AMEC Oil

1
AMEC Oil Gas Presentation

• 4 February 2003

2
Welcome

• Chris Kirk General Manager, Wallsend

3
Safety Our Position is Clear

• Safety is our business from executives to the
  front line worker, it starts and stops with us,
  it is one of our core values

4
Performance Counts - Some Facts
5
Performance Counts - Some Facts
6
Introduction

• Sir Peter Mason KBE, Chief Executive

7
Relevance of Oil Gas to AMECAMECs markets by
sales (Nine months ended 30 September 2002)
20
25
20
20
15
AMEC plc total turnover plus 100 of SPIE
8
AMEC - Oil Gas

• A 1 billion business
• Upstream, Downstream and Distribution markets
• Good record of growth
• Addition of SPIE will strengthen AMECs market
  position
• Future prospects remain good
• Strategy for growth

Total turnover 2001 including proforma 100 of
SPIE and Foraid
9
AMEC - International Oil Gas Collaboration
Group
Mike Straughen Chairman
SPIE
Upstream
Downstream
Oil Sands
Pipelines
EnerTech
Foraid
10
AMEC - Oil Gas

• Mike Straughen, Chairman, International Oil
  Gas Collaboration Group

11
AMEC - Oil Gas

• A 1 billion business
• Upstream, downstream, distribution
• Margins 4 - 5 per cent
• Good cash flow characteristics
• Growth market
• Differentiated portfolio
• Barriers to entry are extremely high
• Strategy for growth
• Future prospects remain good

20
Total Turnover Oil and gas percentage
Total turnover 2001 including proforma 100 of
SPIE and Foraid AMEC plc total turnover plus
100 of SPIE nine months ended 30 September 2002
12
AMEC has a differentiated portfolio across the
value chain
13
AMEC - Oil GasTurnover
million
Total growth 78
Organic growth 44
Total turnover 2001 including proforma 100 of
SPIE and Foraid
14
AMEC - Oil Gas Financial Performance

• Total turnover around 1 billion
• Margins stable
• UK long-term contracts average 3-5 years
• Majority of contracts are cost reimbursable
  (i.e. net cost protected)
• Good cash flow characteristics
• Equal balance of Services and Projects activity
• CAGR in total turnover 1996-2001 of 12 per
  annum

Total turnover 2001 including proforma 100 of
SPIE and Foraid
15
A Growth Market
Exajoules per year
1,500
1,000
500
0
1860
1880
1900
1920
1940
1960
1980
2000
2020
2040
2060
Source Shell International (1 exajoule
280 GWh)
16
What This Means

• Energy demand continues to rise
• Oil and gas remain dominant around 65 of total
  demand
• Only constraint is global production capacity
• New sources of supply
• Oil from West Africa, Caspian and Russia
• Gas from Trinidad, Algeria and Indonesia
• Deepwater oil is the new frontier Gulf of
  Mexico, Brazil, North Atlantic, West Africa
• Many markets previously closed now being
  liberalised

17
Global Oil and Gas Industry Projected Spend
During 2003
Sources Hydrocarbon Processing, Oil Gas
Journal, Salomon Smith Barney
18
Global Exploration and Production Spend 2003By
Type of Company and By Region
Total US130 billion
Source SalomonSmithBarney
19
AMEC - Oil GasLong-term Client Relationships

• BP Continuous project activity since 1970s
• Shell Relationship in North Sea since early 1970s
• ExxonMobil Relationship with Esso since 1960s
• Saudi Aramco Relationship going back to 1966
• Sinopec Working in China since 1930
• DuPont Repeat activity since early 1990s
• Dow / Union Carbide Five year operations support
  alliance
• Transco Relationship since mid-1970s (compressor
  stations)

20
A Balanced PortfolioAMEC - Oil Gas total
turnover around 1 billion
Total turnover 2001 including 100 of SPIE and
Foraid
21
Changing Nature of the Industry

• Many strong trends have emerged over the last few
  years
• Alliancing and partnering
• Longer term relationships
• Longer term service contracts
• Clients require both cost reimbursable and lump
  sum projects
• Client consolidation and competitor consolidation
• New trends
• Some contractors withdrawing from certain EPC
  offshore contracts
• Service contracts turning evergreen
• Commoditisation, e-procurement, on-line bidding
• Majors restructuring their portfolios in the
  North Sea
• Truly global procurement

22
Truly Global Procurement

• Bonga field development,
• Nigeria, West Africa
• Client in USA orders -
• Design from UK
• Hull from Korea
• Fabrication in UK, US and Monaco
• - all for delivery offshore Nigeria

23
AMEC - Oil Gas DifferentiatorsProven Delivery
and People

• Long-term relationships with key clients
• Recognised for delivery - when you plug it in, it
  works
• Health, safety and environmental leadership
• Complex, large scale, arctic and harsh
  environment facilities
• Total life of asset capability design for
  operations
• Application of technology held by others -
  freeing us to recommend best solution for client
• Successful track record with different types of
  contract
• Addition of SPIE will further enhance AMECs
  market position (expertise, client base,
  geographical spread etc.)

24
Principal Competitors
John Brown Hydrocarbons
Eni (Saipem, Bouygues, Snamprogetti)
Technip-Coflexip
Halliburton/KBR
Foster Wheeler
Aker Kvaerner
Products and services (not geographic reach)
Shaw Group
Wood Group
Hyundai
Bechtel
Chiyoda
AMEC
JGC
Fluor
ABB
Exploration and drilling
Engineering and project management
Complex topsides fabrication
Upstream
Jacket fabrication and installation
Subsea equipment installation
Hulls
Operations maintenance services
Oil and Gas
Gas processing / LNG
Refining
Petrochemicals
Downstream
Oil sands
Pipelines
Operations maintenance services
25
Barriers to Entry are Extremely High

• Requirements for success include
• Proven health and safety management systems
• Robust environmental systems and commitment
• Highly skilled workforce
• Global supply chain
• Regional presence
• Demonstrable track record
• Long-term relationships with clients

26
Strategy for Growth

• International diversification built on strong
  domestic position
• Strengthening of long-term client relationships
• Established relationships bring significant
  repeat business
• Lead to recurring revenues
• Focus on safety and sustainability
• Reputation for delivery
• Selectivity and proven risk management techniques
• Application of technology
• In how we undertake our work and in the products
  we deliver
• Focus on providing clients with high value adding
  solutions
• Growth through a combination of Organic, Alliance
  and Acquisition

27
Strategy for GrowthAMEC - Oil Gas turnover
(1996 and 2001)
million
Total turnover 2001 including proforma 100 of
SPIE and Foraid
28
Strategy for GrowthCurrent geographical spread
of AMEC - Oil Gas activities
including SPIE including proforma 100 of
SPIE and Foraid
UK represented 55 of total turnover in 2001
29
AMEC - Oil Gas

• Neil Bruce, Managing Director Upstream Oil and
  Gas

30
Leading Provider of International Services

• Consolidated strengths of major oil and gas
  players King Wilkinson, Woodhall Duckham, Press
  Construction, Matthew Hall, AGRA, Simons
• Addition of SPIE will further strengthen AMECs
  market position by increasing the client base,
  geographical spread and expertise
• Leading international player in large diameter
  pipelines

31
Outstanding Expertise and Track Record

• Recognised core competency is delivering
  added-value oil and gas operational support
  services to long-term clients around the world
• Also recognised for capability to deliver large
  and complex project solutions
• Over past 30 years
• Delivered over 100 new facilities
• Managed, fabricated and completed 400,000 tonnes
  of offshore platform facilities
• Daily support services to over 200 facilities
• 30 UK market share
• Growing international spread

32
Canadian Oil Sands

• World industry centred in northern Alberta
• Vast deposits equivalent to 2,500 billion barrels
  of oil
• Projected spend US 10 billion in next three
  years
• AMEC expertise in mining and extraction process
• Current projects
• Albian Oilsands Muskeg River
• Syncrude Canada Aurora Mine

33
Pipelines

• Leading international player in large diameter
  pipelines
• Consulting and design, construction and
  operational support
• Global capability
• Current projects
• ExxonMobil Chad-Cameroon oil pipeline (1,070
  kms)
• Sonatrach Algeria oil pipeline (800 kms)
• Sea Gas Minerva-Adelaide gas pipeline (685 kms)
• BTC Pipeline Company Georgia section of oil
  pipeline (248 kms) and three pumping stations
• Ireland Dublin-Galway gas pipeline (96 kms)

34
ExxonMobilChad-Cameroon pipeline project

• 1,070 kilometre oil pipeline of 30 inch diameter
• Duration of works 32 months (1999-2003)
• Client very demanding in terms of safety and
  protection of the environment
• Strong focus on sustainability, under World Bank
  supervision
• Verifications carried out by 102 non-governmental
  organisations during construction

35
ExxonMobilSkene

• Design and construction of new 2,500 tonne gas
  compression module to develop satellite oil, gas
  and condensate field
• Modifications to Beryl Alpha platform to accept
  module and to upgrade existing facilities
• Installation of module
• Commissioning support
• All milestone and budget targets achieved
• ExxonMobil safety award no Lost Time Incident
  during project

36
Shell ExproNorth Sea Services Contract Sigma 3

• Seven year contract worth 750 million (AMEC
  share 250 million)
• Unique joint venture between major North Sea
  services providers
• Supports all Shells Northern North Sea assets
• AMECs association with these facilities goes
  back more than 25 years
• Scope of services includes management and
  execution of engineering, design, construction,
  operations and maintenance and support services
• Supply chain of more than 200 companies
• Fully integrated with Shell sharing reward from
  common business drivers

37
BPCoryton Refinery Partnering Relationship,
Essex, UK

• Ongoing multi-project environment providing
  project execution services as an integrated part
  of the refinery
• 8th year of relationship
• 2001 award of clean fuels EPC project
• Evergreen contract providing engineering,
  procurement and project management services
• BP Silver Safety award two years with no
  recordable injury

38
BPCaspian Oil and Gas

• Engineering services leader in Caspian region
  (15 of worlds oil reserves)
• Organic growth based on long-term relationships
• 42 million contract for engineering services and
  project management for first two phases of
  Azeri-Chirag-Guneshli oilfield development
• 100 million contract for engineering and
  delivery of 248 kilometres of oil pipeline from
  Caspian to Mediterranean

39
Saudi AramcoBerri ethane recovery plant, Al
Jubail, Saudi Arabia

• Modifications to existing facilities plus new
  facilities including gas compression pre-treating
  plant, turbo expander trains and cold boxes,
  pumping and metering facilities
• Engineering, procurement, project management and
  construction services (Out of Kingdom)
• Engineering, design verification and site survey
  work (In Kingdom)

40
Shell Malampaya, Philippines

• Strategic alliance with Fluor Daniel
• Initial six year contract
• Supports development and long-term achievement of
  Malampayas objectives
• Covers operational facility maintenance,
  provision of operational services and sub
  contract management
• Includes innovative asset management services
  global remote support

41
Sinopec / BPShanghai Ethylene Cracker Complex
(SECCO), Shanghai, China

• Support contractor for the Integrated Project
  Management Team
• Total investment - US 2.7 billion
• Claimed to be worlds largest ethylene plant
• Ethylene capacity of 900,000 metric tonnes per
  annum (MTPA)
• Four downstream process plants together with all
  associated operational and utilities
  infrastructure
• Expected to commence operation in 2005

42
Sakhalin Energy Investment Company (SEIC)
Sakhalin II Field Development - Russian Far East

• Detailed proposals, specification, schedules and
  study reports for two new oil and gas platforms
• Definition and detailed engineering of
  Piltun-Astokhskoye and Lunskoye platforms and a
  tanker loading unit
• Project management
• Topsides design
• Integrated decks installed on a 4 leg gravity
  based structures resistant to wave, ice and
  seismic loads
• Immense technical challenges
• Extreme climatic conditions
• Area prone to earthquakes
• Temperatures down to 36ºC and fog

43
AMEC - Oil Gas DifferentiatorsProven Delivery
and People

• Long-term relationships with key clients
• Recognised for delivery when you plug it in,
  it works
• Health, safety and environmental leadership
• Complex, large scale, arctic and harsh
  environment facilities
• Total life of asset capability
• Design for operations
• Application of technology held by others
• Freeing AMEC to recommend best solution for
  client
• Successful track record with different types of
  contract
• Addition of SPIE will further enhance AMECs
  market position (expertise, client base,
  geographical spread)

44
AMEC - Oil Gas Recent Contract Awards

• AIOC Caspian Sea development AMEC share US67m
• Baku-Tbilisi-Ceyhan Pipeline Company
• Georgia pipeline - Caspian SPIE share US160m
• BP Clair oil platform - UK North Sea 50m
• Holstein/Mad Dog - US Gulf of Mexico 5m
• KNOC Donghae I field - South Korea 3m
• SEIC Sakhalin II Russian Far East US230m
• Suncor Energy Firebag Pipeline Project Canada
  8m
• Transco Bathgate gas compression station
  Scotland 48m

Azerbaijan International Operating Company a
consortium of BP, ExxonMobil and other leading
oil and gas producers. Korean National Oil
Corp. Sakhalin Energy Investment Company
45
Future Prospects Remain Good

• Several significant operational support services
  contracts to be awarded during 2003
• Major oil and gas projects planned in next 3-5
  years
• 44 offshore developments greater than 1 billion
• 13 new refineries average 1.5 billion
• 9 LNG plants, 11 LNG regasification terminals
• 11 worldscale petrochemical complexes
• 12 significant pipelines

46
Summary

• A 1 billion business
• Margins 4 5 per cent
• Good cash flow characteristics
• Growth market
• Differentiated portfolio
• Barriers to entry are extremely high
• Strategy for growth
• Future prospects remain good

Total turnover 2001 including proforma 100 of
SPIE and Foraid
47
Bonga Project

• Derek Harwood, Project DirectorAMEC Upstream Oil
  and Gas

48
Bonga ProjectDevelopment Description

• Client SNEPCO Shell Nigeria Exploration and
  Production Co Ltd

• Five contracts
• Topsides AMEC
• Hull Samsung (Korea)
• Moorings SBM (Monaco)
• Subsea Umbilicals ABB Vetco Gray (Houston /
  UK)
• Flowlines Risers Stolt Offshore (Houston /
  Paris)

49
Bonga Oil and Gas Field DevelopmentOffshore
Nigeria

• Floating Production, Storage and Offloading
  (FPSO) vessel
• 120 kilometres offshore Nigeria
• Moored in 1,030 metres of water
• Subsea wells for oil and associated gas and for
  water injection
• Storage for two million barrels of crude oil
• Oil exported by tanker
• Gas exported to Bonny Island liquefied natural
  gas (LNG) plant

50
Bonga FPSOTopsides Processing Plant

• 10 main modules
• Total of 22,000 tonnes
• Processing capacity
• 225,000 barrels of oil per day
• 170 million standard cubic feet of gas per day

51
Scope of Work

• Project management
• Engineering and procurement (three centres)
• Module construction (UK, The Netherlands and
  Nigeria)
• Hull tow from Korea
• Integration in UK
• Completion to pre-commissioning in UK and Nigeria
  

52
Sustainability Details of AMEC Local Content
Strategy

• Technology transfer and training
• Ongoing, Netco in London
• Technical seminars in Lagos
• Develop engineering design capability in Nigeria
  
• Ongoing, Netco in Lagos
• Develop module fabrication capability in Nigeria
  
• Ongoing, Daewoo in Warri
• Establish an offshore support base
• Subcontractor to be selected

53
Execution Strategy
UK - Hartlepool - Module Fabrication
UK Wallsend - Integration
The Netherlands - Zwijndrecht - Module Fabrication
UK Wallsend - Module Fabrication
UK London/Wallsend Design and Project
Management
Korea - Hull Collection
Nigeria - Design
Nigeria - Module Engineering and Fabrication
Nigeria - Offshore Hook-Up and Commissioning
54
Our Team
SNEPCO
Daewoo Nigerian Fabricator
Lloyds Register Certifying Authority
Alliance Partners
Foxboro Main Control Vendor
Smit Hull Tow
NETCO Nigerian Engineering
HMC Module Transport
Smit Module Lift
55
Execution Services Engineering

• Three design offices
• 90 in-house capability
• Known personnel and known systems (e.g. 3D CAD
  model)

56
Execution Services Procurement Management

• International procurement strategy
• Value of approx 150 million
• Management based in London with field support
  using in-house systems
• Over 100 orders placed
• Bulk and equipment deliveries currently ongoing
  to sites

57
Execution Services Construction Management

• Four yards
• Two in UK, one in The Netherlands, one in
  Nigeria
• Co-ordination of subcontractors yards
• Heerema at Hartlepool
• Heerema at Zwijndrecht
• Daewoo, Warri

58
Bonga Summary

• World class project
• Good for AMEC
• Continues to develop and build our relationship
  with Shell
• Expands our international profile
• Builds our West African capability
• Reinforces our position in the offshore and FPSO
  markets
• A growing market

59
FPSO and Deepwater DevelopmentA Growing Market

• Market for FPSOs remains strong
• More oil and gas reserves being discovered in
  deeper waters
• Majority of these projects will use floating
  production units 
• Nearly 150 deepwater oilfield developments
  planned before 2007
• Likely spend over next four years nearly US 60
  billion
• 40 in West Africa, 30 in the Gulf of Mexico.
  Source Douglas-Westwood
• Three largest deepwater operators are AMECs key
  clients
• BP, ExxonMobil and Shell