At PETRONAS Dagangan Berhad, we are focused on achieving

sustainable long-term growth. With quality and innovation as the basis

of our operations, we will continuously strive to build our position

as Malaysia’s ‘Brand of 1st Choice’ for petroleum products.

Moving forward, we remain committed in creating optimum value

for our community, customers and shareholders.

Annual Report 2007

“PRIMAX 3 stretches my ringgit. “After using PRIMAX 3, What our This is the brand that I am my engine runs more smoothly sticking to for sure.” and the pick-up is great.”

Vincent Lim Chong Beng Mohd Shukri Helmy bin Mohd Fahmi customers Businessman, Penang Businessman, Kuala Lumpur think

“I can see the savings compared with using other brands of fuel.” “We are very satisfi ed with Gas PETRONAS. “PETRONAS Dagangan is the leading Mohd Nawawi bin Rani We use LPG for our kitchen and boiler. fuel supplier, continuously providing Teacher, Terengganu It produces less carbon and jet fuel and refuelling services the supply is timely delivered.” that fulfi ll our requirements.”

Putra Rakhish bin Wayer @ Mohd Wazir Abdul Wahid bin Ahmad Shift Engineer, Petaling Jaya Ground Engineer, Kuala Lumpur International Airport

“Since using PRIMAX 3, the power has defi nitely got more ummph.” “It really gives me the power to reach my destination in no time.” Wan Muniati Wan Ngah Contractor, Terengganu Shariman bin Arshad Businessman, Kuala Lumpur

“Initially, it was diffi cult to convince “We have been using Syntium for one year. our customers to change to PETRONAS Our customers are coming to us to fi nd out Lubricants. Now, our customers are more what we are doing differently now. satisfi ed by using Syntium due to its Syntium does wonders for their cars. We are supreme performance.” now convinced with PETRONAS Syntium.”

Erwan Othman Kevin Kong Automotive Mechanic, Kuala Lumpur Marketing Executive, Kuala Lumpur

“PRIMAX 3 really saves our money.” “I look for a high performance fuel. Tantiana Nelson & Tijan Hendrick Hank And PRIMAX 3 is the Students, Kuching best I’ve tried.”

Shasindran Muthu DJ, Kuala Lumpur PETRONAS DAGANGAN BERHAD (88222-D) 1 Contents

2 Five Year Financial Highlights 47 Corporate Governance 48 Corporate Governance Statement 4 Corporate Profi le 53 Statement on Internal Control 7 Corporate Information 55 Board Audit Committee’s Report 8 Financial Calendar 57 Board Audit Committee’s 9 Corporate Information Terms of Reference 10 Board of Directors 59 Statement of Directors’ Responsibility 12 Profi le of Directors 61 Financial Statements 14 Management Committee 100 Areas of Operation 16 Performance Review 18 Chairman’s Statement 102 Shareholders’ Information 22 CEO’s Report 105 List of Properties 32 Share Performance 33 Crude Oil & Petroleum 130 Notice of Annual General Meeting Product Price Trend 132 Appendix I 34 Corporate Responsibility 140 Statement Accompanying 36 Corporate Social Responsibility Notice of Annual General Meeting 39 Calendar of Events 45 PETRONAS Dagangan in the News Proxy Form

NOTICE IS HEREBY GIVEN THAT the Twenty-Fifth

Annual General Meeting of PETRONAS Dagangan Berhad

(the Company) will be held on Tuesday, 10 July 2007

at 10.00 a.m. at the Ballroom 1, Level 2,

Hotel Nikko Kuala Lumpur, 165, Jalan Ampang,

50450 Kuala Lumpur. 2 PETRONAS DAGANGAN BERHAD (88222-D) Five year

Profit RM million

903.2

724.6 640.3

555.2 504.7

381.2

330.1

230.7 210.7 150.0

‘03 ‘04 ‘05 ‘06 ‘07

Profit as % of Revenue Percent

5.6

4.6 4.4 3.9

3.3 3.0 2.7

2.6

1.7 1.7

‘03 ‘04 ‘05 ‘06 ‘07

Profit Before Tax

Net Profit Attributable to Shareholders of the Company PETRONAS DAGANGAN BERHAD (88222-D) 3 Financial Highlights

Revenue Equity Attributable to Shareholders Capital Expenditure RM million of the Company RM million RM million

3,487.8 19,496.4

16,567.9

3,026.3

614.6 12,451.1 592.9 2,643.5 2,540.1 9,830.4 8,970.5 498.8 496.0 2,266.2 473.1

‘03 ‘04 ‘05 ‘06 ‘07 ‘03 ‘04 ‘05 ‘06 ‘07 ‘03 ‘04 ‘05 ‘06 ‘07

Total Assets Net Assets per share Earnings per share RM million Sen Sen

64.5 351.1 6,516.9 6,139.7 6,170.9 50.8 304.6

38.4 4,711.5 266.1 255.7

21.2 3,689.6 228.1 15.0

‘03 ‘04 ‘05 ‘06 ‘07 ‘03 ‘04 ‘05 ‘06 ‘07 ‘03 ‘04 ‘05 ‘06 ‘07

The Net Assets per share and Earnings per share for the comparative periods are based on the enlarged share capital restated for the effect of the bonus issue in the fi nancial year 2005. The effect of the new Financial Reporting Standards (FRSs) is refl ected for the comparative period of fi nancial year 2006 only. 4 PETRONAS DAGANGAN BERHAD (88222-D) Corporate

PETRONAS Dagangan Berhad (the Company) was incorporated in Malaysia under the Companies Act 1965 on 5 August 1982 and was converted to a public company on 21 August 1993. Shares of the Company were listed on the Main Board of Bursa Malaysia Securities Berhad on 8 March 1994.

The Company is the principal domestic marketing arm of Petroliam Nasional Berhad (PETRONAS), the national oil company, which holds 69.86% of its equity. The Company markets a wide range of high quality petroleum products including motor gasoline, aviation fuel, kerosene, diesel, fuel oil, bunker fuel, lubricants, liquefi ed petroleum gas (LPG) and asphalt in Malaysia.

The market for petroleum products is highly competitive, with major multinational corporations competing for sales of fuels to consumers which include motorists, households, airlines, shipping lines, transporters, plantations, processing and manufacturing plants, power stations and commercial enterprises. The Company’s products have enjoyed high market acceptance and customer confi dence, as evidenced by its rapid sales growth over the years. The Company markets its products throughout the country, directly to customers as well as through its network of service stations, LPG dealers and industrial dealers. Its marketing activities are well supported by a comprehensive logistics and distribution system consisting of bulk depots, aviation depots, bunkering facilities and LPG bottling plants, all strategically located to ensure a reliable supply of products at all times.

The Company has a sophisticated Customer Service Centre to serve its customers better. PETRONAS DAGANGAN BERHAD (88222-D) 5 Profi le 6 PETRONAS DAGANGAN BERHAD (88222-D) PETRONAS DAGANGAN BERHAD (88222-D) 7

Corporate Information

8 Financial Calendar 9 Corporate Information 10 Board of Directors 12 Profi le of Directors 14 Management Committee 8 PETRONAS DAGANGAN BERHAD (88222-D) Financial Calendar

29 AUGUST 2006 8 SEPTEMBER 2006 Announcement of the unaudited consolidated results Date of payment of the 2005/2006 fi nal dividend for the 1st quarter ended 30 June 2006

30 NOVEMBER 2006 28 DECEMBER 2006 Announcement of the unaudited consolidated results for Date of payment of the 2006/2007 interim dividend the 2nd quarter ended 30 September 2006

26 FEBRUARY 2007 31 MARCH 2007 Announcement of the unaudited consolidated results Date of fi nancial year end for the 3rd quarter ended 31 December 2006

28 MAY 2007 18 JUNE 2007 Announcement of the unaudited consolidated results Date of Notice of 25th Annual General Meeting and for the 4th quarter and fi nancial year ended date of issuance of 2007 Annual Report 31 March 2007

10 JULY 2007 23 AUGUST 2007

Date of 25th Annual General Meeting Date of payment of the 2006/2007 fi nal dividend PETRONAS DAGANGAN BERHAD (88222-D) 9 Corporate Information

DIRECTORS REGISTRAR BANKERS

Datuk Anuar bin Ahmad (Chairman) Symphony Share Registrars Sdn. Bhd. CIMB Bank Berhad Ibrahim bin Marsidi Level 26, Menara Multi Purpose Malayan Banking Berhad Dato’ Chew Kong Seng Capital Square Dr. R. Thillainathan No. 8 Jalan Munshi Abdullah STOCK EXCHANGE LISTING Dato’ Kamaruddin bin Mohd Jamal 50100 Kuala Lumpur Datuk Ainon Marziah bt Wahi Tel : (03) 2721 2222 Bursa Malaysia Securities Berhad Mohammad Medan bin Abdullah Fax : (03) 2721 2530 / 2721 2531 Main Board

BOARD AUDIT COMMITTEE REGISTERED ADDRESS AUDITORS

Dato’ Chew Kong Seng (Chairman) Tower 1 KPMG Desa Megat & Co. Dr. R. Thillainathan PETRONAS Twin Towers Dato’ Kamaruddin bin Mohd Jamal Kuala Lumpur City Centre Mohammad Medan bin Abdullah 50088 Kuala Lumpur Tel : (03) 2051 5000 Fax : (03) 2026 5505 COMPANY SECRETARIES

Noor Lily Zuriati bt Abdullah Yeap Kok Leong BUSINESS ADDRESS Level 30-33, Tower 1 PETRONAS Twin Towers Kuala Lumpur City Centre 50088 Kuala Lumpur Tel : (03) 2051 5000 Fax : (03) 2026 5505 Website : www.mymesra.com.my Mesralink Tel : 1-300-88-8181 E-mail : [email protected] 10 PETRONAS DAGANGAN BERHAD (88222-D)

Board of Directors

From Left:

Datuk Anuar bin Ahmad (Chairman)

Ibrahim bin Marsidi

Dato’ Chew Kong Seng

Dr. R. Thillainathan

Dato’ Kamaruddin bin Mohd Jamal

Datuk Ainon Marziah bt Wahi

Mohammad Medan bin Abdullah

Noor Lily Zuriati bt Abdullah (Company Secretary)

Yeap Kok Leong (Company Secretary) PETRONAS DAGANGAN BERHAD (88222-D) 11 12 PETRONAS DAGANGAN BERHAD (88222-D) Profi le of Directors

Datuk Anuar bin Ahmad, a Malaysian aged 53, is a Non- Dato’ Chew Kong Seng, a Malaysian aged 69, is an Independent Independent Non-Executive Director. He was appointed as Chairman Non-Executive Director and the Chairman of the Board Audit of PETRONAS Dagangan Berhad on 3 October 2005. He holds a Committee. He is a Fellow of the Institute of Chartered Accountants Bachelor of Science Degree (Econs) from the London School of in England and Wales and a member of the Malaysian Institute Economics & Political Science, University of London and had attended of Certifi ed Public Accountants and the Malaysian Institute of Harvard Business School’s Advanced Management Programme Accountants. His career started off as a tax offi cer in the United (AMP), USA. Kingdom with the Inland Revenue Department and Stoy Hayward & Co. from 1964 to 1970. He returned to Malaysia to join Turquand He joined PETRONAS in 1977 and is currently the Vice President, Oil Young & Co. (now known as Ernst & Young) and was subsequently Business, PETRONAS. Before his appointment to this position, he transferred to Sarawak offi ce in 1973, fi rst as Manager-in-Charge held various senior managerial positions in International Marketing and later as Partner-in-Charge. He served as the Managing Partner Division, Corporate Planning Unit, PETRONAS Trading Corporation of Ernst & Young for six years before he retired from professional Sdn Bhd and PETRONAS Dagangan Berhad. He has been a member practice in 1996. From May 1999 to June 2005, he was an executive of PETRONAS’ Management Committee since July 1998 and was director of Sarawak Enterprise Corporation Bhd. appointed as a PETRONAS Board member in October 2002. He also sits on the Board of several other companies within the PETRONAS His experience covers a wide variety of industries including those Group. relating to banking and fi nancial institutions, utilities, timber based, manufacturing, trading and advisory services to local and foreign He was appointed to the Board on 20 May 1995 and attended six investors. He is also an Independent Director and Audit Committee (6) Board meetings during the period under review. Chairman of four (4) public listed companies namely PETRONAS Dagangan Berhad, Industrial Concrete Products Berhad, AEON Co. (M) Bhd and PBA Holdings Berhad. He is an Audit Committee Ibrahim bin Marsidi, a Malaysian aged 55, is the Managing member of PETRONAS Gas Berhad and GuocoLand Malaysia Director and Chief Executive Offi cer of PETRONAS Dagangan Berhad. Berhad. He also acts as an Independent Director in other public He holds a Bachelor of Econs. (Analytical) (Hons), University of limited companies. Malaya. He joined PETRONAS in 1979 and since then has held various senior managerial positions in PETRONAS. He was appointed to the Board on 25 March 1994 and attended fi ve (5) Board meetings during the period under review. Prior to his appointment as Managing Director and Chief Executive Offi cer of the Company on 1 October 2002, he was the Senior Manager of Eastern Region and Northern Region, General Manager of LPG Business and Retail Business in PETRONAS Dagangan Berhad, and General Manager of Crude Oil Group, PETRONAS. He is also a Board member of other affi liated companies.

He has attended six (6) Board meetings during the period under review. PETRONAS DAGANGAN BERHAD (88222-D) 13

Profi le of Directors

Dr. R. Thillainathan, a Malaysian aged 62, is an Independent Non- Datuk Ainon Marziah bt Wahi, a Malaysian aged 56, is a Non- Executive Director. He holds a Class 1 Honours in Bachelor of Arts Independent Non-Executive Director. She holds a Bachelor of Arts (Economics), University of Malaya (1968) and obtained his Masters (Hons) Anthropology & Sociology, University of Malaya and obtained and PhD in Economics from the London School of Economics. He is her Master of Science (Industrial Relations) from University of also a Fellow of the Institute of Bankers, Malaysia. Strathclyde, United Kingdom.

He is currently the Executive Director of Genting Berhad, a public She joined PETRONAS in 1979 and is currently the Vice President, listed company. He is also on the Board of Bursa Malaysia Berhad. Human Resources Management Division, PETRONAS. Prior to Dr. R. Thillainathan has extensive years of experience in fi nance and assuming this position, she has held various senior positions in Human banking and is or has been actively involved in numerous professional Resources Management Division, PETRONAS. She is also a Board and national bodies. He is also the Immediate Past President of the member of several other companies within the PETRONAS Group. Malaysian Economic Association. She was appointed to the Board on 1 October 2002 and attended He was appointed to the Board on 24 March 1994 and attended six fi ve (5) Board meetings during the period under review. (6) Board meetings during the period under review.

Mohammad Medan bin Abdullah, a Malaysian aged 49, is a Dato’ Kamaruddin bin Mohd Jamal, a Malaysian aged 64, is an Non-Independent Non-Executive Director. He holds a Bachelor of Independent Non-Executive Director. He had attended the British Laws from Universiti Malaya. Royal Military College of Science and British Command and Staff College. He holds an MBA from the School of Business Management He joined PETRONAS in 1982 and is currently the Senior General of the Cranfi eld Institute of Technology, United Kingdom. He had Manager, Corporate Services Division, PETRONAS Carigali Sdn Bhd. also attended the Advance Management Program at the IMD, Prior to assuming this position, he has held various senior positions Lousanne, Switzerland. in PETRONAS. He is also a Board member of other companies within the PETRONAS Group. He was commissioned into the Malaysian Army in 1962 and left the service in 1974 after he had served in various command and staff He was appointed to the Board on 20 February 2006 and attended positions for 12 years. He then joined Esso Production Malaysia Inc. in six (6) Board meetings during the period under review. 1975 and held various management positions in both upstream and downstream sectors. He was an Assistant to the Chairman for two years before he was appointed HR Director for the Esso Companies in Malaysia on 1 January 1987. He remained in this position until he elected to retire in December 2001.

He was appointed to the Board on 1 March 2002 and attended six (6) Board meetings during the period under review.

None of the Directors has : Any family relationship with any Director and/or major shareholder. Any confl ict of interest with PETRONAS Dagangan Berhad. Any conviction for offences within the past ten (10) years other than traffi c offences. (All of the Directors are members of Nomination and Remuneration Committee).

14 PETRONAS DAGANGAN BERHAD (88222-D) Management

From Left:

Mohd Shobri bin A. Bakar Fadzilan bin Mohd Daud General Manager, Lube Business Division Senior Manager, Human Resource Management & Administration Services Department Ir. Yee Gim Kong Senior Manager, HSE & Risk Management Department Ruziah Azdi bt Abdul Rahman Senior Manager, Brand Department Raja Abd Halim bin Raja Abd Razak Senior Manager, Planning Department Rahiman bin Hashim General Manager, Commercial Business Division PETRONAS DAGANGAN BERHAD (88222-D) 15 Committee

From Left:

Sulaiman bin Daud Ibrahim bin Marsidi General Manager, LPG Business Division Managing Director / Chief Executive Offi cer

Md Arif bin Mahmood Azmi bin Yahaya Senior General Manager, Retail Business Division General Manager, Finance Services Division

Izuddin Husaini bin Mohd Yusoff Noor Lily Zuriati bt Abdullah General Manager, Supply & Distribution Division Company Secretary / Senior Legal Counsel

Muhamad bin Hashim Senior Manager, Business Technology Department 16 PETRONAS DAGANGAN BERHAD (88222-D)

Performance Review

18 Chairman’s Statement 22 CEO’s Report 32 Share Performance 33 Crude Oil & Petroleum Product Price Trend PETRONAS DAGANGAN BERHAD (88222-D) 17 18 PETRONAS DAGANGAN BERHAD (88222-D) Chairman’s PETRONAS DAGANGAN BERHAD (88222-D) 19 Statement

The Group’s pre-tax profit rose by 25% to RM903 million. After providing for corporate tax, Group net profit amounted to RM647 million, a 26% increase from that of the previous year.

On behalf of the Board of Directors, I am During the fi nancial year, the Company pleased to present the Annual Report further expanded its market share from of PETRONAS Dagangan Berhad (the 41% last year to about 42.4%, further Company) for the Financial Year ended widening the gap between the Company 31 March 2007. and its closest competitor. Strong growth was recorded in almost all product The period under review has been another categories namely, gasoline, liquefi ed successful year for PETRONAS Dagangan petroleum gas (LPG), diesel, aviation fuel Berhad and its subsidiary (the Group). and bitumen. The Group’s total revenue increased by 18% to RM19,496 million from the previous The Retail Business continued to be the year’s RM16,568 million. The revenue focus of the Company’s business growth. growth is due to improved sales recorded During the year, a signifi cant portion of the for most products as well as higher product Company’s capital expenditure was spent prices in line with the international prices. on expanding the retail network facilities. As a result, the Group’s pre-tax profi t rose As at 31 March 2007, the Company was by 25% to RM903 million. After providing operating a total of 832 service stations for corporate tax, Group net profi t nationwide. The year also saw the amounted to RM647 million, a 26% Company’s launching of its PETRONAS increase from that of the previous year. PRIMAX 3, a new revolutionary gasoline blended with a new additive called SINAR The Board of Directors is recommending a G-05, which not only delivers power to the fi nal dividend of 20 sen less 27% tax per engine, but also provides fuel economy share. Together with the interim dividend and engine cleansing. As refl ected by the of 10 sen less 28% tax per share paid on increasing sales, the new product was well 28 December 2006, the total dividend for received by the customers. Consequently, the Financial Year amounts to 30 sen per the Company improved its retail market share. share to 30.6% from 30% in the previous year. 20 PETRONAS DAGANGAN BERHAD (88222-D)

Chairman’s Statement

The Commercial Business again recorded was achieved as a result of greater various products at Bintulu depot. The improved sales performance and continued brand exposure given to the Company’s Company will be closing its aging Kuching to dominate the market especially in diesel, key lubricant brands, namely SYNTIUM depot and will utilize the new independent aviation fuel, fuel oil and bitumen sales. and SPRINTA through participation in facilities at Senari to serve its Kuching Its market share improved to 63.2% from motorsports events such as Formula One market. Another initiative includes the 61% in the last fi nancial year, retaining its team, PETRONAS 4X4 Adventure Team installation of Global Positioning System position as the top volume contributor to and PETRONAS SPRINTA AAM Malaysian equipment in the Company’s trucks to the Company’s sales growth. Cub Prix Championship. The Company’s track the vehicles’ movement in real time to excellent after-sales service to the enhance the security and safety of product In the LPG sector where the market demand customers also contributed to the strong delivery. declined arising out of competition from performance. natural gas, the Company’s performance In our continuous pursuit for excellence, surpassed the average market growth rate, Behind all these achievements is the we remain committed to ensure that the increasing its market share to 45.4% from reliable support provided by the Company’s highest possible standards of health, safety 45% and hence, maintaining its market comprehensive logistics and distribution and environment (HSE) management leadership and GAS PETRONAS’ position as system which comprises bulk depots, practices are applied throughout the “Malaysia’s No. 1 Selling Cooking Gas”. aviation depots, bunkering facilities and organisation. Towards this end, the LPG bottling plants. During the year, the Company has conducted various HSE The Lubricant sector too registered a supply and logistic facilities have been exercises, drills, seminars and educational commendable performance with its market enhanced in tandem with the Company’s activities during the year as part of our share expanding to 16.9% from the business growth. This includes the ongoing HSE improvement programme. previous year’s 15.5%. This performance construction of additional storage for We also strive to ensure that our business

The outlook for the coming year appears to be promising with the demand for petroleum products expected to grow in line with Malaysia’s projected economic growth. PETRONAS DAGANGAN BERHAD (88222-D) 21

Chairman’s Statement

partners also comply to the HSE standards, been encouraged to discharge their role as On behalf of the Board of Directors, I would guidelines and procedures stipulated by a responsible and caring corporate citizen. like to thank the Management and staff of the Company. We hope that our efforts have contributed the Company for their continued hard work towards the creation of a caring society in and commitment in making the FY2006/07 Another key factor for the Company’s Malaysia. another successful year for the Company. success is people. They are the Company’s I would also like to thank the Company’s most important asset. No efforts have been Looking ahead, the outlook for the coming shareholders, dealers and customers as spared to develop and retain the right year appears to be promising with the well as the Government of Malaysia for talent in the Company to ensure that the demand for petroleum products expected their unwavering support extended to the vision of becoming the Brand of 1st Choice to grow in line with Malaysia’s projected Company. Finally, I would like to thank is achieved. Various programmes have been economic growth. Nonetheless, we the Members of the Board of Directors for introduced and implemented to ensure expect competition in all business sectors their advice, support and cooperation. that staff at all levels are equipped with particularly retail business, will continue the appropriate competencies and skills to to persist. In anticipation of the increasing enhance their capabilities in executing the challenges ahead, the Company will business plans and strategies. remain focused on expanding its network of facilities, improving the quality of its As a responsible corporate citizen, the products and services, optimising costs Company conducted various social and and developing its human capital even community projects at both national and further. The Company will also continue state levels during the year. In addition, to play its part in contributing towards the Datuk Anuar bin Ahmad PETRONAS Service Stations operators have development of the industry. Chairman 22 PETRONAS DAGANGAN BERHAD (88222-D)

Market Share CEO’s Total All Products

58% 42% PETRONAS Dagangan Berhad

Others

The Group achieved its best ever financial performance with a record revenue of RM19,496 million amidst intense competition.

The Company ended Financial Year 2006/07 The Group’s fi nancial position continued on an impressive note with its earnings to remain healthy. Total assets stood at exceeding the previous year’s fi gures to RM6,517 million as at 31 March 2007, hit its highest level ever. The Company’s mainly funded by our shareholders’ funds performance is commendable and refl ective except for a RM5 million borrowings taken of its continued business growth. by our subsidiary Kuala Lumpur Aviation Fuelling System (KAFS). A total of RM496 million was spent during the year on FINANCIAL PERFORMANCE capital expenditure, fi nanced by internally During the year under review, the Group generated funds to support the business achieved its best ever fi nancial performance growth. with a record revenue of RM19,496 million amidst intense competition. This represents an increase of 18% from RM16,568 million BUSINESS PERFORMANCE in the previous year. Group profi t before tax The Company further strengthened its increased to RM903 million from RM725 position as the market leader with a wider million while net profi t grew by 26% gap ahead of its closest competitor. During to RM647 million, another new record, the fi nancial year, total sales volume grew compared to last year’s RM511 million. by 3.6% to 12,255 million litres and market The growth in revenue and earnings were share increased to 42.4% from 41% attributed to the healthy growth in sales previously. volume. Earnings per share rose to 64.5 sen from 50.8 sen last year. PETRONAS DAGANGAN BERHAD (88222-D) 23 Report 24 PETRONAS DAGANGAN BERHAD (88222-D)

CEO’s Report

Market Share Retail Business continued to be the focus of The Company’s convenience store business Retail the Company’s business growth. A milestone under the name, Kedai Mesra, also grew was charted on 5 June 2006 when the signifi cantly with 57 new stores opened Company introduced PETRONAS PRIMAX 3 during the year. With a total of 469 Kedai 31% 69% to the Malaysian market. PRIMAX 3, a new Mesra outlets in operation as at 31 March revolutionary gasoline blended with new 2007, the Company currently operates additive SINAR G-05 which not only delivers the largest network of convenience stores power to the engine but also provides at petrol stations in the country. At the fuel economy and cleans the engine, was moment, the Company also has the launched with the tagline “POWER TO biggest ATM network at petrol stations, GO THE DISTANCE”. with a total of 304 ATM machines, as well as 114 Touch ‘n Go reload terminals PETRONAS Dagangan Berhad In FY 2006/07, the Retail Business and 627 ePay terminals available at its contributed approximately 58% of the stations nationwide. The Company has also Others Company’s total gross margin and equipped more of its service stations with achieved 30.6% market share. This sector’s the electronic payment system, bringing contribution to the Company’s sales volume the total number of stations equipped with and profi tability is expected to continue to this system to 701. increase in tandem with the Company’s planned network expansion. The Company The launch of a comprehensive retail dealer achieved yet another major milestone in communication and information portal its growth as the number of PETRONAS known as myStation in February 2007 Service Stations in the country breached has provided a user-friendly platform to the 800-level. During the year under review, encourage communication and information 47 new stations began operations, sharing between the dealers and the increasing the total of PETRONAS Service Company. Stations in operation nationwide to 832 as at 31 March 2007. PETRONAS DAGANGAN BERHAD (88222-D) 25

CEO’s Report

In our continuous effort to maintain our air traffi c especially from Air Asia’s rising Market Share loyal customers and attract new ones, demand with the introduction of its new Commercial various initiatives were undertaken during destinations. In terms of aviation fuel, the year such as the “PETRONAS Car Malaysia Airlines and Air Asia remained Craze Contest” which ran from January as the Company’s biggest customers. 37% to May 2007. Other programmes that At the same time, the Company was were successfully implemented include aggressive in securing new airlines landing the PETRONAS Coffee Break campaign, at the KL International Airport (KLIA) and 63% Kad Mesra Joran fi shing competition and other regional airports in the country. The PETRONAS PRIMAX 3 Mini Carnival. Company’s aggressive push into aviation, commercial diesel and bitumen has been Commercial Business remained the largest effective in compensating for the lower volume contributor to the Company’s sales fuel oil volume uplifted due to the extensive PETRONAS Dagangan Berhad and continued to dominate the market conversion to Natural Gas in the previous especially in diesel, aviation fuel, fuel oil year. The Company also continued to Others and bitumen sales. We will continue to dominate the fuel oil market following the provide excellent and reliable services to the positive growth in bunker sales. customers in line with our role as a trusted fuel supplier. For the second consecutive year, we have successfully maintained our number one During the year, the Commercial Business position in bitumen sales with more than contributed 29% of the Company’s total 45% market share. Bitumen sales grew by gross margin and is in the leading position almost 33% from the previous year, largely domestically with 63.2% market share. contributed by the stable bitumen supply from PETRONAS’ refi nery in Melaka and Sales of aviation fuel increased during the aggressive sales captured from pre- the year, driven mainly by the growth in mix plants and major road construction 26 PETRONAS DAGANGAN BERHAD (88222-D)

CEO’s Report

Market Share companies. PETRONAS has also time- Terengganu. Its leading position is further LPG chartered a new 1,500 MT bitumen vessel enhanced by a wide network of committed to ensure continuous product supply to channel members comprising 14 stockists, East Malaysia. 400 dealers and 7 bottling plants that 55% are strategically located nationwide. The 45% The Company’s LPG Business further channel members are well-trained in the strengthened its market leadership with areas of Health, Safety and Environment GAS PETRONAS remaining as “Malaysia’s (HSE) and customer service, among No. 1 Selling Cooking Gas”. Notably, the others, to ensure a high level of service LPG Business Division successfully secured capabilities. the ISO 9001:2000 certifi cation, in line with the Company’s vision to be “The Brand of In the Lubricant Business, the Company PETRONAS Dagangan Berhad 1st Choice”. turned in a commendable performance with continued growth in its market share. Others In the LPG Business, the Company not Our SYNTIUM range of lubricants has been only sustained its pole position but also widely acknowledged in the market as expanded its market share further to being of world class standard, which had 45.4% from 45% during the year under further enhanced our brand image. review. The LPG sales growth outpaced the market growth rate by four times and this During the year under review, the was attributed to higher cylinder sales. Company’s Lubricant Business increased its market share to a respectable 16.9% from The Company has an advantage in this 15.5% in the previous year. The growth sector as its LPG supply is sourced directly was achieved through aggressive sales from PETRONAS’ own refi nery and gas drive, continuous branding efforts and processing plants located in Kertih, value-added service offerings. PETRONAS DAGANGAN BERHAD (88222-D) 27

CEO’s Report

In the luxury car segment, Lubricant various improvement initiatives to enhance Market Share Business successfully secured lube supply its logistic infrastructure and capabilities. Lubricants contracts with three BMW Service Centres, One of the steps taken was the provision 17% two of which belonged to Auto Bavaria of facilities for the marketing of bitumen 83% and one owned by Sapura Auto. We are and the construction of additional storage currently supplying the BMW-approved facilities at the Bintulu depot. Hydrant lubricant, SYNTIUM 3000 LL, which meets facilities for the refueling of aircrafts were the stringent engine requirements set by also installed at the Kuching airport. Other the German car maker and other foreign milestones include the relocation of the bulk luxury car manufacturers. Our continued fuel and LPG terminal to a new independent involvement with the BMW Sauber F1 team, site at Senari, Sarawak, following the PETRONAS Adventure Team (4X4) and closure of the Kuching Terminal. PETRONAS SPRINTA AAM Malaysian Cub PETRONAS Dagangan Berhad Prix Championship has also strengthened Apart from the infrastructure development, Others the brand image of our SYNTIUM and the Company also embarked on a “Zero SPRINTA lubricants. Accident” campaign for its road tankers by equipping the vehicles with Global Positioning System equipment that can SUPPLY AND LOGISTICS track their movement in real time. On the The Company realised that effi cient supply side, the Company will continue supply and logistics support is imperative to ensure timely product replenishment at in fulfi lling the marketing needs of the all our depots, with the aim of improving respective business lines. In this respect, customer service. the Company has continuously pursued 28 PETRONAS DAGANGAN BERHAD (88222-D)

CEO’s Report

OPERATIONAL IMPROVEMENT This will ultimately lead to greater customer satisfaction. During the year, six of the With the escalating challenges and demands Company’s Innovative and Creative Circle faced by the business, greater emphasis (ICC) teams participated in the National has been placed on maintaining our high- Productivity Corporation’s Regional ICC performance environment by developing Convention which kicked off in June and retaining the right talent to steer the 2006. Three of our ICC teams managed to Company to greater heights. advance to the National ICC Convention held in September the same year. At the To ensure that the Company meets its National ICC Convention, all the three ICC business targets, we continue to focus teams from the Company won the “Gold on capability and leadership development Award with Three Stars” recognition, to ensure that highly capable and well- whereby team “Budi” from KLIA Aviation trained human resources are readily Depot emerged as the overall runner-up for available within the organisation to the service sector. effectively execute the business strategies. Leadership Development Programmes Moving forward in our brand journey, were also implemented to nurture and we have also introduced our new way of instill leadership qualities among the working which is “Build, Own, Learn and young executives and those who have Deliver” or “BOLD” in short to strengthen been identifi ed as potential leaders. our brand-driven culture and to ensure that things are done the right way in order to Quality improvement initiatives were achieve our vision to be the “Brand of 1st actively undertaken across the Group in Choice”. line with its effort to integrate the various key processes within the Group that would enhance our operational effi ciency. PETRONAS DAGANGAN BERHAD (88222-D) 29

CEO’s Report

HSE continued to be a top priority for the REACHING OUT TO THE COMMUNITY Greater emphasis has been Company and this was refl ected in the At the ground level, the Company various HSE programmes carried out during continued to organise various community placed on maintaining the year. Emphasis was given to ensuring programmes at PETRONAS Service Stations safety in all our business operations while nationwide with the objectives of creating our high-performance safeguarding the health of employees with brand awareness among the public and due care for the environment. strengthening our relationship with the environment by developing local community surrounding the respective and retaining the right talent STAFF RECOGNITION stations. These activities include the Kad Mesra-Joran Fishing Competition, PETRONAS Recognising that people are the Company’s to steer the Company to PRIMAX 3 Mini Carnival, educational visits most important asset, we continued to and talks and other sponsorship events. adopt the Company Staff Recognition greater heights. The Company also took the initiative to Scheme which was fi rst introduced in 2006. promote safety during the festive seasons The objectives of the recognition scheme through its “Coffee Break” programmes at are to promote a healthy culture that values selected PETRONAS service stations. staff for their accomplishment and to create a brand driven organisation, where The Company continued to carry out its staff are passionate about the Company’s popular community relations programme branding effort and would go the extra mile such as “Hari Mesra Pelanggan” (Customer beyond their normal job scope to promote Appreciation Day) at PETRONAS Service the Company’s brand. In the year under Stations throughout the country on a review, eight employees received awards in regular basis. recognition of their valued contributions to the Company and the community. 30 PETRONAS DAGANGAN BERHAD (88222-D)

CEO’s Report

We expect to continue to The Company also took the responsibility Carrier Terminal this year to become an of maintaining the StreetSmart Reading international hub for budget carriers and maintain our current sales Corners in the 100 sponsored schools long haul traffi c in the region. At the same to ensure the effectiveness of the time, new constructions and upgrading growth, while delivering programme. of roads and highways will contribute to higher demand for bitumen while the opportunities for bunker sales growth look added value to our FUTURE OUTLOOK AND promising. shareholders and CHALLENGES The outlook for the domestic petroleum Despite the favorable prospects, there will customers as well as products market is expected to remain be numerous challenges that need to be favorable with the anticipated continuous faced. Volatility in the crude oil price could fi rming our position growth of the Malaysian economy. With result in higher product cost, therefore the current uptrend in demand for all major squeezing retailers’ margin for non- to be the “Brand of products, the Financial Year 2007/2008 regulated products such as jet fuel, fuel promises to be a year of growth for the oil, industrial diesel and lubricant products st 1 Choice.” industry and the Company. which are not household products and hence, are not subsidised. The high capital The retail or transport sector will remain a investments due to rising land, labour major revenue contributor to the industry and construction costs will also have an as the increase in the sales of cars and impact on the profi tability of the Company. commercial vehicles is anticipated to Competition will also persist as Oil continue in the coming year. As for the Companies continue to widen their retail aviation sector, the industry will benefi t network, upgrade their existing facilities, from new airlines landing at KLIA in introduce new products and embark on conjunction with Visit Malaysia Year 2007 aggressive marketing and promotional as well as the expansion of the Low Cost campaigns. In this regard, the Company PETRONAS DAGANGAN BERHAD (88222-D) 31

CEO’s Report

will continue to build new stations at our shareholders and customers as well as strategic locations and expand its current fi rming our position to be the “Brand of 1st network of facilities. With the available Choice.” resources, capabilities and experience within the Company, we are well-poised to APPRECIATION overcome competition and further improve our operational effi ciency. On behalf of the management, I would like to take this opportunity to thank all To support the Government’s call to employees for their continued hard work, encourage the use of natural gas as a dedication and loyalty to the Company. cheaper and cleaner fuel, the Company, I would also like to express my appreciation which has been entrusted to operate and to the Government and their agencies for manage the Natural Gas for Vehicles (NGV) their encouragement and co-operation business in the country, has increased the and to our Board of Directors for their wise number of outlets equipped with NGV counsel and guidance. To our shareholders, dispensing units. Plans are underway to dealers and customers, I thank you for your increase the network of these stations to continued support and goodwill. make NGV more widely available.

The Company is ready to face new challenges in the coming year, as it moves forward and strengthens its market position further, particularly in the retail sector, while catering for the growing demand in aviation and bitumen sales. We expect to continue to maintain our current sales Ibrahim bin Marsidi growth, while delivering added value to Managing Director / Chief Executive Offi cer 32 PETRONAS DAGANGAN BERHAD (88222-D) Share Performance

Share Price Average Composite Total Volume (RM) Index (Points) Traded (Lots)

10 2,000 250,000

8 1,600 200,000

6 1,200 150,000

4 800 100,000

2 400 50,000

0 0 0 Jan Jan Jan Jan Jan Jan 2002 2003 2004 2005 2006 2007

PDB Stock Highest Price Lowest Price Total Volume Traded Average Composite Index

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005*1 2006 2007*2

Highest Price 6.25 7.85 6.80 4.70 4.42 4.70 4.50 6.05 7.05 8.00 8.10 4.98 6.25

Lowest Price 4.42 5.60 2.99 1.78 3.40 2.86 2.80 4.20 4.96 6.15 3.52 3.66 4.82

*1 PETRONAS Dagangan Bhd on 15 March 2005 has issued a one-for-one bonus issue of up to 496.72 million shares. *2 Based on transacted prices for the period ended 31 March 2007. PETRONAS DAGANGAN BERHAD (88222-D) 33 Crude Oil and Petroleum Product Price Trend

US$/BBL 100

80

60

40

20

0 Jan2002 Jan Jan Jan Jan Jan 2003 2004 2005 2006 2007

Crude Oil (Tapis) Ron 97 Diesel Jet A1

Note: Average monthly prices based on Mean of Platts at Singapore (MOPS) 34 PETRONAS DAGANGAN BERHAD (88222-D)

Corporate Responsibility

36 Corporate Social Responsibility 39 Calendar of Events 45 PETRONAS Dagangan in the News PETRONAS DAGANGAN BERHAD (88222-D) 35 36 PETRONAS DAGANGAN BERHAD (88222-D) Corporate Social Responsibility

As the trusted retailer in the country, the Company places utmost this HSE initiative a step further by conducting a major ERP drill importance on its role as a socially responsible corporate citizen. at PETRONAS Service Station Mutiara Damansara, Petaling Jaya. Hence, corporate social responsibility runs deep in the heart of our The drill, which involved 70 personnel from the Company, business entire business operation. partners, local authorities and government bodies, truly refl ects our seriousness in protecting the safety of the public that is directly The Company is committed to provide the best convenience for involved in our retail business operations. our customers and to share our success with the community. At the same time, the Company also places great emphasis on health, During the year, a Vapour Recovery System was successfully safety and environment aspects in every area of our operations. implemented at our Prai Depot that has helped eliminate petrol vapour released to the air during loading and offl oading of Realising that the employees are our most important asset, petrol to and from the oil tankers, hence promoting a cleaner the Company strives to provide a highly conducive working environment. Under the system, petrol vapour emitted during environment that would help inspire them to continuously aspire loading and offl oading is channeled via a special hose to a to be the best. dedicated compartment in the oil tanker, whereby it will later be transferred to a vapour recovery unit at the depot. The vapour The Company is also sensitive and responsive towards the needs will then be re-processed into its original liquid form for re-use. arising from the marketplace, in line with our goal to be the Brand of 1st Choice. The Company also continued to organise HSE-related campaigns, training programmes and courses dedicated to our staff, business HEALTH, SAFETY & ENVIRONMENT (HSE) partners and customers throughout the year. These include the As the largest marketer of petroleum products in Malaysia, the “Towards Zero Accident Campaign” for our road tanker drivers Company continuously takes all necessary precautions possible and defensive driving courses for liquefi ed petroleum gas (LPG) to protect the health and safety of all our stakeholders including lorry drivers, among others. The defensive driving courses, for individual and corporate customers, business partners, employees instance, were to ensure that the LPG lorry drivers are well and members of the community. trained in all aspects of road safety, safe handling of LPG and customer service. Emergency Response Plan (ERP) exercises, such as fi re drills at the Company-owned depots, are among the regular activities included With more than 832 PETRONAS Service Stations in the country in our HSE calendar of events. In March 2007, the Company took that are frequented by millions of vehicle users, it is only natural

The Company is committed to provide the best convenience for our customers and to share our success with the community. At the same time, the Company also places great emphasis on health, safety and environment aspects in every area of our operations. PETRONAS DAGANGAN BERHAD (88222-D) 37

Corporate Social Responsibility

for the Company to put signifi cant emphasis on road safety. Thus, In the education fi eld, the Company continued to undertake the following the huge success of our previous Coffee Break campaigns responsibility of maintaining the StreetSmart Reading Corners at during the major festive seasons, the Company has increased the 100 schools which have benefi ted from the project. The StreetSmart number of PETRONAS Service Stations involved in the campaign to Reading Corner project was an initiative under the Tabung Mesra 24 from 21 previously, all of which are located along the highways Fund launched by the Company in October 2001. A joint effort and busy trunk roads. Already in its eighth year, the campaign between the Company and the Ministry of Education, Tabung was held to encourage the road users to take a break during their Mesra is aimed at creating a more stimulating learning environment long journey to ensure a safe trip to their respective destinations. for pupils via the StreetSmart Reading Corners, each of which is It is organised by the Company in collaboration with the Transport equipped with more than 500 books related to English and Living Ministry, Nestlé and AMP Radio. Skills subjects.

COMMUNITY Another community activity sponsored by the Company during the With a diverse range of business operations scattered throughout year was a charity run, “Larian Amal Jelita Bersamamu” organised the country, the Company is always conscious of the need to touch by Jelita magazine in April 2006. The event was held in conjunction the lives of the local community wherever we operate. with Jelita’s 30th anniversary aimed at promoting a healthy lifestyle. Under this programme, every RM1 of the registration fee collected Testimony to this was when the Company launched our revolutionary, for the run will be channeled to the Tabung TV3 Bersamamu. high performance petrol, PETRONAS PRIMAX 3 in the local market in June 2006, the Company decided to price the fuel at the regular Besides these activities, our service station operators have also standard price to enable Malaysians from all walks of life to enjoy taken their own initiative to undertake community-relations this premium petrol without having to pay a premium price. programme on the ground. A good example is the highly popular Customer Appreciation Day or “Hari Mesra Pelanggan” that is held Another occasion was when massive fl ood hit Johor by surprise in collaboration with the Company at various PETRONAS Service in December 2006. The Company was quick to lend a helping Stations nationwide. The Customer Appreciation Day provides an hand by donating 700 cylinders of cooking gas to several fl ood excellent avenue for the Company and our dealers to reach out and relief centres in the state. The gas was used for the preparation share our success with the local community through wholesome, of food for fl ood victims in the affected areas such as Segamat, family-oriented activities such as colouring contest, telematches Parit Sulong and Sri Medan. and singing competition. The Company also took the opportunity to reach out to the less fortunate ones, especially orphans and 38 PETRONAS DAGANGAN BERHAD (88222-D)

Corporate Social Responsibility

single mothers, who were also invited to be a part of the event. corporate initiatives among the participants. During the last Brand Donations in cash and kind were also contributed to ease their Camp held on March 2007 themed “BOLD to Brand Beyond”, the burden. brand agents were reminded to go beyond BOLD in serving their customers and to be BOLD enough to push the PETRONAS brand WORKPLACE to be the Brand of 1st Choice at all times. The Company consistently strives to develop the leadership skills and capabilities of our employees as we recognise them as the MARKETPLACE key players in achieving our goal to be the Brand of 1st Choice. The Company is the fi rst oil fi rm in the country to introduce the pay-at-pump facility for Europay-MasterCard-Visa (EMV)-compliant In ensuring that the Company meets its business targets, the or chip-based credit cards at our petrol stations. The move refl ects Individual Performance Contract (IPC) has been implemented right our strong support towards the Government’s effort in reducing from the Managing Director/Chief Executive Offi cer to the junior credit card forgery as well as our commitment in providing the executive level. The Company has even introduced our own way ultimate convenience to our customers. of working, whereby all employees are encouraged to be “BOLD” by building meaningful experience and creating opportunities for The Company also continued to work closely with the Government growth, owning their actions and speaking their minds, learning in the latter’s effort to curb the misuse of Government-subsidised continuously by being innovative, responsive and forward looking, diesel by closely monitoring our petrol station dealers on a constant as well as delivering on their promises. basis to ensure that none of them are involved in such unwarranted activities. Employees are also kept abreast with the latest development in the Company through various channels such as the Aspire newsletter, As the only station operator supplying natural gas for vehicles the intranet, talks by members of the Management Committee (NGV) in the country, the Company is indeed privileged to be to employees throughout the country and Management forums able to support the Government’s endeavour to increase the known as “Creating Excellence Forums.” To cultivate a brand usage of this cleaner fuel in the country. In this regard, the culture among the employees, the Company also organises the bi- Company is now aggressively looking for new suitable sites for annual “Brand Camp” which serves as a platform for the Company the development of more NGV stations. The Company is also to channel the knowledge on branding to the appointed “brand carrying out a comprehensive review of all our service stations agents”, as well as to share the best organisational practices and on their suitability for NGV station expansion.

The Company is also sensitive and responsive towards the needs arising from the marketplace, in line with our goal to be the Brand of 1st Choice. PETRONAS DAGANGAN BERHAD (88222-D) 39 Calendar of Events

21 APRIL 2006 A 26 MAY 2006 B PDB Contributes StreetSmart Reading Corners to Seven Prize giving ceremony for Kad Mesra Car Craze Contest Schools in Johor A 35-year-old customer relations offi cer from Batu Caves, Selangor, The Company contributed RM210,000 towards the setting up of Mrs. Anusha, was announced the grand prize winner of the StreetSmart Reading Corners in seven schools in Johor at a special Company’s Kad Mesra Car Craze Contest for the month of April, ceremony held at Sekolah Kebangsaan Paloh 2, Kluang. The bringing home a brand new BMW 320i worth RM280,000. Anusha StreetSmart Reading Corners project is part of the Company’s Tabung received a mock key of the car from PETRONAS Dagangan’s Senior Mesra Fund programme that has benefi ted 100 schools nationwide. General Manager, Retail Business Division, Encik Md Arif Mahmood Tabung Mesra is a joint initiative between the Company and the at a special ceremony held in Kuala Lumpur. Education Ministry which aims at improving the mastery of English Language and Living Skills among local pupils. 5 JUNE 2006 C Launching of PETRONAS PRIMAX 3 at KL Convention Centre 30 APRIL 2006 The Company unveiled its newest fuel for the Malaysian market, Larian Amal Jelita Bersamamu PETRONAS PRIMAX 3, at the KL Convention Centre. A replacement The Company sponsored a charity run event, Larian Amal Jelita for the company’s previous petrol brand, PRIMAX, the revolutionary Bersamamu, organized by Jelita magazine in a bid to create greater new fuel offers customers the benefi ts of high-performance petrol, exposure and awareness on Gas PETRONAS brand among the minus the premium price. The launch ceremony was offi ciated by public, especially women aged 18 and above who participated in Domestic Trade and Consumer Affairs Minister, Datuk Mohd Shafi e the event. Apdal.

7 MAY 2006 7 JUNE 2006 Launching of PETRONAS-Malaysia Basketball Association PETRONAS Dagangan Berhad Organises Visits to PETRONAS (MABA) 3-ON-3 Basketball Season 2006 Twin Towers Skybridge and PETROSAINS for Commercial The PETRONAS-MABA 3-on-3 Basketball Season returned once Customers and Their Family Members again, this time taking place at eight selected PETRONAS Service The Commercial Business Division of the Company conducted Stations nationwide. The 2006 season, which kicked off at PETRONAS educational visits to Aquaria and PETRONAS Twin Towers Skybridge Service Station Mutiara Damansara, Petaling Jaya, was launched for its valued customers and their family members to thank them by Chairman of the PETRONAS-MABA Management Committee, for their support towards the Company. YBhg. Datuk Abdul Rahim Hashim.

A

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Calendar of Events

10 JUNE 2006 D 12-14 JULY 2006 Launch of Proton Edar’s “Servis Mesra” at PETRONAS Service Retail Dealer Convention & Award Night Station Bukit Tinggi, Klang at KL Convention Centre Proton Edar Sdn Bhd (PESB) launched the new tagline called “Servis More than 300 PETRONAS Service Station operators and their Mesra” for its lube bays that are operated at selected PETRONAS spouses attended the Retail Dealer Convention and Award Night Service Stations. The launch was offi ciated by Datuk Maruan Mohd held at KL Convention Centre. The event was specially organised to Said, CEO Proton Edar Sdn Bhd (PESB) at PETRONAS Service Station recognise their contribution towards the Company’s success. Bukit Tinggi Klang, witnessed by the Company’s MD/CEO, Encik Ibrahim Marsidi. 14 JULY 2006 LPG Award Night 2006 at Awana Hotel, Genting Highlands 18 JUNE 2006 E The Company organised an appreciation and award night for its Kad Mesra-Joran Carnival at Titiwangsa Lake Garden, LPG business partners to thank them for their support in making Kuala Lumpur Gas PETRONAS the “No. 1 Cooking Gas in Malaysia.” A total of Following the earlier success of Kad Mesra Joran Fishing Competition, 27 prizes were given out to the top performing LPG dealers, focal the company has once again sponsored the same event albeit on group leaders and stockists. a grander scale, as it is now known as Karnival Kad Mesra Joran. Co-organised with Berita Harian, the event also showcased various 15 JULY 2006 F booths displaying PETRONAS major brands such as PETRONAS Futsal Tournament for PETRONAS Dagangan Berhad’s PRIMAX 3, SYNTIUM, SPRINTA and Kedai Mesra, that have received Government and Bitumen Customers positive response from the public. The Company’s Commercial Business Division organized a Futsal Tournament in a bid to build closer rapport with its customers, 19 JUNE 2006 particularly the Government agencies and the bitumen customers. Signing Ceremony Between PDB and Ministry of Defense The tournament was participated by 12 teams representing key (MINDEF) customers including MINDEF and NEKMAT, as well as one team The Company formally sealed a new agreement with MINDEF to from the Company’s Commercial Business Division and Lubricants provide RM408 million worth of petroleum products to the latter Business Division each respectively. for a period of three years until end-April 2008. Signing on behalf of the Company was the MD/CEO, Encik Ibrahim Marsidi, while MINDEF was represented by YBhg. Tan Sri Dato’ Sri Subhan Jasmon and YBhg. Dato’ Haji Ahmad Latffi Hashim.

E

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Calendar of Events

27 JULY 2006 two categories namely Deep Sea, which departed from LKIM Jetty PETRONAS Dagangan Berhad’s Annual General Meeting at Jalan Tanah Putih, Kuantan; and Beach, which took place at Teluk Cempedak. The Company held its 24th Annual General Meeting at Hotel Nikko Kuala Lumpur. 20 SEPTEMBER 2006

23-24 AUGUST 2006 G PETRONAS Dagangan Berhad Brings the New season of “Jalan-Jalan Cari Makan” Programme on TV3 Educational Visit for PETRONAS Dagangan Berhad’s Commercial Customers to Aquaria & Skybridge The Company and Sistem Televisyen Malaysia Berhad (TV3) launched the ninth season of “Jalan-Jalan Cari Makan”, a popular TV show The Commercial Business Division of the Company once again featuring local eateries with unique ambience and great food. conducted educational visits for its valued customers and their family members, this time around to Aquaria and PETRONAS Twin Towers Skybridge. 20-23 OCTOBER & 26-29 OCTOBER 2006 H “Coffee Break” Safety Campaign in conjunction 5-6 SEPTEMBER 2006 with Deepavali and Hari Raya Aidilfi tri PETRONAS Dagangan Berhad’s Fifth Brand Camp The Company’s Coffee Break campaign once again returned, where at Mariott Putrajaya motorists on their way home for Deepavali and Hari Raya Aidil Fitri The Company held the Fifth Brand Camp for the 200 appointed celebrations got to enjoy free drinks at selected PETRONAS Service “brand agents” among its employees at Mariott Putrajaya. Themed Stations. A total of 24 PETRONAS Service Stations located along “Be BOLD (Build, Own, Learn and Deliver)”, the bi-annual event highways and major trunk roads took part in the campaign, which was aimed at updating appointed brand agents on the progress started from 20 October until 23 October and resumed on 26 until of the Company’s brand journey and to equip them with the latest 29 October. knowledge on branding. 8-10 NOVEMBER 2006 I 16-17 SEPTEMBER 2006 Gas PETRONAS “Conquers” Mount Kinabalu Kad Mesra-Joran Carnival & Fishing Competition A group of 12 people comprising the Company’s staff and Gas in Kuantan, Pahang PETRONAS dealers from all over Sabah successfully conquered The Company once again became the main sponsor of the Kad the summit of Mount Kinabalu, bringing along a Gas PETRONAS Mesra-Joran Fishing competition which was co-organised with cylinder all the way up to Low’s Peak. The victorious attempt was Berita Harian newspaper. The fi shing competition was divided into aimed at capturing the spirit of Gas PETRONAS tagline, namely “Gas PETRONAS: Tentu Ada!” - even on top of the country’s highest mountain.

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H I 42 PETRONAS DAGANGAN BERHAD (88222-D)

Calendar of Events

10 NOVEMBER 2006 6 DECEMBER 2006 K PETRONAS Dagangan Berhad’s Hari Raya Open House “Joint Apron Safety Campaign” at KL International Airport at Renaissance Hotel, Kuala Lumpur The Company took part in Malaysia Airport Sepang Berhad’s 5th Joint The Company hosted a Hari Raya Open house for its staff, customers, Apron Safety Campaign that was launched on December 6, 2006 business partners and members of the media at Renaissance Hotel, at KL International Airport (KLIA). The objectives of the campaign Kuala Lumpur to thank them for their long-standing support. were to promote safety awareness among KLIA service providers and operators, as well as to enhance their knowledge on all safety- 14 – 16 NOVEMBER 2006 J related issues and procedures at the airport. IATA Aviation Fuel Forum Kuala Lumpur 16 DECEMBER 2006 The Company’s Commercial Business Division hosted the Offi cial Conference Dinner for the IATA Aviation Fuel Forum 2006 that Prize giving ceremony for Kad Mesra Card Craze Contest was held in Malaysia for the fi rst time. The international event was An airport limosine driver from Kulim and a businessman from attended by airlines representatives, fuel suppliers and strategic Cheras were announced as the main prize winners of the Card Craze partners from around the world, who have gathered to discuss contest co-organised by PETRONAS Dagangan Berhad, Maybankard industry-related issues. Bankcard and MasterCard. Zainudin Jahaya, 44, won the grand prize of a Proton Satria Neo worth RM46,000, while Chow Yuen Weng, 29 – 30 NOVEMBER 2006 43, took home a Naza Bestari 206 worth nearly RM70,000. Both Visit to Aquaria for Commercial Business Division’s received the mock key of their prizes at a special prize presentation Customers ceremony held at PETRONAS Service Station USJ 20, Subang Jaya. Once again, the Company’s Commercial Business Division organised 18 DECEMBER 2006 L a special event for its direct customers in conjunction with the year- end school holiday season. About 100 hundred selected customers Visit by PETRONAS Dagangan Berhad’s including those from Malaysia Airlines, FELDA and Nadicorp, as well Commercial Customers to UTP as their family members were invited to visit the Aquaria, KLCC as For the fi rst time ever, the Company’s Commercial Business Division a token of appreciation for their support. The programme was also organized an educational visit and career talk at Universiti Teknologi aimed at strengthening the existing business relationship between PETRONAS (UTP), in Tronoh for 80 of its selected customers and their the Company and its customers, as well as to promote interesting children within the age of 15 to 17 years, in a bid to provide them places around KLCC.

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K L PETRONAS DAGANGAN BERHAD (88222-D) 43

Calendar of Events

with fi rst-hand exposure to the education offerings available at UTP. 15 JANUARY 2007 The visit was part of the Company’s corporate social responsibility PETRONAS Car Craze Contest Media Briefi ng at Nikko Hotel, towards the human capital development of the next generation and Kuala Lumpur in motivating the youth to excel in their education. The Company held a special briefi ng for journalists from both print and electronic media to promote the launch of PETRONAS Car Craze 21 DECEMBER 2006 M Contest. The contest, which was held from January until May this LPG Fire Drill at Gas PETRONAS Stockist year, offers seven different cars as the main prizes plus 800 other The Company conducted an Emergency Response Drill at the consolation prizes in total during the fi ve-month contest period. premise of its Gas PETRONAS stockist in Rawang, Selangor to test the response capabilities of its Emergency Response Team in handling 24 JANUARY 2007 a fi re emergency. Codenamed “Gas PETRONAS Rescue”, the drill Signing Ceremony with Sapura Auto was participated by the Royal Malaysian Police, Fire and Rescue The Company commemorated its partnership with Sapura Auto Department, Hospital Sungai Buloh, Department of Enviroment Sdn Bhd, a BMW authorised dealer, in a symbolic signing ceremony (DOE), Selayang District Council (MPS), Rawang Integrated Council held at the latter’s 3S (sales, services and spare parts) centre in Jalan and other relevant authorities. Tun Razak, Kuala Lumpur. Under the partnership, the Company will supply to Sapura Auto the high performance, fully synthetic 10 JANUARY 2007 N engine oil, SYNTIUM 3000 LL, which was exclusively developed by PDB Seals New Lube Supply Partnership with Auto Bavaria PETRONAS for BMW engines. In conjunction with the ‘opening’ of its upgraded branch in Sungai Besi, Kuala Lumpur, Auto Bavaria concluded a new oil supply 3 FEBRUARY 2007 O partnership with the Company for the supply of PETRONAS Syntium Launching of Maybank’s 200th ATM at PSS Glenmarie 3000 LL at the former’s service centers. Present to commemorate the TTDI Jaya partnership were the Company’s Chairman, Datuk Anuar Ahmad, Maybank offi cially launched its 200th ATM at PETRONAS Service Sime Darby Berhad Group Chief Executive, Dato’ Ahmad Zubir Station Glenmarie, TTDI Jaya. The event was jointly offi ciated by Murshid, the Company’s Managing Director and Chief Executive Maybank’s Head of Consumer Banking, Mr Spencer Lee together Offi cer, Encik Ibrahim Marsidi and Auto Bavaria Managing Director, with the Company’s MD/CEO, Encik Ibrahim Marsidi. Mathias Heimann.

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O 44 PETRONAS DAGANGAN BERHAD (88222-D)

Calendar of Events

5 FEBRUARY 2007 16 MARCH 2007 Management Visit to ASTRO Prize Presentation Ceremony for PETRONAS Car Craze The Company’s senior management, led by MD/CEO, Encik Ibrahim Contest February Winners Marsidi, paid a courtesy visit to the head offi ce of ASTRO All Asia Mukhtar Mohamad, a 48-year-old businessman from Rawang Networks plc at Technology Park, Malaysia. The visit was aimed at Selangor, was announced the grand prize winner of PETRONAS Car fostering a closer relationship between the Company and the media Craze Contest for the month of February, bringing home a brand group, which is the provider of direct-to-home satellite television new Honda Civic 2.0 worth RM125,000! For the month of February, services in Malaysia, Brunei and Indonesia, as well as the leading PETRONAS Car Craze Contest also offered a Satria Neo worth commercial radio broadcaster in Malaysia. RM55,000 as a bonus prize for one lucky Kad Mesra cardholder. The lucky Kad Mesra member was Tan Tong Hin, 52, also a businessman 14-17 FEBRUARY AND 22-25 FEBRUARY 2007 P from Port Klang. Chinese New Year’s Coffee Break Campaign 19-20 MARCH 2007 R The Company’s Coffee Break Campaign was back once again for the Chinese New Year festival. This time around, the campaign was held PETRONAS Dagangan Berhad’s Brand Camp 6 from 14 until 17 February 2007 to coincide with the balik kampung at Mariott Putrajaya exodus, and resumed on 22 until 25 February 2007 to cater for The Company held its Sixth Brand Camp themed “BOLD to Brand motorists traveling back to the city after the celebrations. Already Beyond” at Mariott Putrajaya, which saw the participation of its 220 in its eighth year, the campaign was organised by the Company in “brand agents” from all over the country. collaboration with the Transport Ministry, Nestlé and AMP Radio. 22 MARCH 2007 15 FEBRUARY 2007 Q Press Conference on PETRONAS SPRINTA AAM Malaysian First Grand Prize Winner of PETRONAS Car Craze Cub Prix Season 2007 Contest Announced A press conference was held in Kuala Lumpur to mark the launch A 36-year-old housewife from Kinarut, Sabah, Genevieve Esther of the new season for the PETRONAS Sprinta AAM Malaysian Cub Lojinin, was announced the grand prize winner of PETRONAS Car Prix Championship. The championship, which is the biggest national Craze Contest for the month of January, bringing home a brand motorsports event in the country, introduced a drastic change in new Naza Bestari 206 worth RM70,000. Genevieve received a mock its race format for the 2007 season, whereby instead of the usual key of the car from the Company’s Senior General Manager, Retail one-day event, all rounds in the Cub Prix Championship will now Business Division, Encik Md Arif Mahmood at a special ceremony be held over two days. held at the Esplanade, KLCC.

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R PETRONAS DAGANGAN BERHAD (88222-D) 45 PETRONAS Dagangan in the News 46 PETRONAS DAGANGAN BERHAD (88222-D) PETRONAS DAGANGAN BERHAD (88222-D) 47

Corporate Governance

48 Corporate Governance Statement

53 Statement on Internal Control

55 Board Audit Committee’s Report

57 Board Audit Committee’s Terms of Reference

59 Statement of Directors’ Responsibility 48 PETRONAS DAGANGAN BERHAD (88222-D) Corporate Governance Statement

COMPLIANCE WITH THE BEST PRACTICES The profi le of each Director is presented in this Annual Report from IN CORPORATE GOVERNANCE pages 12 to 13. The Company’s Board of Directors (the Board) acknowledges that Corporate Governance is a form of self-regulation which is aimed The Board is of the opinion that its current composition and size at maximizing shareholders’ value. constitutes an effective Board to the Company.

The Board strives to ensure that the best practices in Corporate Role and Responsibilities of Board Governance pursuant to the Malaysian Code on Corporate The Board practises a clear demarcation of responsibilities whilst Governance are adhered to in carrying out its duties and maintaining the balance of power and authority. The positions of responsibilities. the Chairman and the Managing Director/Chief Executive Offi cer are individually held by two persons.

EFFECTIVE BOARD OF DIRECTORS The Chairman is primarily responsible for the orderly conduct and The Company has adopted a number of measures to ensure workings of the Board. The Managing Director/Chief Executive effectiveness of the Board in discharging its duties and Offi cer is responsible for the day-to-day running of the business, responsibilities. implementation of Board policies and decision-making on operational matters. In managing the business affairs, he is assisted Composition of Board by a Management Committee (MC), which meets once a month. The Board comprises members with relevant expertise and experiences drawn from business, fi nancial, technical and public The non-executive Directors have the necessary calibre to ensure that service. The wide spectrum of skills and experiences has given the strategies proposed by the Management are fully deliberated them an edge and an added strength in terms of leadership and and examined, taking into account the long term interest of management, thus ensuring that PETRONAS Dagangan Berhad and the shareholders and other stakeholders. They contribute to the its subsidiary (the Group) is steered and guided by an accountable formulation of policy and decision-making through their expertise and competent Board. and experience and are independent of the Management, thereby helping to ensure that no one individual or group dominates the The Board comprises seven (7) members. One (1) of whom holds Board’s decision-making process. an Executive Offi ce, having a dual role as Managing Director as well as Chief Executive Offi cer. There are three (3) members who are The presence of the independent non-executive Directors is independent and non-executive and three (3) other non-independent essential as it provides unbiased and independent views, advice and non-executive members (including the Chairman). and judgement as well as to safeguard the interests of other parties such as minority shareholders and the community. The concept As at the date of this report, the percentage of the Board of independence adopted by the Board is in accordance with the composition is as follows: defi nition in Section 1.01 of Listing Requirements of Bursa Malaysia Securities Berhad (Bursa Malaysia). Executive Director 1/7 (14.28%) (also the Managing Director)

Independent non-executive Directors 3/7 (42.86%)

Non-independent non-executive Directors 3/7 (42.86%) (including Chairman)

PETRONAS DAGANGAN BERHAD (88222-D) 49

Corporate Governance Statement

The role and responsibilities of the Board are, inter alia, as follows: to the advice and services of the Company Secretaries and where independent professional advice is required, external independent • to discuss and critically examine strategies proposed by the experts are engaged at the Group’s expense to facilitate their Management taking into account the long term interest of the decision making. shareholders as well as other stakeholders; • to contribute to the formulation of policy and decision-making YBhg Dato’ Chew Kong Seng has been identifi ed and appointed through the Board’s accumulated expertise and experience; as the Senior Independent Non-Executive Director, to whom any • to identify principal risks and ensure that these risks are concerns pertaining to the Company may be conveyed. managed in a proper and effective manner; • to review the integrity and capability of the Company’s Attendance at Board Meetings internal control systems as well as its management information During the year under review, the Board met six (6) times. The system; attendance of the Board members were as follows: • to oversee and critically review the proper management of the Company’s business; and No. Name of Board Total Meetings Attended Member by Board Members • to review the Company’s plans and budget including cash fl ow forecast for the forthcoming year and fi nancial projections. 1 Datuk Anuar bin Ahmad 6 / 6 2 Ibrahim bin Marsidi 6 / 6 Re-election 3 Dato’ Chew Kong Seng 5 / 6 The Company’s Articles of Association further provides that at least 4 Dr. R. Thillainathan 6 / 6 one third of all Directors are subject to retirement by rotation at 5 Dato’ Kamaruddin bin Mohd Jamal 6 / 6 each Annual General Meeting (AGM) but shall be eligible for re- 6 Datuk Ainon Marziah bt Wahi 5 / 6 election in line with the Listing Requirements of Bursa Malaysia. 7 Mohammad Medan bin Abdullah 6 / 6

Supply of Information to the Board The above meetings were held in the Meeting Room located at The Board members are supplied with required and timely Tower 1, PETRONAS Twin Towers, Kuala Lumpur City Centre, information which allows them to discharge their responsibilities 50088 Kuala Lumpur. effectively and effi ciently. Prior to each Board meeting, every Director is given an agenda and a set of Board papers for each Training agenda item to be deliberated. In compliance with the Listing Requirements of Bursa Malaysia, all members of the Board have attended the required mandatory Information provided to the Board goes beyond the quantitative accreditation training programme. performance data as it includes qualitative performances for the Directors to obtain a holistic view on the issues deliberated. Further, as an integral part of orientation and education programme All Directors are entitled to call for additional clarifi cation and for new Directors, the Management provides them with a information to be furnished to them for the purpose of assisting comprehensive understanding of the operations of the Group them in their decision making. In addition, in arriving at any decision through briefi ngs on its history, fi nancial control systems, including recommended by the Management a thorough deliberation and site visits. discussion by the Board is a prerequisite. All Directors shall receive further training that may be required from The Board is also updated by the Company Secretaries on new time to time to keep them abreast with the current developments of statutory and regulatory requirements concerning their duties and the industry as well as the current changes in laws and regulations responsibilities as and when necessary. All Directors have access where appropriate. 50 PETRONAS DAGANGAN BERHAD (88222-D)

Corporate Governance Statement

Directors’ Fees In addition to the Managing Director/Chief Executive Offi cer, other With the exception of the Managing Director/Chief Executive Management staff and executives have also been seconded from Offi cer, all non-executive Directors are paid Director’s fees which PETRONAS. Their training and succession planning are aligned to are subsequently approved by the shareholders at the AGM based the PETRONAS’ Human Resources Division. The Board ensures that on the recommendations of the Board. For the year of review, only appropriate personnel with the relevant skills and experience breakdown of fees received by each Director is as listed: are appointed to Management positions of the Company.

Details of Directors’ Fees Shareholders and Investors The Board values its dialogue with both institutional shareholders Name of Directors Directors’ and private investors and recognises that timely and equal Fees BAC Fees Total dissemination of relevant information be provided to them. (RM) (RM) (RM) The AGM is the principal forum of dialogue with the shareholders Datuk Anuar bin Ahmad 60,000 0.00 60,000 and also an avenue for the Chairman and Board members to Ibrahim bin Marsidi 0.00 0.00 0.00 respond personally to all queries and undertake to provide suffi cient Dato’ Chew Kong Seng 36,000 12,000 48,000 clarifi cation on issues and concerns raised by the shareholders. Dr. R. Thillainathan 36,000 8,400 44,400 Dato’ Kamaruddin Other than the forum of the AGM, the other medium of bin Mohd Jamal 36,000 7,000 43,000 communication between the Company and shareholders and/or Datuk Ainon Marziah investors are as follows: bt Wahi 36,000 0.00 36,000 Mohammad Medan • quarterly fi nancial statements and annual reports; bin Abdullah 36,000 7,000 43,000 • announcements on major developments to the Bursa TOTAL 240,000 34,400 274,400 Malaysia; • the Company’s general meetings; The Managing Director/Chief Executive Offi cer, an employee • the Company’s website at www.mymesra.com.my; and of PETRONAS, is seconded to the Company to undertake all • discussions between the Managing Director/Chief Executive responsibilities of an Executive Director who is also the Managing Offi cer and the General Manager of Finance Services Division Director. In consideration for the above service, the Company is with analysts/investors throughout the year. required to pay a management fee to cover all payroll related costs and benefi ts ordinarily incurred by him in the course of his Disclosures employment. During the year, the Company paid RM735,600 as The Board is fully committed in providing and presenting a true and management fee. fair view of the fi nancial performances and future prospects of the Company in the industry. This is provided through the quarterly, Pursuant to Article 84 of the Company’s Articles of Association, half yearly and annual fi nancial statements as well as the Annual the Company also reimburses reasonable expenses incurred by Report. Directors where relevant, in the course of carrying out their duties as Directors. The Board also recognises the need to fully disclose to shareholders all major developments in relation to the Company on a timely basis. In addition to the mandatory disclosures requirement by Bursa Malaysia as well as other corporate disclosures, the Company also maintains a website - www.mymesra.com.my - for access by the public and shareholders. PETRONAS DAGANGAN BERHAD (88222-D) 51

Corporate Governance Statement

The Company is committed to provide its shareholders and Further, in accordance with prescribed best practices of Corporate stakeholders the best services that it could offer. In realising its Governance, the BAC hereby presents its report in pages 55 to 56 commitment, a Customer Service Center has been established as of the Annual Report to the shareholders. a communication link between its shareholders and stakeholders with the Company either by phone, facsimile or e-mail via Directors Nomination and Remuneration Committee [email protected]. In cognisance of the recommendations of the Malaysian Code on Corporate Governance, the Board has decided that the Board as a While the Company endeavours to provide as much information as whole will serve as the Nomination and Remuneration Committee. possible to its shareholders and stakeholders, it must also be wary No smaller committee is recommended as the Company believes of the legal and regulatory framework governing the release of that all members must be equally responsible for the duties of such material and price-sensitive information. All corporate disclosures committee as follows: takes into account of the prevailing legislative restrictions and • to assess and recommend new Directors to the Board; requirements as well as the investors need for timely release of • to review annually the mix of skills and experiences, and other price-sensitive information such as fi nancial performance results and qualities to enable the Board to function completely and statements, material acquisitions, signifi cant corporate proposals as effi ciently; well as other signifi cant corporate events. In all circumstances, the Group is cautious not to provide undisclosed material information • to implement formal appraisal process for the evaluation of the about the Group and continually stresses on the importance of effectiveness of the Board as a whole, the committees and the timely and equal dissemination of information to shareholders and individual contribution of each Board member; and stakeholders. • to recommend to the Board the remuneration of all non-executive Directors. Individual Directors do not participate in the discussion on their own remuneration. COMMITTEES

In ensuring its effectiveness and realising its responsibilities to The Board will deliberate on the above during the normal its stakeholders generally and specifi cally to its shareholders, the proceedings of the meeting of Directors. Board has formed committees to effi ciently discharge its duties and responsibilities. These committees, members of which are amongst the members of the Board itself, are delegated with specifi c powers ACCOUNTABILITY AND AUDIT and responsibilities. 1. Financial Reporting The Board aims to present a balanced and meaningful Board Audit Committee assessment of the Group’s fi nancial performance, position and The Board Audit Committee (BAC) is formed to operate within the prospects, primarily through the annual fi nancial statements, clearly defi ned terms of reference as stated in pages 57 to 58 of quarterly and half yearly announcement of results to the the Annual Report. The BAC comprises of four (4) members, three shareholders as well as the Chairman’s statement and review (3) of which are independent and non-executive members whilst of operations in the Annual Report. The Board is assisted by the one (1) is a non-independent and non-executive member. Thus, BAC to oversee the Group’s fi nancial reporting processes and ensuring the balance of roles and responsibilities within the BAC in the quality of its fi nancial reporting. overseeing the fi nancial effi ciency and effectiveness of the Company within the current fi nancial year. The Chairman of the BAC reports The Directors’ Responsibility Statement is enclosed in page 59 the outcome of its meetings to the Board and such reports are of the Annual Report. incorporated as part of the minutes of the Board meetings. 52 PETRONAS DAGANGAN BERHAD (88222-D)

Corporate Governance Statement

2. Internal Control ADDITIONAL COMPLIANCE INFORMATION The Board acknowledges its overall responsibility for continuous 1. Non-Audit Fees maintainance of a sound system of internal control to safeguard The amount of non-audit fees paid and payable to the external shareholders’ investment and the Group’s assets. This principle auditors by the Company for the fi nancial year ended 31 March is further elaborated under Statement on Internal Control by 2007 was RM18,000.00 (RM37,000.00 for fi nancial year ended the Directors in pages 53 to 54 of the Annual Report. 31 March 2006).

3. Relationship with the Auditors 2. Sanctions The external auditors, Messrs. KPMG Desa Megat & Co., have During the fi nancial year, there were no sanctions and/ continued to report to shareholders of the Company on their or penalties imposed on the Company, Directors or opinion which are included as part of the Group’s fi nancial Management by the relevant regulatory bodies. reports with respect to their audit on each year’s statutory fi nancial statements. In so doing, the Company has established 3. Material Contracts a transparent arrangement with the auditors to meet the There was no material contract entered into or subsisting auditors’ professional requirements. The auditors also highlight between the Company and its Directors or substantial to the BAC and the Board on matters that require the Board’s shareholders during the fi nancial year except as disclosed in the attention. annual account.

A summary of the activities of the BAC during the year, including the evaluation of independent audit process, are set out in the BAC Report on pages 55 to 56 of the Annual Report.

This statement is made in accordance with the resolution of the Board of Directors dated 28 May 2007.

Datuk Anuar bin Ahmad Chairman

Ibrahim bin Marsidi Managing Director/Chief Executive Offi cer PETRONAS DAGANGAN BERHAD (88222-D) 53 Statement on Internal Control

INTRODUCTION CONTROL STRUCTURE AND ENVIRONMENT

The Malaysian Code on Corporate Governance requires Public In furtherance to the Board’s commitment to maintain a sound system Listed Companies to maintain a sound system of internal controls of internal control, the Board continues to maintain and implement to safeguard shareholders’ investments and Company assets. a strong control structure and environment for the proper conduct Under the provisions of the Bursa Malaysia Listing Requirements, of the Group’s business operations as follows : para 15.27(b), Directors of Public Listed Companies are required to • The Board meets at least quarterly and has set a schedule of produce a statement on the state of the Company’s internal control matters, which is required to be brought to its attention for in their Annual Report. discussion, thus ensuring that it maintains full and effective supervision over appropriate controls. The Managing Director/ The Board continues with its commitment to maintain a sound system Chief Executive Officer leads the presentation of board of internal control throughout the Group and in compliance with papers and provides comprehensive explanation of pertinent Bursa Malaysia Listing Requirements and the Statement on Internal issues. In arriving at any decision, on recommendation by the Control: Guidance for Directors of Public Listed Companies (“Internal Management, a thorough deliberation and discussion by the Control Guidance”), the Board is pleased to provide the following Board is a prerequisite. In addition, the Board is kept updated statement which outlines the nature and scope of internal control on the Group’s activities and its operations on a regular basis. of the Group during the year in review. • The Managing Director/Chief Executive Offi cer reports to the Board on signifi cant changes in the business and external BOARD RESPONSIBILITY environments which affect risks. The General Manager of Finance The Board acknowledges the importance of sound internal controls Services Division provides the Board with quarterly fi nancial for good corporate governance. The system of internal control information. covers, inter alia, risk management and fi nancial, organisational, • An organisational structure with formally defined lines of operational, project and compliance controls. The Board reaffi rms its responsibility and delegation of authority is in place. A process overall responsibility for the Group’s systems of internal control, and of hierarchical reporting has been established which provides for reviewing the adequacy and integrity of those systems. It should for a documented and auditable trail of accountability. be noted, however, that such systems are designed to manage, rather than eliminate, risk of failure to achieve corporate objectives. • A documented delegation of authority with clear lines of Inherently, it can only provide reasonable and not absolute assurance accountability and responsibility serves as a tool of reference against material misstatement or loss. in identifying the approving authority for various transactions including matters that require Board’s approval. The Group has in place an on-going process for identifying, • The Group performs annual budgeting and forecasting exercise evaluating, monitoring and managing signifi cant risks that may including development of business strategies for the next fi ve materially affect the achievement of corporate objectives. This years, and the establishment of key performance indicators process has been in place throughout the year under review up to against which units within the Group can be evaluated. Variances the date of this report, and this process is reviewed by the Board against budget are analysed and reported internally on a monthly and it accords with the Internal Control Guidance. basis in MC meetings. On a quarterly basis, the variances are reported to the Board. The Group’s strategic direction is also reviewed annually through a rigorous assessment process taking into account changes in market conditions and signifi cant business risks.

• The Accounting Procedure Manuals defi ne the policies and procedures for day-to-day operations and act as guidelines as to the proper measures to be undertaken in a given set of circumstances. 54 PETRONAS DAGANGAN BERHAD (88222-D)

Statement on Internal Control

RISK MANAGEMENT INTERNAL AUDIT FUNCTION

The Risk Management Framework serves to manage and control Internal audits are undertaken to provide independent assessments significant risk exposures inherent in the Company’s business on the adequacy, effi ciency and effectiveness of the Group’s internal operations. The scope of the framework covers the following control systems in the assessment of potential risks exposures in areas: key business processes and in controlling the proper conduct of business within the Group. The BAC has full and direct access to • Identifying principal risks and ensure the implementation of internal auditors and the BAC receives reports on all internal audits appropriate risk management framework and guidelines to performed. manage these risks; The internal audit function of the Group is carried out by PETRONAS • Reviewing the adequacy and integrity of the Company’s internal Group Internal Audit (GIA), a division in PETRONAS. One of the key control systems and management information systems, including objectives of GIA is to assist the Group in accomplishing its goals systems for compliance with applicable laws, regulations, rules, by bringing a systematic and disciplined approach to evaluating directive and guidelines. and improving the effectiveness of risk management, control and governance processes within the Group. GIA maintained their During the year, the Company had further reviewed and updated impartiality, profi ciency and due professional care by having its plans the Company’s risk profi le. The review had identifi ed several new and reports directly under the purview of the BAC. risk events which have been presented to the MC, BAC and the Board in August 2006 and February 2007. In order to validate some The internal audit function reviews the internal controls in selected of the controls that have been implemented, risk assessments were key activities of the Group’s businesses on the basis of an annual carried out at selected Company’s locations to check the effectiveness internal audit plan which is presented to the BAC for approval. of controls that were implemented and to recommend additional controls as appropriate. The BAC reviews audit reports and directs the Management for the necessary corrective actions. The Management is responsible for The Preparedness Plan covering the outbreak of Avian Infl uenza ensuring that corrective actions are implemented accordingly. and the effects of the Haze provides guidelines and directions for mitigating any potential business disruptions. WEAKNESSES IN INTERNAL CONTROLS THAT RESULT

IN MATERIAL LOSSES During the year, risk awareness sessions have been conducted at all Regional Offi ces and at the Company’s Corporate Head Offi ce There were no material losses incurred during the current to communicate risk awareness. Emphasis has also been made to fi nancial year as a result of weaknesses of internal control. The communicate the importance of credit risk management and the Management continues to take measures to strengthen the control roles and responsibilities of the Company’s staff in managing credit environment. risk exposures. This statement is made in accordance with the resolution of the The Company recognizes that effective risk management is an Board of Directors dated 28 May 2007. essential part of corporate governance. The Company shall strive to manage risk effectively with a view to protect its personnel, assets and stakeholders, ensure achievement of the business objectives and enhance shareholder value. Datuk Anuar bin Ahmad Chairman The Company shall continue to incorporate risk management practices within its business processes and activities. The continual monitoring of risk exposures and risk events shall be reported periodically to the Management. Ibrahim bin Marsidi Managing Director/Chief Executive Offi cer PETRONAS DAGANGAN BERHAD (88222-D) 55 Board Audit Committee’s Report

From Left: Dato’ Chew Kong Seng • Dr. R. Thillainathan • Dato’ Kamaruddin bin Mohd Jamal • Mohammad Medan bin Abdullah

The Board Audit Committee (BAC) is pleased to present the BAC SUMMARY OF ACTIVITIES OF THE BAC Report for the year ended 31 March 2007 as follows:- During the fi nancial year, the BAC in discharging its duties and functions as an independent entity within the Company, had held MEMBERSHIP four (4) quarterly meetings. By invitation, the Managing Director/ Chief Executive Offi cer, Company Secretary, General Manager of Pursuant to a Board resolution passed on 3 March 1994, the BAC Finance Services Division, external and internal auditors were also was formed. Currently, the BAC comprises of four (4) Directors, present during deliberations which require their inputs and advice. namely:-

1) Dato’ Chew Kong Seng (Chairman) ATTENDANCE RECORD OF BAC MEMBERS (Independent non-executive Director) The attendance of the BAC members at the BAC meeting were as follows: 2) Dr. R. Thillainathan (Independent non-executive Director) No. Name of BAC Member Total Meetings Attended by BAC Member 3) Dato’ Kamaruddin bin Mohd Jamal 1 Dato’ Chew Kong Seng 4 / 4 (Independent non-executive Director) 2 Dr. R. Thillainathan 4 / 4 3 Dato’ Kamaruddin bin Mohd Jamal 4 / 4 4) Mohammad Medan bin Abdullah 4 Mohammad Medan bin Abdullah 4 / 4 (Non-Independent non-executive Director)

The following activities were carried out by the BAC during the The BAC is governed by the Terms of Reference as stipulated in pages fi nancial year ended 31 March 2007:- 57 to 58 of the Annual Report. All the requirements under the Terms of Reference were fully complied with and the BAC did not see any 1) reviewed the external auditors’ scope of work and audit plans matter in breach of the Listing Requirements of Bursa Malaysia that for the year. Prior to the audit, representatives from the external warrants reporting to Bursa Malaysia. auditors, presented their audit strategy and plan;

2) reviewed with the external auditors the results of the audit, the audit report and the Management Letter, including the Management’s response; 56 PETRONAS DAGANGAN BERHAD (88222-D)

Board Audit Committee’s Report

3) consideration and recommendation to the Board for approval governance practices and the prescribed corporate governance of the audit fees payable to the external auditors as disclosed principles and best practices under the Malaysian Code on in Note 23 to the fi nancial statements; Corporate Governance.

4) reviewed the independence and objectivity of the external auditors and the services provided; INTERNAL AUDIT

5) reviewed the internal audit reports, which highlighted the audit The Internal Audit function of the Group was carried out by the issues, recommendations and the Management’s response. Group Internal Audit Division of PETRONAS, the holding company. Discussed with the Management, actions taken to improve the They maintained their impartiality, profi ciency and due professional system of internal control based on improvement opportunities care by having their plans and reports directly under the purview identifi ed in the internal audit reports; of the BAC.

6) reviewed the Annual Report and the audited financial The internal audits were undertaken to provide independent statements of the Group prior to submission to the Board for assessments on the adequacy, effi ciency and effectiveness of the their consideration and approval. The review was to ensure that Group’s internal control systems in anticipating potential risks the audited fi nancial statements were drawn up in accordance and/or exposures over key business processes within the Company. with the provisions of the Companies Act 1965 and the The BAC also has full access to internal auditors and received applicable approved accounting standards; reports on all audits performed. 7) reviewed the Company’s compliance in particular the quarterly and year end fi nancial statements with Listing Requirements During the fi nancial year, the internal auditors had carried out audits of Bursa Malaysia, Malaysian Accounting Standards Board and according to the internal audit plan which had been approved by other relevant legal and regulatory requirements; the BAC.

8) reviewed the quarterly unaudited fi nancial results announcements The resulting reports from the audits undertaken were forwarded before recommending them for the Board’s approval. The review to the Management for attention and necessary corrective actions and discussion were conducted with the General Manager of as recommended. The Management is responsible for ensuring that Finance Services Division; corrective actions on reported weaknesses are taken within the 9) reviewed the related party transactions entered into by the required time frame. Company; and

10) reviewed the extent of the Company’s compliance with the provisions set out under the Malaysian Code on Corporate Governance for the purpose of preparing the Corporate Governance Statement and Statement of Internal Control pursuant to Listing Requirements of Bursa Malaysia. Dato’ Chew Kong Seng Recommended to the Board action plans to address the Chairman identified gaps between the Group’s existing corporate Board Audit Committee PETRONAS DAGANGAN BERHAD (88222-D) 57 Board Audit Committee’s Terms of Reference

In line with the best practices of Corporate Governance, both MEETINGS the Board and the Management recognises the importance of • Meetings shall be held not less than three (3) times a year; maintaining and ensuring that the BAC remains an independent • A quorum shall be two (2) members, both being Independent entity within the Company. An independent BAC ensures that in Directors and one (1) of whom shall be the Chairman of the performing its duties and functions, the checks and balances within BAC; the Board, the Management and the major shareholders are in place, thus safeguarding the interest of public shareholders. • The external auditors have the right to appear and be heard at any meeting of the BAC and shall appear before the BAC when required to do so. As such, the external auditors may request a COMPOSITION meeting if they consider it necessary; The members of the BAC shall be appointed by the Board from • At least once a year, the BAC shall meet with external auditors amongst their number and shall consist of not less than three (3) without any Executive Director present. The Chairman of the members of whom the majority shall be Independent Directors. An BAC shall convene a meeting of the Committee to consider any Independent Director shall be one who fulfi ls the requirement as matter which the external auditors believe should be brought to provided in the Listing Requirements of Bursa Malaysia. the attention of the Directors or shareholders; • The Company Secretaries shall be the Secretary of the BAC; At least one (1) member of the BAC:- and 1) must be a member of the Malaysian Institute of Accountants • The Secretaries shall draw up an agenda, which shall be circulated (MIA); or together with the relevant supporting papers, at least one (1) 2) if he is not a member of the MIA, he must have at least three week prior to each meeting to the members of the BAC. (3) years working experience and:- a) he must have passed the examinations specifi ed in Part I REPORTING PROCEDURES of the 1st Schedule of the Accountants Act 1967; or • The Secretaries shall circulate the minutes of meetings to all b) he must be a member of one of the associations of members of the BAC; and accountants specifi ed in Part II of the 1st Schedule of the • The Secretaries shall ensure that the minutes of the meetings be Accountants Act 1967; or duly entered in the books provided thereof. 3) fulfills such other requirements as prescribed by Bursa Malaysia. AUTHORITY

The members of the BAC shall elect a Chairman from amongst their The BAC is authorised by the Board to investigate any activity within number who shall be an Independent Director. its Terms of Reference. It is authorised to seek any information it requires from any employee and all employees are directed to If a member of the BAC resigns, dies or for any other reason ceases cooperate with any request made by the BAC. to be a member with the result that the number of members is reduced below three (3), the Board shall within three (3) months of The BAC shall have the resources that are required to perform that event, appoint such number of new members as may be required its duties. The BAC can obtain, at the expense of the Group, to make up the minimum number of three (3) members. No alternate external legal or other independent professional advice it considers Director can be appointed as a member of the BAC. necessary. 58 PETRONAS DAGANGAN BERHAD (88222-D)

Board Audit Committee’s Terms of Reference

DUTIES AND FUNCTIONS 5) to discuss problems and reservations arising from the interim The duties and functions of the BAC are:- and fi nal audits, and matters the auditors may wish to discuss (in the absence of Management where necessary); 1) to consider the appointment of the external auditors, the audit fee and any question of resignation or dismissal of the external 6) to review the internal audit programme, consider the major auditors before making recommendation to the Board; findings of internal audits and Management’s response, and ensure coordination between the internal and external 2) to discuss with the external auditors before the audit auditors; commences on the nature and scope of the audit, and ensure coordination where more than one audit fi rm is involved; 7) to review any related party transactions and conflict of interest situation that may arise in the Company including 3) to review with the Management and the external auditors the any transaction, procedure or course of conduct that raises fi nancial results and statements prior to approval by the Board, questions of Management integrity; focusing particularly on:- 8) to keep under review the effectiveness of internal control • any change in accounting policies and practices; systems and the internal and/or external auditors’ evaluation • signifi cant and unusual events; of these systems and in particular review the external auditors’ • major judgmental areas; Management Letter and Management’s response; • signifi cant adjustments resulting from the audit; 9) to review the audit reports; • the going concern assumption; • compliance with accounting standards; and 10) to direct and where appropriate supervise any special project • compliance with Bursa Malaysia and legal requirements. or investigation considered necessary;

4) to arrange for periodic reports from Management, the external 11) to prepare periodic reports to the Board summarising the work auditors and the internal auditors to assess the impact of performed in fulfi lling the BAC’s primary responsibilities; and signifi cant regulatory changes, and accounting or reporting 12) to consider other topics, as defi ned. developments proposed by accounting and other bodies, or any signifi cant matters that may have a bearing on the annual examination; PETRONAS DAGANGAN BERHAD (88222-D) 59 Statement of Directors’ Responsibility IN RELATION TO THE FINANCIAL STATEMENTS

The fi nancial statements as set out on pages 67 to 99 of the Group, are properly drawn up so as to give a true and fair view of the state of affairs of the Group as at 31 March 2007 and of the results of its operations and cash fl ows for the year ended on that date.

The Directors consider that in preparing the fi nancial statements:-

• the Group has used appropriate accounting policies and are consistently applied; • reasonable and prudent judgements and estimates were made; and • all applicable approved accounting standards in Malaysia have been followed.

The Directors are also responsible for ensuring that the accounting and other records and registers required by the Companies Act, 1965 to be kept by the Group have been properly kept in accordance with the provisions of the said Act.

The Directors also have general responsibilities for taking such steps that are reasonably available to them to safeguard the assets of the Group, and to prevent and detect fraud and other irregularities. 60 PETRONAS DAGANGAN BERHAD (88222-D)

The Group achieved another record performance for financial year 2006/07 with a 26% surge in net profi t amounting to RM647 million. PETRONAS DAGANGAN BERHAD (88222-D) 61 Financial Statements

62 Directors’ Report

65 Statement by Directors

65 Statutory Declaration

66 Report of the Auditors to the Members

67 Consolidated Balance Sheet

68 Consolidated Income Statement

69 Consolidated Statement of Changes in Equity

70 Consolidated Cash Flow Statement

71 Balance Sheet

72 Income Statement

73 Statement of Changes in Equity

74 Cash Flow Statement

75 Notes to the Financial Statements 62 PETRONAS DAGANGAN BERHAD (88222-D) Directors’ Report FOR THE YEAR ENDED 31 MARCH 2007

The Directors have pleasure in submitting their report and the audited fi nancial statements of the Group and of the Company for the fi nancial year ended 31 March 2007.

PRINCIPAL ACTIVITIES The principal activities of the Company in the course of the fi nancial year remain unchanged and consist of the domestic marketing of petroleum products and the operation of service stations.

The principal activities of its subsidiary and associates are described in Notes 33 and 34 to the fi nancial statements respectively. There have been no changes in the principal activities during the fi nancial year.

RESULTS

Group Company RM’000 RM’000

Profi t for the year 646,639 629,029

Attributable to: Shareholders of the Company 640,307 629,029 Minority interest 6,332 – 646,639 629,029

DIVIDENDS Since the end of the previous fi nancial year, the Company paid: (i) as proposed in last year’s report, a fi nal dividend of 15% less 28% tax amounting to RM107,293,032 in respect of the fi nancial year ended 31 March 2006 on 8 September 2006.

(ii) an interim dividend of 10% less 28% tax amounting to RM71,528,688 in respect of the fi nancial year ended 31 March 2007 on 28 December 2006.

The Directors propose a fi nal dividend of 20% less 27% tax amounting to RM145,044,284 in respect of the fi nancial year ended 31 March 2007 which has not been accounted for in the fi nancial statements.

RESERVES AND PROVISIONS There were no material movements to and from reserves and provisions during the year other than as disclosed in the Financial Statements.

DIRECTORS OF THE COMPANY Directors who served since the date of the last report are: Datuk Anuar bin Ahmad – Chairman Ibrahim bin Marsidi – Managing Director/CEO Dato’ Chew Kong Seng Dr. R. Thillainathan Dato’ Kamaruddin bin Mohd Jamal Datuk Ainon Marziah binti Wahi Mohammad Medan bin Abdullah PETRONAS DAGANGAN BERHAD (88222-D) 63

Directors’ Report

FOR THE YEAR ENDED 31 MARCH 2007

DIRECTORS OF THE COMPANY (CONT’D) In accordance with Article 93 of the Company’s Articles of Association, Datuk Anuar bin Ahmad and Dato’ Kamaruddin bin Mohd Jamal retire by rotation from the Board at the forthcoming Annual General Meeting and, being eligible, offer themselves for re-election.

DIRECTORS’ INTERESTS The Directors in offi ce at the end of the fi nancial year who have interests in the shares of the Company and of its related corporations as recorded in the Register of Directors’ Shareholdings are as follows:

Number of Shares in the Company Balance at Balance at Name 1.4.2006 Bought Sold 31.3.2007

Datuk Anuar bin Ahmad 2,000 – – 2,000 Datuk Ainon Marziah binti Wahi 2,000 – – 2,000

Number of Shares in PETRONAS Gas Berhad Balance at Balance at Name 1.4.2006 Bought Sold 31.3.2007

Datuk Ainon Marziah binti Wahi 5,000 – – 5,000

None of the other Directors holding offi ce at 31 March 2007 had any interest in the ordinary shares of the Company and of its related corporations during the fi nancial year.

DIRECTORS’ BENEFITS Since the end of the previous fi nancial year, no Director of the Company has received or become entitled to receive any benefi t (other than the benefi t included in the aggregate amount of emoluments received or due and receivable by Directors as shown in the fi nancial statements or the fi xed salary of a full time employee of a related corporation) by reason of a contract made by the Company or a related corporation with the Director or with a fi rm of which the Director is a member, or with a company in which the Director has a substantial fi nancial interest.

There were no arrangements during and at the end of the fi nancial year which had the object of enabling Directors of the Company to acquire benefi ts by means of the acquisition of shares in or debentures of the Company or any other body corporate.

ISSUE OF SHARES There were no changes in the issued and paid up capital of the Company during the fi nancial year.

OPTIONS GRANTED OVER UNISSUED SHARES No options were granted to any person to take up unissued shares of the Company during the fi nancial year. 64 PETRONAS DAGANGAN BERHAD (88222-D)

Directors’ Report

FOR THE YEAR ENDED 31 MARCH 2007

OTHER STATUTORY INFORMATION Before the fi nancial statements of the Group and of the Company were made out, the Directors took reasonable steps to ascertain that: (i) all known bad debts have been written off and adequate provision made for doubtful debts, and

(ii) all current assets have been stated at the lower of cost and net realisable value.

At the date of this report, the Directors are not aware of any circumstances: (i) that would render the amount written off for bad debts, or the amount of the provision for doubtful debts, in the Group and in the Company inadequate to any substantial extent, or

(ii) that would render the value attributed to the current assets in the Group and in the Company’s fi nancial statements misleading, or

(iii) which have arisen which render adherence to the existing method of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate, or

(iv) not otherwise dealt with in this report or the fi nancial statements, that would render any amount stated in the fi nancial statements of the Group and of the Company misleading.

At the date of this report, there does not exist: (i) any charge on the assets of the Group or of the Company that has arisen since the end of the fi nancial year and which secures the liabilities of any other person, or

(ii) any contingent liability in respect of the Group or of the Company that has arisen since the end of the fi nancial year.

No contingent liability or other liability of the Group or of the Company has become enforceable, or is likely to become enforceable within the period of twelve months after the end of the fi nancial year which, in the opinion of the Directors, will or may substantially affect the ability of the Group and of the Company to meet their obligations as and when they fall due.

In the opinion of the Directors, except for the effects arising from the change in accounting policies as disclosed in the fi nancial statements, the results of the operations of the Group and of the Company for the fi nancial year ended 31 March 2007 have not been substantially affected by any item, transaction or event of a material and unusual nature nor has any such item, transaction or event occurred in the interval between the end of that fi nancial year and the date of this report.

AUDITORS The auditors, Messrs KPMG Desa Megat & Co., have indicated their willingness to accept re-appointment.

Signed in accordance with a resolution of the Directors:

DATUK ANUAR BIN AHMAD IBRAHIM BIN MARSIDI

Kuala Lumpur, 28 May 2007 PETRONAS DAGANGAN BERHAD (88222-D) 65 Statement by Directors

In the opinion of the Directors, the fi nancial statements set out on pages 67 to 99, are drawn up in accordance with the applicable approved accounting standards for entities other than private entities issued by the Malaysian Accounting Standards Board (MASB) and the provisions of the Companies Act, 1965 so as to give a true and fair view of the state of affairs of the Group and of the Company at 31 March 2007 and of the results of their operations and cash fl ows for the year ended on that date.

Signed in accordance with a resolution of the Directors:

DATUK ANUAR BIN AHMAD

IBRAHIM BIN MARSIDI

Kuala Lumpur, 28 May 2007 Statutory Declaration

I, AZMI BIN YAHAYA, the offi cer primarily responsible for the fi nancial management of PETRONAS DAGANGAN BERHAD, do solemnly and sincerely declare that the fi nancial statements set out on pages 67 to 99, are to the best of my knowledge and belief, correct and I make this solemn declaration conscientiously believing the same to be true, and by virtue of the provisions of the Statutory Declarations Act, 1960.

Subscribed and solemnly declared by the abovenamed AZMI BIN YAHAYA at KUALA LUMPUR in WILAYAH PERSEKUTUAN on 28 May 2007.

BEFORE ME:

Commissioner for Oaths 66 PETRONAS DAGANGAN BERHAD (88222-D) Report of the Auditors to the Members

We have audited the fi nancial statements set out on pages 67 to 99. The preparation of the fi nancial statements is the responsibility of the Company’s Directors.

It is our responsibility to form an independent opinion, based on our audit, on the fi nancial statements and to report our opinion to you, as a body, in accordance with Section 174 of the Companies Act, 1965 and for no other purpose. We do not assume responsibility to any other person for the content of this report.

We conducted our audit in accordance with approved Standards on Auditing in Malaysia. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the fi nancial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the fi nancial statements. An audit also includes assessing the accounting principles used and signifi cant estimates made by the Directors, as well as evaluating the overall fi nancial statements presentation. We believe our audit provides a reasonable basis for our opinion.

In our opinion: (a) the fi nancial statements are properly drawn up in accordance with the provisions of the Companies Act, 1965 and applicable approved accounting standards in Malaysia so as to give a true and fair view of: (i) the state of affairs of the Group and of the Company at 31 March 2007 and of the results of their operations and cash fl ows for the year ended on that date; and

(ii) the matters required by Section 169 of the Companies Act, 1965 to be dealt with in the fi nancial statements of the Group and of the Company; and

(b) the accounting and other records and the registers required by the Companies Act, 1965 to be kept by the Company and its subsidiary have been properly kept in accordance with the provisions of the said Act.

We are satisfi ed that the fi nancial statements of the subsidiary that have been consolidated with the Company’s fi nancial statements are in form and content appropriate and proper for the purposes of the preparation of the consolidated fi nancial statements and we have received satisfactory information and explanations required by us for those purposes.

The audit report on the fi nancial statements of the subsidiary was not subject to any qualifi cation and did not include any comment made under sub section (3) of Section 174 of the Act.

KPMG DESA MEGAT & CO. JOHAN IDRIS Firm Number: AF 0759 Partner Chartered Accountants Approval Number: 2585/10/08(J)

Kuala Lumpur, 28 May 2007 PETRONAS DAGANGAN BERHAD (88222-D) 67 Consolidated Balance Sheet AT 31 MARCH 2007

Restated Note 2007 2006 RM’000 RM’000

ASSETS Property, plant and equipment 3 3,086,920 2,852,818 Investment in associates 5 4,641 3,718 Long term receivables 6 281,827 247,622 Goodwill 7 24,874 26,349 TOTAL NON-CURRENT ASSETS 3,398,262 3,130,507

Inventories 8 477,650 605,447 Trade and other receivables 9 2,096,976 1,968,921 Cash and cash equivalents 14 544,013 466,006 TOTAL CURRENT ASSETS 3,118,639 3,040,374 TOTAL ASSETS 6,516,901 6,170,881

EQUITY Share capital 15 993,454 993,454 Reserves 16 2,494,370 2,032,884 Total equity attributable to shareholders of the Company 3,487,824 3,026,338 Minority interest 17 55,034 49,458 TOTAL EQUITY 3,542,858 3,075,796

LIABILITIES Borrowings 18 – 5,280 Deferred tax 20 102,642 93,676 Provisions 21 28,309 28,253 TOTAL NON-CURRENT LIABILITIES 130,951 127,209 Trade and other payables 22 2,716,861 2,865,859 Borrowings 18 5,280 10,031 Taxation 120,951 91,986 TOTAL CURRENT LIABILITIES 2,843,092 2,967,876 TOTAL LIABILITIES 2,974,043 3,095,085 TOTAL EQUITY AND LIABILITIES 6,516,901 6,170,881

The notes set out on pages 75 to 99 form an integral part of, and, should be read in conjunction with, these fi nancial statements. 68 PETRONAS DAGANGAN BERHAD (88222-D) Consolidated Income Statement FOR THE YEAR ENDED 31 MARCH 2007

Restated Note 2007 2006 RM’000 RM’000

Revenue – sales of petroleum products 19,481,751 16,550,246 – rendering of services 14,609 17,670 19,496,360 16,567,916 Cost of sales (17,787,386) (15,133,666) Gross profi t 1,708,974 1,434,250 Selling and distribution expenses (233,141) (172,538) Administration expenses (633,063) (591,226) Other operating income 60,226 54,940 Operating profi t 23 902,996 725,426 Financing costs 24 (721) (1,485) Share of net profi t of associates 923 729 Profi t before taxation 903,198 724,670 Tax expense 25 (256,559) (213,500) PROFIT FOR THE YEAR 646,639 511,170

Attributable to: Shareholders of the Company 640,307 504,722 Minority interest 6,332 6,448 PROFIT FOR THE YEAR 646,639 511,170

Dividends per ordinary share – net 26 21.8 sen 14.4 sen

Earnings per ordinary share – basic 27 64.5 sen 50.8 sen

The notes set out on pages 75 to 99 form an integral part of, and, should be read in conjunction with, these fi nancial statements. PETRONAS DAGANGAN BERHAD (88222-D) 69 Consolidated Statement of Changes in Equity FOR THE YEAR ENDED 31 MARCH 2007

Note 2007 2006 RM’000 RM’000

Non-distributable: Share capital Balance at 1 April/31 March 15 993,454 993,454

Distributable: Unappropriated profi ts Balance at 1 April (as previously reported) 2,048,743 1,650,072

Prior year adjustments in respect of provision for dismantling, removal and restoration costs (15,859) (14,617) As restated 2,032,884 1,635,455 Profi t for the year 640,307 504,722 Dividends 26 (178,821) (107,293) Balance at 31 March 2,494,370 2,032,884

Minority interest Balance at 1 April 49,458 43,577 Profi t for the year 6,332 6,448 Dividends (756) (567) Balance at 31 March 17 55,034 49,458 TOTAL EQUITY 3,542,858 3,075,796

The notes set out on pages 75 to 99 form an integral part of, and, should be read in conjunction with, these fi nancial statements. 70 PETRONAS DAGANGAN BERHAD (88222-D) Consolidated Cash Flow Statement FOR THE YEAR ENDED 31 MARCH 2007

2007 2006 RM’000 RM’000

CASH FLOWS FROM OPERATING ACTIVITIES Cash receipts from customers 19,173,311 16,393,171 Cash paid to suppliers and employees (18,205,742) (15,653,130) 967,569 740,041 Taxation paid (218,628) (132,514) Net cash generated from operating activities 748,941 607,527

CASH FLOWS FROM INVESTING ACTIVITIES Interest income from deposits with fi nancial institutions 16,202 14,056 Purchase of property, plant and equipment (446,259) (430,768) Prepaid rental of service station sites (49,737) (67,988) Proceeds from sales of property, plant and equipment 1,047 1,772 Net cash used in investing activities (478,747) (482,928)

CASH FLOWS FROM FINANCING ACTIVITIES Repayment of Al-Bai’ Bithaman Ajil long term facility (10,031) (9,593) Profi t share margin paid (2,579) (3,019) Dividends paid to shareholders (178,821) (107,293) Dividends paid to minority interests of a subsidiary (756) (567) Net cash used in fi nancing activities (192,187) (120,472)

NET INCREASE IN CASH AND CASH EQUIVALENTS 78,007 4,127

CASH AND CASH EQUIVALENTS AT BEGINNING OF THE YEAR 466,006 461,879 CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR 544,013 466,006

CASH AND CASH EQUIVALENTS (Note 14) Cash and bank balances 206,669 40,716 Deposits 337,344 425,290 544,013 466,006

The notes set out on pages 75 to 99 form an integral part of, and, should be read in conjunction with, these fi nancial statements. PETRONAS DAGANGAN BERHAD (88222-D) 71 Balance Sheet AT 31 MARCH 2007

Restated Note 2007 2006 RM’000 RM’000

ASSETS Property, plant and equipment 3 2,984,742 2,740,333 Investment in subsidiary 4 59,475 59,475 Investment in associates 5 1,425 1,425 Long term receivables 6 281,827 247,622 Goodwill 7 24,874 26,349 TOTAL NON-CURRENT ASSETS 3,352,343 3,075,204

Inventories 8 477,096 604,924 Trade and other receivables 9 2,094,468 1,964,028 Cash and cash equivalents 14 444,948 385,676 TOTAL CURRENT ASSETS 3,016,512 2,954,628 TOTAL ASSETS 6,368,855 6,029,832

EQUITY Share capital 15 993,454 993,454 Reserves 16 2,448,531 1,998,323 TOTAL EQUITY 3,441,985 2,991,777

LIABILITIES Deferred tax 20 82,286 73,376 Provisions 21 28,309 28,253 TOTAL NON-CURRENT LIABILITIES 110,595 101,629

Trade and other payables 22 2,697,323 2,844,565 Taxation 118,952 91,861 TOTAL CURRENT LIABILITIES 2,816,275 2,936,426 TOTAL LIABILITIES 2,926,870 3,038,055 TOTAL EQUITY AND LIABILITIES 6,368,855 6,029,832

The notes set out on pages 75 to 99 form an integral part of, and, should be read in conjunction with, these fi nancial statements. 72 PETRONAS DAGANGAN BERHAD (88222-D) Income Statement FOR THE YEAR ENDED 31 MARCH 2007

Restated Note 2007 2006 RM’000 RM’000

Revenue 19,481,751 16,550,246 Cost of sales (17,804,109) (15,149,818) Gross profi t 1,677,642 1,400,428 Selling and distribution expenses (233,141) (172,538) Administration expenses (623,493) (580,296) Other operating income 58,540 54,329 Operating profi t 23 879,548 701,923 Financing costs 24 (239) (562) Profi t before taxation 879,309 701,361 Tax expense 25 (250,280) (207,613) PROFIT FOR THE YEAR 629,029 493,748

Dividends per ordinary share – net 26 21.8 sen 14.4 sen

The notes set out on pages 75 to 99 form an integral part of, and, should be read in conjunction with, these fi nancial statements. PETRONAS DAGANGAN BERHAD (88222-D) 73 Statement of Changes in Equity FOR THE YEAR ENDED 31 MARCH 2007

Note 2007 2006 RM’000 RM’000

Non-distributable: Share capital Balance at 1 April/31 March 15 993,454 993,454

Distributable: Unappropriated profi ts Balance at 1 April (as previously reported) 2,014,182 1,626,485

Prior year adjustments in respect of provision for dismantling, removal and restoration costs (15,859) (14,617) As restated 1,998,323 1,611,868 Profi t for the year 629,029 493,748 Dividends 26 (178,821) (107,293) Balance at 31 March 2,448,531 1,998,323 TOTAL EQUITY 3,441,985 2,991,777

The notes set out on pages 75 to 99 form an integral part of, and, should be read in conjunction with, these fi nancial statements. 74 PETRONAS DAGANGAN BERHAD (88222-D) Cash Flow Statement FOR THE YEAR ENDED 31 MARCH 2007

2007 2006 RM’000 RM’000

CASH FLOWS FROM OPERATING ACTIVITIES Cash receipts from customers 19,156,478 16,375,468 Cash paid to suppliers and employees (18,226,051) (15,675,268) 930,427 700,200 Taxation paid (214,279) (131,839) Net cash generated from operating activities 716,148 568,361

CASH FLOWS FROM INVESTING ACTIVITIES Interest income from deposits with fi nancial institutions 12,192 11,814 Purchase of property, plant and equipment (443,717) (421,626) Prepaid rental of service station sites (49,737) (67,988) Proceeds from sale of property, plant and equipment 1,047 1,772 Dividends received 2,160 1,731 Net cash used in investing activities (478,055) (474,297)

CASH FLOWS FROM FINANCING ACTIVITY Dividends paid (178,821) (107,293) Net cash used in fi nancing activity (178,821) (107,293)

NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS 59,272 (13,229)

CASH AND CASH EQUIVALENTS AT BEGINNING OF THE YEAR 385,676 398,905 CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR 444,948 385,676

CASH AND CASH EQUIVALENTS (Note 14) Cash and bank balances 206,264 40,146 Deposits 238,684 345,530 444,948 385,676

The notes set out on pages 75 to 99 form an integral part of, and, should be read in conjunction with, these fi nancial statements. PETRONAS DAGANGAN BERHAD (88222-D) 75 Notes to the Financial Statements 31 MARCH 2007

1. BASIS OF PREPARATION (i) Statement of Compliance The fi nancial statements of the Group and of the Company have been prepared in accordance with applicable approved accounting standards for entities other than private entities issued by the Malaysian Accounting Standards Board (MASB) and the provisions of the Companies Act, 1965. These fi nancial statements also comply with the applicable disclosure provisions of the Listing Requirements of Bursa Malaysia Securities Berhad.

The MASB has issued the following new and revised Financial Reporting Standards (FRSs) that are effective for accounting periods beginning after 1 January 2006 or available for early adoption.

The effects of adopting the new/revised FRSs in the current year are set out in Note 28 and Note 36.

In this set of fi nancial statements, the Group and Company has not chosen to early adopt the following FRSs: (i) FRS 117, Leases – This FRS is effective for accounting periods beginning on or after 1 October 2006. By virtue of the exemption in paragraph 67B of FRS 117, the impact of applying FRS 117 on the fi nancial statements upon fi rst adoption of this standard as required by paragraph 30(b) of FRS 108, Accounting Policies, Changes in Accounting Estimates and Errors is not disclosed;

(ii) FRS 124, Related Party Disclosures – This FRS is effective for accounting periods beginning on or after 1 October 2006. By virtue of the exemption in paragraph 22A of FRS 124, the impact of applying FRS 124 on the fi nancial statements upon fi rst adoption of this standard as required by paragraph 30(b) of FRS 108 is not disclosed;

(iii) FRS 139, Financial Instruments: Recognition and Measurement – This FRS has been issued by the MASB but the MASB has yet to announce the effective date of this standard. By virtue of the exemption in paragraph 103AB of FRS 139, the impact of applying FRS139 on the fi nancial statements upon fi rst adoption of this standard as required by paragraph 30(b) of FRS 108 is not disclosed;

(iv) Amendment to FRS 1192004, Employee Benefi ts: Actuarial Gain and Losses Group Plans and Disclosures – Certain

amendments made to FRS 1192004 are effective for accounting periods beginning on or after 1 January 2007. The adoption of these amendments does not have any impact on the fi nancial statements of the Group and of the Company in the period of initial application.

On 15 August 2006, the MASB issued FRS 6, Exploration for and Evaluation of Mineral Resources. This FRS is effective for accounting periods beginning on or after 1 January 2007. This FRS is not applicable to the Group and the Company.

On 15 February 2007, the MASB issued the following amendments to FRS and interpretations (ICs) for entities other than private entities: (i) Amendments to FRS 121, The Effects of Changes in Foreign Exchange Rates – Net Investment in a Foreign Operation;

(ii) IC Interpretation 1, Changes in Existing Decommissioning, Restoration and Similar Liabilities;

(iii) IC Interpretation 2, Members’ Shares in Co-operative Entities and Similar Instruments;

(iv) IC Interpretation 5, Rights to Interests arising from Decommissioning, Restoration and Environmental Rehabilitation Funds; (v) IC Interpretation 6, Liabilities arising from Participating in a Specifi c Market – Waste Electrical and Electronic Equipment;

(vi) IC Interpretation 7, Applying the Restatement Approach under FRS 1292004 Financial Reporting in Hyperinfl ationary Economics; and

(vii) IC Interpretation 8, Scope of FRS 2 Share-based payments. 76 PETRONAS DAGANGAN BERHAD (88222-D)

Notes to the Financial Statements

31 MARCH 2007

1. BASIS OF PREPARATION (CONT’D) (i) Statement of Compliance (Cont’d) The above amendments to FRS and ICs are effective for accounting periods beginning on or after 1 July 2007. The initial application of the IC Interpretation 1 does not have any signifi cant impact on the fi nancial statements of the Group and of the Company. The amendments to FRS and other ICs as issued above are not applicable to the Group and the Company.

The Group and the Company plans to apply FRS 117, FRS 124, Amendments to FRS 1192004 and IC Interpretation 1 initially for the annual period beginning 1 April 2007.

The accounting policies set out below have been applied consistently to all periods presented in these fi nancial statements, and have been applied consistently by Group entities, unless otherwise stated.

The fi nancial statements were approved and authorised for issue by Board of Directors on 28 May 2007.

(ii) Basis of Measurement The fi nancial statements have been prepared on the historical cost basis, unless otherwise stated.

(iii) Functional and Presentation Currency The fi nancial statements are presented in Ringgit Malaysia (RM), which is the Company’s functional currency.

(iv) Use of Estimates and Judgements The preparation of fi nancial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amount of assets, liabilities, income and expenses. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised and in any future periods affected.

In particular, information about signifi cant areas of estimation uncertainty and critical judgements in applying accounting policies that have the most signifi cant effect on the amount recognised in the fi nancial statements are described in Note 21- Provisions.

2. SIGNIFICANT ACCOUNTING POLICIES 2.1 Basis of Consolidation Subsidiaries are entities controlled by the Company. Control exists when the Company has the power to govern the fi nancial and operating policies of an enterprise so as to obtain benefi ts from its activities.

The fi nancial statements of subsidiaries are included in the consolidated fi nancial statements from the date that control commences until the date that control ceases.

Investment in subsidiary is stated in the Company’s balance sheet at cost less impairment losses.

All inter-company transactions are eliminated on consolidation and revenue and profi ts relate to external transactions only. Unrealised losses resulting from intercompany transactions are also eliminated unless cost cannot be recovered. PETRONAS DAGANGAN BERHAD (88222-D) 77

Notes to the Financial Statements

31 MARCH 2007

2. SIGNIFICANT ACCOUNTING POLICIES (CONT’D) 2.1 Basis of Consolidation (Cont’d) Minority interests at the balance sheet date, being the portion of the net assets of subsidiaries attributable to equity interests that are not owned by the Company, are presented in the consolidated balance sheet and statement of changes in equity within equity, separately from equity attributable to the equity shareholders of the Company. Minority interests in the results of the Group are presented on the face of the consolidated income statement as an allocation of the total profi t or loss for the year between minority interests and the equity shareholders of the Company.

Where losses applicable to the minority exceed the minority’s interest in the equity of a subsidiary, the excess, and any further losses applicable to the minority, are charged against the Group’s interest except to the extent that the minority has a binding obligation to, and is able to, make additional investment to cover the losses. If the subsidiary subsequently reports profi ts, the Group’s interest is allocated all such profi ts until the minority’s share of losses previously absorbed by the Group has been recovered.

2.2 Goodwill Goodwill or negative goodwill arises on the acquisition of subsidiaries, associates and joint ventures.

For acquisitions prior to 1 April 2006, goodwill represents the excess of the cost of acquisition over the fair value of the identifi able assets acquired.

Prior to adoption of FRS 3, goodwill was measured at cost less accumulated amortisation and accumulated impairment losses, if any. It was amortised from the date of initial recognition over the unexpired lease term.

With the adoption of FRS 3 beginning 1 April 2006, goodwill represents the excess of the cost of the acquisition over the Company’s interest in the net fair value of the identifi able assets, liabilities and contingent liabilities of the acquiree.

Goodwill is measured at cost and is no longer amortised but tested for impairment at least annually or more frequently when there is objective evidence of impairment. Goodwill is allocated to cash-generating units.

2.3 Associates Associates are entities in which the Company has signifi cant infl uence, but not control, including representation on the Board of Directors, over the fi nancial and operating policies.

Associates are accounted for in the consolidated fi nancial statements using the equity method. The consolidated fi nancial statements include the Company’s share of post-acquisition profi ts or losses after adjustments to align the accounting policies with those of the Company from the date that signifi cant infl uence commences until the date that signifi cant infl uence ceases. The Company’s share of post-acquisition reserves and retained profi ts less losses is added to the carrying value of the investment in the consolidated balance sheet. These amounts are taken from the latest audited fi nancial statements or management fi nancial statements of the associates.

Unrealised profi ts arising on transactions between the Company and its associates are eliminated to the extent of the Company’s interests in the associates. Unrealised losses on such transaction are also eliminated partially, unless cost cannot be recovered. 78 PETRONAS DAGANGAN BERHAD (88222-D)

Notes to the Financial Statements

31 MARCH 2007

2. SIGNIFICANT ACCOUNTING POLICIES (CONT’D) 2.3 Associates (Cont’d) When the Group’s share of losses exceeds its interest in an equity accounted associate, the carrying amount of that interest (including any long-term investments) is reduced to nil and the recognition of further losses is discontinued except to the extent that the Group has an obligation or has made payments on behalf of the investee.

Investments in associates are stated in the Company’s balance sheet at cost less impairment losses.

2.4 Prepaid Rental Prepaid rental of service station sites is accounted for as Long Term Receivables. The prepayments are expensed off on a straight-line basis over the period of the agreements.

2.5 Property, Plant and Equipment and Depreciation Freehold land and projects-in-progress are stated at cost and are not depreciated. Other property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any.

Cost includes expenditures that are directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the asset to working condition for its intended use, and the costs of dismantling and removing the items and restoring the site on which they are located. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment.

When signifi cant parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefi ts embodied within the part will fl ow to the Group and its cost can be measured reliably. The net book value of the replaced item of property, plant and equipment is derecognised with any corresponding gain or loss recognised in the income statement accordingly. The costs of the day-to-day servicing of property, plant and equipment are recognised in the income statement as incurred.

Depreciation for property, plant and equipment other than freehold land and projects-in-progress is recognised in the income statement on a straight-line basis over the estimated useful lives of each part of an item of property, plant and equipment.

Buildings are depreciated over its useful life or over the remaining land lease period, whichever is shorter.

Leasehold land and lease properties are depreciated over the lease period of 8 to 999 years.

The estimated useful lives for the current and comparative periods are as follows: Plant, machinery, tankage and pipeline 3 – 20 years Offi ce equipment, furniture and fi ttings 5 – 6.7 years Motor vehicles 4 years Computer software and hardware 5 years

The depreciable amount is determined after deducting the residual value.

Depreciation methods, useful lives and residual values are reassessed at the reporting date.

Property, plant and equipment individually costing less than RM5,000 are expensed off in the year of purchase. PETRONAS DAGANGAN BERHAD (88222-D) 79

Notes to the Financial Statements

31 MARCH 2007

2. SIGNIFICANT ACCOUNTING POLICIES (CONT’D) 2.6 Impairment The carrying amount of assets, other than inventories (refer to Note 2.7), deferred tax assets (refer to Note 2.10) and fi nancial assets (fi nancial assets in this context exclude investments in subsidiary and associates), are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated. An impairment loss is recognised whenever the carrying amount of an asset or the cash-generating unit to which it belongs exceeds its recoverable amount. Impairment losses are recognised in the income statement. A cash generating unit is the smallest identifi able asset group that generates cash fl ows that are largely independent from other assets and groups.

The recoverable amount is the greater of the asset’s fair value less cost to sell and its value in use. In assessing the value in use, estimated future cash fl ows are discounted to their present value using a pre-tax discount rate that refl ects current market assessments of the time value of money and the risks specifi c to the asset. For asset that does not generate largely independent cash infl ows, the recoverable amount is determined for the cash-generating unit to which the asset belongs.

An impairment loss in respect of goodwill is not reversed unless the loss was caused by a specifi c external event of an exceptional nature that is not expected to recur and subsequent external events have occurred that reverse the effect of the event. In respect of other assets, impairment losses are reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised. Reversals of impairment losses are credited to the income statement in the year in which the reversals are recognised.

2.7 Inventories Inventories are stated at the lower of cost and net realisable value. The cost of inventories includes direct costs and transportation charges necessary to bring the inventories to their present locations and condition and is determined on the weighted average basis.

Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and selling expenses.

2.8 Trade and Other Receivables Trade and other receivables are stated at cost less allowance for doubtful debts. Receivables are not held for the purpose of trading.

2.9 Employee Benefi ts (i) Short term benefi ts Wages and salaries, bonuses and social security contributions are recognised as an expense in the year in which the associated services are rendered by employees of the Company.

(ii) Defi ned contribution plans As required by law, companies in Malaysia make contributions to the state pension scheme, the Employees Provident Fund (“EPF”). Obligations for contributions to defi ned contribution plans are recognised as an expense in the income statement as incurred. 80 PETRONAS DAGANGAN BERHAD (88222-D)

Notes to the Financial Statements

31 MARCH 2007

2. SIGNIFICANT ACCOUNTING POLICIES (CONT’D) 2.9 Employee Benefi ts (Cont’d) (iii) Defi ned benefi t plans The Company contributes monthly to the PETRONAS Retirement Benefi t Fund (“PETRONAS Fund”). The retirement benefi t plan is a funded defi ned benefi t plan.

Contributions to the PETRONAS Fund are based on eligible employees’ monthly emoluments less statutory contribution, to fi nance the retirement benefi ts payable to eligible employees. The monthly maximum tax allowable contribution is paid to the PETRONAS Fund by the Company. The excess is paid by the Company to a special account in Petroliam Nasional Berhad, the holding company, as a provision for retirement benefi ts.

As the eligible members of the PETRONAS Fund are contracted to the holding company, any shortfall of the Fund will be borne by the holding company. The Company has agreed with the Trustees of the Fund to undertake such liability in respect of future contributions to the Fund which may be adjusted by the Trustees to recover such shortfall.

Actuarial valuation of the PETRONAS Fund is conducted by an independent actuary at regular intervals. The last valuation performed for the Fund was on 31 March 2007.

2.10 Taxation Tax on the profi t and loss for the year comprises current and deferred tax. Income tax is recognised in the income statement except to the extent it relates to items recognised directly in equity, in which case it is recognised in equity.

(i) Current tax Current tax expense is the expected tax payable on the taxable income for the year, using the statutory tax rates at the balance sheet date, and any adjustment to tax payable in respect of previous years.

(ii) Deferred tax Deferred tax is provided for, using the balance sheet method, on temporary differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts in the fi nancial statements. In principle, deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised for all deductible temporary differences, unabsorbed capital allowances, unused tax losses and unused tax credits to the extent that it is probable that future taxable profi t will be available against which the deductible temporary differences, unabsorbed capital allowances, unused tax losses and unused tax credits can be utilised.

Deferred tax is not recognised if the temporary difference arises from goodwill or negative goodwill or from the initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the transaction, affects neither accounting profi t nor taxable profi t.

Deferred tax is measured at the tax rates that are expected to apply in the period when the asset is realised or the liability is settled, based on statutory tax rates at the balance sheet date.

Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefi t will be realised.

PETRONAS DAGANGAN BERHAD (88222-D) 81

Notes to the Financial Statements

31 MARCH 2007

2. SIGNIFICANT ACCOUNTING POLICIES (CONT’D) 2.11 Cash and Cash Equivalents Cash and cash equivalents consist of cash on hand, balances and deposits with fi nancial institutions.

2.12 Provisions A provision is recognised if, as a result of a past event, the Company has a present legal or constructive obligation that be can be estimated reliably, and it is probable that an outfl ow of economic benefi ts will be required to settle the obligation. Provisions are determined by discounting the expected future cash fl ows at a pre-tax rate that refl ects current market assessments of the time value of money and the risks specifi c to the liability. The amount recognised as a provision is the best estimate of the expenditure required to settle the present obligation at the balance sheet date. Provisions are reviewed at each balance sheet date and adjusted to refl ect the current best estimate.

In particular, information about provisions that have the most signifi cant effect on the amount recognised in the fi nancial statements are described in Note 21.

2.13 Liabilities Borrowings and other payables are stated at cost.

2.14 Revenue Revenue from sale of petroleum products is measured at the fair value of the consideration receivable and is recognised in the income statement when the signifi cant risks and rewards of ownership have been transferred to the buyer.

Revenue from services rendered is recognised in the income statement based on the value of services performed and invoiced to customers during the period.

2.15 Financing Cost Financing cost comprises profi t share margin on Islamic debt facility and unwinding of discount for provision of dismantling, removal and restoration costs.

2.16 Earnings per share The Group presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by dividing the profi t and loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period. Diluted EPS is determined by adjusting the profi t and loss attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares, which comprise convertible notes and share options granted to employees. 82 PETRONAS DAGANGAN BERHAD (88222-D)

Notes to the Financial Statements

31 MARCH 2007

3. PROPERTY, PLANT AND EQUIPMENT

At Disposals/ At Group 1.4.2006 Additions Write-offs Transfers 31.3.2007 RM’000 RM’000 RM’000 RM’000 RM’000

At cost Freehold land 500,595 – – 106,109 606,704 Leasehold land – long lease 245,462 – (626) 41,618 286,454 – short lease 40,897 – – (3,128) 37,769 Buildings 1,261,695 – (2,742) 174,180 1,433,133 Plant, machinery, tankage and pipeline 1,018,445 31,157 (21,914) 118,282 1,145,970 Offi ce equipment, furniture and fi ttings 122,495 542 (1,776) 36,148 157,409 Motor vehicles 29,029 975 (11) 7,773 37,766 Computer hardware and software 306,640 2,037 (22,866) 28,181 313,992 Projects in progress 632,243 437,988 (530) (509,163) 560,538 4,157,501 472,699 (50,465) – 4,579,735

At Charge for Disposals/ At 1.4.2006 the year Write-offs 31.3.2007 RM’000 RM’000 RM’000 RM’000 Accumulated depreciation Freehold land – – – – Leasehold land – long lease 20,823 3,485 (152) 24,156 – short lease 20,414 (341) – 20,073 Buildings 472,030 68,161 (1,691) 538,500 Plant, machinery, tankage and pipeline 539,310 78,660 (16,379) 601,591 Offi ce equipment, furniture and fi ttings 62,187 23,841 (1,129) 84,899 Motor vehicles 24,293 3,102 – 27,395 Computer hardware and software 165,626 53,409 (22,834) 196,201 Projects in progress – – – – 1,304,683 230,317 (42,185) 1,492,815 PETRONAS DAGANGAN BERHAD (88222-D) 83

Notes to the Financial Statements

31 MARCH 2007

3. PROPERTY, PLANT AND EQUIPMENT (CONT’D)

At Disposals/ At Group (Cont’d) 1.4.2005 Additions Write-offs Transfers 31.3.2006 RM’000 RM’000 RM’000 RM’000 RM’000

At cost Freehold land 395,653 47 (2,430) 107,325 500,595 Leasehold land – long lease 198,552 70 (165) 47,005 245,462 – short lease 40,897 – – – 40,897 Buildings 1,104,498 – (8,440) 165,637 1,261,695 Plant, machinery, tankage and pipeline 920,728 27,350 (5,251) 75,618 1,018,445 Offi ce equipment, furniture and fi ttings 97,597 419 (676) 25,155 122,495 Motor vehicles 29,246 554 (3,471) 2,700 29,029 Computer hardware and software 153,118 8,175 (67) 145,414 306,640 Projects in progress 820,397 380,700 – (568,854) 632,243 3,760,686 417,315 (20,500) – 4,157,501

At Charge for Disposals/ At 1.4.2005 the year Write-offs 31.3.2006 RM’000 RM’000 RM’000 RM’000 Accumulated depreciation Freehold land – – – – Leasehold land – long lease 17,696 3,127 – 20,823 – short lease 19,121 1,293 – 20,414 Buildings 415,863 56,491 (324) 472,030 Plant, machinery, tankage and pipeline 481,855 60,658 (3,203) 539,310 Offi ce equipment, furniture and fi ttings 44,272 18,440 (525) 62,187 Motor vehicles 25,664 2,040 (3,411) 24,293 Computer hardware and software 93,775 71,905 (54) 165,626 Projects in progress – – – – 1,098,246 213,954 (7,517) 1,304,683

Net Book Value 31.3.2007 31.3.2006 RM’000 RM’000

Freehold land 606,704 500,595 Leasehold land – long lease 262,298 224,639 – short lease 17,696 20,483 Buildings 894,633 789,665 Plant, machinery, tankage and pipeline 544,379 479,135 Offi ce equipment, furniture and fi ttings 72,510 60,308 Motor vehicles 10,371 4,736 Computer hardware and software 117,791 141,014 Projects in progress 560,538 632,243 3,086,920 2,852,818

84 PETRONAS DAGANGAN BERHAD (88222-D)

Notes to the Financial Statements

31 MARCH 2007

3. PROPERTY, PLANT AND EQUIPMENT (CONT’D)

At Disposals/ At Company 1.4.2006 Additions Write-offs Transfers 31.3.2007 RM’000 RM’000 RM’000 RM’000 RM’000

At cost Freehold land 500,595 – – 106,109 606,704 Leasehold land – long lease 245,462 – (626) 41,618 286,454 – short lease 40,897 – – (3,128) 37,769 Buildings 1,236,311 – (2,742) 174,180 1,407,749 Plant, machinery, tankage and pipeline 860,854 31,112 (21,385) 112,033 982,614 Offi ce equipment, furniture and fi ttings 119,010 542 (1,776) 35,970 153,746 Motor vehicles 26,915 910 (11) 7,773 35,587 Computer hardware and software 299,409 2,037 (22,866) 28,181 306,761 Projects in progress 624,720 437,988 – (502,736) 559,972 3,954,173 472,589 (49,406) – 4,377,356

At Charge for Disposals/ At 1.4.2006 the year Write-offs 31.3.2007 RM’000 RM’000 RM’000 RM’000

Accumulated depreciation Freehold land – – – – Leasehold land – long lease 20,823 3,485 (152) 24,156 – short lease 20,414 (341) – 20,073 Buildings 462,385 66,892 (1,691) 527,586 Plant, machinery, tankage and pipeline 469,158 71,165 (16,379) 523,944 Offi ce equipment, furniture and fi ttings 59,208 23,700 (1,129) 81,779 Motor vehicles 22,721 2,896 – 25,617 Computer hardware and software 159,131 53,162 (22,834) 189,459 Projects in progress – – – – 1,213,840 220,959 (42,185) 1,392,614 PETRONAS DAGANGAN BERHAD (88222-D) 85

Notes to the Financial Statements

31 MARCH 2007

3. PROPERTY, PLANT AND EQUIPMENT (CONT’D) At Disposals/ At Company (cont’d) 1.4.2005 Additions Write-offs Transfers 31.3.2006 RM’000 RM’000 RM’000 RM’000 RM’000

At cost Freehold land 395,653 47 (2,430) 107,325 500,595 Leasehold land – long lease 198,552 70 (165) 47,005 245,462 – short lease 40,897 – – – 40,897 Buildings 1,079,631 – (8,440) 165,120 1,236,311 Plant, machinery, tankage and pipeline 765,799 27,344 (5,251) 72,962 860,854 Offi ce equipment, furniture and fi ttings 94,149 419 (676) 25,118 119,010 Motor vehicles 27,148 538 (3,471) 2,700 26,915 Computer hardware and software 145,902 8,160 (67) 145,414 299,409 Projects in progress 817,025 373,339 – (565,644) 624,720 3,564,756 409,917 (20,500) – 3,954,173

At Charge for Disposals/ At 1.4.2005 the year Write-offs 31.3.2006 RM’000 RM’000 RM’000 RM’000

Accumulated depreciation Freehold land – – – – Leasehold land – long lease 17,696 3,127 – 20,823 – short lease 19,121 1,293 – 20,414 Buildings 407,502 55,207 (324) 462,385 Plant, machinery, tankage and pipeline 419,179 53,182 (3,203) 469,158 Offi ce equipment, furniture and fi ttings 41,648 18,085 (525) 59,208 Motor vehicles 24,340 1,792 (3,411) 22,721 Computer hardware and software 87,527 71,658 (54) 159,131 Projects in progress – – – – 1,017,013 204,344 (7,517) 1,213,840

Net Book Value

31.3.2007 31.3.2006 RM’000 RM’000

Freehold land 606,704 500,595 Leasehold land – long lease 262,298 224,639 – short lease 17,696 20,483 Buildings 880,163 773,926 Plant, machinery, tankage and pipeline 458,670 391,696 Offi ce equipment, furniture and fi ttings 71,967 59,802 Motor vehicles 9,970 4,194 Computer hardware and software 117,302 140,278 Projects in progress 559,972 624,720 2,984,742 2,740,333

86 PETRONAS DAGANGAN BERHAD (88222-D)

Notes to the Financial Statements

31 MARCH 2007

3. PROPERTY, PLANT AND EQUIPMENT (CONT’D) Security Certain property, plant and equipment of the Group costing RM202,380,138 (2006 – RM203,329,713) have been pledged as securities for a fi nancing facility as set out in Note 19 to the fi nancial statements.

The titles to certain freehold and leasehold land are in the process of being registered in the Company’s name.

Long term leasehold land comprise leasehold interests with an unexpired term in excess of fi fty years.

4. INVESTMENT IN SUBSIDIARY Company

2007 2006 RM’000 RM’000

Unquoted shares at cost 59,475 59,475

Details of the subsidiary are stated in Note 33 to the fi nancial statements.

5. INVESTMENT IN ASSOCIATES Group Company 2007 2006 2007 2006 RM’000 RM’000 RM’000 RM’000

Unquoted shares at cost 1,425 1,425 1,425 1,425 Share of post-acquisition reserves 3,216 2,293 – – 4,641 3,718 1,425 1,425

Represented by: Group’s share of net assets 4,641 3,718

Details of the associates are stated in Note 34 to the fi nancial statements.

6. LONG TERM RECEIVABLES Group and Company

2007 2006 RM’000 RM’000

Long term receivables consist of: Prepaid rental of service station sites 281,827 247,622 PETRONAS DAGANGAN BERHAD (88222-D) 87

Notes to the Financial Statements

31 MARCH 2007

7. GOODWILL Group and Company

2007 2006 RM’000 RM’000

Balance at 1 April – at cost 26,349 30,702 Less: Accumulated amortisation – (4,353) Less: Accumulated impairment loss (1,475) – Balance at 31 March 24,874 26,349

Goodwill arose from the acquisition of certain service stations in previous years.

8. INVENTORIES Group Company 2007 2006 2007 2006 RM’000 RM’000 RM’000 RM’000

Petroleum products – at cost 425,625 576,619 425,625 576,619 Lubricants – at cost 32,308 25,892 32,308 25,892 – at net realisable value – 1,929 – 1,929 Others – at cost 19,717 1,007 19,163 484 477,650 605,447 477,096 604,924

9. TRADE AND OTHER RECEIVABLES Group Company 2007 2006 2007 2006 Note RM’000 RM’000 RM’000 RM’000

Trade receivables 1,453,723 1,153,965 1,451,763 1,150,549 Other receivables, deposits and prepayments 555,580 702,641 555,032 701,164 Amounts due from: Related companies 12 86,352 111,751 86,352 111,751 Associates 13 1,321 564 1,321 564 2,096,976 1,968,921 2,094,468 1,964,028

Credit terms of trade receivables range from 30 to 60 days.

Trade and other receivables denominated in currencies other than functional currency comprise: Group and Company

2007 2006 RM’000 RM’000

USD (RM equivalent) 90,494 96,993 88 PETRONAS DAGANGAN BERHAD (88222-D)

Notes to the Financial Statements

31 MARCH 2007

10. AMOUNT DUE TO HOLDING COMPANY The amount due to holding company represents balances arising in the normal course of business.

11. AMOUNT DUE TO SUBSIDIARY The amount due to subsidiary represents balances arising in the normal course of business.

12. AMOUNTS DUE FROM/TO RELATED COMPANIES The amounts due from and to related companies represent balances arising in the normal course of business.

13. AMOUNTS DUE FROM/TO ASSOCIATES The amounts due from and to associates represent balances arising in the normal course of business.

14. CASH AND CASH EQUIVALENTS Group Company 2007 2006 2007 2006 RM’000 RM’000 RM’000 RM’000

Cash and bank balances 206,669 40,716 206,264 40,146 Deposits 337,344 425,290 238,684 345,530 544,013 466,006 444,948 385,676

Deposits are placed with: Licensed banks 337,344 420,187 238,684 345,530 Finance companies – 5,103 – – 337,344 425,290 238,684 345,530

15. SHARE CAPITAL Group and Company

2007 2006 RM’000 RM’000

Authorised: Ordinary shares of RM1.00 each 1,000,000 1,000,000

Issued and fully paid: Ordinary shares 993,454 993,454

16. RESERVES Subject to agreement by the Inland Revenue Board, the Company has suffi cient Section 108 tax credit and tax exempt income to distribute all its distributable reserves at 31 March 2007 if paid out as dividends.

17. MINORITY SHAREHOLDERS’ INTERESTS This consists of the minority shareholders’ proportion of share capital and reserves of the subsidiary. PETRONAS DAGANGAN BERHAD (88222-D) 89

Notes to the Financial Statements

31 MARCH 2007

18. BORROWINGS Group

2007 2006 RM’000 RM’000

Current Islamic debt facility – secured Al-Bai’ Bithaman Ajil long term non-interest bearing facility 5,280 10,031

Non-current Islamic debt facility – secured Al-Bai’ Bithaman Ajil long term non-interest bearing facility – 5,280

Terms and debts repayment schedule Under 1 – 2 2 – 5 Total 1 year years years RM’000 RM’000 RM’000 RM’000

Secured Islamic debt facility – Al-Bai’ Bithaman Ajil long term non-interest bearing facility 5,280 5,280 – –

19. ISLAMIC DEBT FACILITY The Group entered into the following Islamic Debt Facility: Al-Bai’ Bithaman Ajil long term non-interest bearing facility The RM60,200,000 Al-Bai’ Bithaman Ajil long term facility is repayable by 11 quarterly instalments of RM3,423,064 each commencing from 1 September 2000 to 29 May 2003 and 17 quarterly instalments of RM3,152,685 each commencing 30 May 2003 to 29 August 2007 (profi t share margin of 8.8% per annum was adjusted to 4.50% per annum effective from 30 May 2003). This facility is secured by way of fi xed and fl oating charges over the property, plant and equipment fi nanced. The cost of the assets charged is RM202,380,138 (2006 – RM203,329,713). The facility outstanding as at year end amounted to RM5,280,013 (2006 – RM15,311,298).

In connection with the Al-Bai’ Bithaman Ajil long term facility, the subsidiary has agreed on the following signifi cant covenants with the facility agent: (i) The subsidiary will not, without the prior written consent of the facility agent: (a) incur, assume, guarantee or permit to exist any indebtedness by the subsidiary except those permitted in the facility agreement; or to permit any encumbrance (other than that permitted) by the subsidiary to subsist, arise or be created or extended over any part of its present or future undertaking, assets, rights or revenues to secure or prefer any present or future indebtedness of the subsidiary or any other person;

(b) vary or change the business of the subsidiary to any unrelated business; or to dispose the assets associated with the business except in the ordinary course of business and for fair market value not exceeding RM1 million for any single asset;

(c) consolidate or merge with any other person, fi rm or company or acquire all or substantially all of the assets or stock of, or enter into any partnership, profi t sharing or royalty agreement or other similar arrangement other than that permitted in the facility agreement;

(d) make any loan or investment other than an investment acceptable to the project agent; or to give any guarantee (unless in its ordinary course of business and aggregate of such guarantees shall not exceed RM5 million) or grant any credit to or for the benefi t of shareholder or subsidiaries, holding company, associates or affi liates or Directors of any of the aforegoing. 90 PETRONAS DAGANGAN BERHAD (88222-D)

Notes to the Financial Statements

31 MARCH 2007

19. ISLAMIC DEBT FACILITY (CONT’D) Al-Bai’ Bithaman Ajil long term non-interest bearing facility (Cont’d) (ii) No sale or transfer of shares or other ownership interest in the subsidiary to take place unless such sale or transfer of shares or other ownership interest in the subsidiary is made in compliance with the directives of the Government.

(iii) Procure/maintain equity of not less than RM5 million as part of the issued and paid up capital of the subsidiary and to maintain a debt equity ratio of not more than 57:43.

20. DEFERRED TAX The components and movements of deferred tax liabilities and assets during the fi nancial year prior to offsetting are as follows:

Charged As at to income As at Group 1.4.2006 statement 31.3.2007 RM’000 RM’000 RM’000

Deferred tax liabilities Property, plant and equipment 105,373 8,388 113,761

Deferred tax assets Other provisions (11,682) 573 (11,109) Unabsorbed capital allowances (15) 5 (10) Total (11,697) 578 (11,119)

Company Deferred tax liabilities Property, plant and equipment 85,058 8,337 93,395

Deferred tax assets Other provisions (11,682) 573 (11,109)

Deferred tax liabilities and assets are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when the deferred taxes relate to the same tax authority. The following amounts determined after appropriate offsetting, are as follows: Group Company 2007 2006 2007 2006 RM’000 RM’000 RM’000 RM’000

Deferred tax liabilities 113,761 105,373 93,395 85,058 Deferred tax assets (11,119) (11,697) (11,109) (11,682) 102,642 93,676 82,286 73,376 PETRONAS DAGANGAN BERHAD (88222-D) 91

Notes to the Financial Statements

31 MARCH 2007

21. PROVISIONS Group and Company Dismantling, removal and restoration costs

2007 2006 RM’000 RM’000

Balance at 1 April 28,253 27,691 Reversal of unused provisions (183) – Unwinding of discount 239 562 Balance at 31 March 28,309 28,253

Dismantling, removal and restoration costs Under provisions of certain land lease agreements, the Company is required to dismantle and remove structures on certain sites and restore those sites at the end of the lease term to an acceptable condition consistent with the lease agreement.

For these affected sites, the Company has estimated the costs of dismantling, removal and restoration using existing technology, at current prices and discounted at a real discount rate equivalent to the Company’s weighted average cost of capital.

The present value of the estimated costs is capitalised as part of the asset and the related provisions raised on the date when the obligation arises. The capitalised cost is depreciated over the expected life of the asset. The increase in the net present value of the provision for the expected cost is included with fi nance costs in the income statement.

While the provision is based on the best estimate of future costs and the economic lives of the affected assets, there is uncertainty regarding both the amount and timing of incurring these costs. All the estimates are reviewed on an annual basis or more frequently, where there is indication of a material change.

22. TRADE AND OTHER PAYABLES Group Company 2007 2006 2007 2006 Note RM’000 RM’000 RM’000 RM’000

Other payables 411,569 449,084 391,147 425,660 Amount(s) due to: Holding company 10 262,267 126,383 262,267 126,383 Subsidiary 11 – – 884 2,130 Related companies 12 2,043,025 2,289,043 2,043,025 2,289,043 Associates 13 – 1,349 – 1,349 2,716,861 2,865,859 2,697,323 2,844,565 92 PETRONAS DAGANGAN BERHAD (88222-D)

Notes to the Financial Statements

31 MARCH 2007

22. TRADE AND OTHER PAYABLES (CONT’D) Included in amount due to holding company is a balance which is non-trade in nature, amounting to RM89,238,000 (2006 – RM88,028,000).

Credit terms of trade payables range from 14 to 30 days.

Trade and other payables denominated in currencies other than functional currency comprise:

Group and Company

2007 2006 RM’000 RM’000

USD (RM equivalent) 605 652

23. OPERATING PROFIT Group Company 2007 2006 2007 2006 RM’000 RM’000 RM’000 RM’000

Operating profi t is arrived at after charging: Audit fees 285 275 270 260 Non audit fees paid to external auditors 18 37 18 37 Allowance for doubtful debts – 9,479 – 9,479 Amortisation of goodwill – 1,474 – 1,474 Contribution to EPF 10,786 10,648 10,786 10,648 Contribution to retirement benefi ts 5,997 6,573 5,997 6,573 Cost of inventories 17,531,521 15,037,141 17,531,521 15,037,141 Depreciation of property, plant and equipment 230,317 213,954 220,959 204,344 Fees to holding company for services of an executive director 736 736 736 736 Impairment loss on goodwill 1,475 – 1,475 – Inventories written off 4,886 – 4,886 – Loss on disposal of property, plant and equipment 5,171 – 5,171 – Non-executive directors’ remuneration: Fees 274 290 274 290 Property, plant and equipment expensed off 12,491 12,735 12,475 12,729 Rental of land and buildings 44,869 44,567 42,358 39,575 Rental of plant and equipment 4,460 4,277 4,453 3,846 Staff costs 130,306 116,169 130,306 116,169 PETRONAS DAGANGAN BERHAD (88222-D) 93

Notes to the Financial Statements

31 MARCH 2007

23. OPERATING PROFIT (CONT’D) Group Company 2007 2006 2007 2006 RM’000 RM’000 RM’000 RM’000

and crediting: Allowance for doubtful debts written back 6,241 – 6,241 – Bad debts recoveries 25 9 25 9 Dividend income from associate – – – 677 Dividend income from subsidiary – – 1,404 1,053 Gain on disposal of property, plant and equipment – 72 – 72 Interest income – deposits 14,101 15,880 11,023 13,549 Income from rental of facilities 4,435 6,579 4,435 6,579 Income from rental of premises 6,798 5,890 6,614 5,678

The estimated monetary value of executive director’s benefi ts-in-kind amounting to RM32,595 (2006 – RM30,566) represents the non-monetary benefi ts received during the year.

24. FINANCING COST Group Company 2007 2006 2007 2006 RM’000 RM’000 RM’000 RM’000

Profi t share margin – Islamic Debt Facility Al-Bai’ Bithaman Ajil long term non-interest bearing facility 482 923 – –

Unwinding of discount – Provision for dismantling, removal and restoration costs 239 562 239 562 721 1,485 239 562

25. TAX EXPENSE Group Company 2007 2006 2007 2006 RM’000 RM’000 RM’000 RM’000

Current tax expenses Malaysia Current year 248,868 203,246 242,597 202,549 Prior year (1,275) (9,819) (1,227) (9,819) 247,593 193,427 241,370 192,730 Deferred tax expenses Origination and reversal of temporary differences 8,966 20,073 8,910 14,883 256,559 213,500 250,280 207,613 94 PETRONAS DAGANGAN BERHAD (88222-D)

Notes to the Financial Statements

31 MARCH 2007

25. TAX EXPENSE (CONT’D) Current income tax is calculated at the statutory rate of 27% (2006 – 28%) of the estimated assessable profi t for the year. The statutory tax rate will be reduced to 26% from the current year’s rate of 27% effective year of assessment 2008. The computation of deferred taxation as at 31 March 2007 has refl ected these changes.

A reconciliation of income tax expense applicable to profi t before taxation at the statutory income tax rate to income tax expense at the effective income tax rate of the Group and of the Company is as follows:

2007 2006 Group % RM’000 % RM’000

Profi t before taxation 903,198 724,670

Income tax using Malaysian tax rates 27 243,863 28 202,908 Non-deductible expenses 2 13,971 3 20,411 Tax expense 29 257,834 31 223,319 Overprovision in prior years (1) (1,275) (2) (9,819) Tax expense 28 256,559 29 213,500

2007 2006 Company % RM’000 % RM’000

Profi t before taxation 879,309 701,361

Income tax using Malaysian tax rates 27 237,413 28 196,381 Non-deductible expenses 2 14,094 3 21,051 Tax expense 29 251,507 31 217,432 Overprovision in prior years (1) (1,227) (1) (9,819) Tax expense 28 250,280 30 207,613

26. DIVIDENDS Group and Company

2007 2006 RM’000 RM’000

Ordinary: Final paid: 2006 – 15% less tax at 28% (2005 – 10% less tax at 28%) 107,293 71,529

Interim paid: Interim dividend of 10% less tax at 28% (2006 – 5% less tax at 28%) 71,528 35,764 178,821 107,293 PETRONAS DAGANGAN BERHAD (88222-D) 95

Notes to the Financial Statements

31 MARCH 2007

26. DIVIDENDS (CONT’D) The proposed fi nal dividend of 20% less tax at 27% totalling RM145,044,284 has not been accounted for in the fi nancial statements.

The net dividend per ordinary shares as disclosed in the Income Statement for the fi nancial year ended 31 March 2007 on pages 68 and 72 takes into account the total interim and proposed fi nal dividends for the fi nancial year.

27. EARNINGS PER ORDINARY SHARE – GROUP Basic earnings per share The earnings per share is derived based on the net profit attributable to ordinary shareholders of RM640,307,000 (2006 – RM504,722,000) and on the number of ordinary shares as at 31 March 2007 of 993,454,000 (2006 – 993,454,000).

28. CHANGES IN ACCOUNTING POLICIES AND PRIOR YEAR ADJUSTMENTS Changes in accounting policy The MASB has issued a number of new and revised FRSs that are effective for accounting periods beginning after 1 January 2006.

The effect adopting the new/revised FRSs has been accounted for either prospectively or retrospectively by restating comparatives and adjusting the opening balance of retained earnings, in accordance with specifi c requirements of the respective FRSs.

The principal effect of the changes in accounting policies resulting from the adoption of the new/revised FRSs are as follows: FRS 116 – Property, Plant and Equipment With the adoption of the revised FRS 116, the cost of an item of property, plant and equipment includes the costs of dismantling and removing items and restoring the site on which it is located, where such obligations exist. When signifi cant parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment. Depreciation is recognised in the income statement on a straight line basis over the estimated useful lives of each part of an item of property, plant and equipment.

Prior Year Adjustment The change in accounting policy due to the above changes has been accounted for by restating comparatives and adjusting the opening balances of retained profi ts as at 1 April 2006 as disclosed in Note 36 and in the Statement of Changes in Equity respectively.

29. COMMITMENTS Outstanding commitments in respect of capital expenditure at balance sheet date not provided for in the fi nancial statements are: Group Company 2007 2006 2007 2006 RM’000 RM’000 RM’000 RM’000

Property, plant and equipment: Approved and contracted for 24,562 65,508 22,267 65,189 Approved but not contracted for 88,262 129,667 86,470 129,392 112,824 195,175 108,737 194,581 96 PETRONAS DAGANGAN BERHAD (88222-D)

Notes to the Financial Statements

31 MARCH 2007

30. SIGNIFICANT RELATED PARTIES TRANSACTIONS Controlling related party relationships are as follows: (i) the holding company as disclosed in Note 32; and (ii) its subsidiary as disclosed in Note 33.

Other than as disclosed elsewhere in the notes to the fi nancial statements, the signifi cant related party transactions are as follows:

Group and Company

2007 2006 RM’000 RM’000

Sales of petroleum products Related companies: Malaysia LNG Sdn. Bhd. 287,841 285,638 MISC Berhad 27,562 21,846 PETRONAS Carigali Sdn. Bhd. 300,743 253,966 PETRONAS Trading Corporation Sdn. Bhd. 140,916 –

Purchases of petroleum products Related companies: PETRONAS Trading Corporation Sdn. Bhd. 2,747,464 1,886,055 PETRONAS Penapisan Melaka Sdn. Bhd. 13,807,129 13,017,649 PETRONAS Penapisan Terengganu Sdn. Bhd. 2,554,346 1,996,775 Malaysian Refi ning Company Sdn. Bhd. 206,072 293,586

The Directors of the Company are of the opinion that the above transactions have been entered into in the normal course of business and have been established on a commercial basis.

31. FINANCIAL INSTRUMENTS The Petroliam Nasional Berhad (PETRONAS) Group has a Group Risk Management Framework and Guideline that sets the foundation for the establishment of effective risk management across the PETRONAS Group.

The Group is exposed to various risks that are particular to its core business which consists of the domestic marketing of petroleum products and the operation of service stations. These risks arise in the normal course of the business.

The Group and the Company’s goal in risk management is to ensure that the management understand, measure and monitor the various risks that arise in connection with their operations. Policies and guidelines have been developed to identify, analyse, appraise and monitor the dynamic risks facing the Group and Company. Based on this assessment, each business unit adopts appropriate measures to mitigate these risks in accordance with the business unit’s view of the balance between risk and reward.

The main fi nancial risks faced by the Group and Company through their normal activities are credit risk and interest rate risk. PETRONAS DAGANGAN BERHAD (88222-D) 97

Notes to the Financial Statements

31 MARCH 2007

31. FINANCIAL INSTRUMENTS (CONT’D) Credit risk Credit risk is the probability of fi nancial loss arising from the failure of counterparties to make payment for goods or services already delivered or to deliver goods or services for which payment has already been made.

Credit evaluations are performed on an on-going basis where customer’s credit worthiness is evaluated using a list of qualitative and quantitative weighted criteria. All credit risks are measured, monitored and managed proactively in a decentralised approach based on guidance from PETRONAS Group Risk Management Framework and Guideline.

The Group mitigates its credit risks within a conservative framework by dealing with creditworthy counterparties or setting credit limits on exposures to counterparties where appropriate. These are done on an on-going basis to constantly monitor any developments.

On balance sheet date, there was a signifi cant concentration of credit risk arising from an amount owing by a customer constituting 28% (2006 – 28%) of the total trade receivables, of which all outstanding balances were current.

In addition, there was a signifi cant concentration of credit risk being an amount owing from the government constituting 64% (2006 – 88%) of the total other receivables relating to subsidies arising from the Automatic Pricing Mechanism governing the sale of petroleum products.

The maximum exposure to credit risk for the Group is represented by the carrying amount of each fi nancial asset, without taking into account the fair value of any collateral.

Interest rate risk Exposure to interest rate risk arises from the normal course of the Group engaging in fund raising and investing activities.

All interest rate risks are monitored and managed proactively by PETRONAS Group Treasury Division based on guidance from PETRONAS Group Risk Management Framework and Guideline.

The Group uses Al-Bai’ Bithaman Ajil Islamic fi nancing facility to fi nance its capital expenditure.

Liquidity risk Liquidity risk arises from the requirement to raise funds for the business on an ongoing basis as a result of existing and future commitments which are not funded from internal resources.

The Group monitors and maintains a level of cash and cash equivalents deemed adequate by management to fi nance the Group’s operations and to mitigate the effects of fl uctuations in cash fl ows.

Fair value In respect of cash and cash equivalents, trade and other receivables, other payables and borrowings, the carrying amounts approximate fair value due to the relatively short term nature of these fi nancial instruments.

Effective interest rates and repricing analysis In respect of interest-earning fi nancial assets and fi nancial liabilities with fi xed profi t share margin, the following table indicates their effective interest rate and profi t share margin at the balance sheet date and the periods in which they reprice or mature, whichever is earlier.

98 PETRONAS DAGANGAN BERHAD (88222-D)

Notes to the Financial Statements

31 MARCH 2007

31. FINANCIAL INSTRUMENTS (CONT’D) 2007 2006 Effective Effective interest interest rate/profi t rate/profi t share margin Within share margin Within Within per annum Total 1 year per annum Total 1 year 2 years % RM’000 RM’000 % RM’000 RM’000 RM’000

Group Financial assets Deposits 3.61 337,344 337,344 3.12 425,290 425,290 –

Financial liabilities Secured Islamic debt facility – Al-Bai’ Bithaman Ajil 4.50 5,280 5,280 4.50 15,311 10,031 5,280

Company Financial asset Deposits 3.62 238,684 238,684 2.94 345,530 345,530 –

32. HOLDING COMPANY The holding and ultimate holding company is Petroliam Nasional Berhad (PETRONAS), a company incorporated in Malaysia.

33. SUBSIDIARY AND ACTIVITY

Effective Percentage Holding Principal Activity 2007 2006

Company Incorporated in Malaysia Kuala Lumpur Aviation Fuelling 65% 65% Operation of aviation fuelling facilities at System Sdn. Bhd. Kuala Lumpur International Airport, Sepang.

34. ASSOCIATES AND ACTIVITIES

Effective Percentage Holding Principal Activity

2007 2006

Companies Incorporated in Malaysia Lub Dagangan Sdn. Bhd. 20% 20% Marketing and distribution of lubricants.

PS Pipeline Sdn. Bhd. 50% 50% To maintain and operate the Multi-Product Pipeline and Klang Valley Distribution Terminal (MPP-KVDT) and the associated facilities for the transportation of the petroleum products on behalf of the MPP-KVDT owners/shareholders on a cost recovery basis. PETRONAS DAGANGAN BERHAD (88222-D) 99

Notes to the Financial Statements

31 MARCH 2007

34. ASSOCIATES AND ACTIVITIES (CONT’D)

Effective Percentage Holding Principal Activity

2007 2006

Companies Incorporated in Malaysia (Cont’d) PS Terminal Sdn. Bhd. 50% 50% To operate, manage and maintain the joint facilities – terminal, depot, warehouse etc. in Tawau and Bintulu on behalf of the owners Shell Timur Sdn. Bhd. and PETRONAS Dagangan Berhad.

IOT Management Sdn. Bhd. 20% 20% To operate and manage an automated bulk petroleum terminal with facilities for receipt, storage and delivery of petroleum products at Senari, Kuching, Sarawak for the users, PETRONAS Dagangan Berhad and Shell Timur Sdn. Bhd.

35. SEGMENTAL INFORMATION Financial information by activity and geographical segment are not presented as the Group is principally involved in the domestic marketing of petroleum products and the operation of service stations in Malaysia.

36. COMPARATIVE FIGURES Certain comparative fi gures have been restated/reclassifi ed as a result of changes in accounting policies as stated in Note 28 and to conform with the presentation requirements of FRS 101 – Presentation of Financial Statements.

Group Company

As As previously previously As restated stated As restated stated RM’000 RM’000 RM’000 RM’000

Balance sheet Property, plant and equipment 2,852,818 2,840,424 2,740,333 2,727,939 Provisions 28,253 – 28,253 –

Income statement Administration expenses 591,226 601,569 580,296 579,616 Operating profi t 725,426 726,106 701,923 702,603 Financing costs 1,485 923 562 – Profi t before taxation 724,670 726,214 701,361 702,603 Profi t for the year 511,170 512,412 493,748 494,990

Statement of changes in equity Unappropriated profi ts – 1 April 2005 1,635,455 1,650,072 1,611,868 1,626,485 – 31 March 2006 2,032,884 2,048,743 1,998,323 2,014,182

100 PETRONAS DAGANGAN BERHAD (88222-D) Areas of Operation

HEAD OFFICE

Level 30-33, Tower 1 PETRONAS Twin Towers Kuala Lumpur City Centre 50088 Kuala Lumpur Tel: 03-2051 5000 Fax: 03-2026 5505 Pulau Langkawi

Bayan Lepas AREA OFFICES Prai

Central Region Level 12, Menara Dayabumi Jalan Sultan Hishamuddin P.O. Box 11946 Kerteh 50762 Kuala Lumpur Tel: 03-2260 1500 Fax: 03-2260 1527

Northern Region Kuantan

Lot No. 93 Kuala Lumpur Prai Industrial Estate Dengkil Port Klang 13600 Prai, Pulau Pinang Subang Tel: 04-390 7291/7201 Kuala Lumpur Fax: 04-399 0211 International Airport

Southern Region Port Dickson Melaka 1st & 2nd Floor, Bangunan PETRONAS Bandar Baru UDA

Km 7, Jalan Skudai Johor Pasir Bahru Gudang 81200 Johor Bahru, Johor Senai Tel: 07-237 8161 Fax: 07-236 0954 Sabah Region Level 1 & 2 Western Region Menara PETRONAS Kota Kinabalu Lot M1-2-17 & M1-2-18 No. 2, Jalan Belia Komplek Yayasan Belia Beg Berkunci No. 110 Sedunia (WYF Complex) 88100 Kota Kinabalu, Sabah Lebuh Ayer Keroh Tel: 088-23 9033/9035 75450 Melaka Fax: 088-23 7045 Tel: 06-232 6262 Fax: 06-232 6111 Sarawak Region 3rd & 4th Floor Eastern Region Wisma Naim A-39 & A-43, Jalan Haji Abdul Aziz Lot 2679, Jalan Rock 25000 Kuantan, Pahang 93200 Kuching, Sarawak Tel: 09-513 7022/7099 Tel: 082-25 5200 Fax: 09-514 4040 Fax: 082-42 9958 PETRONAS DAGANGAN BERHAD (88222-D) 101

Areas of Operation

Kota Kinabalu Sandakan

Labuan

Tawau Miri

Bintulu

Sibu

Kuching

Bulk Depot

Aviation Depot

Bottling Plant

Area Offi ce

Bunkering Facilities

Multi Product Pipeline 102 PETRONAS DAGANGAN BERHAD (88222-D) Shareholders’ Information

Financial Year End : 31 March 2007 Class of Shares : Ordinary Shares of RM1.00 Each Voting Rights : One Vote Per Ordinary Share (On A Poll)

ANALYSIS OF SHAREHOLDINGS AS AT 11 MAY 2007

% of Total % of Total Size of Holdings No. of Holders Shareholders No. of Shares Shares

Less than 100 30 0.31 484 0.00 100 - 1,000 1,196 12.49 1,033,930 0.10 1,001 - 10,000 7,499 78.29 21,275,700 2.15 10,001 - 100,000 661 6.91 22,370,464 2.25 100,001 to less than 5% of issued shares 191 1.99 254,769,422 25.64 5% and above of issued shares 1 0.01 694,004,000 69.86

9,578 100.00 993,454,000 100.00

CLASSIFICATION OF SHAREHOLDERS AS AT 11 MAY 2007

Category No. of Holders No. of Shares % of Total Shareholding Malaysian Foreign Malaysian Foreign Malaysian Foreign

• Individual 8,321 95 40,210,132 1,027,500 4.05 0.10 • Corporate Body a. Banks / Finance Companies 26 0 96,478,796 0 9.71 0.00 b. Investment Trusts / 16 0 37,000 0 0.00 0.00 Foundation / Charities c. Industrial and Commercial Companies 273 6 12,310,400 1,000,000 1.24 0.10 • Government Agencies / Institution 10 0 10,375,400 0 1.05 0.00 • Nominees 651 180 800,617,440 31,397,332 80.59 3.16

9,279 281 960,029,168 33,424,832 96.64 3.36

LIST OF THIRTY LARGEST SHAREHOLDERS

Registered As At 11 May 2007

Name No. of Shares % of Total Shares

1. Cartaban Nominees (Tempatan) Sdn Bhd 694,004,000 69.86 (Petroliam Nasional Berhad) (Strategic INV) 2. Employees Provident Fund Board 35,796,000 3.60 3. Valuecap Sdn Bhd 33,254,300 3.35 4. Malaysia Nominees (Tempatan) Sdn Bhd 28,629,200 2.88 (Great Eastern Life Assurance (Malaysia) Berhad (PAR 1)) 5. Amanah Raya Nominees (Tempatan) Sdn Bhd 20,930,300 2.11 (Skim Amanah Saham Bumiputera) 6. Kumpulan Wang Persaraan (Diperbadankan) 12,706,400 1.28 7. Lembaga Tabung Haji 9,692,600 0.98 8. Amanah Raya Nominees (Tempatan) Sdn Bhd 6,551,900 0.66 (Amanah Saham Wawasan 2020) PETRONAS DAGANGAN BERHAD (88222-D) 103

Shareholders’ Information

LIST OF THIRTY LARGEST SHAREHOLDERS (CONT’D)

Registered As At 11 May 2007

Name No. of Shares % of Total Shares 9. HSBC Nominees (Tempatan) Sdn Bhd 5,044,000 0.51 (Nomura Asset Mgmt SG For Employees Provident Fund) 10. Mayban Nominees (Tempatan) Sdn Bhd 4,021,500 0.40 (Mayban Trustees Berhad For Public Ittikal Fund) 11. Malaysia Nominees (Tempatan) Sendirian Berhad 3,808,000 0.38 (Great Eastern Life Assurance (Malaysia) Berhad (PAR 2)) 12. Amanah Raya Nominees (Tempatan) Sdn Bhd 3,533,600 0.36 (Amanah Saham Malaysia) 13. Cartaban Nominees (Asing) Sdn Bhd 3,307,500 0.33 (Investors Bank And Trust Company For Ishares, INC.) 14. DB (Malaysia) Nominee (Tempatan) Sendirian Berhad 3,300,000 0.33 (icapital.biz Berhad) 15. Cartaban Nominees (Asing) Sdn Bhd 2,937,900 0.30 (Exempt AN for Credit Agricole Titres Brunoy) 16. Amanah Raya Nominees (Tempatan) Sdn Bhd 2,769,700 0.28 (Amanah Saham Didik) 17. HSBC Nominees (Asing) Sdn Bhd 2,485,700 0.25 (HSBC-FS for the Navis Asia Navigator Master Fund) 18. Hong Leong Bank Berhad 2,471,600 0.25 19. HSBC Nominees (Asing) Sdn Bhd 2,197,300 0.22 (BBH And Co. Boston for Vanguard Emerging Markets Stock Index Fund) 20. Foh Chong & Sons Sdn Bhd 2,014,000 0.20 21. State Financial Secretary Sarawak 2,000,000 0.20 22. Kerajaan Negeri Perak Darul Ridzuan 2,000,000 0.20 23. Setiausaha Kerajaan Pulau Pinang 2,000,000 0.20 24. State Secretary Kedah Incorporated 2,000,000 0.20 25. HLG Nominee (Asing) Sdn Bhd 2,000,000 0.20 (Hong Leong Fund Management Sdn Bhd for Asia Fountain Investment Company Limited) 26. Mayban Securities Nominees (Tempatan) Sdn Bhd 2,000,000 0.20 (Kumpulan Wang Amanah Pencen For Kerajaan Negeri Negeri Sembilan) 27. Am Nominees (Tempatan) Sdn Bhd 1,729,500 0.17 (Employees Provident Fund Board (A/C1)) 28. Cartaban Nominees (Asing) Sdn Bhd 1,719,000 0.17 (SSBT Fund ZVE4 for SSGA Emerging Markets Alpha Select Securities Lending Comman Trust Fund) 29. Alliancegroup Nominees (Tempatan) Sdn Bhd 1,266,300 0.13 (PHEIM Asset Management Sdn Bhd for Employees Provident Fund) 30. HSBC Nominees (Asing) Sdn Bhd 1,229,000 0.12 (Exempt AN for JPMorgan Chase Bank, National Association (DEKA INTL. S.A.)) 104 PETRONAS DAGANGAN BERHAD (88222-D)

Shareholders’ Information

LIST OF SUBSTANTIAL SHAREHOLDERS

As At 11 May 2007

Name No. of Shares % of Total Shares

1. Cartaban Nominees (Tempatan) Sdn Bhd 694,004,000 69.86 (Petroliam Nasional Berhad (Strategic INV))

LIST OF DIRECTORS’ SHAREHOLDING IN THE COMPANY AND RELATED COMPANIES

As At 11 May 2007

No. of Shares % of Name in the Company Shareholding

1. Datuk Anuar bin Ahmad 2,000 0.00 2. Datuk Ainon Marziah bt Wahi 2,000 0.00

No. of Shares in PETRONAS % of Name Gas Berhad Shareholding

1. Datuk Ainon Marziah bt Wahi 5,000 0.00 PETRONAS DAGANGAN BERHAD (88222-D) 105 List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book Value (Sq.Ft.) Acquisition Expiry Building as at (Years) 31 March 2007 (RM’000)

A PULAU PINANG 1 Lot PT 456, Mukim 11, 22,400 SS LH 4/8/1994 13/6/2014 22 140 Daerah Seberang Perai Selatan 2 Lot 16, Seksyen 3, 53,274 SS LH 14/6/1991 16/8/2081 21 392 Bandar Butterworth 3 Lot 2360, Mukim 11, 11,467 SS FH 31/3/1983 - 24 296 Daerah Seberang Perai Tengah 4 Lot 2453, Mukim 9, 21,463 SS FH 13/2/1989 - 21 1,300 Daerah Seberang Perai Utara 5 Lot 5352 & 5353, Mukim 11, 43,831 SS FH 11/7/1991 - 20 1,929 Daerah Seberang Perai Tengah 6 Lot 107, Seksyen 5, Daerah 21,081 VL FH 17/12/1991 - - 1,634 Timur Laut, Georgetown 7 Lot 3609 HS(D) 1745, Mukim 15, 26,135 SS FH 9/10/1998 - 7 850 Daerah Seberang Perai Selatan 8 Lot 2574 - 2576, Seksyen 4, 6,684 SH FH 7/1/1984 - 22 200 Bandar Butterworth 9 Lot 1070, Mukim 1, 907,860 BD LH 23/4/1992 27/8/2041 25 1,289 Kawasan Perindustrian Perai 10 Lot PT 1612, Mukim 6, 55,937 SS FH 27/8/1999 - 7 2,613 Seberang Perai Tengah 11 Lot 1475, Mukim 13, 39,241 SS FH 16/8/1999 - 7 2,960 Daerah Timur Laut 12 Lot 10034, Mukim 13, 26,200 SS FH 28/12/1999 - 7 3,500 Daerah Timur Laut 13 Lot 3237, Mukim 10, 22,367 SS FH 5/2/2001 - 2 2,052 Daerah Seberang Perai Utara 14 Lot 2840 & 2843, Mukim 4, 67,910 SS FH 14/3/2001 - 4 4,830 Daerah Seberang Perai Utara 15 Lot 2489 & 2490, Seksyen 2, 50,590 SS FH 31/1/2002 - 4 3,289 Bandar Butterworth, Seberang Perai Utara 16 Lot 3167 HS(M) 815, Mukim 4, 85,637 SS FH 25/2/2002 - 3 4,550 Butterworth-Kulim, Seberang Prai 17 Lot 10885, Jalan Rozhan, Mukim 69,658 SS FH 5/3/2004 - 2 3,300 15, Seberang Prai Tengah 18 Lot 859, Bandar Baru Perda, 55,958 SS FH 24/7/2002 - 4 2,750 Mukim 6, Seberang Perai Tengah 19 Lot 4290, Jalan Perusahaan, 60,020 VL FH 13/12/2004 - - 5,505 Mukim 6, Seberang Perai Tengah 20 Lot 5494 & 5279, Sunway BKE, 71,811 SS LH 23/4/2004 21/10/2092 3 6,485 Mukim 1, Seberang Perai Tengah 21 Lot 8889 & 4867, Jalan Dato 29,662 SS FH 22/7/2005 - 2 1,499 Ahmad Badawi, Seberang Perai Utara 22 Lot 648, Bukit Tengah, Mukim 25,504 SS FH 8/2/2005 - 1 3,684 11, Seberang Prai Tengah 23 Lot 112, 117 & 118, Seksyen 1, 78,378 VL FH 27/6/2006 - - 2,753 Bandar Bukit Mertajam, Seberang Prai Tengah 106 PETRONAS DAGANGAN BERHAD (88222-D)

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

24 Lot 18566, 18568 & 18570, 41,921 SS FH 6/2/2006 - 1 1,896 Mukim 15, Bukit Mertajam, Seberang Perai Tengah

B KEDAH DARUL AMAN 1 Sebahagian Lot 1990/1991 16,090 SS LH 22/5/1991 13/7/2012 26 13 HS(M) 24/1982, Mukim Sungai Petani, Daerah Kuala Muda 2 Lot 27, Seksyen 9, Pekan Gurun, 24,775 SS LH 15/7/1990 7/1/2048 21 106 Daerah Kuala Muda 3 Lot PT 461 HS(M) 5/1982 & 27,000 SS LH 22/5/1991 16/5/2012 19 34 PT 1055 HS(M) 113/1983, Mukim Kota Setar, Daerah Kota Setar 4 Lot PT 669, Mukim Ayer Puteh, 26,327 SS LH 22/5/1991 29/7/2014 20 13 Daerah Pendang 5 Lot PT 149 HS(M) 6/85, Mukim 69,384 SS LH 4/8/1994 14/8/2045 22 48 Kuah, Daerah Pulau Langkawi 6 Lot 703, Mukim Sungai Seluang, 12,567 SS FH 31/1/1991 - 22 257 Daerah Kulim 7 Lot PT 9290, Mukim Sungai 19,576 SS FH 17/9/1989 - 15 294 Petani, Daerah Kuala Muda 8 Lot 3268 GM 368, Mukim 27,373 SS FH 16/8/1992 - 20 900 Mergong, Daerah Kota Setar 9 Lot PT 12241, Mukim Sungai 29,945 SS FH 16/8/1993 - 14 1,048 Pasir, Daerah Kuala Muda 10 Lot PT 3541, Mukim Naga, 32,450 SS FH 18/8/1994 - 13 1,000 Daerah Kubang Pasu 11 Lot 2226, Mukim & Daerah Kulim 43,540 SS FH 31/1/1991 - 24 610 12 Lot PT 3356 HS(M) 126/92, 48,200 SS FH 28/4/1993 - 11 1,157 Mukim Keladi, Daerah Kulim 13 Lot PT 9289, Mukim Sungai 20,274 SS FH 16/3/1991 - 16 406 Petani, Daerah Kuala Muda 14 Lot PT 926, Mukim Sungai Laka, 32,000 VL LH 5/8/1985 4/8/2015 - 9 Daerah Kubang Pasu 15 Lot PT 553-564, Mukim Sungai 18,576 SS FH 29/8/1991 - 7 204 Seluang, Daerah Kulim 16 Lot PT 2964, Mukim Sungai 28,674 SS FH 16/7/1991 - 7 373 Seluang, Daerah Kulim 17 Lot PT 11615, Mukim Sungai 38,250 SS FH 21/7/1991 - 5 612 Pasir, Daerah Kuala Muda 18 Lot PT 23539 HS(D) 258/94, 23,856 VL FH 31/7/1997 - - 1,193 Mukim Sungai Petani, Daerah Kuala Muda 19 Lot PT 23540 HS (D) 259/84, 18,051 VL FH 31/7/1997 - - 866 Mukim Sungai Petani, Daerah Kuala Muda 20 Lot PT 23517 HS(D) 499/97, 23,863 SS FH 15/3/1998 - 5 725 Mukim Sungai Petani, Daerah Kuala Muda PETRONAS DAGANGAN BERHAD (88222-D) 107

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

21 Part of Lot 2008 & 2009, 76,300 SS FH 1/10/1998 - 6 1,614 Mukim Sungai Laka, Daerah Kubang Pasu 22 Lot PT 4761, Tanjung Bendahara, 43,550 SS FH 31/12/2003 - 2 1,750 Mukim Derga 23 Lot 5840 HS(D) 5380/97, Mukim 43,621 SS FH 25/1/2004 - 3 1,919 Padang Cina, Daerah Kulim 24 Lot PT 12770, Mukim Pengkalan 35,502 SS FH 10/8/2004 - 2 1,400 Kundor, Kota Setar 25 Lot 1491, Seksyen 41, 42,508 SS FH 23/8/2004 - 3 1,398 Kota Kenari, Kulim 26 Lot PT 57919, Mukim Sungai 44,225 SS FH 30/6/2003 - 3 2,000 Petani, Daerah Kuala Muda 27 Lot PT 437 HSM 25/1986, 12,495 SS FH 2/11/2004 - 21 562 Alor Bekong, Mukim Mergong, Kota Setar 28 Lot 134, Lebuhraya Kulim- 79,758 SS FH 7/1/2003 - 2 2,499 Butterworth, Mukim Seluang 29 Lot 2356, Kuala Ketil, 66,892 SS FH 30/3/2002 - 1 1,053 Mukim Tawar, Daerah Baling 30 Lot 3932, Bandar Padang Serai, 33,788 SS FH 30/5/2006 - 1 1,400 Mukim Sidam Kanan, Daerah Kulim

C PERLIS INDERA KAYANGAN 1 Lot 2729, Mukim Berseri, 13,340 SS FH 31/1/1991 - 17 123 Daerah Padang Malau 2 Lot 3684, Jln Raja Syed Alwi, 50,579 SS FH 5/10/2004 - 3 1,600 Behor Gandil, Mukim Utan Aji 3 Lot PT 726 HSM 773, 30,280 SS FH 30/4/2004 - 3 2,225 Behor Temak, Mukim Seriab 4 Lot 1925, Mukim Titi Tinggi, 18,686 SS LH 2/11/2004 1/5/2043 23 1,125 Padang Besar

D KELANTAN DARUL NAIM 1 Lot PT 2424, Bandar & 10,367 SS LH 14/6/1991 2/3/2049 22 12 Daerah Kuala Krai 2 Lot 2079 (PT 1043), 15,995 SS LH 15/8/1985 13/3/2084 20 179 Bandar & Daerah Gua Musang 3 Lot PTLO 1945, Mukim Maka, 19,946 SS LH 22/5/1991 10/10/2086 24 8 Daerah Tanah Merah 4 Lot PT 38/1433, Mukim Lembu, 22,593 SS LH 14/6/1991 23/1/2017 20 4 Daerah Kota Bharu 5 Lot PT 48, Seksyen 16, 28,710 SS LH 28/12/1992 22/8/2088 23 907 Bandar & Daerah Kota Bharu 6 Lot PT 2360, Mukim Maka, 43,200 SS LH 15/1/1983 9/1/2053 20 186 Daerah Tanah Merah 7 Lot 2781, Bandar & Daerah 26,285 SS FH 24/5/1992 - 6 550 Kuala Krai 108 PETRONAS DAGANGAN BERHAD (88222-D)

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

8 Lot PT 623, Mukim Panchor, 84,680 W LH 26/9/1983 25/7/2048 21 135 Bandar & Daerah Kota Bharu 9 Lot PT 88 & 89, Mukim Lemal, 15,177 SS LH 8/12/1998 12/5/2065 7 600 Daerah Pasir Mas 10 Lot 2799, Mukim Tanah Merah, 18,535 SS LH 29/10/2001 3/8/2068 5 455 Jajahan Tanah Merah 11 Lot PT1272 HS(M)166, Kampung 45,667 SS LH 29/7/2003 28/7/2069 2 1,012 Dalam Huma, Makim Pasir Puteh, Daerah Limbongan 12 Lot 243 & 1310, Mukim Demit, 15,973 SS FH 31/12/2002 - 3 890 Kubang Kerian 13 Lot PT 3399, Mukim Pasir Pekan, 27,039 SS LH 18/6/2006 17/6/2072 21 729 Wakaf Baru, Jajahan Tumpat

E TERENGGANU DARUL IMAN 1 Lot 7858, Mukim Chukai, 28,201 SS LH 22/5/1991 24/4/2044 22 43 Daerah Kemaman 2 Lot 2913 & 3486, Mukim Sura, 30,408 SS LH 14/6/1991 2/9/2043 21 28 Daerah Dungun 29/5/2045 3 Lot PT 134, Mukim Pelagat, 39,159 SS LH 5/5/1988 4/1/2018 18 17 Daerah Besut 4 Lot 6108 & 4182, 53,087 SS LH 14/6/1991 13/9/2043 22 40 Mukim Kuala Dungun, Daerah Dungun 5 Lot 3578, Mukim Kuala Paka, 15,834 SS FH 8/10/1996 - 20 400 Daerah Dungun 6 Lot PT 1722, Mukim Abang, 31,323 SS LH 12/10/1995 16/10/2055 8 35 Daerah Dungun 7 Lot PT 4799 (Bhg), Mukim Kijal, 30,000 SS LH 1/9/1999 25/11/2101 4 463 Daerah Kemaman 8 Lot 2112, Mukim Hulu Setiu, 22,800 SS FH 21/7/1994 - 5 140 Daerah Setiu 9 Lot PT 5010, Mukim Teluk 64,580 SS LH 28/10/1999 20/10/2058 6 1,319 Kalung, Daerah Kemaman 10 Lot 2247, Mukim Bukit Kenak, 43,712 SS FH 20/10/2000 - 5 850 Padang Jerteh, Daerah Besut 11 Lot 13181 HM 5258, Banggol 17,738 SS FH 9/9/2004 - 21 1,015 Titian Ketat, Mukim Kuala Nerus, Kuala Terengganu

F PAHANG DARUL MAKMUR 1 Lot PT 3370, Mukim Sabai, 22,826 SS LH 18/1/1989 17/1/2049 17 69 Daerah Bentong 2 Lot PT 719, Mukim Ringlet, 9,000 SS LH 23/6/1990 22/6/2089 19 71 Daerah Cameron Highlands 3 Lot PT 15291, Mukim Kuala 11,115 SS LH 16/8/1991 16/1/2085 16 373 Kuantan, Daerah Kuantan 4 Lot PT 3640, Mukim Pedah, 13,612 SS LH 12/12/1991 9/2/2082 23 247 Daerah Jerantut PETRONAS DAGANGAN BERHAD (88222-D) 109

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

5 Lot PT 1207, Mukim Kuala Lipis, 19,329 SS LH 10/10/1990 9/10/2056 18 28 Daerah Lipis 6 Lot PT 1987, Mukim Semantan, 56,901 SS LH 19/8/1986 18/8/2052 20 39 Daerah Temerloh 7 Lot PT 4335, 10,054 SS LH 16/9/1991 30/1/2091 13 484 Bandar & Daerah Temerloh 8 Lot PT 9011, Mukim Gali, 11,434 SS LH 4/8/1984 10/8/2091 22 10 Daerah Raub 9 Lot PT 4519, Mukim & 11,887 SS LH 29/7/1991 22/3/2053 13 367 Daerah Bentong 10 Lot PT 10693, Mukim Kuala 26,966 SS LH 14/6/1991 11/2/2080 22 125 Kuantan, Daerah Kuantan 11 Lot PT 601, Mukim Tanah Rata, 30,797 SS LH 23/6/1990 22/6/2089 20 245 Daerah Cameron Highlands 12 Lot PT 3920, Mukim Sungai 16,968 SS FH 24/11/1990 - 12 173 Karang, Daerah Kuantan 13 Lot PT 3921, Mukim Sungai 15,020 SS FH 24/11/1990 - 15 173 Karang, Daerah Kuantan 14 Lot 2, Seksyen 3, Kampung 20,691 SS FH 22/5/1991 - 10 450 Ketari, Daerah Bentong 15 Lot 24757, Mukim Kuala 34,929 SS FH 11/11/1991 - 12 675 Kuantan, Daerah Kuantan 16 Lot 1593, Mukim Pedah, 14,284 SS FH 15/1/1984 - 12 600 Daerah Jerantut 17 Lot 7, 8 & 43, Seksyen 18, 25,345 SS FH 26/8/1991 - 11 1,290 Bandar & Daerah Kuantan 18 Lot 112, Mukim & Daerah 39,030 SS FH 23/11/1991 - 12 520 Bentong 19 Lot PT 3443, Mukim Perak, 47,647 SS LH 19/8/1986 18/8/2052 2 43 Daerah Temerloh 20 Lot PT 33423, Seksyen 1, 20,000 SS LH 10/9/1992 6/4/2093 6 500 Bandar Indera Mahkota, Daerah Kuantan 21 Lot 587, Mukim Ulu Cheka, 14,593 VL FH 15/1/1994 - - 130 Daerah Jerantut 22 Lot 5093 CT 6585, 21,200 SS FH 20/8/1993 - 7 515 Mukim Kuala Kuantan, Daerah Kuantan 23 Lot 26180 - 26186, 11,711 VL FH 30/8/1991 - - 780 Mukim Kuala Kuantan, Daerah Kuantan 24 Lot PT 10884, Mukim & Daerah 179,296 LPGSBP LH 20/9/1991 7/1/2058 10 452 Bentong 25 Lot 5515, Mukim Kuala 22,694 VL FH 27/3/1992 - 590 Kuantan, Daerah Kuantan 26 Lot 5392, Mukim Kuala 21,600 VL FH 16/1/1992 - 530 Kuantan, Daerah Kuantan 27 Lot PT 10852 & 10853, Mukim 43,515 SS FH 14/3/2000 - 2 2,100 Mentakab, Daerah Temerloh 110 PETRONAS DAGANGAN BERHAD (88222-D)

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

28 Lot PT 817, Mukim Sungai 19,364 SS LH 10/7/1991 11/7/2090 5 378 Karang, Daerah Kuantan 29 Lot PT 678, Mukim Mentakab, 43,832 SS LH 22/9/2000 6/11/2035 4 1,541 Daerah Temerloh 30 Lot PT 57349, Bandar Kuantan, 41,689 SS LH 19/2/2001 2/9/2093 1 2,859 Daerah Kuantan 31 Lot PT 67234, Mukim Kuala 71,748 SS LH 7/7/2002 25/6/2101 1 2,334 Kuantan, Daerah Kuantan 32 Lot PT 4019, Bandar Kerayong, 49,051 SS FH 9/8/2005 - 2 1,166 Mukim Triang, Daerah Bera 33 Lot PT 3775 (HSM 3112), 17,438 VL FH 12/11/2004 - - 940 Paya Siak Ulu, Mukim Perak, Daerah Temerloh 34 Lot 21123, Jalan Telok Sisek, 15,845 SS LH 6/3/2006 11/9/2089 13 960 Mukim Kuala Kuantan 35 Lot 3258, Simpang Chini, 25,855 SS LH 29/8/2006 1/8/2088 15 434 Mukim Bebar, Pekan

G JOHOR DARUL TAKZIM 1 Lot PTD 3009, Mukim Linau, 10,772 SS LH 22/5/1991 17/1/2047 21 69 Daerah Batu Pahat 2 Lot PTD 4560, Mukim Kesang, 17,837 SS LH 9/1/1996 28/10/2046 23 128 Daerah Muar 3 Lot PTB 324, Bandar Jementah, 25,000 SS LH 14/6/1991 1/12/2051 20 35 Daerah Segamat 4 Lot PTD 3618, Mukim Sungai 25,000 SS LH 14/6/1991 15/9/2051 21 35 Segamat, Daerah Segamat 5 Lot PTD 13309 & 52136, Mukim 70,726 SS LH 20/2/1991 25/11/2015 19 464 Tebrau, Daerah Johor Bahru 6 Lot PTB 16964, Bandar & Daerah 24,012 SS LH 20/2/1991 2/5/2087 14 1,270 Johor Bahru 7 Lot PTD 89980, Mukim 25,000 SS LH 14/6/1991 30/3/2089 22 320 Plentong, Daerah Johor Bahru 8 Lot PTD 60266, Mukim Pulai, 39,260 SS LH 10/1/1991 3/8/2021 10 1,262 Daerah Johor Bahru 9 Lot PTD 57850, Mukim Tebrau, 43,512 SS LH 23/3/1992 15/10/2021 10 850 Daerah Johor Bahru 10 Lot PTD 7605, Mukim Serom, 12,818 SS FH 30/7/1990 - 14 280 Daerah Muar 11 Lot PTD 9492, Mukim Tebrau, 13,208 SS FH 23/1/1991 - 13 510 Daerah Johor Bahru 12 Lot PTD 814, Mukim Sungai 13,663 SS FH 22/5/1991 - 22 153 Kluang, Daerah Batu Pahat 13 Lot 7949, Mukim Senai-Kulai, 15,860 SS FH 16/9/1990 - 14 599 Daerah Johor Bahru 14 Lot PTD 37211, Bandar & 16,847 SS FH 18/12/1989 - 15 500 Daerah Kluang 15 Lot PTD 15400, Mukim Tangkak, 20,000 SS FH 19/5/1992 - 21 288 Daerah Muar PETRONAS DAGANGAN BERHAD (88222-D) 111

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

16 Lot 881, Bandar Maharani, 27,143 SS FH 14/5/1991 - 19 628 Daerah Muar 17 Lot PTD 84376, Mukim 28,846 SS FH 23/8/1989 - 15 721 Plentong, Daerah Johor Bahru 18 Lot PTD 10908, Mukim Sedenak, 30,582 SS FH 27/9/1989 - 15 397 Daerah Johor Bahru 19 Lot 1069, Mukim & 34,848 SS FH 11/1/1991 - 13 1,063 Daerah Kota Tinggi 20 Lot 230, Bandar & 49,713 SS FH 30/3/1993 - 20 512 Daerah Kota Tinggi 21 Lot 3116, Mukim Jalan Bakri, 30,764 SS FH 4/1/1992 - 12 600 Daerah Muar 22 Lot PTD 34963, Mukim 18,135 SS FH 26/11/1990 - 13 861 Plentong, Daerah Johor Bahru 23 Lot 155, Mukim Sermin, 21,789 SS FH 25/6/1989 - 11 300 Daerah Segamat 24 Lot PTD 69921, Mukim 24,779 SS FH 18/10/1990 - 10 1,239 Plentong, Daerah Johor Bahru 25 Lot PTD 44992, Mukim Pulai, 50,202 SS FH 12/9/1990 10 1,506 Daerah Johor Bahru 26 Lot 7320, Mukim Senai-Kulai, 23,475 SS FH 24/6/1991 - 9 1,415 Daerah Johor Bahru 27 Lot PTD 100976, Mukim 21,246 SS FH 26/11/1990 - 9 1,009 Plentong, Daerah Johor Bahru 28 Lot 4188 & 4189, 14,157 VL LH 20/2/1989 11/1/2034 - 96 Mukim & Daerah Kluang 29 Lot PTD 57709, Mukim Pulai, 19,200 SS LH 13/3/1991 29/6/2020 7 137 Daerah Johor Bahru 30 Lot PTB 11985, Bandar & 24,000 SS LH 25/5/1991 2/2/2042 7 852 Daerah Johor Bahru 31 Lot PTD 1225, Mukim Jementah, 24,993 VL LH 14/6/1991 15/9/2051 - 35 Daerah Segamat 32 Lot PTD 8255, Mukim Buloh 28,807 SS LH 7/6/1990 31/12/2086 6 538 Kasap, Daerah Segamat 33 Lot PTD 35578, Mukim Senai- 32,147 SS LH 31/7/1992 18/8/2084 16 1,489 Kulai, Daerah Johor Bahru 34 Lot PTB 9, Bandar Gemas, 25,000 VL LH 14/6/1991 15/9/2051 - 35 Daerah Segamat 35 Lot 23551 (PTD 110909), 21,273 SS FH 24/8/1993 - 9 469 Mukim Plentong, Daerah Johor Bahru 36 Lot 7344, Mukim Sungai Balang, 19,979 SS FH 20/1/1992 - 5 380 Semerah, Daerah Batu Pahat 37 Lot 7452, Mukim Plentong, 21,780 VL FH 6/3/1991 - - 795 Daerah Johor Bahru 38 Lot PTD 88326, Mukim 23,750 SS FH 18/7/1990 - 7 1,069 Plentong, Daerah Johor Bahru 112 PETRONAS DAGANGAN BERHAD (88222-D)

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

39 Lot 367, Bandar & 29,784 VL FH 26/7/1990 - - 2,978 Daerah Johor Bahru 40 Lot 24883, Mukim Pulai, 34,832 SS FH 9/3/1993 - 9 1,392 Bandar Selesa Jaya, Johor Bahru 41 Lot 23551 (PTD 110910), Mukim 21,325 SS FH 24/8/1993 - 9 1,406 Plentong, Daerah Johor Bahru 42 PTD 6717, Mukim Kesang, 35,005 SS FH 9/1/1996 - 7 858 Daerah Muar 43 Lot PTD 71062, Mukim Pulai, 33,540 SS FH 10/6/1998 - 7 6,500 Daerah Johor Bahru 44 Lot PTD 71046, Mukim Pulai, 42,690 SS FH 10/6/1998 - 7 5,100 Daerah Johor Bahru 45 Lot PTD 100820, Mukim Pulai, 61,673 SS FH 9/8/1999 - 6 4,800 Daerah Johor Bahru 46 Part of Lot 441, 442 & 1504 40,000 SS FH 28/1/1999 - 5 3,000 Mukim Plentong, Daerah Johor Bahru 47 Lot PTB 19195, 33,632 SS LH 15/5/2001 8/3/2091 2 1,903 Bandar Johor Bahru 48 Lot PTD 1525, Mukim Gemereh, 34,734 SS FH 19/2/2002 - 2 799 Daerah Segamat 49 Lot PTD 85816 (105615), 91,875 SS FH 28/5/2003 - 4 6,983 Taman Pelangi Indah, Mukim Tebrau 50 Lot PTD 95704, Taman Setia 54,390 SS FH 15/10/2003 - 2 5,167 Indah, Mukim Tebrau 51 Lot PTB 4648 HS(D) 47973, 45,019 SS FH 8/8/2004 - 3 3,750 Jalan Rahmat, Bandar Penggaram, Batu Pahat 52 Lot PTD 105784 HS(D) 361231, 52,600 SS FH 10/2/2004 - 3 4,471 Mukim Tebrau, Johor Bahru 53 Lot PTD 77623 HS(D) 258216, 31,416 SS FH 9/10/2003 - 4 2,104 Taman Nusa Perintis, Mukim Pulai, Johor Bahru 54 Lot PTD 95241, Taman Setia Indah, 32,637 VL FH 28/4/2004 - - 3,104 Mukim Tebrau, Johor Bahru 55 Lot LT PTD 135636, Taman Sri 56,886 SS FH 11/10/2004 - 3 5,857 Yaakob, Mukim Pulai, Johor Bahru 56 Lot LT PTD 129028, Kota Masai, 38,298 SS FH 11/6/2003 - 4 2,718 Mukim Plentong, Johor Bahru 57 Lot PTD 174174, Bandar Seri Alam, 43,577 SS FH 1/7/2004 - 3 3,746 Mukim Plentong, Johor Bahru 58 Lot MLO 8028, Parit Tengah, 70,499 SS FH 4/2/2005 - 2 1,664 Mukim Tanjung Sembrong, Batu Pahat 59 Lot PTD 127744, Jalan Kempas 44,190 SS FH 26/1/2005 - 2 3,300 Lama, Mukim Tebrau, Johor Bahru PETRONAS DAGANGAN BERHAD (88222-D) 113

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

60 Lot PTD 76295, R&R Skudai (NB) 120,529 SS LH 18/7/2003 17/7/2102 3 11,587 Lebuhraya Raya Utara-Selatan, Johor Bahru 61 Lot PTD173047 HS(D) 353199, 70,165 SS LH 8/5/2003 7/5/2102 2 6,130 Bayu Senibong, Mukim Plentong, Johor Bahru 62 Lot 181563, Mukim Plentong, 50,812 SS LH 21/9/2004 21/1/2097 2 4,212 Taman Bayu Puteri, Bandar Baru Permas Jaya, Johor Bahru 63 Plot 4, Bandar Putra, 48,460 SS FH 22/3/2005 - 3 3,877 Mukim Senai-Kulai, Daerah Johor Bahru 64 Lot PTD133688, Taman Perling, 50,601 SS FH 23/3/2005 - 1 4,250 Mukim Pulai, Daerah Johor Bahru 65 Lot PTD 93016 HS(D) 329339, 48,835 SS FH 25/10/2005 - 1 4,538 Taman Desa Tebrau, Johor Bahru 66 Lot PTD 130265 HS(D) 395366, 45,000 SS FH 3/10/2005 - 1 3,622 Mukim Tebrau, Daerah Johor Bahru 67 Lot PTB 20846, Jalan Tampoi, 41,397 SS FH 11/11/2005 - 2 4,182 Bandar Johor Bahru 68 Lot 1283 (PTD 135891) HSM 40,000 SS FH 28/2/2006 - 1 4,747 1527, Mukim Pulai, Batu 8 Jalan Skudai, Johor Bahru 69 Lot PTD 104981, Taman Intan, 43,562 SS FH 9/6/2004 - 2 6,640 Mukim Tebrau (Damansara Alif), Johor Bahru 70 Lot PT 44208 HSM 6268, 43,593 SS FH 12/10/2004 - 2 2,679 Simpang Kanan, KM 7 Jalan Keluang, Batu Pahat 71 Lot PTD 166495 HS(D) 333428), 47,467 SS LH 17/1/2005 15/6/2101 3 3,115 Taman Bukit Dahlia, Mukim Pelentong, Daerah Johor Bahru 72 Lot PTD 160926, Taman Cahaya 51,911 SS LH 22/3/2005 7/7/2102 3 3,506 Masai, Mukim Plentong, Johor Bahru 73 Lot 105660, Lebuhraya Perling- 38,560 SS FH 16/10/2003 - 2 3,432 Pasir Gudang, Kampung Kempas Baru, Mukim Tebrau 74 Lot PTB 21228, Jalan Datin 47,048 SS LH 7/8/2003 6/8/2102 1 4,305 Halimah, Johor Bahru 75 Lot 111466, Jalan Masai, Mukim 45,000 SS FH 24/3/2004 - 3 4,185 Plentong, Johor Bahru 76 Lot PTD138181, 43,551 VL LH 23/5/2006 23/5/2105 - 3,788 Taman Daya, Mukim Tebrau, Daerah Johor Bahru 77 Lot PTD107116, Taman Impian 48,549 SS FH 28/4/2006 - 1 4,760 Emas, Mukim Tebrau, Daerah Johor Bahru 114 PETRONAS DAGANGAN BERHAD (88222-D)

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

78 Lot 823, Mukim Bandar Johor 124,420 VL FH 4/5/2006 - - 4,957 Bahru 79 Lot PTD 11262, Mukim Rimba 30,666 VL FH 27/10/2005 - - 1,901 Terjun, Daerah Pontian 80 Lot PTD 177201, Mukim Plentong 65,788 SS FH 15/11/2006 - 1 6,464 81 Lot PTB 21742, Jalan Tun Abdul 43,561 SS LH 28/12/2006 25/7/2065 1 5,365 Razak, Daerah Johor Bahru 82 Lot PTD 770, Pekan Bukit Pasir, 11,142 SS FH 24/2/2005 - 2 249 Mukim Sungai Raya, Daerah Muar 83 Lot PT 61674, Bandar Putra (Plot 22,950 SS FH 23/8/2006 - 1 4,077 1), Mukim Senai-Kulai, Johor Bahru 84 Lot PTD 82406, Bandar Putra 43,923 VL FH 23/8/2006 - - 1,890 (Plot 2), Mukim Senai-Kulai, Johor Bahru 85 Lot PTD 67447, Bandar Putra 31,950 VL FH 23/8/2006 - - 2,633 (Plot 3), Mukim Senai-Kulai, Johor Bahru 86 Lot PTD 15085, Jalan Pintasan 43,572 VL FH 25/1/2007 - - 1,705 Muar, Daerah Muar 87 Lot PTD 94525, KM 1 Jalan 44,997 SS FH 11/10/2006 - 1 2,738 Kulai-Kota Tinggi, Mukim Senai-Kulai, Kulai 88 Lot PTD 90167, Kampung Jaya 35,941 VL FH 1/12/2005 - - 3,485 Sepakat, Mukim Senai-Kulai, Daerah Kulai

H NEGERI SEMBILAN DARUL KHUSUS 1 Lot PT 1414, Mukim Triang Hilir, 11,926 SS LH 4/8/1990 24/2/2090 12 168 Daerah Jelebu 2 Lot 268 (PT 6086), Mukim 16,000 SS LH 20/12/1985 20/12/2045 17 205 Ampangan, Daerah Seremban 3 Lot PT 999, Mukim Gemas, 21,780 SS LH 22/5/1991 13/9/2043 19 57 Daerah Tampin 4 Lot PT 278, Mukim Ampangan, 25,019 SS LH 22/5/1991 12/9/2075 13 309 Daerah Seremban 5 Lot 10066, Mukim Rasah, 14,400 SS FH 17/7/1982 - 16 442 Daerah Seremban 6 Lot 2253, Mukim Si Rusa, 15,781 SS FH 31/1/1991 - 19 423 Daerah Port Dickson (Coast) 7 Lot PT 489, Mukim Serting Ulu, 16,861 SS FH 16/4/1990 - 15 660 Daerah Jempol 8 Lot 448, Mukim Tampin, 20,418 SS FH 31/1/1991 - 17 387 Daerah Tampin 9 Lot 5935, Mukim Rantau, 17,687 SS FH 12/2/1991 - 22 680 Daerah Seremban 10 Lot PT 1583 - Lot PT 1588 & Lot 24,098 VL FH 29/10/1990 - - 916 PT 1595 - Lot PT 1599, Mukim & Daerah Seremban PETRONAS DAGANGAN BERHAD (88222-D) 115

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

11 Lot PT 26/2 - Lot PT 26/3 & 24,550 SS FH 14/5/1990 - 6 300 Lot PT 26/6 - Lot PT 26/11, Pekan Kuala Klawang, Daerah Jelebu 12 Lot 527, Bandar Port Dickson, 43,914 SS FH 8/4/1991 - 5 800 Daerah Port Dickson (Coast) 13 Lot PT 10841 & PT 10842, 41,167 SS FH 11/3/1998 - 7 2,200 Mukim Rasah, Daerah Seremban 14 Lot PT 2277 HS(D) 16461, 24,393 SS FH 12/3/1998 - 7 995 Mukim Jimah, Daerah Port Dickson 15 Lot 13796 HS(D) 49314, Mukim 17,663 SS FH 17/8/1998 - 6 795 Rantau, Daerah Seremban 16 Lot PT 21419, Mukim Labu, 55,006 SS FH 4/10/2000 - 5 2,200 Daerah Seremban 17 Lot PT 12874 & 12875, Mukim 26,354 SS FH 11/12/2002 - 5 3,350 Labu, Daerah Seremban 18 Lot PT 6054, Mukim Seremban, 52,140 SS FH 26/3/2002 - 4 2,345 Daerah Seremban 19 Lot PT 5890, Bandar Seremban 63,162 SS FH 19/3/2002 - 4 3,346 20 Lot PT 2172, Jalan Seremban- 29,396 SS FH 28/2/2002 - 4 1,531 Tampin, Daerah Tampin 21 Lot PT 4087 HS(D)154332, 47,303 SS FH 10/3/2004 - 2 2,506 Senawang Ampangan, Daerah Seremban 22 Lot PT 7931, Jalan Jelebu, 29,590 SS FH 9/10/2004 - 2 1,175 Seremban 23 Lot PT 1421, Mukim Titian 87,174 VL LH 28/1/2004 3/12/2062 - 7,592 Bintanggor, Daerah Rembau 24 Lot 2902 & 2903, Pekan Lukut, 42,819 SS FH 1/3/2005 - 1 2,374 Port Dickson 25 Lot 726 & 727 HSM 7196, 71,799 SS FH 30/11/2004 - 2 1,834 Mukim Ampangan, Seremban 26 Lot PT 2244, Lavender Height, 43,562 SS FH 22/7/2003 - 3 2,309 Pekan Senawang, Daerah Seremban 27 Lot 19968, Bandar Seremban 2, 40,451 SS FH 8/11/2006 - 1 2,756 Mukim Rasah, Daerah Seremban 28 Part of Lot 6283, Bandar 47,389 VL FH 2/11/2006 - - 3,376 Seremban 2, Mukim Rasah, Daerah Seremban

I MELAKA 1 Lot PT 32 dan Lot 684, 12,176 SS LH 19/11/1996 19/12/2075 21 143 Kawasan Bandar XXXVII, 31/7/2090 Daerah Melaka Tengah 2 Lot 1072, Mukim Ramuan Cina 16,770 SS LH 7/7/1985 7/7/2084 19 87 Kechil, Daerah Alor Gajah 3 Lot 351, Mukim Batu Berendam, 22,400 SS LH 4/8/1994 30/9/2084 10 124 Daerah Melaka Tengah 116 PETRONAS DAGANGAN BERHAD (88222-D)

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

4 Lot PT 1, Mukim Cheng, 23,143 SS LH 14/6/1991 28/6/2045 22 96 Daerah Melaka Tengah 5 Lot 260, Kampung Klebang, 23,435 SS LH 10/8/1990 12/2/2047 19 403 Seksyen 11, Daerah Melaka Tengah 6 Lot 271, Bandar Pulau Sebang, 24,154 SS LH 14/6/1991 14/8/2044 22 105 Seksyen 1, Daerah Alor Gajah 7 Lot 4351, Mukim Bukit Katil, 28,578 SS LH 14/6/1991 16/7/2050 23 81 Daerah Melaka Tengah 8 Lot 353, Mukim Tangga Baru, 28,050 SS FH 1/9/1999 - 20 950 Daerah Melaka Tengah 9 Lot PT 4175, Mukim Bukit Baru, 12,066 SS FH 16/6/1982 - 22 309 Daerah Melaka Tengah 10 Lot 347, Bandar Bukit Baru, 13,329 SS FH 22/10/1991 - 11 714 Seksyen 111, Daerah Melaka Tengah 11 Lot PT 701, Mukim Selandar, 20,599 SS FH 23/1/1992 - 11 300 Daerah Jasin 12 Lot PT 4683, Mukim Bachang, 30,000 SS FH 9/2/1991 - 11 735 Daerah Melaka Tengah 13 Lot 321, Mukim Bukit Baru, 63,162 SS FH 17/8/1990 - 16 1,366 Daerah Melaka Tengah 14 Lot 175 & 1456, Kawasan 18,649 SS FH 9/8/1989 - 14 522 Bandar XXXVII, Daerah Melaka Tengah 15 Lot 311, Bandar Bukit Baru, 18,741 SS FH 19/3/1985 - 16 412 Seksyen 5, Daerah Melaka Tengah 16 Lot 142, Kawasan Bandar XXXI, 23,079 SS FH 23/8/1990 - 14 1,324 Daerah Melaka Tengah 17 Lot PT 1130, Kawasan Bandar 14,155 VL LH 21/9/1989 15/11/2085 - 324 VI, Daerah Melaka Tengah 18 Lot 70, Kawasan Bandar XXIX, 14,322 SS LH 7/3/1991 10/12/2051 7 421 Daerah Melaka Tengah 19 Lot 918, Mukim Peringgit, 84,345 VL FH 19/12/1992 - - 405 Daerah Melaka Tengah 20 Lot 2031, GM MCL 1150, 19,400 SS FH 11/3/1992 - 7 400 Mukim Air Molek, Daerah Melaka Tengah 21 Lot 1375, MCL 360, 20,000 SS FH 5/10/1992 - 5 440 Mukim Balai Panjang, Daerah Melaka Tengah 22 Lot PT 851, Mukim Sungai Baru 20,000 SS FH 9/6/1993 - 5 340 Hulu, Daerah Alor Gajah 23 Lot 303, Kawasan Bandar XXIX, 21,351 SS FH 15/1/1991 - 7 726 Daerah Melaka Tengah 24 Lot PT 1317 HS(M) 67, 27,953 SS FH 24/4/1998 - 6 730 Mukim Sungai Udang, Daerah Alor Gajah PETRONAS DAGANGAN BERHAD (88222-D) 117

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

25 Lot 2854 GMM 1094, Jalan Air 58,704 SS FH 30/4/2004 - 3 3,669 Keroh, Mukim Durian Tunggal, Daerah Alor Gajah 26 Lot PT 13670, 48,416 SS FH 16/8/2006 - 1 2,294 Mukim Batu Berendam, Daerah Melaka Tengah

J PERAK DARUL RIDZUAN 1 Lot PT 5309, Mukim Sungai 15,110 SS LH 19/12/1990 17/12/2089 14 229 Siput, Daerah Kuala Kangsar 2 Lot 5653, Mukim Parit Buntar, 17,147 SS LH 10/5/1991 9/5/2043 22 255 Daerah Kerian 3 Lot 87409, Mukim Hulu Kinta, 18,977 SS LH 31/1/1991 31/12/2078 23 682 Daerah Kinta 4 Lot 29526, Mukim Setiawan, 21,700 SS LH 1/7/1987 22/11/2086 21 251 Daerah Dinding 5 Lot PT 66101, Bandar Ipoh, 26,332 SS LH 19/8/1987 18/8/2047 21 202 Daerah Kinta 6 Lot 303, Pekan Sungkai, 37,200 SS LH 2/12/1992 1/12/2052 18 90 Daerah Batang Padang 7 Lot PT 89905, Mukim Hulu 49,735 SS LH 23/8/1984 10/4/2088 15 492 Kinta, Daerah Kinta 8 Lot 5739 & Lot PT No. 3131- 12,404 SS LH 24/8/1984 3/6/2083 19 268 3137, Mukim Slim, Daerah Batang Padang 9 Lot 14501, Bandar Ipoh, Daerah 16,975 SS LH 16/11/1985 31/7/2052 16 390 Kinta 10 Lot PT 64796, Bandar Ipoh, 20,000 SS LH 14/6/1991 11/12/2044 21 193 Daerah Kinta 11 Lot 1963, Batu 1, Mukim 39,761 SS LH 16/1/1983 11/12/2044 21 82 Kampar, Daerah Hilir Kinta 12 Lot PT 923, Mukim Sungai Raya, 17,653 SS LH 20/5/1992 19/4/2083 11 594 Daerah Kinta 13 Lot 43881, Mukim Sungai Terap, 11,979 SS FH 22/6/1994 - 19 250 Daerah Kinta 14 Lot PT 92889, Mukim Hulu 12,359 SS LH 16/9/1992 9/10/2049 7 447 Kinta, Daerah Kinta 15 Lot PT 131534 HS(D) KA 35310, 43,712 SS LH 3/1/1997 8/8/2093 20 983 Mukim Hulu Kinta, Daerah Kinta

16 Lot 1454, Mukim Bagan Serai, 16,089 SS FH 16/1/1992 - 7 333 Daerah Kerian 17 Lot PT 856 HS(M) 3, Mukim Teja, 17,146 SS LH 28/1/1997 28/12/2096 6 669 Daerah Kinta 18 Lot PT 154712 HS(D) KA 70460, 44,734 SS LH 24/3/1998 22/4/2097 7 1,091 Mukim Batu, Daerah Kinta 19 Lot PT 8621, Mukim Lumut, 45,805 SS LH 14/10/1999 15/12/2098 7 1,391 Daerah Manjung 20 Lot PT 1341, Mukim Simpang, 32,130 SS FH 24/9/1992 - 7 610 Daerah Larut & Matang 118 PETRONAS DAGANGAN BERHAD (88222-D)

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

21 Lot 92912, Jalan Lahat, Mukim 48,395 SS LH 29/11/2000 8/1/2110 5 1,858 Hulu Kinta, Daerah Kinta 22 Lot PT 10158, Taman Saujana, 30,887 SS LH 24/9/2001 26/1/2098 4 911 Batu Gajah, Mukim Sungai Terap, Daerah Kinta 23 Lot 191515, Jalan Kuala 16,523 SS LH 14/3/2002 11/5/2102 3 1,153 Kangsar, Mukim Kinta, Ipoh 24 Lot PT 15613, Mukim Terap, 41,499 SS FH 31/12/2002 - 4 1,743 Daerah Kinta 25 Lot PT 187383, 34,016 SS FH 7/12/2004 - 2 1,768 Jalan Bercham-Tanjung Rambutan, Mukim Hulu Kinta 26 Lot PT 3491, Kampung Kedah, 43,588 SS FH 18/10/2004 - 1 1,000 Mukim Parit Buntar, Daerah Kerian 27 Lot PT 15978 HSD 131903, 65,393 SS LH 28/4/2004 27/4/2013 2 2,424 Mukim Sungai Raya, Kinta 28 Lot PT 191532, Taman 65,415 SS LH 19/6/2003 18/6/2102 1 2,806 Pengkalan Utama, Mukim Hulu Kinta, Daerah Kinta 29 Lot PT 3137, Mukim Sungai 94,144 SS LH 31/3/1997 30/3/2096 2 2,756 Raya, Daerah Kinta, Jalan Ipoh-Kampar, Gopeng 30 Lot 3553, Simpang Lima, Mukim 45,090 SS FH 11/3/2005 - 1 1,572 Parit Buntar, Daerah Kerian 31 Lot 115478 & 131710, 14,000 SS LH 11/6/2004 27/12/2052 12 951 Tanjung Rambutan, Hulu Kinta 28/11/2054 32 Lot 126025, Taman Bandar Baru 45,230 SS LH 20/10/2004 31/1/2083 3 2,102 Kampar, Mukim Kampar, Daerah Kinta 33 Lot 8123 & 8124, Mukim Bota, 47,124 SS LH 22/12/2004 7/4/2102 4 1,952 Daerah Perak Tengah 34 Lot 195487, Taman Rishah Hijau, 29,999 SS LH 24/1/2005 15/1/2103 1 1,465 Mukim Ulu Kinta 35 Lot 497, Paya Panjang, 54,788 VL FH 18/5/2006 - - 1,390 Mukim Kampung Buaya, Daerah Kuala Kangsar 36 Lot PT 4556, Suak Sidonan, 43,562 SS FH 21/11/2006 - 1 802 Mukim Bota

K SELANGOR DARUL EHSAN 1 Lot PT 3164, Mukim & 17,702 SS LH 20/4/1989 18/11/2087 13 657 Daerah Petaling 2 Lot 1891, Mukim Sungai Buloh, 15,314 SS LH 31/1/1991 20/3/2011 25 49 Daerah Petaling 3 Lot PT 6972, Mukim 32,658 SS LH 19/2/1992 24/11/2085 23 675 & Daerah Petaling 4 Lot 1890, Mukim Sungai Buloh, 18,200 SS LH 31/1/1991 20/3/2011 23 60 Daerah Petaling PETRONAS DAGANGAN BERHAD (88222-D) 119

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

5 Lot PT 4684, Mukim & Daerah 26,136 SS LH 28/6/1991 22/8/2092 13 889 Petaling 6 Lot PT Utama, Lot PT 1985 13,606 SS LH 29/3/1990 6/12/2076 13 700 (Plot 749), Mukim Batu, Daerah Gombak 7 Lot PT 45, Seksyen 15, Bandar 61,946 SS LH 14/3/1989 12/1/2086 12 850 Shah Alam, Daerah Petaling 8 Lot PT 119, Seksyen 1, Mukim 16,731 SS LH 5/1/1990 2/12/2019 14 221 Damansara, Daerah Petaling 9 Lot PT 435, Seksyen 6, Bandar 26,275 SS LH 14/6/1991 5/2/2018 22 274 Shah Alam, Daerah Petaling 10 Lot PT No. 476 & 484, Mukim 9,600 SS LH 2/8/1990 30/7/2074 15 403 Ampang, Daerah Ulu Langat 11 Lot PT 22521, Mukim Kajang, 26,144 SS LH 4/6/1991 9/5/2021 13 499 Daerah Ulu Langat 12 Lot PT 318, Mukim Ampang, 11,400 SS LH 25/6/1987 21/1/2073 19 521 Daerah Gombak 13 Lot PT 436, Mukim Batu, 9,320 SS LH 4/8/1994 22/11/2014 20 3 Daerah Kuala Langat 14 Lot PT 31182, Mukim & Daerah 17,058 SS LH 19/9/1990 17/9/2050 14 846 Kelang 15 Lot PT 9995, Mukim & 43,560 SS LH 21/5/1985 20/3/2015 20 15 Daerah Kelang 16 Lot PT 669, Mukim Ampang 14,850 SS LH 4/8/1994 30/9/2015 22 9 Pechah, Daerah Ulu Selangor 17 Lot PT 5162, Mukim Setapak, 18,209 SS LH 28/9/1990 12/2/2067 13 623 Daerah Gombak 18 Lot 1859, Mukim Ampang, 20,192 SS LH 31/1/1991 25/9/2011 21 110 Daerah Hulu Langat 19 Lot PT. 27361 & Lot No. 15 & 18,700 SS LH 17/3/1992 3/1/2090 11 994 16, Seksyen 5, Pekan Ampang 20 Lot PT No. 29071 & 29072, 51,646 SS LH 19/9/1991 16/10/2091 10 2,865 Mukim Batu, Daerah Gombak 21 Lot PT 2059, Mukim Serendah, 34,092 SS LH 11/12/1991 21/11/2090 11 510 Daerah Ulu Selangor 22 Lot PT 1466 (Lot 7380) & Lot 24,038 SS FH 22/5/1991 - 24 314 PT 1467 (Lot 7381), Mukim Damansara, Daerah Petaling 23 Lot PT 3585, Mukim Kapar, 10,417 SS FH 23/3/1992 - 18 625 Daerah Kelang 24 Lot PT 2781, Mukim Damansara, 16,687 SS FH 14/8/1989 - 15 751 Daerah Petaling 25 Lot PT 11854, Mukim & Daerah 12,985 SS FH 18/6/1990 - 14 935 Kelang 26 Sebahagian dari Lot 2883, 20,000 SS FH 6/8/1990 - 15 385 Mukim Tanjong Duabelas, Daerah Kuala Langat 27 Lot PT 12842, Mukim Kajang, 26,639 SS FH 4/2/1989 - 23 1,066 Daerah Ulu Langat 120 PETRONAS DAGANGAN BERHAD (88222-D)

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

28 Lot 44, 45 & 46, Seksyen 25, 28,670 SS FH 12/10/1990 - 13 920 Bandaraya & Daerah Kelang 29 Lot PT 12911, Mukim Kapar, 30,685 SS FH 27/3/1990 - 24 1,420 Daerah Kelang 30 Lot 136 - 140, Kampung Salak, 10,145 SS FH 7/6/1990 - 16 195 Daerah Sepang 31 Sebahagian dari Lot PT 32, 30,000 VL LH 25/8/1990 14/6/2066 - 624 Mukim & Daerah Petaling 32 L.O. 15, Seksyen 6, Bandar 17,160 SS LH 8/8/1988 12/11/2062 7 523 Petaling, Daerah Kuala Lumpur 33 Lot PT 19163, Mukim & Daerah 19,795 SS LH 21/1/1992 7/3/2092 11 659 Petaling 34 Lot PT 28938, Mukim Ampang, 19,533 SS LH 2/10/1991 27/4/2092 11 898 Daerah Ulu Langat 35 Lot PT 32008, Mukim Batu, 27,695 SS LH 2/10/1991 20/7/2073 11 850 Daerah Gombak 36 Lot 13697, Mukim Sungai Buloh, 32,496 SS LH 30/5/1990 1/2/2079 3 1,202 Daerah Petaling 37 Lot 4029, Mukim Sungai Buloh, 41,382 SS LH 11/9/1990 21/2/2029 6 776 Daerah Petaling 38 Sebahagian dari Lot PT 10295, 18,310 SS LH 20/4/1989 13/7/2024 2 379 Mukim Rawang, Daerah Gombak 39 Lot PT 9260, Mukim Damansara, 15,000 VL LH 14/1/1991 2/7/2051 - 728 Daerah Petaling 40 Lot PT 19197, Mukim Kapar, 14,283 VL FH 17/6/1991 - - 1,000 Daerah Kelang 41 Lot PT 43361 (Lot Pertama), 23,000 VL FH 19/3/1990 - - 1,633 Mukim & Daerah Kelang 42 Lot PT 43362 (Lot ke-2), 23,000 VL FH 24/9/1991 - - 1,495 Mukim & Daerah Kelang 43 Lot 3441 HS(D) 1608, 13,769 VL FH 18/11/1991 - - 509 Mukim Batang Berjuntai, Daerah Kuala Selangor 44 Lot PT 5052 HS(D) 44113, 25,950 SS FH 2/1/1992 - 6 1,427 Seksyen 28, Bandar Shah Alam 45 Lot PT No. 739 & 740, 25,693 SS FH 25/6/1991 - 6 607 Mukim Serendah, Daerah Hulu Selangor 46 Lot PT 16292, HS(D) 27931, 19,361 SS FH 10/10/1997 - 7 1,400 Mukim Cheras, Daerah Kuala Langat 47 Lot 4042 HS(M) 5694, Mukim 21,790 SS LH 9/12/1997 26/9/2087 7 1,026 Tanjung Duabelas Daerah Kuala Langat 48 Lot PT 32710 HS(M) 32875, 31,720 SS LH 28/8/1998 2/8/2094 7 1,825 Mukim Ampang, Daerah Hulu Langat 49 Lot PT 63, Mukim Damansara, 78,410 TCSS FH 30/12/1985 - 12 1,423 Daerah Petaling PETRONAS DAGANGAN BERHAD (88222-D) 121

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

50 Lot PT 1442, Mukim Dengkil, 40,935 SS FH 5/5/1999 - 7 5,118 Daerah Putrajaya 51 Lot PT 3870, Mukim Damansara, 17,367 SS FH 14/8/1989 - 12 782 Daerah Petaling 52 Lot PT 7003, Mukim Damansara, 16,250 SS FH 14/8/1989 - 12 731 Daerah Petaling 53 Lot PT 14026, Mukim 11,025 VL FH 14/8/1989 - - 634 Damansara, Daerah Petaling 54 Lot PT 10444, Mukim 16,970 SS FH 14/8/1989 - 11 764 Damansara, Daerah Petaling 55 Lot PT 38352, Mukim & Daerah 25,000 SS FH 23/4/1991 - 7 1,063 Klang 56 Lot PT 26061, Mukim & Daerah 20,764 SS FH 31/10/1990 - 7 831 Klang 57 Lot 1253, Mukim Rawang, 30,492 SS FH 2/12/1991 - 7 1,265 Daerah Gombak 58 Lot PT 23990, Mukim Kapar, 26,000 SS FH 24/2/1992 - 7 1,663 Daerah Klang 59 Lot PT 13173, Mukim & Daerah 23,207 SS FH 7/3/1991 - 4 1,184 Petaling 60 Lot 219, Mukim Cheras, Daerah 51,009 SS FH 18/3/1993 - 5 1,999 Ulu Langat 61 Lot PT 588, Mukim Damansara, 23,487 SS FH 7/11/1993 - 15 1,174 Daerah Petaling 62 No. 204 Seksyen 25, 48,007 SS FH 28/8/1998 - 7 3,360 Mukim & Daerah Klang 63 Lot 5006, Mukim Dengkil, 4,808,672 KVDT FH 3/8/1995 - 10 7,382 Daerah Sepang, Selangor 64 Lot PT 11887, Mukim Rawang 48,394 SS LH 6/3/2000 9/2/2094 5 3,278 65 P.T. 37331, Seksyen 5, 22,387 SS FH 7/1/2003 - 5 2,812 Bandar Kinrara Daerah Petaling 66 Lot PT 70, Pekan Bukit 52,227 VL FH 30/10/2003 - - 4,182 Kemuning, Mukim Klang 67 Lot 52548, 52549 & 52550, 71,548 SS LH 28/2/2001 3/8/2068 4 4,976 Jalan Batu Tiga-Puchong, Mukim Damansara 68 Lot PT 27423, Taman Dato 161,223 SS LH 3/6/1991 2/6/2090 2 19,043 Ahmad Razali, Jalan Kolam Air Lama, Ampang, Daerah Hulu Langat 69 Lot PT 35256 (Old Lot 60349), 38,613 SS LH 3/8/2001 2/8/2100 4 1,565 Bandar Baru Selayang, Mukim Batu, Daerah Gombak 70 Lot PT 10702, Puncak Alam, 56,649 SS LH 7/4/2004 6/4/2103 1 3,240 Mukim Ijok, Kuala Selangor 71 Lot PT 10659, Puncak Alam, 43,576 SS LH 18/9/2003 17/9/2102 4 2,603 Mukim Ijok, Kuala Selangor 72 Lot PT 7741, Batu 9, 37,246 SS LH 13/8/2002 13/8/2101 5 2,160 Mukim Teluk Panglima Garang, Kuala Langat 122 PETRONAS DAGANGAN BERHAD (88222-D)

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

73 Lot PT 3429 HS(D)17325, Mukim 66,958 SS FH 30/1/2004 - 4 8,328 Hulu Kelang, Daerah Gombak, Bukit Antarabangsa 74 Lot PT 25433, Bandar Tun 18,478 SS FH 23/5/2003 - 3 1,201 Hussein Onn, Mukim Cheras, Daerah Ulu Langat 75 Lot PT 30965 HS(D)69867, 43,577 SS FH 25/11/2002 - 3 5,000 Bandar Baru Damai Perdana, Cheras 76 Lot PT 1545 (Old Lot 2838) HSD 24,002 SS FH 4/6/2003 - 3 1,607 43089, Kepong Industrial Park, Daerah Gombak 77 Lot PT 44579,Mutiara 56,940 SS FH 15/1/2004 - 3 9,392 Damansara, Mukim Sungai Buloh, Daerah Petaling 78 Lot PT 1161, Pekan Puchong, 33,573 SS FH 14/4/2003 - 3 3,959 Daerah Petaling 79 Lot PT 24766, Guthrie Corridor 44,306 VL FH 2/8/2004 - - 6,780 Expressway, Bukit Jelutong, Mukim Damansara, Daerah Petaling 80 Lot PT 6273, Taman Meranti Jaya, 70,185 SS FH 23/12/2004 - 2 5,005 Mukim Dengkil, Daerah Sepang 81 Lot PT 30147, Bukit Jelutong, 33,951 SS FH 16/9/2004 - 1 5,089 Mukim Damansara, Daerah Petaling 82 Lot 83230, Bandar Bukit Tinggi, 43,559 SS FH 8/5/2003 - 5 4,700 Klang 83 Lot 75237A, Bandar Bukit 43,602 SS FH 24/7/2002 - 3 2,300 Ringgi, Klang 84 Lot PT 39138, Bandar Seri 54,153 SS FH 12/7/2005 - 1 2,956 Putera, Bangi, Mukim Kajang, Daerah Hulu Langat 85 Lot 14387 HSM 6834, LDP 35,715 VL FH 12/9/2005 - - 5,259 Sungai Penaga, Mukim Damansara, Daerah Petaling 86 Lot PT 25 HSM 2948, Mukim 43,562 SS FH 6/4/2004 - 2 741 Hujung Permatang Sungai Gawar, Daerah Kuala Selangor 87 Lot 58764 HM 339, Kampung 38,395 SS FH 23/7/2004 - 5 1,848 Bharu Serdang, Mukim Petaling, Seri Kembangan 88 Lot PT 1536, Jalan Semenyih, 72,789 VL FH 23/1/2006 - - 6,000 Mukim Semenyih, Daerah Hulu Langat 89 Lot PT 52587, Taman Prima 43,621 SS FH 23/1/2006 - 1 4,369 Saujana, Daerah Ulu Langat, Mukim Kajang PETRONAS DAGANGAN BERHAD (88222-D) 123

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

90 Lot PT 52322, Taman Prima 42,700 SS FH 23/1/2006 - 1 4,281 Saujana, Daerah Ulu Langat, Mukim Kajang 91 Lot PT 29771, Fasa A1 65,498 SS FH 28/12/2005 - 2 7,070 Cyberjaya, Mukim Dengkil, Daerah Sepang 92 Lot PT 11509 HSD 57278, 47,663 SS FH 16/7/2004 - 1 5,955 Bukit Subang, Mukim Bukit Raja, Daerah Petaling 93 Lot PT 1278, NKVE Arah 92,397 SS FH 1/1/2005 - 2 9,858 Damansara, Mukim Pekan Cempaka, Petaling 94 Lot PT 621, Taman Desa Mentari, 45,004 SS LH 26/12/2003 11/4/2101 5 3,304 Mukim Damansara 95 Lot PT 50147 Site A, Jalan 43,961 SS LH 3/5/2004 25/4/2102 3 3,710 Pekeliling Section 15, Bandar Baru Bangi, Selangor 96 Lot PT 2661 HSD 3142, 35,596 SS LH 15/4/2004 24/3/2095 1 2,410 Sungai Buloh Country Resort, Ijuk, Kuala Selangor 97 Lot 37310-37311, Subang 45,445 SS LH 29/6/2005 1/12/2095 1 3,843 Bestari, Jalan Subang-Sungai Buloh, Mukim Sungai Buloh 98 Lot PT 166 Section 15, KM 12.3 54,939 VL LH 31/1/2005 18/4/2103 - 6,594 Federal Highway (Klang Bound), Shah Alam 99 Lot PT 1560 HSD 54927, Taman 50,117 SS LH 27/10/2005 26/4/2104 2 4,145 Bersatu, Bandar Kundang, Daerah Gombak 100 Lot PT 1, Seksyen 33(51A), 22,000 SS LH 20/7/2005 19/7/2104 18 2,262 Jalan 222, Petaling Jaya 101 Lot PT 111, Section 40, 43,551 SS LH 15/3/2005 28/9/2103 2 7,831 Mukim Damansara, Daerah Petaling 102 Lot PT 40846, Taman Sungai 43,562 SS FH 30/10/2003 4 4,051 Kapar, Mukim Kapar 103 Lot PT 49946, USJ 20, Mukim 68,133 SS FH 31/3/2005 - 2 7,000 Damansara, Daerah Petaling 104 Lot 19146, Jalan Haji Sirat, 23,207 SS FH 20/3/2006 - 1 4,587 Mukim Kapar 105 Lot PT 36061, Pekan Penaga, 66,058 SS LH 21/4/2006 24/1/2104 1 7,649 Taman Subang Mewah, Mukim Petaling 106 Lot PT 41658, Taman Putra 61,780 VL LH 14/4/2006 22/9/2098 - 5,095 Budiman, Mukim Kajang, Daerah Hulu Langat 107 Lot 64241, Puchong Jaya, 54,422 SS FH 20/3/2006 - 3 8,907 Pekan Kinrara, Mukim Petaling 108 Lot PT 4054, Pekan Kinrara, 44,625 SS FH 18/9/2006 - 1 5,976 Daerah Petaling 124 PETRONAS DAGANGAN BERHAD (88222-D)

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

109 Lot 81504, Taman Equine Park, 62,689 SS LH 24/7/2006 18/9/2093 4 5,223 Mukim Petaling 110 Lot PT 52814, Taman Saujana 33,541 SS LH 30/6/2006 29/9/2103 2 3,624 Puchong, Daerah Petaling 111 Lot 2883, Mukim Kelanang, 87,664 SS FH 25/1/2006 - 15 406 Daerah Kuala Langat 112 Lot PT 34453, Putra Heights, 43,562 VL FH 16/10/2006 - - 5,140 Subang Jaya, Mukim Damansara

L WILAYAH PERSEKUTUAN 1 Lot 44489 (PT 3), 21,780 SS LH 18/7/1990 8/8/2073 14 928 Mukim Kuala Lumpur, Daerah Wilayah Persekutuan 2 Lot PT 9614, Mukim Batu, 17,773 SS LH 22/8/1990 22/7/2072 14 1,142 Daerah Wilayah Persekutuan 3 Lot No. 29395 & 29396, 32,081 SS LH 21/12/1977 21/1/2011 25 134 Mukim Kuala Lumpur, Daerah Wilayah Persekutuan 4 Lot 6209, Mukim Batu, 23,250 SS LH 14/6/1991 17/11/2043 22 22 Daerah Wilayah Persekutuan 5 Lot PT 39732, Mukim Kuala 22,853 SS LH 10/9/1984 10/2/2077 20 827 Lumpur, Daerah Wilayah Persekutuan 6 Lot 48523 (PT No. 7489), 36,210 SS LH 12/9/1987 24/6/2017 18 89 Mukim Batu, Daerah Wilayah Persekutuan 7 Lot 136, Seksyen 90, 10,753 SS LH 4/8/1994 4/5/2047 20 244 Bandaraya Kuala Lumpur 8 Lot 12134, Mukim Batu, 30,837 SS LH 25/1/1991 28/6/2066 14 1,502 Daerah Wilayah Persekutuan 9 Lot PT 2956, Mukim Kuala 27,341 SS FH 25/7/1989 - 17 1,300 Lumpur, Daerah Wilayah Persekutuan 10 Lot 48653, Mukim Kuala 23,714 SS FH 16/11/1989 - 15 996 Lumpur, Daerah Wilayah Persekutuan 11 Lot 20272, Mukim Setapak, 25,529 SS FH 31/12/1987 - 16 869 Daerah Wilayah Persekutuan 12 Lot 232, Seksyen 96, 17,212 SS FH 31/3/1990 - 14 2,592 (PT No. 232 & 233), Bandaraya Kuala Lumpur 13 Lot PT 3644, Mukim Setapak, 31,300 SS FH 1/6/1990 - 24 889 Daerah Wilayah Persekutuan 14 Lot 16794, Mukim Batu, 16,351 SS FH 25/9/1987 - 16 817 Daerah Wilayah Persekutuan 15 Lot 59, Seksyen 88, 19,785 SS FH 22/5/1981 - 23 2,477 Bandaraya Kuala Lumpur 16 Lot No. 4295 & 4310, 12,626 SS FH 22/5/1981 - 20 1,301 Mukim Ampang, Bandaraya Kuala Lumpur PETRONAS DAGANGAN BERHAD (88222-D) 125

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

17 Lot 2343 (Lot 1653), Seksyen 41, 13,638 SS FH 24/3/1988 - 17 770 Bandaraya Kuala Lumpur 18 Lot No. 545-552, Seksyen 55, 9,741 SS FH 13/3/1990 - 15 1,800 Bandaraya Kuala Lumpur 19 Lot PT 2381, Mukim Setapak, 21,052 SS LH 15/7/1991 20/9/2086 9 1,207 Daerah Wilayah Persekutuan 20 Lot 353, Seksyen 91A, 13,164 SS LH 14/6/1991 11/1/2043 9 91 Bandaraya Kuala Lumpur 21 Lot 9524, Mukim Batu, 32,343 SS FH 28/7/1992 - 9 3,260 Daerah Wilayah Persekutuan 22 Sebahagian dari Lot 33495 24,427 VL LH 20/12/1990 19/12/2089 - 1,201 (PT 2197), Mukim Petaling, Daerah Wilayah Persekutuan 23 Lot PT 1035, Mukim Petaling, 17,250 VL LH 12/8/1991 23/10/2085 - 688 Daerah Wilayah Persekutuan 24 Sebahagian dari Lot 33492 24,925 VL LH 15/7/1991 27/4/2086 - 735 (PT 2194), Mukim Petaling, Daerah Wilayah Persekutuan 25 Lot PT 737, Mukim Petaling 32,947 SS LH 15/12/1989 17/8/2085 16 891 Daerah Wilayah Persekutuan 26 Sebahagian dari Lot PT 899, 27,439 SS LH 1/3/1991 19/8/2084 5 929 Mukim Petaling, Daerah Wilayah Persekutuan 27 Lot PT 2686, Mukim Setapak, 17,912 SS LH 14/8/1991 10/11/2089 14 922 Daerah Wilayah Persekutuan 28 Lot 25, Seksyen 87, 20,010 VL FH 24/7/1990 - - 2,801 Bandaraya Kuala Lumpur 29 Sebahagian dari Lot 847, 20,518 VL FH 25/9/1991 - - 1,128 Mukim Kuala Lumpur Daerah Wilayah Persekutuan 30 Lot 788, Mukim Setapak, 57,173 VL FH 25/7/1991 - - 1,800 Daerah Wilayah Persekutuan 31 Lot 522, Mukim Petaling, 169,884 LPGSBP LH 14/6/1991 31/3/2011 26 99 Daerah Wilayah Persekutuan 32 Lot 836, Precint 9, 43,154 SS FH 22/4/2003 - 4 4,315 Wilayah Persekutuan Putrajaya 33 Lot 3352, Precint 11, 36,500 SS FH 22/4/2003 - 3 4,510 Wilayah Persekutuan Putrajaya 34 Lot 2495, Precint 16, 43,640 SS FH 22/4/2003 - 2 4,364 Wilayah Persekutuan Putrajaya 35 Lot PT 7667, 63,140 SS FH 24/7/2003 - 4 7,602 Taman Setiawangsa, Setapak 36 Lot PT62368 & PT61957, 43,560 SS FH 31/12/2002 - 4 7,000 Mukim Petaling, Wilayah Persekutuan Kuala Lumpur 37 Lot 25067, Taman Melati, 19,182 SS FH 7/1/2003 - 24 2,268 Mukim Setapak, Kuala Lumpur 38 Lot 20721, Wangsa Melawati, 28,933 SS FH 6/11/2003 - 15 2,511 Mukim Setapak 126 PETRONAS DAGANGAN BERHAD (88222-D)

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

M SABAH DAN WILAYAH PERSEKUTUAN LABUAN 1 Lot TL 147501764, Daerah 24,750 SS LH 14/6/1991 31/12/2011 20 8 Tambunan 2 Lot CL 175310595 (Lot 136), 24,750 SS LH 4/10/1983 31/12/2901 20 594 Daerah Beaufort 3 Lot CL 025331631, Jalan Papar- 24,750 SS LH 22/1/1990 10/9/2913 14 107 Kimanis, Daerah Papar 4 Lot CL 015414490, 18,280 SS LH 14/6/1991 31/12/2012 23 62 Jalan Reservoir, Daerah Kota Kinabalu 5 Lot TL 227500816, Daerah Kota 21,650 SS LH 14/6/1991 31/12/2011 20 4 Marudu 6 Lot CL 10542613, Lot CL 22,450 SS LH 11/4/1990 17/1/2914 14 404 10542622 & Lot CL 105542631, Daerah Tawau 7 Lot TL 207527044, Jalan 30,502 SS LH 14/6/1991 31/12/2011 23 14 Saguking, Daerah Labuan 8 Lot CL 28409 & Lot CL 284410, 21,344 SS LH 18/1/1984 4/5/2913 21 482 Jalan Mat Salleh, Daerah Kota Kinabalu 9 Lot CL 075326082, 14,750 SS LH 13/1/1991 9/7/2887 25 189 Jalan Utara, Daerah Sandakan 10 Lot CL 105316630, 23,820 SS LH 17/10/1991 20/6/2055 14 344 Daerah Tawau 11 Lot CL 015433379, 29,927 SS LH 15/1/1990 31/12/2930 15 520 Lot CL 015433388, Lot CL 013433404, Lot CL 015433360, Jalan Swamp, Daerah Kota Kinabalu 12 Lot TL 057504688, 28,300 SS LH 31/12/1991 31/12/2009 12 107 Pekan Kudat, Daerah Kudat 13 Lot CL 10546680 21,780 SS LH 23/3/1995 23/2/2025 11 315 (CL 105311500), KM 7, Jalan Apas, Daerah Tawau 14 Lot CL 105139580 (Lot 1), 19,249 SS LH 13/6/1991 30/10/2055 12 339 Jalan Kuhara, Daerah Tawau 15 Sebahagian dari 25,968 SS LH 27/10/1991 24/10/2916 9 599 Lot CL 105244326, Jalan Apas, Daerah Tawau 16 Lot CL 1153799989, 21,279 SS LH 22/1/1994 31/12/2069 4 267 Jalan Silam, Daerah Lahad Datu 17 Lot CL 165005569, 12,000 SS LH 9/10/1985 30/12/2014 4 20 Daerah Tenom 18 Lot CL 075203413, 20,000 VL LH 1/4/1993 1/7/2882 - 650 Jalan Labuk, Daerah Sandakan 19 Lot CL 025337722, Kampung 39,639 SS LH 18/6/1993 31/12/2084 7 297 Kinarut, Daerah Papar PETRONAS DAGANGAN BERHAD (88222-D) 127

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

20 Lot TL 247501177, 13,930 SS LH 18/11/1997 31/12/2088 9 494 Daerah Kunak 21 Lot CL 156466699, KM 7, 79,598 SS LH 30/4/1998 23/2/2925 12 151 Jalan Apas, Daerah Tawau 22 Lot CL 105430868, 435,600 BD LH 14/6/1991 31/12/2042 11 122 Lot 82100054, Tanjong Batu, Daerah Tawau 23 Lot RSP No. 90019022, 522,720 BD LH 29/12/1994 28/12/2045 14 6,422 Sepangar Bay, Kota Kinabalu 24 Lot CL 207901933, Tanjong 23,096 SS FH 29/7/1992 - 12 342 Kubong, Labuan 25 Lot CL 015580186, Jalan Luyang, 8,503 SS LH 23/12/2002 31/12/2906 15 985 Daerah Kota Kinabalu 26 Lot CL 015500893, Likas, 30,158 SS LH 23/12/2002 23/12/2083 17 867 Daerah Kota Kinabalu 27 Lot CL 01578533, Jalan Inanam, 20,575 SS LH 23/12/2002 14/5/2076 22 734 Daerah Kota Kinabalu 28 Lot CL 015474012, Penampang, 28,353 SS LH 23/3/2003 31/12/2076 20 806 Daerah Kota Kinabalu 29 Lot CL 215386851, Daerah 27,007 SS LH 23/12/2002 8/12/2062 17 934 Penampang, Kampung Nosoob 30 Lot CL 21539539, 29,063 VL LH 23/12/2002 31/12/2904 - 714 Daerah Penampang, Kasigui 31 Lot TL 077544186, KM 6, Jalan 85,813 SS LH 21/10/2003 14/11/2883 3 697 Batu Sapi, Karamunting, Sandakan 32 Lot CG 2205005894, 58,125 VL LH 23/11/2004 21/7/3002 - 1,594 KM 6.5, Jalan Pohon Batu, Wilayah Persekutuan Labuan 33 Lot CL 045310334, Batu 16, 51,836 SS LH 10/2/2006 31/12/2068 1 1,120 Jalan Tuaran, Kampung Bakud

N SARAWAK 1 Lot 5185, Seksyen 64, 21,388 SS LH 10/11/1987 23/9/2048 15 383 Daerah Bandar Kuching 2 Lot 1392, Blok 11, 12,325 SS LH 31/1/1991 31/12/2069 11 237 Daerah Muara Tebas 3 Lot 7933, Seksyen 64, 12,884 SS LH 31/1/1991 23/1/2777 19 359 Daerah Bandar Kuching 4 Lot 721, Blok 31, 46,392 SS LH 14/6/1991 11/3/2051 23 264 Daerah Kemena 5 Lot 2974, Seksyen 65, 35,865 SS LH 1/11/1985 23/10/2045 17 489 Daerah Bandar Kuching 6 Lot 397, Blok 9, 63,733 SS LH 14/6/1991 18/1/2042 21 98 Daerah Konsesi Miri 7 Lot 425, Blok 2, Daerah Sibu 15,069 SS LH 14/6/1991 31/1/2042 12 246 8 Lot 4772, Blok 16, 60,762 SS LH 10/5/1990 2/5/2050 24 101 Daerah Kuching Tengah 9 Lot 402, Daerah Serian 11,270 SS LH 6/10/1997 26/12/2045 18 28 128 PETRONAS DAGANGAN BERHAD (88222-D)

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

10 Lot 299, Seksyen 5, 16,512 SS LH 22/5/1989 30/3/2049 24 40 Daerah Bandar Kuching 11 Lot 1804, Daerah Limbang 18,094 SS LH 22/1/1992 21/1/2052 11 287 12 Lot 2156, Blok 16, 36,372 SS LH 14/3/1991 9/2/2041 14 672 Daerah Kuching Tengah 13 Lot 2065, Blok 1, 38,179 SS LH 8/12/1992 7/12/2052 11 183 Daerah Lambir 14 Lot 419, Blok 26, Daerah 22,432 SS LH 15/8/1994 14/8/2054 16 101 Kemena 15 Lot 650, Blok 3, 18,546 SS LH 3/4/1991 27/5/2052 12 354 Daerah Sentah-Segu 16 Lot 284, Blok 16, 35,370 SS LH 8/1/1992 31/12/2025 18 682 Daerah Kuching Tengah 17 Sublot 131 & Lot 2400, Blok 4, 23,034 SS LH 12/12/1995 13/10/2057 9 888 Daerah Sungai Merah 18 Lot 486, Block 4, 22,657 SS LH 15/4/1996 31/12/2019 9 736 Daerah Bandar Sungai Merah 19 Sublot 102, Blok 5, 22,012 VL LH 23/8/1994 16/2/2056 - 640 Daerah Sentah-Segu 20 Lot 1144, Blok 6, 22,423 SS LH 6/4/1994 14/7/2053 8 235 Daerah Seduan 21 Lot 251, Daerah Muara Tebas 35,198 SS LH 29/11/1995 28/11/2055 6 625 22 Lot 1176, Block 14, 11,169 VL LH 3/9/1996 9/2/2056 - 69 Daerah Seduan 23 Lot 570, Blok 16, 16,102 W LH 30/8/1984 20/6/2038 14 54 Daerah Bandar Seduan 24 Lot 123, 124, 125 & 126, 301,004 BD LH 8/7/1989 20/5/2018 13 817 Daerah Bandar Seduan 25 Lot 1415, Seksyen 66, 472,956 BD LH 14/6/1981 17/2/2042 25 339 Daerah Bandar Kuching 26 Lot 94, Blok 217, 22,703 SS LH 20/3/2000 27/8/2058 5 1,167 Daerah Batu Kawah 27 Lot 121, Blok 217, 22,388 SS LH 5/4/1999 12/4/2056 5 195 Daerah Bukit Kisi 28 Lot 1106, Blok 5, 36,867 VL FH 31/12/2002 - - 1,250 Kuala Baram Land District, Daerah Miri 29 Lot 1050, Blok 7, 79,639 SS LH 27/6/2002 13/12/2054 4 3,859 Jalan Bulan Sabit, Miri 30 Lot 4003, Blok 14, 73,076 SS LH 9/12/2005 8/12/2065 2 2,045 Salak Land District, Kuching PETRONAS DAGANGAN BERHAD (88222-D) 129

List of Properties

Property Land Area Description Tenure Date of Date of Age of Net Book (Sq.Ft.) Acquisition Expiry Building Value as at (Years) 31 March 2007 (RM’000)

O LAND FOR PIPELINE 1 Pipeline for multiple petroleum 36,603,280 MPP FH 7/20/1995 - - 28,401 products of 130 km, which (Negeri Sembilan consists of 28 km from Sungai & Melaka) Udang, Melaka to Sungai Linggi, 8/3/1995 Negeri Sembilan, 62 km from (Selangor) Sungai Linggi to FELDA LPJ, Mukim Labu, Negeri Sembilan, 36 km from FELDA LPJ, Mukim Labu to KVDT, Sepang, Selangor, 3 km from KVDT, Sepang to KLIA, Selangor and 1 km from Port Dickson Refi nery to main pipeline.

ABBREVIATION DESCRIPTION TENURE SS – Service Station FH - Freehold VL – Vacant Land LH - Leasehold SH – Shophouse OSS – Offi ce & Service Station BD – Bulk Depot LPGSBP – LPG Storage & Bottling Plant W – Warehouse TCSS – Training Centre & Service Station MPP – Multi Product Pipeline KVDT – Klang Valley Distribution Terminal 130 PETRONAS DAGANGAN BERHAD (88222-D) Notice of Annual General Meeting

NOTICE IS HEREBY GIVEN THAT the Twenty-Fifth Annual General Meeting of

PETRONAS Dagangan Berhad (the Company) will be held on Tuesday, 10 July

2007 at 10.00 a.m. at the Ballroom 1, Level 2, Hotel Nikko Kuala Lumpur, 165,

Jalan Ampang, 50450 Kuala Lumpur for the following purposes, namely:

AGENDA

As Ordinary Business 1. To receive the Audited Financial Statements for the year ended 31 March 2007 together with the Reports of the Directors and Auditors thereon. (Resolution 1) 2. To approve the payment of fi nal dividend of 20% per ordinary share less income tax at 27% in respect of the year ended 31 March 2007. (Resolution 2) 3. To re-elect the following Directors pursuant to Article 93 of the Company’s Articles of Association: (a) Datuk Anuar bin Ahmad (Resolution 3) (b) Dato’ Kamaruddin bin Mohd Jamal (Resolution 4)

4. To approve the payment of Directors’ fees in respect of the year ended 31 March 2007. (Resolution 5)

5. To re-appoint Messrs. KPMG Desa Megat & Co. as Auditors of the Company and to authorise the Directors to fi x their remuneration. (Resolution 6) As Special Business 6. To consider and if thought fi t, to pass the following Special Resolution: Proposed Amendments to the Articles of Association of the Company “THAT alterations, modifi cations, additions or deletions to the Articles of Association of the Company contained in Appendix I of the Annual Report 2007 be and are hereby approved.” (Special Resolution 1)

7. To transact any other business for which due notice has been given. PETRONAS DAGANGAN BERHAD (88222-D) 131

Notice of Annual General Meeting

NOTICE OF DIVIDEND ENTITLEMENT AND PAYMENT

NOTICE IS ALSO HEREBY GIVEN THAT subject to the approval of members at the Twenty-Fifth Annual General Meeting to be held on 10 July 2007, a fi nal dividend of 20% per ordinary share less income tax at 27% will be paid on 23 August 2007 to shareholders whose names appear in the register of Depositors on 3 August 2007.

A depositor shall qualify for entitlement only in respect of :

(a) Shares transferred into the Depositor’s Securities Account before 4.00 p.m. on 3 August 2007 in respect of ordinary transfers. (b) Shares bought on the Bursa Malaysia on a cum entitlement basis according to the Rules of Bursa Malaysia.

By Order of the Board

NOOR LILY ZURIATI BT ABDULLAH (LS 05485) YEAP KOK LEONG (MAICSA 0862549) Company Secretaries

Kuala Lumpur 18 June 2007

NOTES :

1. A member of the Company entitled to attend and vote at the meeting may appoint a proxy or proxies to attend and vote on his behalf. A proxy may but need not be a member of the Company.

2. Where a member of the Company is an authorised nominee as defi ned under the Securities Industry (Central Depositories) Act 1991, it may appoint at least one proxy in respect of each Securities account it holds with ordinary shares of the Company standing to the credit of the said Securities accounts.

3. The instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney duly authorised in writing or if the appointer is a corporation either under seal or under the hand of an offi cer or attorney duly authorised and must be deposited at the Company’s Share Registrar, Symphony Share Registrar Sdn. Bhd., Level 26, Menara Multi Purpose, Capital Square, No. 8, Jalan Munshi Abdullah, 50100 Kuala Lumpur, not less than 48 hours before the time fi xed for the meeting. If this Proxy Form is signed under the hand of an offi cer duly authorized, it should be accompanied by a statement reading “signed as authorized offi cer under Authorisation Document which in still in force, no notice of revocation having been received.“ If this Proxy Form is signed by an attorney duly appointed under a power of attorney, it should be accompanied by a statement reading “signed under Power of Attorney which is still in force, no notice of revocation having been received”. A copy of the Authorisation Document or the Power of Attorney, which should be valid in accordance with the laws of the jurisdiction in which it was created and is exercised, should be enclosed with this Proxy Form.

4. Explanatory Notes on Special Business : Special Resolution 1 - Amendments to the Articles of Association of PETRONAS Dagangan Berhad This proposed Special Resolution 1 if passed, will bring the Articles of Association of the Company in line with the amendments to Listing Requirements of Bursa Malaysia Securities Berhad and to comply with the Companies Act, 1965. 132 PETRONAS DAGANGAN BERHAD (88222-D) Appendix I

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF THE COMPANY

The existing Articles of Association of the Company (“the existing Articles”) are amended by the alterations, modifi cations, deletion and/or additions, wherever necessary whereby the affected existing Articles are reproduced here with the Proposed Amendments to the Articles of Association of the Company alongside it:

Article EXISTING ARTICLES PROPOSED ARTICLES Rationale(s) No.

1 Defi nition Defi nition In these Articles, if not inconsistent with the In these Articles, if not inconsistent with subject or context:- the subject or context:-

WORDS MEANINGS WORDS MEANINGS

Approved Market The stock exchange [Deleted] Pursuant to Para. 1.01 of Place which is specifi ed the Listing Requirements. to be an approved market place in the Securities Industry (Central Depositories) (Exemption) (No. 2) Order 1998

Benefi cial Owner In relation to Deposited [Deleted] Redundant defi nition Securities, the ultimate owner of the Deposited Securities who is the person who is entitled to all rights, benefi ts, powers and privileges and is subject to all liabilities, duties and obligations in respect of, or arising from, the Deposited Securities and does not include a nominee of any description.

Book Closing Date The specifi ed time and [Deleted] Redundant defi nition date set by the Company for the purpose of determining persons entitled to dividends, interest, or new securities, or rights to a priority of application of issues of securities or other distributions. PETRONAS DAGANGAN BERHAD (88222-D) 133

Appendix I

Article EXISTING ARTICLES PROPOSED ARTICLES Rationale(s) No.

Commission Securities Commission [Deleted] Redundant defi nition established under Section 3 of the Securities Commission Act 1993

Central Depository the Malaysian Central Depository Bursa Malaysia Pursuant to Para. Depository Sdn. Bhd. Depository 1.01 of the Listing Sdn. Bhd. Requirements.

Exchange The Kuala Lumpur Stock Exchange Bursa Malaysia Pursuant to Para. Exchange Securities Berhad 1.01 of the Listing Requirements.

Independent a Director as defi ned in Independent a Director as defi ned Pursuant to Para. Director the Listing Requirements Director in the Listing 1.01 of the Listing of Kuala Lumpur Stock Requirements of Requirements. Exchange including any Bursa Malaysia amendment to the Listing Securities Berhad Requirements that may be including any made from time to time amendment to the Listing Requirements that may be made from time to time

Listing The Listing Requirements Listing The Listing Pursuant to Para. Requirements of Kuala Lumpur Stock Requirements Requirements of 1.01 of the Listing Exchange including any Bursa Malaysia Requirements. amendment to the Listing Securities Berhad Requirements that may be including any made from time to time amendment to the Listing Requirements that may be made from time to time

Member/ any person/persons for Member/ any person/persons Pursuant to Para. Members the time being holding Members for the time being 1.01 of the Listing shares in the Company holding shares in Requirements and whose names the Company and appear in the Register whose names appear of Members (except in the Register of the Malaysian Central Members (except Depository Nominees the Bursa Malaysia Sdn. Bhd.) including Depository Sdn. depositors whose names Bhd.) including appear on the Record of depositors whose Depositors names appear on the Record of Depositors.

Rules The Rule of the Central Rules The Rule of the Pursuant to Para. Depository. Central Depository. 1.01 of the Listing Requirements 134 PETRONAS DAGANGAN BERHAD (88222-D)

Appendix I

The term “Central Depository”, wherever it appears in this Articles of Association, shall be replaced with the term “the Depository”.

Article EXISTING ARTICLES PROPOSED ARTICLES Rationale(s) No.

4(b) Issues of Share to Directors Issues of Share to Directors Pursuant to Para. 7.04 of the Listing Requirements No Director shall participate in an issue of No Director shall participate in an issue of shares to employees unless shareholders in shares to employees unless shareholders general meeting have approved of the specifi c in general meeting have approved of the allotment to be made to such Director and specifi c allotment to be made to such unless he holds offi ce in an executive capacity Director and unless he holds offi ce in an executive capacity

6(a) Issue of Preference Shares Issue of Preference Shares Pursuant to the removal of Para. 7.05 of the Subject to the Act, the provision of these Subject to the Act, the provision of these Listing Requirements. Articles and the requirements of the Articles and the requirements of the Exchange, the Company shall have power Exchange, the Company shall have power to issue preference shares on such terms to issue preference shares on such terms and conditions and carrying such rights or and conditions and carrying such rights or restrictions provided that the total nominal restrictions provided that the total nominal value of the issued preference shares shall not value of the issued preference shares exceed the total nominal value of the issued shall not exceed the total nominal value ordinary shares at any time. The Company of the issued ordinary shares at any time. shall not, unless with the consent of existing The Company shall not, unless with the preference shareholders at a class meeting, consent of existing preference shareholders issue preference shares ranking in priority at a class meeting, issue preference shares to the preference shares already issued but ranking in priority to the preference shares may issue preference shares ranking equally already issued but may issue preference therewith. shares ranking equally therewith.

8. Waiver from Exchange for convening [Deleted] To delete in its entirety as Extraordinary General Meeting for New Issue it is a redundant clause. of Shares

Notwithstanding Article 7 above, the Company may apply to the Exchange to waive the convening of a general meeting to obtain Members’ approval for further issues of shares (other than bonus or rights issues) where :-

(a) the aggregate issues of which in any one fi nancial year do not exceed ten per cent (10%) of the issued share capital of the Company; and

(b) there is still in effect a resolution under Section 132D of the Act approving the issuance of shares by the Company. PETRONAS DAGANGAN BERHAD (88222-D) 135

Appendix I

Article EXISTING ARTICLES PROPOSED ARTICLES Rationale(s) No.

36 (a) Suspension of Registration Suspension of Registration In line with the amendment to the Listing The registration of transfer may be suspended The registration of transfer may be Requirements whereby at such times and for such periods as the suspended at such times and for such the timeframe to make Directors may from time to time determine, periods as the Directors may from time to announcement on the provided always that such registration shall time determine, provided always that such Book Closure has been not be suspended for more than thirty (30) registration shall not be suspended for shortened to ten (10) days in any year or such number of days as more than thirty (30) days in any year or market days. may be prescribed by the Exchange. The such number of days as may be prescribed Company shall give the Exchange prior by the Exchange. The Company shall give It is also not a written notice and publication in a daily the Exchange prior written notice and requirement under the newspaper circulating in Malaysia of the publication in a daily newspaper circulating Listing Requirements to period of the intended suspension or closure in Malaysia of the period of the intended publish the Notice of and the purposes thereof, which notice shall suspension or closure and the purposes Book Closure in the daily be at least twelve (12) market days after the thereof, which notice shall be at least newspaper. date of announcement to the exchange or ten (10) market days after the date of such number of days as may be prescribed announcement to the exchange or such by the Exchange. In relation to the closure, number of days as may be prescribed by the Company shall give written notice in the Exchange. In relation to the closure, accordance with the Rules to prepare the the Company shall give written notice in appropriate Record of Depositors. accordance with the Rules to prepare the appropriate Record of Depositors.

44A(1) Transmission of Securities From Foreign Transmission of Securities From Foreign Pursuant to Para. 7.14 of Register Register the Listing Requirements.

Where: Where:

a) the securities of a company are listed on a) the securities of a company are listed an Approved Market Place; and on another Stock Exchange; and

b) such company is exempted from b) such company is exempted from compliance with Section 14 of the compliance with Section 14 of the Central Depositories Act or Section Central Depositories Act or Section 29 of the Securities Industry (Central 29 of the Securities Industry (Central Depositories) (Amendment) Act 1998, Depositories) (Amendment) Act 1998, as the case may be, under the Rules of as the case may be, under the Rules the Central Depository in respect of such of the Central Depository in respect of securities, such securities,

such company shall, upon request of a such company shall, upon request of a securities holder, permit a transmission of securities holder, permit a transmission of securities held by such securities holder from securities held by such securities holder the register of holders maintained by the from the register of holders maintained registrar of the Company in the jurisdiction by the registrar of the Company in the of the Approved Market Place (hereinafter jurisdiction of the Approved Market Place referred to as “the Foreign Register”), to the (hereinafter referred to as “the Foreign register of holders maintained by the registrar Register”) other stock exchange, to of the company in Malaysia (hereinafter the register of holders maintained by the referred to as “the Malaysian registrar of the company in Malaysia 136 PETRONAS DAGANGAN BERHAD (88222-D)

Appendix I

Article EXISTING ARTICLES PROPOSED ARTICLES Rationale(s) No. Register”) provided that there shall be no (hereinafter referred to as “the Malaysian charge in the ownership of such securities. Register”) and vice versa provided that there shall be no charge in ownership of such securities.

44A(2) For the avoidance of doubt, no company [Deleted] Pursuant to Para. 7.14 of which fulfi lls the requirements of the Listing Requirements subparagraphs (1)(a) and (b) above shall allow any transmission of securities from the Malaysian Register into the Foreign Register.

57. Notice of Meetings Notice of Meetings Pursuant to Para. 7.17 of the Listing Requirements. The notices convening meetings shall specify The notices convening meetings shall the place, day and hour of the meeting, specify the place, day and hour of the and shall be given to all Members at least meeting, and shall be given to all Members fourteen (14) days before the meeting or at at least fourteen (14) days before the least twenty one (21) days before the meeting meeting or at least twenty one (21) days where any special resolution is to be proposed before the meeting where any special or where it is an annual general meeting. Any resolution is to be proposed or where notice of a meeting called to consider special it is an annual general meeting. Any business shall be accompanied by a statement notice of a meeting called to consider regarding the effect of any proposed special business shall be accompanied by resolution in respect of such special business. a statement regarding the effect of any At least fourteen (14) days’ notice or twenty proposed resolution in respect of such one (21) days’ notice, in the case where any special business. At least fourteen (14) special resolution is proposed or where it is days’ notice or twenty one (21) days’ the annual general meeting, of every such notice, in the case where any special meeting shall be given by advertisement in resolution is proposed or where it is the the daily press and in writing to each Stock annual general meeting, of every such Exchange upon which the Company is listed. meeting shall be given by advertisement in at least 1 nationally circulated Bahasa Malaysia or English daily press and in writing to each Stock Exchange upon which the Company is listed.

59(b) Request to Central Depository for Record of Request to Central Depository for Record Pursuant to Para. Depository of Depository 7.18(2) of the Listing Requirements. The Company shall also request the Central The Company shall also request the Depository in accordance with the Rules, to Central Depository in accordance with the issue a Record of Depositors, as at a date not Rules, to issue a Record of Depositors, as less than three (3) market days before the at the latest date which is reasonably general meeting (hereinafter referred to as practicable which shall in any event be “the General Meeting Record of Depositors”) a date not less than three (3) market days before the general meeting (hereinafter referred to as “the General Meeting Record of Depositors”) PETRONAS DAGANGAN BERHAD (88222-D) 137

Appendix I

Article EXISTING ARTICLES PROPOSED ARTICLES Rationale(s) No. 70. Voting Rights of Members Voting Rights of Members Pursuant to Para. 7.19A of the Listing Subject to any rights or restrictions for the Subject to any rights or restrictions for Requirements time being attaching to any class or classes the time being attaching to any class or of Members, each Member entitled to vote classes of Members, each Member entitled may vote in person or by proxy or by attorney to vote may vote in person or by proxy or and on a show of hands, every person present by attorney and on a show of hands, a who is a Member or a representative of a holder of ordinary shares or preference Member or a proxy shall have one vote, and shares who presents as a member or on a poll every Member present in person a member’s representative or proxy or or by proxy or by attorney or other duly attorney and entitled to vote shall be authorized representative shall have one vote entitled to one vote and on a poll every for each share he holds. Member present in person or by proxy or by attorney or other duly authorized representative shall have one vote for each share he holds.

73 Appointment of Proxies Appointment of Proxies To amend pursuant to Section 149 of the A holder may appoint more than two (2) A holder may appoint not more than two Companies Act, 1965 proxies to attend at the same meeting. Where (2) proxies to attend at the same meeting. a holder appoints two (2) or more proxies, he Where a holder appoints two (2) or more shall specify the proportion of his shareholding proxies, he shall specify the proportion of to be represented by each proxy. his shareholding to be represented by each proxy.

73A Appointment of More Than One Proxies Appointment of Not More Than Two To be consistent with the Proxies proposed amendments to Where a member of the Company is an Article 73 above authorized nominee as defi ned under the Where a member of the Company is an Central Depositories Act, it may appoint at authorized nominee as defi ned under the least one proxy in respect of each securities Central Depositories Act, it may appoint at account it holds with ordinary shares of the least one proxy but not more than two Company standing to the credit of the said (2) proxies in respect of each securities securities account. account it holds with ordinary shares of the Company standing to the credit of the said securities account. 138 PETRONAS DAGANGAN BERHAD (88222-D)

Appendix I

Article EXISTING ARTICLES PROPOSED ARTICLES Rationale(s) No.

98(a) Ipso Facto Vacation of Offi ce Ipso Facto Vacation of Offi ce Pursuant to Para.7.29 and 15.05(3) of the Listing The offi ce of a Director shall ipso facto be The offi ce of a Director shall ipso facto be Requirements vacated if the Director - vacated if the Director -

(i) ceases to be a Director by virtue of the (i) ceases to be a Director by virtue of the Act; Act;

(ii) becomes bankrupt or makes any (ii) becomes bankrupt or makes any arrangement or composition with his arrangement or composition with his creditors generally; creditors generally during his term of offi ce; (iii) becomes prohibited from being a director by reason of any order made under the (iii) becomes prohibited from being a Act; director by reason of any order made under the Act; (iv) becomes of unsound mind or a person whose person or estate is liable to be (iv) becomes of unsound mind or a person dealt with in any way under the law whose person or estate is liable to be relating to mental disorder; dealt with in any way under the law relating to mental disorder during his (v) is absent for more than 50% of the total term of offi ce; Board of Directors’ meetings held during a fi nancial year save and except in a case (v) is absent for more than 50% of the where the Exchange has granted a waiver total Board of Directors’ meetings held to the Director from compliance with this during a fi nancial year save and except requirement; in a case where the Exchange has granted a waiver to the Director from (vi) is removed by a resolution of the compliance with this requirement; Company in general meeting and in the case of an alternate or substitute Director (vi) is removed by a resolution of the by a resolution of the Directors; Company in general meeting and in the case of an alternate or substitute (vii) resigns his offi ce by notice in writing to Director by a resolution of the the Company. Directors;

(vii) resigns his offi ce by notice in writing to the Company. PETRONAS DAGANGAN BERHAD (88222-D) 139

Appendix I

Article EXISTING ARTICLES PROPOSED ARTICLES Rationale(s) No.

153(a) Persons Entitled to Receive Notice Persons Entitled to Receive Notice It is not a requirement to send a copy of the Notice Notice of every general meeting shall be given Notice of every general meeting shall of every general meeting in any manner hereinbefore authorised to:- be given in any manner hereinbefore to Securities Commission. authorised to:- (i) every Member; (i) every Member; (ii) every person entitled to a share in consequence of the death or bankruptcy (ii) every person entitled to a share of a Member who but, for his death or in consequence of the death or bankruptcy, would be entitled to receive bankruptcy of a Member who but, notice of the meeting; for his death or bankruptcy, would be entitled to receive notice of the (iii) the auditor for the time being of the meeting; Company; (iii) the auditor for the time being of the (iv) the Exchange; and Company; and

(v) Commission. (iv) the Exchange.; and

(v) Commission.

158. Similar Provisions [Deleted] Pursuant to the removal of Para. 7.03 of the Subject to the Act and the rules of the Listing Requirements. Exchange, the Articles of each subsidiary company of the Company must contain similar provisions as contained in Articles 98(a)(ii), 98(a)(iv), 98(a)(v), 114 and 121 herein. 140 PETRONAS DAGANGAN BERHAD (88222-D) Statement Accompanying Notice of Annual General Meeting

Pursuant to Paragraph 8.28(2) of the Listing Requirements of Bursa Malaysia Securities Berhad appended hereunder are:-

DIRECTORS STANDING FOR RE-ELECTION Directors who are standing for re-election at the Twenty-Fifth Annual General Meeting of the Company which will be held at Ballroom 1, Level 2, Hotel Nikko Kuala Lumpur, 165, Jalan Ampang, 50450 Kuala Lumpur on Tuesday, 10 July 2007 at 10.00 a.m. are:

(a) Datuk Anuar bin Ahmad (b) Dato’ Kamaruddin bin Mohd Jamal

DETAILS OF DIRECTORS STANDING FOR RE-ELECTION AS IN AGENDA 3 OF THE NOTICE OF ANNUAL GENERAL MEETING

Datuk Anuar bin Ahmad

Age 53

Nationality Malaysian

Qualifi cation • Bachelor of Science Degree (Econs) from the London School of Economics & Political Science, University of London • Attended Harvard Business School’s Advanced Management Programme (AMP), USA.

Position in the Company Non-Independent Non-Executive Director

Date fi rst appointed to the Board 20.05.1995

Membership of the Board Committees Chairman of the Board of Directors

Number of board meetings attended during the period under review 6/6

Working experience • Joined PETRONAS in 1977 and has held various senior managerial positions in International Marketing Division, Corporate Planning Unit, PETRONAS Trading Corporation Sdn Bhd and PETRONAS Dagangan Berhad • Vice President of Oil Business, PETRONAS since October 2002 to date.

Directorships in other public companies PETRONAS Group

Securities holdings in the Company 2,000

Family relationships with any directors and/or major shareholders of the Company Nil

Confl ict of interest with the Company Nil

List of conviction for offences within the past 10 years other than traffi c offences Nil PETRONAS DAGANGAN BERHAD (88222-D) 141

Statement Accompanying Notice of Annual General Meeting

DETAILS OF DIRECTORS STANDING FOR RE-ELECTION AS IN AGENDA 3 OF THE NOTICE OF ANNUAL GENERAL MEETING (CONT’D)

Dato’ Kamaruddin bin Mohd Jamal

Age 64

Nationality Malaysian

Qualifi cation • British Royal Military College of Science and British Command and Staff College. • MBA from the School of Business Management of the Cranfi eld Institute of Technology, United Kingdom • Advance Management Program at the IMD, Lousanne, Switzerland.

Position in the Company Independent Non-Executive Director

Date fi rst appointed to the Board 01.03.2002

Membership of the Board Committees • Board of Directors • Board Audit Committee

Number of board meetings attended during the period under review 6/6

Working experience • Served the Malaysian Army from 1962 – 1974. • Joined Esso Production Malaysia Inc. in 1975 and had held various management positions in both Upstream and Downstream Sectors. • Assistant to the Chairman for two years before he was appointed as the HR Director for Esso Companies in Malaysia on 1 January 1987 until he elected to retire in December 2001.

Directorships in other public companies Nil

Securities holdings in the Company Nil

Family relationships with any directors and/or major shareholders of the Company Nil

Confl ict of interest with the Company Nil

List of conviction for offences within the past 10 years other than traffi c offences Nil PETRONAS DAGANGAN BERHAD (88222-D) Proxy Form

I/We

of

being a member of PETRONAS Dagangan Berhad hereby appoint

or failing him/her, the Chairman of the Meeting as my/our proxy to vote for me/us on my/our behalf at the Annual General Meeting of the Company to be held at the Ballroom 1, Level 2, Hotel Nikko Kuala Lumpur, 165, Jalan Ampang, 50450 Kuala Lumpur on Tuesday, 10 July 2007 at 10.00 a.m. and at any adjournment thereof.

Resolution For Against

1. Adoption of Directors’ Report and Financial Statements

2. Approval of Final Dividend

3. To re-elect Director under Article 93 : Datuk Anuar bin Ahmad

4. To re-elect Director under Article 93 : Dato’ Kamaruddin bin Mohd Jamal

5. Approval of Payment of Directors’ Fees

6. Re-appointment of Auditors

7. Special Resolution 1 Approval of Amendments to the Articles of Association

Number of Ordinary Shares Held

Date: Signature/Common Seal of Shareholder(s)

Notes:

1. A member of the Company entitled to attend and vote at the meeting may appoint a proxy or proxies to attend and vote on his behalf. A proxy may but need not be a member of the Company.

2. Where a member of the Company is an authorised nominee as defi ned under the Securities Industry (Central Depositories) Act 1991, it may appoint at least one proxy in respect of each Securities account it holds with ordinary shares of the Company standing to the credit of the said Securities accounts.

3. The instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney duly authorised in writing or if the appointer is a corporation either under seal or under the hand of an offi cer or attorney duly authorised and must be deposited at the Company’s Share Registrar, Symphony Share Registrar Sdn. Bhd., Level 26, Menara Multi Purpose, Capital Square, No. 8, Jalan Munshi Abdullah, 50100 Kuala Lumpur, not less than 48 hours before the time fi xed for the meeting. If this Proxy Form is signed under the hand of an offi cer duly authorized, it should be accompanied by a statement reading “signed as authorized offi cer under Authorisation Document which in still in force, no notice of revocation having been received.“ If this Proxy Form is signed by an attorney duly appointed under a power of attorney, it should be accompanied by a statement reading “signed under Power of Attorney which is still in force, no notice of revocation having been received”. A copy of the Authorisation Document or the Power of Attorney, which should be valid in accordance with the laws of the jurisdiction in which it was created and is exercised, should be enclosed with this Proxy Form.

4. Unless voting instructions are indicated in the spaces provided above, the proxy may vote as he thinks fi t. First fold here

Affi x Stamp

Symphony Share Registrars Sdn. Bhd. Level 26, Menara Multi Purpose Capital Square No. 8, Jalan Munshi Abdullah 50100 Kuala Lumpur

Second fold here PETRONAS Dagangan Berhad (88222-D) Level 30-33, Tower 1 PETRONAS Twin Towers Kuala Lumpur City Centre 50088 Kuala Lumpur Tel : (03) 2051 5000 Fax : (03) 2026 5505

Website : www.mymesra.com.my Mesralink Tel : 1-300-88-8181 E-mail : [email protected]