NOC‐IOC partnerships In the build up to the 2012 World National Oil Companies Congress we asked some of our speakers 3 key questions. 1. What are the key ingredients for a successful NOC‐IOC partnership? 2. How will the NOC‐IOC relationship evolve? 3. What are you hoping to achieve by speaking at and attending the World National Oil Companies Congress? This is a summary of what they had to say. 18 ‐ 22 June 2012 The Landmark Hotel London, UK Opportunity and strategy for NOCs and their partners Organised by: Contents Jay Pryor, Chevron ........................................................................................................................................ 3 Manuel Ferreira de Oliveira, GALP Energia ................................................................................................... 4 Chakib Khelil, retired minister of energy & mines ........................................................................................ 5 Takashi Yoshida, JOGMEC ............................................................................................................................. 6 Eugene Shepherd, Namcor ........................................................................................................................... 7 Momodou Badjie, Gambia National Petroleum Corporation ....................................................................... 8 Francois Rafin, Yemen LNG ........................................................................................................................... 9 Victor Eromosele, Nigeria LNG Limited ....................................................................................................... 10 Paul Groves, Petrofac Training Services ...................................................................................................... 11 Faizel Mulla, PetroSA .................................................................................................................................. 12 Produced as part of the World National Oil Companies Congress www.worldnationaloilcongress.com Jay Pryor, Chevron Jay Pryor is Vice President, Chevron Corp; President & Global Business Development at Chevron. He is responsible for identifying and developing new, large‐scale upstream and downstream business opportunities, including mergers and acquisitions. 1) What are the key ingredients for a successful NOC‐IOC partnership? One of the keys to any great relationship is taking the time to really understand your partner—learning about what they really need and how they define value. This type of understanding is a springboard for innovation, and it can lead to breakthrough solutions that build solid foundations and relationships that last decades. 2) How will the NOC‐IOC relationship evolve? More and more, we need to identify projects where NOC‐IOC partnerships will bring greater value than either can provide individually. These relationships have always provided excellent platforms for the exchange of knowledge, capital and technology, but increasingly NOC‐IOC partnerships will also be focused on a deeper understanding of how these relationships will benefit all stakeholders and can help provide a more equitable balance of risk and reward. 3) What are you hoping to achieve by speaking at and attending the World NOC Congress? This is another opportunity for us to talk to our partners about some of the exciting things we are doing at Chevron, particularly in regard to technology. But more importantly, it’s an opportunity to hear from them. To learn about how we can work together to overcome challenges, mitigate risk and support broad socioeconomic development. Produced as part of the World National Oil Companies Congress www.worldnationaloilcongress.com Manuel Ferreira de Oliveira, GALP Energia Manuel Ferreira de Oliveira is CEO of Galp Energia, SGPS, SA and has been since January 2007. 1) What are the key ingredients for a successful NOC‐IOC partnership? Aligned, shared and complementary objectives. Stable policies (taxes, operational rules and regulations). 2) How will the NOC‐IOC relationship evolve? Where there is regulation stability there will be accelerated relationships and attractive and sustainable projects driven by economic efficiency. In unstable political regulation or political environment the evolution will not be as strong and will evolve contingent upon political support. 3) What are you hoping to achieve by speaking at and attending the World NOC Congress? Improve the communication and win‐win business opportunities between IOC’s and NIOC’s. Produced as part of the World National Oil Companies Congress www.worldnationaloilcongress.com Chakib Khelil, retired minister of energy & mines Chakib Khelil was the Algerian minister of energy and mines from 1999 to 2010 and president of Sonatrach form 2001 to 2003. 1) What are the key ingredients for a successful NOC‐IOC partnership? A win‐win relationship is the key ingredient of a successful NOC‐IOC partnership . IOC's generally are more innovative technologically and have the trained human resources to build on quickly on their application in the field . IOC's have a well diversified technical international experience and the financial resources to explore for and develop hydrocarbon resources quickly. IOC's lack sufficient access to hydrocarbon resources and require a lubricant in the dialogue with government institutions to smooth out issues during implementation of their contracts. NOC's would benefit from the comparative advantages of IOC's while the latter would benefit from more ready access to resources and a smooth dialogue with governmental institutions. The win‐win relationship has to be agreed by both sides on a case by case basis between a specific IOC and NOC.Examples of Qatar gasand Exxon or Exxon with Roseneft could be given. 2) How will the NOC‐IOC relationship evolve? The relationship will evolve as NOC's become more like IOC's as they gain confidence and international experience. It also depends on the need for NOC's to go international as their local resources become more expensive or are being depleted . Examples abound such as TOTAL, STATOIL, PETRONAS, PETROBRAS show the way for the other evolving national oil companies . 3) What are you hoping to achieve by speaking at and attending the World NOC Congress? I am hoping to communicate and discuss my long experience with relationships between IOC's and NOC's during my work at the World Bank for 20 years in the oil and gas sector in Latin America and Africaas well as my experience as Minister of Energy and Mines in Algeria and as President of Sonatrach, the National Algerian Company. Hopefully lesons could be learned by attendees to improve relationships between IOC's and NOC's. Produced as part of the World National Oil Companies Congress www.worldnationaloilcongress.com Takashi Yoshida, JOGMEC Takashi Yoshida has been the Director General, Research & Analysis Department, Oil & Gas Upstream Business Unit at JOGMEC since July 2011. 1) What are the key ingredients for a successful NOC‐IOC partnership? Win‐win relationships. Respect for your counterpart's strong points. 2) How will the NOC‐IOC relationship evolve? It will advance into unconventionals development and then cooperation in the LNG industry. 3) What are you hoping to achieve by speaking at and attending the World NOC Congress? To share the current situation and the state of energy supply and demand in Japan, focussing on natural gas as a vital energy resource for Japan. Produced as part of the World National Oil Companies Congress www.worldnationaloilcongress.com Eugene Shepherd, Namcor Eugene Shepherd is the Acting MD of Namcor 1) What are the key ingredients for a successful NOC‐IOC partnership? Interaction and co‐operation for mutual economic benefit are key ingredients. Often IOC’s have pure profit motives, and NOC’s have more strategic views, but these do not necessarily have to conflict. With the global rise in awareness of Corporate Social Responsibility (especially post Macondo) IOC’s and NOC’s would be well advised to have pro‐active negotiations on designing mutually compatible goals. 2) How will the NOC‐IOC relationship evolve? In my opinion it is probable that IOC’s will gravitate to playing a greater role in exploration and operation, whilst NOC’s will increasingly be assigned licences by Governments which they will farm out to the expert IOC exploration and operation specialists. It will thus be less competitive and more symbiotic. 3) What are you hoping to achieve by speaking at and attending the World NOC Congress? I am hoping to give some exposure to my NOC, and its potential projects, whilst learning more about the successes achieved and lessons learnt by other NOC’s. Produced as part of the World National Oil Companies Congress www.worldnationaloilcongress.com Momodou Badjie, Gambia National Petroleum Corporation Momodou has been the Managing Director of Gambia National Petroleum Company (GNPC) since 2008. 1) What are the key ingredients for a successful NOC‐IOC partnership? Transparency, Candidness and Full and Accurate Record‐Keeping are the key ingredients. Transparence brings efficiency and accuracy. Candidness brings understanding and friendship. Full and Accurate Record‐Keeping keeps dispute and argument away. 2) How will the NOC‐IOC relationship evolve? NOC’s wants to maximize the value of domestic resources. IOC’s wants to give maximum profit to their shareholders. Without cooperation and understanding, both parties will fail to achieve their goals.