquisition pro- (Slovnaft) lishing the new business model we so set up at more than 100 service stations awaiting riders. MOL Bubi provides freedom on-bike computers. gram. UPPP is designed exclusively for university HR Director vitally need. In this framework, the whereby various bicycle-related services, students specialized in the field of Exploration & Intensity program will be a key tool in equipment and accessories are offered Production related studies. UPPP provides students I perceive this achieving such an organisational cul- to cyclists. “MOL has been supporting the opportunity to apply their knowledge in an on- Group modular tural change that impacts each and sustainability for quite some time now as MOL Bubi smarties line simulation of a Pakistani oil field with real-life leadership program as one of the key every level of the organisation from part of its general commitment and sup- data. The program website is: www.uppp.info Dock! factors in creating a common under- individual contributors to senior-level porting cyclists certainly fits in perfectly There are docks located in stu- standing of what a desirable leader- managers, all of whom will require with this effort. MOL Bubi provides a dent, tourist and office worker-fre- get inspired ship culture means to our Company. significant new skills, competences sustainable means of transport designed quented downtown sites along the to lead the It’s crucial for our future success to and capabilities. to get ahead in the urban jungle. How- Körút (Grand Boulevard) and the future have both leaders and specialists with ever, MOL Bubi is also an important Városliget (City Park) in Pest and strong capabilities who contribute Qasim Nawaz initiative from our business perspective. in Viziváros (Water City) and the to more effective performance in a (MOL Kalegran) university campus (South Buda) in INTENSITY domokos szollár constantly changing environment. In HR Manager Communications Director Buda, as well as on Margitsziget – MOL Hungary addition, Intensity will deliver, to my (Margaret Island). eye, something that still needs to be In Kurdistan, a fostered: knowledge-sharing, network career develop- Budapest Bicycle building and experience changing, ment medium such as the Intensity The idea to launch MOL Bubi first another added value of Intensity, program will be an excellent and emerged in 2008. The name was which will be highly appreciated by all important strategy for implementing selected through an internet-based poll and an internet voting process. participants. the ‘Change Management’ needed “Bubi” is in fact the shortened ver- in Kurdistan over the next five years. sion of Budapest Bicycle. László Fekete Why are initiatives such as Intensity (MOL HU) so important? Well, many local young Made for endurance MOL Hungary Kurdish professionals have not been A bicycle should be durable, reliable HR Director exposed to the international working and safe. Bubi tyres are made of environment and, more crucially, lack solid rubber, so punctures are The LEAD program the professional experience required our world is a world of rapid change out of the question. The frame FastIN transformationTEN isS a IwayT ofY life in– the Modularworld’s leading companies. SkillsLeadership which made people successful in has been a clear success at the MOL to play senior leadership roles. If local the past won’t help us crack it today. To manage continuous change successfully, vital new dynamic skills are is made to be more robust than needed. Get started on your journey into change right now with our new modular leadership development employees are given opportunities like programDevelopment and SHAPE THE WORLD WITH US! For Program more details contact your HR partner. Flagship for all levels of managers usual. The bicycle is equipped Intensity is a modular, short course training portfolio through its modularity of design, clear this modular leadership program, they with an electronic tracking de- aimed at providing crucial skill development solutions and appealing image and the posi- can be guided to senior management vice, an electronic lock and a bat- for the entire pool of leaders, leadership successors and tive impact it has already had on our levels and eventually to leadership tery that charges automatically experts. Expected launch of Intensity: November 2014 organisations. Quite naturally, demand positions much more efficiently at the during the ride. was always there for a program with same time enhancing their loyalty.

24 MOL Group Panorama October 2014 25 E&P E&P A World-class bu siness approach

In line with MOL Group's vision of building a world-class What does our pragmatic approach cover? Harnessing the power of the state-of-the- E&P business, the Group has established the position of art technology provided through the supply Chief Operating Officer (COO) – MOL Group E&P with the chain, using best practice approaches to emphasis on full value-chain life cycle operational and active managing large capital projects and opera- portfolio management. This new position has been filled by tional excellence. Carl Grenz, a senior professional with 39 years of experience During the summer, MOL Group further in the oil and gas industry. extended its portfolio in the region. Could you briefly introduce the most important assets and how these support Group E&P’s targets? he North Sea asset acquisi- Our current portfolio includes 5 key as- tion is a significant step Excellence sets; Catcher, Cladhan, Scolty/Crathes, towards establishing a in project Scott and Rochelle. Catcher and Cladhan balanced portfolio in MOL are approved major new development Group. How does it help the management projects. Catcher is a high profile develop- Torganisation mitigate risks exactly? ment and is the first North Sea project left to right: Steve Kemp (Operations and Technical Director), Jonathan Chapman (Subsurface Director), The North Sea represents a significant and execution which MOL Group has sanctioned. Chris Bird (Managing Director) Caroline McGovern (Finance Director), Neil Robertson (Wells Director) and Paul Lindop (Integration Director). growth step for the company and this is critical to The Cladhan development project will growth position will allow us to balance deliver near-term production and will be our high risk high reward portfolio such the success of our first new producing asset in 2015. MOL Energy UK Management Team as the world class assets we are in the our investment Scolty/Crathes is a subsea development, set up in the North Sea Region process of developing in the Kurdistan and although not yet sanctioned, MOL MOL Group entered the North Sea at the end of last year in a deal with Wintershall to acquire Region of Iraq. strategy. Group has been instrumental in driving assets in 14 offshore licences. In June, MOL Energy UK (with its partners Premier Oil and Cairn En- partner focus with a view to accelerating ergy) received approval for the Catcher Area Field Development Plan. In the same month, the com- What are the main risks we project delivery. Scott and Rochelle are pany completed a sale and purchase agreement with Premier Oil for offshore assets in 6 further Carl Grenz licences. Completion of the senior management team closes out the first phase of MOL Group’s have to take into consideration? COO - MOL Group E&P both producing assets which will provide presence in Aberdeen. Over the coming months and into 2015, MOL Energy UK is looking forward North Sea developments are large, robust cash flow and significant contribu- to the successful outcome of its submission to the 28th UK licensing round. complex and technically challenging. tion to our growth aspiration. Excellence in project management and execution is critical to the success of What new opportunities do Group E&P our investment strategy. However, I am business plans in the region provide to MOL pleased to report that we've success- Group employees, especially in terms of fully recruited our UK leadership team professional development? members. All are industry experts with New opportunities in the North Sea region proven experience in managing large offer MOL Group employees various profes- independent E&P companies. sional development possibilities; acquiring Ali Murtaza Dr. Majdi knowledge from working on the new pro- Abbas Ahmad Regional Regional This is a new operating environment for jects, developing their technical skills through Adviser for Director for MOL Group, especially regarding offshore on-the-job training and learning from col- the Middle East the Middle East & Africa & Africa opportunities. In terms of technology and leagues who possess region-specific technical operations, what are the expectations we knowledge and industry understanding. The The Erbil Office need to meet in the area? MOL Group E&P leadership team, together The North Sea region has a history of with Group HR, recognises the urgent need Due to the-fast track expansion of MOL Group E&P, there has been an increasing need to organise the regional autonomy of MOL Group companies to oversee and manage local issues directly. In pioneering new technology to create to support all new growth opportunities by June, MOL Group announced the setting up of a new regional office in Erbil, Kurdistan Region of value from the basin. Heavy oil and tight developing and setting up formal technical Iraq, which is responsible for controlling operations in the Middle East, Africa and Pakistan, thus reservoirs are examples of where MOL can career ladders, strengthening technical benefiting from the local experience of its management. exploit North Sea opportunities through learning curricula, looking at opportunities The settlement of issues at a local and regional level will be much more effective in achieving MOL our international Research & Development to mentor junior colleagues and setting up Group E&P targets. “We are here to facilitate Upstream operations in the Middle East, Africa and Pakistan as my program. The extensive experience of our teams of technical excellence. With each new directorate seeks to settle issues locally or on a regional basis and to make the control of these UK team is already earning respect from prospect, new technical development areas subsidiaries more effective for Headquarters in Budapest,” explained Dr Majdi Ahmad, newly- the operators and strongly influencing can arise and, as a team, we need to be ready appointed Regional Director. operations and project outcomes. for any professional challenge.

26 MOL Group Panorama October 2014 27 problem solving problem solving Thousands of ide as: EIFFEL and ÖTR

Since 2008, employees have submitted 3,000+ ideas in the Eiffel Downstream Program,

Tibor Zászlós which have contributed nearly EUR 38 million Process Technology expert to Downstream's efficiency improvements. In Péter Györkös Teréz Bacsurné Kurucz 1998, TVK launched the Ideas Support System Group Fuel Products DS Development & Product Sales representative Development Engineer (ÖTR), which sometimes resulted in savings of hundreds of thousands of euros.

he EIFFEL Program is One use of micro wax is as a food Downstream’s Group- industry feedstock. In 2009, the lead- level employee idea ing producer asked to buy significant management system. quantities of two types of micro wax. Its goals are firstly to further sup- We had no such feedstock so we had port efficiency improvements and to buy-in the required amounts. We employee motivation through analysed the requirements and our László Dávid Refining innovations generated and submit- ideas people met Refining to explore Operations ted by employees and secondly to likely sources. Then, successful pilot Supervisor provide an incentive to strengthen production started in cooperation a cost-awareness mentality. The with DS Development, Refining Program was launched in 2009 and, and Controlling, contracts were

since then, several subsidiaries have signed and, in 2013, we successfully Ernő Tóth Base Oil And Wax joined the initiative, in addition to processed 630 tons realising ~EUR Viktor Győri Production Group Fuel Products MOL Manager MOL and Slovnaft Downstream. 65,000 net profit. In 2014, we will sell Sales representative The purpose of the TVK ÖTR Pro- 2kt of these three products to realise gram is to encourage employees for EUR 206,000. Since we have to generate novel and advanta- heard our main competitor, Shell, will geous solutions to resolve various stop base oil production at the end of reactor equipment was analysed Heating oil sold by MOL and B7 ethylene and 6 tons of isobutene. technical, safety and administrative 2015, demand for our products will and production difficulties were quality diesel by Slovnaft used to The idea was simple. Feed this accu- problems. ÖTR follows up and grow. Our maximum possible output found, potentially arising from in- go to the same Austrian market, mulated hydrocarbon mixture back monitors employee ideas from of 15kt could produce a profit of creased charge size, which could be but B7 production was more into the solvent recovery unit using submission through implementation EUR 1 million per annum. manually monitored by re-installing expensive at Slovnaft. How could a simple cross-connection between to post-appraisal. If the implementa- the sight glass method, which is we change this to meet customer this nitrogen pipeline and and the tion of an idea results in financial critical because the foam phase that requirements if there were a inlet line of the guard filter of the savings then the idea originator is might emerge during reaction can problem with MOL’s heating oil ÖTR Idea (TVK) flash gas compressors. In this way, the recognised financially through the be swiftly detected. Thus the exis- supply? As a first step, we decided Title: Reducing hydrocarbon loss hydrocarbons can be reco-vered and EIFFEL Program and at TVK through ting service can maintain produc- to sell normal diesel as heating oil in the PE-1/HDPE-1 plant – already reused. The ethylene fraction is sent the ÖTR Program. tion. The idea could produce using road tanker cars (RTCs), to implemented back to the Cracker as vent gas and HUF 3.5 million in savings per year. reduce logistics costs. After selling Idea generator: JÁNOS OROSZ the recovered isobutene is re-used in EIFFEL Idea (MOL – Supply & Sales/ the first 14kt in January 2010, we (PE-1 unit system operator) the plant. The estimated project cost DSD/Refining) EIFFEL Idea (MOL-LUB) distributed heating oil as a norm. Hydrocarbons accumulate in the totalled EUR 8,700 and EUR 83,000 Title: Improving capacity utilisation Title: Improving use of RALOX We met Commercial & Logistics PE-1/HDPE-1 Plant feed prepara- can be achieved in annual savings, in micro wax (BSLO) processing and production equipment and decided to use barges which tion section regeneration nitrogen with a ROI of less than 2 months. solvent de-waxing in the MEK plant Idea generator: Tibor Kovács meant higher savings. A pilot pipeline when it is out of use, due and micro-hydro-generation in the (Refining foreman) barge load to Korneuburg was to a lack of tight hydrocarbon MIH plants To reduce energy consumption, successful. Today we ship B7 die- valves. In the past a 2" connecting Idea generators: indicators are a priority, particularly EIFFEL Idea (SLOVNAFT, a.s. – SCM) sel, heating oil, normal quality and pipe was installed between this Péter Györkös & Viktor Győri in the additive production plant, so Title: Loading heating oil on to Slovak quality, in barges. We now nitrogen pipe and a flare pipe for Contributors: the opportunity to introduce higher barges in Port Bratislava produce original heating oil qual- the de-pressurization of the system. Teréz Bacsurné Kurucz, charge size emerged when various Idea generator: Karin Tóthová ity and save valuable components. This earlier modification solves the Join the program now, we are counting László Dávid, Attila Horpácsi, options were analysed using existing (Supply & Distribution The 5-year average benefit is over-pressurizing problem, but causes on your ideas as well - contact your local coordinator! Ernő Tóth , Tibor Zászlós RALOX plant equipment. R-7/1 Planning Expert) EUR 4.3m. a monthly loss of roughly 2 tons of

28 MOL Group Panorama October 2014 29 corporate responsibility & sponsorship corporate responsibility & sponsorship

THE SLOVNAFT CUP News in brief 2014/2015 NEW MOL CHAMPION – “BIBLIOBUS” NOW ON TAKING TO THE WATER Nearly 180 football teams have begun THE ROAD IN RIJEKA playing under new rules in this year’s As part of its commitment to new initiatives in the field of culture, INA has An international swimming star with an international top competition, the Slovnaft Cup. MOL LEAGUE STARTED OFF Slovnaft remains the title sponsor of supported the City Library of Rijeka in partner – MOL is the proud sponsor of Dániel Gyurta, buying and operating a “Bibliobus”, Olympic swimmer. the 2014/2015 season, a reliable and The 2014/2015 MOL Group Ice Hockey League season began on serious supporter of a competition a library on wheels, bringing books and 19 September boosted by a new team: the Debreceni Hoki Klub. The Gyurta phenomenon in numbers: T magazines to local inhabitants who are 2012: London Olympic Games – gold medal & a new that motivates teams towards athletic The team was greeted by its biggest fans: Tankcsapda, the MOL- N performances that please all football unable to get to a library themselves. world record – 200m breaststroke supported rock band from Debrecen. Ice hockey fans can follow recent fans. The final will take place in May MOL League developments on a brand new website: www.molliga. 2013: Swimming World Championships (Barcelona) – 110KV GENERATORS gold medal & new European & World record – 2015, with the winner then advancing Meu and via the online MOL League TV channel. Ágnes Kelenvölgyi, to the European Cup competition. DONATED TO JUNALA Head of Corporate Giving and Internal Communications, MOL Group, 200m breaststroke MOL Kalegran donated generators for the vil- commented: “MOL League has proved to be an international sporting 2014: Swimming World Cup (Doha) – victory in both lagers of both Cojar and Junala to cover their project we can all be proud of. World class players join the League the 200m and 100m breaststroke & breaks his own electricity needs. The first two generators year after year with teams competing from three countries, Hungary, record in the shorter distance by 2.00.48 seconds. were handed over by Majdi Ahmad, Managing Romania and Slovakia that truly represent quality, dynamism, fair play Director of MOL Kalegran. and teamwork, the very values MOL Group stands for.” AID FOR REFUGEES NEW SCHOOL COMMUNITY IN KURDISTAN SERVICE PROGRAM The New Europe Foundation has initiated a new grant programme this year called MOL Kalegran is helping refugee men, women THANKS! (KÖSZ!). The THANKS! Program and children with food, milk, nappies and aims to encourage collaboration between medication due to the security situation in the local NGOs and educational institutions so Kurdistan Region of Iraq. For the thousands as to implement new school community of Kurdish Christian and Yazidi refugees in the service projects. AAkre Bijel area where it operates, Kalegran has demonstrated its commitment to be INA FOUNDS THE in the very forefront in such relief efforts. CROATIAN OIL MUSEUM MOL Kalegran continuously stands by to INA and the town of Ivanić have signed an help the Kurdistan Regional Government, in agreement to cooperate in establishing the collaboration with the Ministry of Natural first Croatian oil museum – the Museum of Resources, to bring comfort to people in need. Petroleum Engineering. The museum will be situated close to Ivanić Grad, where the first oil well in Southeast Europe was drilled in TALENTS OF 1948. The opening of the museum is sched- uled for late 2015. NEW EUROPE: BEAUTIFUL BRATISLAVA GOLD, SILVER AND BY SLOVNAFT COLLEAGUES Slovnaft employees again participated in this HOLLYWOOD! year’s Pontis Foundation project “Our City”. Thirty Slovnaft employees were involved in The 8th annual Talents of New Europe competition was several activities – from cleaning up black announced in September in Slovakia, while young talented rubbish dumps under a bridge to cleaning people alreadyT supported by Slovnaft and the Central European the Little Danube and helping school children Foundation (CEF) have reaped great successes: build a mud house using the techniques of our Michaela Brchnelová (17) – Astronomy – gold medal at the Intel distant ancestors. International Science & Engineering Fair – Los Angeles, USA Viktor Demin – Canoeing – silver medal at the European THE SZEGED HANDBALL CHAMPIONS IES COLLEAGUES Flatwater Canoeing Championships – Brandenburg, Germany The Szeged handball team will play under a CLEANED UP MANTOVA Ema Klučovská (15) – exclusive presentation at the new name in the 2014-2015 season, Domokos Stan Winston Studio – Hollywood, USA Szollár, Communications Director – MOL Hungary announced: “MOL Hungary is more “Puliamo il Mondo” (“Clean Up the World” in than happy to become the title sponsor of INA VOLUNTEERS RENOVATE Italian), which is one of the largest community- such a successful team, which from now on based environmental campaigns, was organized by KINDERGARTEN IN SISAK is called: “MOL-Pick Szeged”. We have been Legambiente Association and involved cca. 1000 cooperating with Szeged handball players municipalities in Italy in September this year. More INA volunteers were invited by the “Sisak Stari” kindergarten ROWMANIA FEST FEATURED BY MOL ROMANIA for years. They have constantly been in the Ithan 80 colleagues of IES joined the initiative and to help renovate its premises. The volunteers gladly responded Olympic champion Ivan Patzaichin organised the Rowmania Fest Hungarian first division and, what’s more, in and helped to whitewash walls and repair furniture. The INA acted locally. IES volunteers cleaned up the shore of for the 4th time in Tulcea, Romania, at the end of August. The event 2014 achieved an outstanding result in the Volunteers Club was established in 2011 with the aim of offering Mantova Lake opposite the refinery. program featured rowing contests on the Danube, live concerts, photo international arena by winning the European voluntary personal investment in time, effort, knowledge and skills exhibitions, a fair with traditional arts and crafts and the second edition Handball Federation Cup.” Ito help other people and society as a whole. R of the Delta Rowmania Triathlon. 30 MOL Group Panorama October 2014 31 science in detail RACING FUEL – WE GO ONLINE! MOL Group introduced its new internal and external online communication ARE now RACING! platforms in recent months.

Two MOL Group subsidiaries, ased on the experience feedstock of excellent quality even by of Panta, one of Europe’s international standards. MOL Group’s Panta and Hexan Kft., play largest racing fuel pro- long-term ambition is to appear with its an active role in the racing ducers and in light of racing motor gasoline at any interna- fuel market. As a result international racing fuel tional car or motorbike racing event. To market research about this end, knowledge sharing and consul- of their cooperation, demand conducted by MOL Product tations are going on between the two MOL RACING FUEL 102+ Development, Hexan has developed “MOL-subs”, reviewing opportunities for MOL RACING FUEL 102+, a racing gaso- further collaboration, brand harmonisa- entered the Hungarian line produced from Danube Refinery tion and integrated appearance. market this summer. Engine speed (RPM x1000)

5 6 7 8 9 10 11 12 13 14 40 28 MOL 26 35 Torque (N-M) Torque Power (hp)

24 30

The red line represents MOL Racing Fuel. 22 The blue line stands for a regular, but 25 elevated octane numbered fuel. 20 The horizontal axis shows rev data.

20 18 RACING GASOLINE 15 16

Octane number: 102 Density: 0.7555 g/cm3 at 15 oC Initial boiling New INTRANET SITE – Group Portal point: 50.4 oC Launching the Group Portal (GP), End boiling point: 145.9 oC our MOL Group Intranet site, has Oxygen content: 3.4 New Website – MOLGROUP.info been a giant step towards ensuring The newly setup MOLGROUP.info website is our primary more consistent and efficient MOL Racing Fuel fully meets the official external communications channel for reaching internal communications across MSZ 228:2013 standard (E10/ESZ-98). the international audience. It is not only a means of the organisation. In a company that Available from March 2014 – the fuel introducing the organisation and our main brands to the employs more than 29,000 individuals was introduced to the public at the public, but for communicating with our stakeholders in a in 40 countries, communication has Hungarian F1 Grand Prix. clear way. In addition, our social media channels ensure to be powerful and effective. This that we stay in touch with wider audiences interactively so starts with clear and timely messaging they can follow what is happening in MOL Group through and continues through optimised our LinkedIn and new Twitter pages. information flow. • 100% MOL Nyrt. subsidiary • Dominant role in the Hungarian marketplace Gyöngyi Janky Ágnes Kelenvölgyi • 25 year history in the Hungarian racing fuel market Head of group Media & Communications HEAD OF CORPORATE GIVING & INTERNAL COMMUNICATIONS • Official fuel supplier to Formula Student Hungary • A Member of MOL Group, an IES subsidiary • Wide product range • One of Europe’s largest racing fuel producers • Produces off-standard fuels • Official WTCC supplier – driver Norbert Michelisz WTCC sponsored by MOL Group “All these new communication channels which are ideal platforms to facilitate knowledge, are • Produces hydrocarbon mixtures with • Has had its own Racing Department since 1989, characterised since birth by its innovative R & D developed in the English language for one simple reason: MOL Group wants to open up new one-off composition spirit and constant improvement of products specifically produced for competition international markets and the language of these new markets is the world language English.”

Dominic Köfner Vice President – Group Corporate Communications 32 MOL Group Panorama October 2014 33 barrel per day next edition: corporate responsibility & sponsorship

The Expert’s Column. The Chief Economist Team’s insight BARREL and guide to today’s trends and tomorrow’s developments. mol group PER DAY Read more at barrelperday.com

CSR›

Child healing Corporate Volunteering CULTURE & TRADITION Environment Sports sponsorships Sustainable Development TALENT SUPPORT & EDUCATION

Borders they are a-changin’

t is the season to redraw maps. How a polity deals with separatist on heavy oppression to stay in power. Many Russia has annexed the Crimea and movements can also be a sign of maturity. economies are shackled by state regulation Scotland has just voted on indepen- Rich democratic countries tend to handle and are all about the distribution of govern- dence (and will stay in the UK – at secessionist aspirations relatively well (and ment largesse and perks. least for now). The eastern part of definitely without killing people). Such coun- The Middle Eastern status quo is already Ukraine is getting blurry, while Catalonia tries get along well with their counterparts: changing due to the domino effects of the may try to hold a referendum on indepen- prosperous democracies almost never go to Arab Spring and the departure of US forces dence soon. The borders of the Middle East war with each other. Sometimes there is no from Iraq and Afghanistan. For now, the are also changing, at least in terms of actual formal separation, but regional autonomy direction of change seems to be away from control: the maps of Syria, Iraq and Libya all reaches such a high level that although an rather than towards inclusive societies. But look like modern art with various colours “umbrella” country remains, it is just an such transition is rarely smooth; during the splashed over them. Meanwhile, nationalist empty shell. Does Belgium really still exist, “interim period”, which can last a very long tensions are mounting in the South China beyond its UN seat, its monarch and its time, conflict and violent fracturing is likely. Sea. In short, sovereignty seems to matter sovereign bond markets (and football team)? However, the new, more cohesive countries more than it did a few years ago. On the other hand, violent armed conflict emerging from the current turmoil may be Why? During good times, many people is much more likely among, between and better raw material for achieving internal (and countries) continuously become bet- within poorer, more autocratic countries. consensus and eventual democratisation. ter off, so the distribution of wealth mat- It is no surprise that the Middle East is es- It is easy to feel pessimistic regarding ters less. But in a less optimistic era of slow pecially ripe for change. Many of its countries the mid-term outlook in the Middle East growth, the world is more of a zero-sum are plagued by ethnic and religious divisions and elsewhere. But maybe this is the game – or at least that is what many people and it also has abundant oil and gas resources darkest hour (or these are the darkest think. At the same time, the potential to fight over which, in turn, can finance wars. years) and the foundations of longterm penalty for breaking (international) rules It has large numbers of idle young males with- future cooperation and integration are counts for less if a) everyone else is doing out much real opportunity in life. Moreover, just beginning to emerge… it and b) no one (including the former the borders of the Middle East were drawn global policeman, the United States) wants up around the time of WW1 without much to shoulder the burden of upholding the concern for ethnic identity. Rulers often rep- international status quo. resent only a narrow elite and (used to) rely

34 MOL Group Panorama PETROCHEMICALS MATTER, EVEN IN RACING

Everyday objects are made possible by petrochemicals, making our lives more comfortable and even more exciƟ ng! Faster too: every racing car contains rubber and plasƟ c from the Ɵ res right through to the dashboard!

MOL GROUP’S PETROCHEMICALS BUSINESS IS THE MARKET LEADER ACROSS THE CEE REGION AND IS AMONG THE TOP POLYMER PRODUCERS IN EUROPE. For more informaƟ on, visit our website: www.molgroup.info