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A new era is dawningThe rise of the hybridnational oil company

Energy & Resources


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The rise of the hybrid national oil company 1

Hybrid NOCs defined 2

Analyzing the business competencies: 4

Traditional NOCs versus hybrids

Transitioning to hybrid status 10

Contacts 11

Contents


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A new era is dawning The rise of the hybrid national oil company 1

The most obvious is that hNOCs are continuously

assailed by a myriad of contradictory pressures.

This most often takes the form of balancing the

needs of government money for the treasury and

jobs for the local population with traditional business

requirements of capital investment and operational

efficiency.

Despite this challenge, a growing number of traditionalNOCs have embraced the hybrid model as the most

logical path to growing their oil and gas businesses

while continuing to provide social and economic

benefits to their populations. So what must todays

traditional NOCs consider in transitioning to a hybrid

model? How can they achieve effective and efficient

management and oversight? This management brief

proposes answers to these questions by defining what

constitutes an hNOC and then comparing and contrasting

how three fundamental business competencies are

addressed in a traditional NOC business model versus

a hybrid one. These competencies are corporategovernance, procurement, and alliances and joint

ventures.

The rise of the hybrid nationaloil company

So what must todays traditional NOCs consider in transitioning to ahybrid model? How can they achieve effective and efficientmanagement and oversight?

A new era is dawning for national oil companies.

They are expanding, not only beyond their borders,

but also in the sophistication of their organizational

structures and the ways in which they do business.

This trend is reflected in the recent proliferation of what

are being labeled as hybrid national oil companies

(hNOCs). These are not nationalised companies; they

are entities that quietly move between both the private

and public sectors. This fluidity enables hNOCs to enjoythe best of both worlds: a safety net from the public

sector largely backed by the government in terms of

ownership and financing and the risk-taking of the

private sector. As an example, their global reach

provides their home countries with opportunities to

gain access to the best resources while being able to

borrow money from local banks at favorable rates

thanks to government guarantees.

In light of these advantages, many traditional NOCs

those that are 100 percent owned by the government

and operate exclusively within their countrys border may want to consider making a shift to a hybrid model,

but this transition is not without its challenges.


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2

Based on a recent ranking of the worlds 50 largest oil

companies as measured by reserves, 30 of them feature

some form of government ownership, ranging from a

31.5 percent government stake in OMV of Austria to

100 percent government ownership in such companies

as Abu Dhabi National Oil Company.1 A traditional NOC

has three main characteristics:

it is 100 percent owned by the government;

it is the steward of its nations natural resources; and

it operates exclusively within its home countrys

borders.

Companies such as National Iranian Oil Company, Iraq

National Oil Company, and Nigeria National Petroleum

Corporation all fall into this category.

By comparison, hNOCs have the following

characteristics:

they have varying levels of government ownership;

they are the steward of their nations natural resources;

and

they operate both within and outside their home

countries.

Hybrid NOCs have expanded their reach and operate

outside of their home countries and in many sub-

sectors such as upstream and downstream. A majority

of these companies are domiciled in the Middle East,

China and Russia. Many hNOCs in the Middle East

remain largely governed by a ruling leader or party

whereas some Chinese companies have web-like ties to

the central or local governments. Russia has created a

large class of state companies mainly throughnationalization efforts and mergers and acquisitions

from the private sector although the government

remains firmly in control.

Although hNOCs can be considered a new category of

companies within global oil and gas, there is much

variety within it, featuring multinational operations as

well as public and private structures. Malaysias Petronas

and China National Petroleum Corporation (CNPC) are

examples: each company operates businesses in more

than 25 countries. They have access to plentiful private

capital and sophisticated management and technicalknow-how. Other hNOCs such as Gazprom, Statoil,

China National Offshore Oil Company (CNOOC) and Oil

and Natural Gas Corporation (ONGC) are all publicly

listed as is Petrobras of Brazil. On the private side,

companies such as Saudi Aramco and Kuwait Petroleum

Corporation remain 100 percent government-owned

but they too can be described as hNOCs. Saudi Aramco

qualifies as an hNOC because it sells its crude oil to

importing nations and it is involved in petrochemical

projects outside Saudi Arabia.

Hybrid NOCs defined

Hybrid NOCs have expanded their reach and operate outside oftheir home countries and in many sub-sectors such as upstream anddownstream. A majority of these companies are domiciled in theMiddle East, China and Russia.

1 PIWs Top 50: How the

Firms Stack Up.

Petroleum Intelligence

WeeklyNovember 30,

2009


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Traditional NOCs Hybrid NOCs International oil cos

Abu Dhabi National Oil Co. CNOOC Anadarko

Iraq National Oil Co. China National Petroleum Corp. Apache

KazMunaiGaz Ecopetrol BP

Libya National Oil Co. ENI Chevron

National Iranian Oil Co. Gazprom* ConocoPhillips

Nigeria National Petroleum Corp. Kuwait Petroleum Devon Energy

PEMEX Oil & Natural Gas Corp.* Exxon Mobil

Pertamina OMV* Hess

Petroleum Development Oman PdVSA Marathon

Qatar Petroleum Petrobras* Occidental

Socar Petronas* Repsol YPF

Sonatrach Rosneft* Royal Dutch Shell

Uzbekneftegas Saudi Aramco Total

Sinopec*

Statoil

Note: * indicates publicly traded on either an international or local exchange

Source: PIWs Top 50: How the Firms Stack Up. Petroleum Intelligence Weekly November 30, 2009

Figure 1.

Figure 2. NOCs Ranked by reserves (billion barrels)

Source: PIWs Top 50: How the Firms Stack Up. Petroleum Intelligence Weekly November 30, 2009

0 50 100 150 200 250 300

ExxonMobil

Rosneft

Nigeria National Petroleum

China National Petroleum

Libya National Oil Co

Abu Dhabi National Oil Co

PdvSA

Kuwait Petroleum

Iraq National Oil Co

National Iranian Oil Co

Saudi Aramco


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4

Corporate governance

In the traditional NOC model, governments own

100 percent of the national oil company. This ownership

structure provides the government with a great deal of

decision-making authority. This is where some friction is

observed: governments want control whereas NOCs

want self-governance.

The complex nature between governments and theirNOCs is compounded by the reasons that governments

form them in the first place. NOCs are formed primarily

to carry out the stewardship of the countrys natural

resources, provide jobs for the local population and

generate revenue for the home government. Thus, the

reasons behind the formation of NOCs are both social

and economic. Typically, most government personnel do

not possess the skills in petroleum engineering, geology,

and business management that are needed to run a

NOC (based on recent openings of petroleum and

geosciences-focused schools, this is changing). This may

dictate that the home country outsource much of thework and operational management to international oil

companies and oil and gas services firms through

alliances and joint ventures. To retain involvement, the

government will form an agency such as a petroleum

ministry to oversee operations and/or they will develop

a hydrocarbon-related institution that holds the NOC

accountable for its performance. The balance between

the governments reliance on mostly expatriate talent

and its desire to control the NOC is often difficult to

maintain.

Governments typically control their NOCs through

policymaking which includes setting oil and gas

production targets, health, safety, and environmental

(HSE) standards and social and economic targets.

Representation within OPEC is frequently included along

with retail subsidies, supply and demand and serving as

the conduit for attracting foreign domestic investment

in the hydrocarbon sector.

In order to be successful, both traditional and hNOCs

need a sufficient level of autonomy to devise strategies

and conduct their operations. They require a clear

mandate from the government in order to deal with

industry challenges effectively and that provides thecompanies time to adapt to the rigors of international

competition.

The volatile nature of the global oil and gas industry

involve changing conditions with respect to prices,

technology, foreign competition and management

techniques, implying that successful companies are

those that can anticipate or rapidly understand complex

situations and actively respond to them. This requires

three executive-level management skills: detailed

insight, understanding of industry dynamics and nimble

decision-making processes.

Governments may want to consider granting hybrid

NOCs more latitude in determining their own course of

action. In cases where the corporate governance of

traditional NOCs is strongly tied to the influence and

control of the host government, hNOCs encompass a

wider variety of stakeholders and shareholders, with

some ownership coming outside the government.

Sinopec (75.84%), Rosneft (75.16%), Statoil (67%) and

Petrobras (32%) all provide examples.2 Although these

companies have outside ownership, the government

retains its authority through specialty shares andinfluence.

A second differentiator between traditional NOCs and

their hybrid counterparts is that management within

hNOCs has likely been educated in major universities

and has had prior experience within the oil sector other

than within the NOC. These accomplished individuals

are likely to have had exposure to subjects such as

procurement and supply chain management, risk

management, human capital and strategy and

operations development. Consequently, hybrids are less

likely to outsource these disciplines and have a strong

propensity for wanting to retain these types of internal

capability.

Statoil offers a good example of how the governance

structure of a hybrid can effectively work. Statoil was

partially privatized with listings on the Oslo and New

York stock exchanges in 2001 when the company was

converted from a private limited company to a public

limited company. With a stake of 67 percent, the

Norwegian state is the main shareholder in Statoil.

This ownership interest is managed by the Ministry of

Petroleum and Energy. The Norwegian state emphasizes

that state-owned companies must comply withprinciples for good corporate governance.

Analyzing the businesscompetencies: Traditional

NOCs versus hybrids

2 PIWs Top 50: How the

Firms Stack Up.

Petroleum Intelligence

WeeklyNovember 30,

2009


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According to Statoils public website, the company

declares its corporate objective as creating and ensuring

long-term value for shareholders. Management has

developed what it calls a value-based performance

culture based on strict ethical guidelines and a code of

conduct. Further, the company underscores its

commitment to good corporate governance by

espousing the following:

all shareholders will be treated equally;

Statoil will ensure that all shareholders have access to

up-to-date, reliable and relevant information about

the companys activities;

Statoil will have a board of directors that is independent

of the groups management. In accordance with our

ethical guidelines, the board focuses on there not

being any conflicts of interest between owners, the

board of directors and the companys management;

and

the board of directors will base its practical work on

the principles for good corporate governance

applicable at all times.

Source: http://www.statoil.com/en/about/

corporategovernance/norwegiancodeofpractice/

pages/default.aspx

The Ministry of Trade and Industrys Ownership

Department has cooperated with key players in the

Norwegian economy to develop The Norwegian Code

of Practice for Corporate Governance.3 In the case of

both traditional NOCs and hNOCs, successful oversight

requires a consensus on what constitutes good

governance, that includes such issues as: distinct lines

of accountability and delineation of decision-making

authority among the various stakeholders including

investors/shareholders (if any), the government, and the

managers of the enterprise itself.

The procurement opportunity

When it comes to the procurement function many

traditional NOCs would fall into an operational rating as

needs improvement. When consideration is given to a

procure-to-pay process, suppliers tend to witness very

basic tender processes in action. Most internal and

external communications are paper-based and much of

the proposal process is focused on the structure of the

actual requirement being procured rather than on whatis actually being procured. Decision-making processes

tend to take a limited view of value versus total cost

that typically results in a commercial selection of the

lowest price. From a supplier perspective, this process

may seem opaque with little ability to influence the

total value; this opaqueness may be enhanced by a

highly complex approval process that may take months

before a final decision can be made. Moreover, the

often fragmented structure of the holding company

model in traditional NOCs prevents the company from

putting one face forward to the supplier market. As an

example, suppliers often receive very similar requests forproposals from traditional NOC operating companies

and subsidiaries which suggests little to no internal

coordination.

Within the traditional NOC structure, the transformation

of the procurement process is likely to be challenging

due to several sub-processes; strategic sourcing,

procure-to-pay process improvements, capability

building, total cost of ownership (TCO), and supplier

relationship management (SRM).

Within the traditional NOC structure,the transformation of the procurementprocess is likely to be challenging

3 Statoil website.

http://www.statoil.com/en/

about/corporategovernance/

ownership/pages/default.

aspx


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6

Strategic sourcing and total cost of ownership

Strategic sourcing is the term used to describe the focus

on creating beneficial relationships with suppliers and

views the concept of procurement as an exercise in

total value versus that of traditional low price or low

bidder competition. The implementation of strategic

sourcing is likely to require viewing the market as a

place where the organization and the associated

supplier(s) can create win-win value through an end-to-end process view. There has been a tendency by some

traditional and hNOCs to view the procurement process

as a set of separate and unrelated transactions rather

than reaching out to the marketplace with the full

spend profile. To capture the strategic sourcing

opportunity, both traditional and hNOCs will need to

break out from the individual transaction mode and

look across their subsidiaries and business units to

understand the total value that they are bringing to the

marketplace. This will likely require the breaking down

of work silos that may fall outside of normal procedures

for these companies. Further, some traditional andhNOCs may want to consider undertaking a view of

spend that provides a rigorous analysis of the total

offer, a process that may require manual intervention of

offline tools to capture.

Total cost of ownership

Total cost of ownership (TCO) is another area of

differentiation between traditional and hNOCs. There is

a fundamental challenge with the traditional NOC

method of procurement commonly referred to as the

lowest bid. By disaggregating the commercial from

the technical bid, significant value may be missed

when viewing the offer as an end-to-end procurement

exercise. By focusing on the lowest bid selection aftermeeting some minimum hurdle of technical criteria,

traditional NOCs may be selecting a bid with the lowest

initial cost but may actually present a higher lifecycle

cost across the length of the asset or project life. In an

example from the exploration and production (E&P)

sector, the price of a certain asset must be viewed over

the asset life cycle including maintenance and

performance as opposed to just initial cost. With the

very sizeable market leading spend volumes, a

traditional NOC can create tremendous total value by

bringing the right offer to market. Just with the

spending scale the business case for these types ofefforts would, in many cases, be overwhelming. Oil and

gas consultants from Deloitte member firms have

estimated that reducing TCO by 1 percent on a $1 billion

spend category can lead to favorable cost savings.

The most effective way to capture TCO value is through

the transformation of the procurement process to one

that is more flexible and less rigid in the approach to

bid and reward. Most international oil companies (IOCs)

have made considerable progress in this area but there

are still opportunities to be realized in traditional and

some hNOCs, given that the TCO approach can

oftentimes result in a significant impact to the bottom

line. Such key building blocks exemplify the foundation

for many similar IOC procurement transformations.

Supplier relationship management (SRM)

Managing supplier relationships is another area of

differentiation between traditional and hNOCs.

Procurement departments within traditional NOCs may

be able to create additional value by actively managing

the ongoing supplier relationship. One IOC-based

example is around the concept of having supplier input

into the design/function of the end product being

procured. By forging an ongoing relationship and

facilitating two-way communication, traditional NOCscan continue to take cost out and create value through

a transformed procurement process.


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Traditionally, the first step in creating an SRM program

is to identify the mission-critical projects and

corresponding supplier relationships across the

organization. This is done by looking down individual

silos at the holding group level whereby perspective is

gained on the criticality of the overall supplier

relationship. Once these relationships are identified, a

small team and third party can work with each supplier

to set goals and objectives for ongoing performancemanagement that will likely yield value to both

organizations.

Organizational capability

The ability to execute and sustain such elements of

procurement strategy requires a procurement function

that has the appropriate skill sets to credibly deliver

both internally and externally to the marketplace.

A challenge for the traditional NOC will be to create

a model of functional excellence in an environment

where such competencies and measures are not built

into the organizational culture. This will likely requirethe development of a robust set of procurement key

performance indicators (KPIs), measurement of those

KPIs and organizational accountability for the delivery

against a set of objectives based on these KPIs.

Some IOCs have used models that have carved out

an organizational group responsible for functional

excellence. Such groups work very closely with the

human resources function to understand the current

skill set of the procurement staff as well as the key

skill set requirements for each procurement role.

The procurement excellence team then typically

develops a roadmap to upskill the appropriate staff

as well as helping to hire talent to fill the organizational

knowledge gaps in order to create the opportunity for

world class procurement.

Similarly, functional performance management is critical

to create organizational momentum for procurement

transformation. Significant opportunities remain for

traditional and hNOCs alike to better define success in

the role of procurement. Certain savings targets have

been established but in many cases, these targets lack

broader credibility outside the procurement function

due to non-robust measurement and tracking. SomehNOCs have observed anywhere from 5 to 15 percent

procurement savings improvement from having the

right skill sets and the right people executing the

procurement process.

Procure-to-pay process improvements

Underpinning any transformation in the procurement

area is procure-to-pay (PTP) process improvements.

The ability to execute world class procurement often

requires such historical information as accurate spend

data and procurement cost savings tracking in the

strategic sourcing process. Many traditional NOC

procurement exercises are done in an entirely manual

response format. Consequently, focus tends to be

placed on the adherence to the procurement processmanual format. In contrast most hNOCs and IOCs have

gone to an all electronic bidding process with

significant use of strategic sourcing support software.

In many cases, this adjustment has streamlined the

process and allowed for quicker decision making.

Communications can be made to all bidders

simultaneously and vast amounts of data can be more

easily analyzed. By creating a central repository of

information, there may also be significant reductions in

processing time. Procure-to-pay process improvements

will also go a long way toward improved transparency

for key supplier relationships. Any increase into the

transparency of the process is likely to help suppliers

create more value for the buying organizations.

Similarly, the requisition-to-RFP process presents

a further opportunity for traditional and hNOCs.

The challenge of being able to secure the right

products and services in a tight market is a big one.

If a traditional or hNOC cant complete a procurement

transaction due to unclear delegation of authority,

there will be missed opportunities. This means competitors

are capturing the best deals or cornering scarce resources

in a tight supply market.

A challenge for the traditional NOC willbe to create a model of functionalexcellence in an environment where suchcompetencies and measures are not built

into the organizational culture.


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8

Alliances and joint ventures

It has come as no surprise that NOCs are on the hunt

for resources. They are aggressively looking for both

corporate and asset M&A opportunities to accomplish

three goals: bolster their market strategies, expand

reserve portfolios, and develop strategic alliances.

These goals can be achieved either by NOC-to-NOCtransactions or by alliances and joint ventures with

IOCs. Deals between Korea National Oil Corporation

and Sinopec, and Kuwait Petroleum and Petrovietnam

are examples of NOC-to-NOC transactions. There

appears to be a number of differences between

traditional and hybrid NOCs when it comes to joint

ventures. Typically, most traditional NOCs are likely to

require both technical and financial support from

IOCs and hNOCs to improve their domestic drilling

programmes. In general terms involving technical

capabilities, traditional NOCs lack the requisite skills to

implement sophisticated exploration and production(E&P) programs and rely on IOCs and oil field service

companies to administer these projects. IOCs engaging

in joint ventures with traditional NOCs need to invest

money into these projects depending on the financial

stability of the producing country and its traditional

NOC. On the other hand, hNOCs are more likely to

enter into joint venture projects with other hNOCs

based upon their need to increase reserves outside of

their home country which in turn drives their own

economic expansion.

One emerging trend in this area involves the Partnership

Operating Company model, in which IOCs and hNOCs

collaborate to form a completely new company, rather

than a joint venture to develop a specific resource in a

specific area.4 This new type of company operates as an

independent entity, run by a jointly approved executive

team and staffed with its own employees. This model

offers advantages to both parties, providing the IOC

access to the NOCs reserves, but with the NOCretaining control over reserves and infrastructure while

gaining access to financing and the IOCs more efficient

operating capabilities. Changing business drivers in the

oil and gas sector are creating an environment that is

amendable to this evolution.

Petrovietnam has been expanding its overseas portfolio

over the last several years. As part of the companys

2008 to 2015 strategy, the Vietnamese government

wants Petrovietnam to produce 25-35 million tons of oil

equivalent per year, of which 18-20 million tons will be

crude oil and 16-17 billion cubic meters will be gas.5

These targets are likely to be met by expanding its E&P

activities abroad. Given the fact that Petrovietnam has

fewer resources to enter into competitive bidding with

major IOCs or cash-rich Chinese NOCs, the company is

pursuing a co-operative overseas growth strategy.

Petrovietnam already has a close relationship with

Russias Zarubezhneft through their joint venture,

Vietsovpetro. The companies are moving to expand

their joint operations by recently agreeing to jointly

explore for oil and gas off the coast of Cuba. Further,

Petrovietnam has formed a joint venture with Gazprom

which will allow the companies to develop deposits in

Russias Orenburg region. One of Petrovietnams Latin

American projects involves the PetroMacareo joint

venture between PdVSA of Venezuela (60 percent

share) and Petrovietnam Exploration & Production

(PVEP), Petrovietnams upstream unit (40 percent share).

The PetroMacareo joint venture is one of the most

advanced JVs in the Junin area an area in the Orinoco

Heavy Oil Belt region.

One emerging trend in this area involvesthe Partnership Operating Companymodel, in which IOCs and hNOCscollaborate to form a completely new

company, rather than a joint ventureto develop a specific resource in aspecific area.

4 Sampat Prakash and

Rachael Goydan. Beyond

the Joint Venture: True

Collaboration for Long-

term Success. Oil & Gas

Financial Journal, May

2009. See also:

http://www.deloitte.com/

view/en_US/us/Industries/

oil-gas/article/

1b83cf6d88912210VgnVC

M100000ba42f00aRCRD.

htm

5 Tom Grieder. Southeast

Asian NOCs to Join

Acquisition Spree. IHS

Global Insight Daily

Analysis September 17,

2009


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Although Southeast Asia is a growing region for oil and

gas projects, similar joint venture arrangements are

being developed in Africa and Latin America. Egypt and

Algeria have established an oil and gas E&P-focused

joint venture which will pursue opportunities in the two

countries and on an international basis. The joint

venture, to be called Selena, is 50 percent owned by

Algerias NOC Sonatrach with Egyptian Natural Gas

Holding Company and Egyptian General PetroleumCorporation holding the remaining shares. This

particular joint venture will have an alternating

presidency and vice-presidency switching between

representatives of the Algerian and Egyptian owners.

Venezuelas oil industry has suffered from a lack of

foreign investment over the last 18 months as a result

of the global economic recession. In spite of this

slowdown, the government has signed a series of

agreements with a wide range of hNOCs covering both

large and high-profile state firms from China and India

and smaller hNOCs with limited upstream experience.China National Petroleum Corporation has emerged as

Venezuelas leading overseas hNOC with its

Petrosinovensa joint venture, while Indias Oil & Natural

Gas Corporation (ONGC) formed the Petrozumano with

PdVSA in 2007.6 More recently, the Chinese

government has promised to lend $20 billion to

Venezuela which underscores Chinas commitment and

interest to oil development in the developing world.7

While alliances and joint ventures with IOCs are

straightforward transactions involving crude oil

exploration and development and technology, NOC-to-

NOC transactions derive economic and political value.

Factors driving this trend are cultural similarities and

ease of doing business. But beyond mutual trust and

comfort lie powerful economic realities and political

motives that are forcing hNOCs to increasingly partner

with each other.

From an economic standpoint, traditional net-importing

NOCs are seeking to gain access to sufficient reserves to

drive their countries economic engines over the long

haul, thus making deals with traditional NOCs in

resource-rich nations very attractive. Several recent

examples exist, including investments by Chinese NOCs

in Brazilian production projects and agreements

between hNOCs to build pipelines for transporting

crude and natural gas from Russia to China. On theother hand, producing nations must secure access to

markets. Kuwait Petroleum recently entered into a

petrochemical agreement with China to ensure a long-

term market for its products.

6 NOCs Yet to Deliver for

Venezuela. Petroleum

Intelligence WeeklyOctober 5, 2009

7 Chinas $20 Billion

Bolsters Chavez.

Wall Street Journal

April 19, 2010 A1


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10

For continued hNOC sustainability, the development of

robust procurement and supply-chain processes should

reside with the companys executives as they possess

the requisite skills for overall management. Within some

hNOCs, decision-making authority is shared by the

government and the NOC but the governments

involvement should not be excessive. Transformation of

the procurement process in traditional NOCs is an issue

best undertaken by the executive team as it has a directimpact on the financial statement.

Joint venture arrangements shift the risk from one

company to many. NOC-to-NOC arrangements have

become more commonplace and their use is increasing.

While Middle East hNOCs have led the way, this

arrangement is increasingly being used in Asia and Latin

America. The Partnership Operating Model is an

emerging trend where IOCs and hNOCs collaborate to

form a brand new company with its own staff and

rotating management.

For those traditional NOCs considering the transition to

an hNOC model, successful execution of corporate

governance strategies, improved procurement processes

and new types of alliances and joint venture

arrangements are likely to require enhanced business

skills and more flexible relationships with host

governments.

Transitioning to hybrid status

When transitioning from a traditionalNOC to an hNOC, one of the crucial

undertakings is delineating themanagement duties between thegovernment and the NOC executives.

Many of todays hNOCs began their corporate life as a

traditional NOC. Their evolution was made possible by

focusing on three important managerial issues:

corporate governance, procurement and alliances and

joint ventures. As a result, hNOCs have been able to

expand their overseas operations gaining access to

much needed oil and gas reserves. Just as reserves are

important to future success, perhaps so is the ability to

tap international financial markets for much neededcapital. This may be somewhat difficult to accomplish

for traditional NOCs but for those hNOCs listing even a

limited number of shares on a local or global exchange

has resulted in attracting capital useful for project

development.

When transitioning from a traditional NOC to an hNOC,

one of the crucial undertakings is delineating the

management duties between the government and the

NOC executives. By comparison, hNOCs will likely

require a clear mandate and limited non-interference

from the government so that executives can focus onthe business issues. Further, good corporate governance

is a good goal to strive for and should be developed so

that all shareholders are treated equally and a high level

of transparency is achieved.


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Global leadership

Peter Bommel

Deloitte Touche Tohmatsu

Global & EMEA Leader, Energy & Resources

+31 882 880 935

[email protected]

Chris Nicholson


Chairman, Energy & Resources

Leader, National Energy Companies

+7 495 787 0600

[email protected]

Adi Karev


Global Leader, Oil & Gas

+1 202 378 5105

[email protected]

David E.A. Williams


Global Leader, National Oil Companies

+971 (4) 369 [email protected]

Dick Cooper


Global Leader, Energy & Resources Consulting

+1 403 261 8115

[email protected]

Pat Concessi


Global Leader

Climate Change and Carbon Markets

+1 416 601 6251

[email protected]

John England


Global Leader

Energy & Resources, Enterprise Risk Services

+1 713 982 2556

[email protected]

Jean-Michel Gauthier


Global Leader

Energy & Resources, Financial Advisory Services

+33 1 55 61 69 11

[email protected]

Doug King


Global Leader

Energy & Resources Audit+44 20 7007 0863

[email protected]

Brad Seltzer


Global Leader

Energy & Resources Tax

+1 202 220 2050

[email protected]

Julian Small


Global Leader

Oil & Gas Tax

+44 20 7007 1853

[email protected]

Dominic Young


Global Leader

Global Energy Markets

+1 403 267 1778

[email protected]

Asia

Kappei Isomata

Deloitte Japan

Leader, Asia Pacific, Energy & Resources+81 92 751 0931

[email protected]

Stephen Reid

Deloitte Australia

Leader, Oil & Gas

+61 (03) 9671 6461

[email protected]

Central Asia

Sanjay Kaul

Deloitte India

Leader, Oil & Gas

+91 11 4608 2435

[email protected]

Central Europe

Vladimir Vanek

Deloitte Central Europe

Leader, Central Europe, Energy & Resources

+420 246 042361

[email protected]

Europe

Carl D. Hughes

Deloitte United Kingdom

UK Head Energy, Infrastructure & Utilities

+44 (0)20 7007 0858

[email protected]

Latin America

Ricardo Ruiz

Deloitte ArgentinaLeader, Latin America, Energy & Resources

+54 11 4320 4013

[email protected]

William Ballantyne

Deloitte Brazil

Leader, Oil & Gas

+55 (21) 3981 0500

[email protected]

Gustavo Ramirez Rubio

Deloitte LATCO (Colombia)

Leader, Oil & Gas

+57 (1) 546 1810

[email protected]

Rodolfo Jativa

Deloitte LATCO (Ecuador)

Leader, Oil & Gas

+593 2 2251 319

[email protected]

Arturo Garcia Bello

Deloitte Mexico

Leader, Oil & Gas

+52 55 5080 6274

[email protected]

Middle EastMutasem Dajani

Deloitte Middle East

Leader, Middle East Oil & Gas

+971 (2) 676 0606

[email protected]

Paul Navratil

Deloitte Middle East

Leader, Middle East Energy & Resources Consulting

+973 1721 4490

[email protected]

North America

Gary Adams

Deloitte LLP (United States)

U.S. Leader, Oil & Gas

+1 713 982 4160

[email protected]

Russia/CIS

Elena Lazko

Deloitte CIS

Leader, CIS Oil & Gas

+7 495 787 0600

[email protected]

South Africa

Anton Botes

Deloitte Southern Africa

Country Leader, Energy & Resources

+27 (0) 12482 0020

[email protected]

Western Africa

Olufemi Abegunde

Deloitte Nigeria

Country Leader, Energy & Resources

+234 1 2717821

[email protected]

Contacts

For more information contact the Global Energy & Resources leadership at our member firms:


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www.deloitte.com/energy

About Deloitte

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legally separate and independent entity. Please see www.deloitte.com/about for a detailed description of the legal structure of

Deloitte Touche Tohmatsu and its member firms.

Deloitte provides audit, tax, consulting, and financial advisory services to public and private clients spanning multiple industries.

With a globally connected network of member firms in more than 140 countries, Deloitte brings world-class capabilities and deep

local expertise to help clients succeed wherever they operate. Deloitte's approximately 169,000 professionals are committed to

becoming the standard of excellence.

The DTT Global Energy & Resources group, which includes senior partners from Deloitte member firms around the world, provides

comprehensive, integrated solutions to the energy sector. These solutions address the range of challenges facing energy companies

as they adapt to changing regulatory environments, to political, economic and market pressure, and to technological development.

Deloitte member firms in-depth expertise in this dynamic sector serves as an indispensable resource for a significant portion of the

worlds largest energy companies. Deloitte member firms have designed their practices to conform to this rapidly changing sectors

unique needs; to that end, member firms offer a complete range of services designed to provide the energy industry with

unparalleled service, innovation, and critical thinking.

Disclaimer

This publication contains general information only, and none of Deloitte Touche Tohmatsu, its member firms, or its and their

affiliates are, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or other professional

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2010 Deloitte Touche Tohmatsu. All rights reserved.

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