Leading the way; Making a difference INTERTANKO International Association of Independent Tanker Owners Singapore Meetings May 2012 DMDs Overview: Association Finance Priorities + Strategic Plan Katharina Stanzel Deputy Managing Director INTERTANKO

Leading the way; Making a difference Financial Statements 2011 E&Y Audit successfully completed Operating income: US$ 200k above budget publications/ tanker event/ membership up Operating expenses: ~5% below budget tight cost control, reduced travel, lower representation expenses ExCom reimbursement 50% only Result for the year just under US$ 955k => Cash Reserve US$

Leading the way; Making a difference 2011 Figures (US$) (Actual) (Budget)(Budget) Operating Income7,753,228 7,572,6507,401,925 Operating Expenses-6,886,593-7,217,450-7,373,997 Operating Result 866, ,200 27,928 Non-operating Income/expenses 87, , ,000 Result for Year 954, ,200 2,928

Leading the way; Making a difference 2012 BUDGET 2010 membership fees -10% No change in 2011 membership fees 2012 membership fees -5%

Leading the way; Making a difference BUDGET (US$) (Actual) (Budget)(Budget) Operating Income7,753,228 7,572,6507,401,925 Operating Expenses-6,886,593-7,217,450-7,373,997 Operating Result 866, ,200 27,928 Non-operating Income/expenses 87, , ,000 Result for Year 954, ,200 2,928

Leading the way; Making a difference Outstanding Fees 8. May 2012 Members: 58US$ Assoc. M.: 82US$ FDIP:14US$ Total154US$

Final Budget 2012 (USD) USD 1=NOK 6 GBP 1=USD 1.6 SGD 1=USD 0.8 EUR 1=USD Actual Budget I N C O M E Membership Fees6,614,9175,710, ,928,6505,878,332 Associate Membership Fees1,050,600909, ,000871,530 Membership FDIP104,83273, ,70082,080 Service Charge76,29974, ,80074,982 Publications775,165397, ,000320,000 Advertising76,41954, ,50050,000 INTERTANKO Courses9, Tanker Events- Income348,402161, ,000125,000 Total Operating Income9,056,3597,381, ,572,6507,401,925 E X P E N S E S Salaries & Benefits2,743,4133,084, ,033,0503,189,277 Social Security / Pensions732,094884, ,300829,342 Meetings236,869283, ,000220,820 Tanker Events- Expenses350,028127, ,000125,000 Travel669,867683, ,000709,668 Regional Representation70,72223, ,80064,799 Consultancy463,284575, ,250517,312 Public Relations17,54415, ,50065,000 Projects / Research76,067174, ,600109,150 Subscriptions41,29843, ,00045,020 Printing162,815107, ,000112,000 Post / Telephone177,985135, ,000131,122 Office Expense / Rent751,555857, ,050816,962 Provision for unpaid fees34,32627, ,000 Depreciation38, ,55038,525 Total Operating Expenses-6,566,390-7,062, ,217,450-7,373,997 Operating Result2,489,968318, ,20027,928 Interest Income12,43412, ,000 Exchange Gains / Losses574, Sum Non-Operating Income587,18013, ,000 Interest Expenses / Bank Charges35,40734, ,000 Sum Non-Operating Expenses-35,407-34, ,000 Result for the Year3,041,741297, ,2002,928

Leading the way; Making a difference 2012 First Quarter Balance Sheet A S S E T S Fixed Assets Office Furniture & Data Equipment75,567 Total Fixed Assets75,567 Long-term Investments Long-term Mortgage Loans to Employees Total Long-term Investments Current Assets Other Short-term Receivables507,149241,219 Accounts Receivable123,593102,379 Cash & Bank9,974,0677,036,507 Total Current Assets10,604,8097,380,105 TOTAL ASSETS10,681,2717,456,502 L I A B I L I T I E S A N D C A P I T A L Capital Capital Fund ,838,3645,883,426 Surplus for the Year3,435,471954,938 Capital Fund / ,273,8356,838,364 Current Liabilities Accounts Payable56,801151,814 Withheld Taxes, Social Security & Holiday Pay309,423315,960 Accrued Expenses & Deferred Income41,212150,364 Total Current Liabilities407,436618,138 TOTAL LIABILITIES AND CAPITAL10,681,2717,456,502

Leading the way; Making a difference 2012 First Quarter Cash Flow MarchDecember Surplus / Deficit for the Year3,435,471954,938 Depreciation for the Year038,523 Change in Current Receivables-287,144301,968 Change in Current Liabilities-210, ,506 Net Cash From Operating Activities2,937,625876,923 Change in Long-term Inv. / Fixed Assets Net Cash From Investing Activities Net Change in Liquid Assets2,937,560877,630 Cash & Bank at ,036,5076,158,876 Cash & bank at / ,974,0677,036,507

Leading the way; Making a difference 2012 First Quarter P&L /03/12BudgetYear I N C O M E Membership Fees3,847,1205,878,3325,903,045 Associate Membership Fees542,531871,531932,422 Membership FDIP48,97982,08079,206 Service Charge074,98277,460 Publications28,868320,000559,733 Advertising1,70050,00019,207 INTERTANKO Courses009,375 Tanker Event - Income55,050125,000172,780 Total Operating Income4,524,2487,401,9257,753,228

Leading the way; Making a difference 2012 First Quarter P&L /03/12BudgetYear E X P E N S E S Salaries & Benefits681,570 3,189,2793,001,854 Social Security / Pensions106, ,344831,484 Meetings33,948220,820227,094 Tanker Event - Expenses0123,000129,637 Travel94, ,666543,516 Regional Representation388 64,79950,418 Consultancy93, ,312722,130 Public Relations13,756 65,000157,750 Projects / Research3, ,15085,706 Subscriptions11,876 45,02030,495 Printing1, ,00080,027 Post / Telephone15, ,122152,321 Office Expense / Rent191, ,962851,551 Provision for unpaid fees0 400,000-15,913 Depreciation0 38,52538,523 Total Operating Expenses-1,247,024-7,373,999-6,886,593

Leading the way; Making a difference Five Year Strategic Plan Scenario Planning Macro Environment Analysis INTERTANKO Political Socio- Cultural Environmental Technological Economic

Macro-environment Political Global Economic Shift of Powers -China/ India/ Brazil - Europe failing Free market distortions - Regional Protectionism Regulatory Environment politicised - Regional regulation - Sanctions etc. Security Issues (Piracy) Economic Market Dynamics (Fleets, Cargos, Finance) Tonne mile demand Fuel availability/ cost Growing national protectionism Growth of national fleets/ interests Environ mental Globalised Concerns, e.g. Ballast Water Nox, Sox, PM, GHG Techno logical Compliance options through technology Availability of abatement/ treatment tec. Availability of Fuels LNG Distillates Socio- cultural Human Resources: - Availability/ Recruitment - Competency - Training Expectations from Legislators Politicians Public Overregulation Political decision making Need for Cooperation with other associations/ orgs

Markets Good Markets Bad Geopolitics unstable Geopolitics stable Environmental Concern Reasonable Envl. Concern Extreme

Leading the way; Making a difference Scenario Market Conditions Geo-political Environment Environmental Concern 1Dark Greengoodstableextreme 2All hands on deckgoodunstableextreme 3Lay-upbadstableextreme 4MAYDAYbadunstableextreme 5Full Aheadgoodstablereasonable 6Privateers ahoygoodunstablereasonable 7Customer is Kingbadstablereasonable 8Hard agroundbadunstablereasonable

Markets Bad Market: good Geopolitics: uncertain Environmental Concern: extreme Market: good Geopolitics: uncertain Environmental Concern: extreme Markets Good Geopolitics unstable Geopolitics stable

Scenario Market Conditions Geo-political Environment 1 - Global fleet capacity matches global demand - Economic growth + oil demand stable - Regulatory Environment workable - Political stability in oil producing regions - Global security risks to shipping manageable goodstable 2 - Global fleet capacity matches global demand - Economic growth + oil demand stable - Regulatory Environment workable - Political instability in oil producing regions - Regionalised political issues (e.g. sanctions/regulation) - Lack of coherent approach to security risks (piracy etc.) goodunstable 3 - Global fleet capacity exceeds demand - Regulatory Environment exceedingly stringent/ difficult to comply with/ regionalised - Political stability in oil producing regions - Global security risks to shipping manageable badstable 4 - Global fleet capacity exceeds demand - Regulatory Environment exceedingly stringent/ difficult to comply with/ regionalised - Political instability in oil producing regions - Regionalised political issues (e.g. sanctions/regulation) - Lack of coherent approach to security risks (piracy etc.) badunstable

Leading the way; Making a difference Strategic Objectives To develop and promote Best Practices in all sectors of the tanker industry, with owners and operators setting the example. (BP) To be a positive and proactive Influence with key stakeholders, developing policies and positions, harmonising a united industry voice and engaging with policy and decision makers. (I) To profile and Promote the Tanker industry, communicating its role, strategic importance and social value. (PT) To provide key Services to Members with customised advice, assistance and access to information, and enabling contact and communication between Members and with other stakeholders. (S)

Leading the way; Making a difference Major Issues Greenhouse Gas Emission Reductions Air Emission Reductions Ballast Water Management Global Maritime Security Threats Tanker Safety & Performance Sustainability Human Element

Leading the way; Making a difference Major Issues & Desired Outcomes Greenhouse Gas Emission Reductions Members’ new tankers meet/exceed, required EEDI and CO 2 emission reductions targets Develop solid industry practices & monitoring system for GHG emission reductions from tankers in operation (in cooperation with other stakeholders such as OCIMF, allowing Members’ tanker fleets to achieve & demonstrate increases in efficiency IF legislation on MBMs to be implemented, support/ promote most practical & transparent alternative at IMO (not regional)

Leading the way; Making a difference Major Issues & Desired Outcomes Air Emission Reductions Global switch to cleaner fuels Members fully advised on best choices for compliance with ECA requirements (and on how to assess and select scrubbers) Revised EU Sulphur Directive aligned with MARPOL Annex VI

Leading the way; Making a difference Major Issues & Desired Outcomes Ballast Water Management Members able to achieve compliance with current and future discharge standards (both regionally and internationally)

Leading the way; Making a difference Major Issues & Desired Outcomes Global Maritime Security Threats Members suitably informed to protect vessels & crew from maritime security threats Key stakeholders develop policies & positions benefiting whole industry Members suitably informed of sanctions that affect their trading patterns and decisions

Leading the way; Making a difference Tanker Safety & Performance Members proactively positioned for top performance with regard to safety & performance Sustainability Members have access to tools, models and information to enable them to continue operating Human Element Members have access to tools, models and information to enable them to continue operating Major Issues & Desired Outcomes

Leading the way; Making a difference

Greenhouse Gas Emission Reduction Desired Outcome: Members’ new tankers meet/ exceed required EEDI values and CO 2 emission reduction targets Tactics: Advise and support members in complying and exceeding EEDI (S) Create central database of EEDI values managed by INTERTANKO (PT) Analyse collected data to assess level of compliance (BP, S, PT) Report on results to members & other stakeholders e.g. to assist in IMO’s review of EEDI compliance (BP,I,PT) Liaise with Designers, Manufacturers, Charterers, other stakeholders to drive developments for safe, cost effective, environmentally sound tankers (S)

Leading the way; Making a difference Greenhouse Gas Emission Reduction Desired Outcome: Development of solid industry practices & a monitoring system for GHG emission reductions from tankers in operation, in cooperation with other stakeholders (e.g. OCIMF), allowing Members’ tanker fleets to achieve and demonstrate increases in efficiency Tactics: Create environmental performance database (S) Analyse collected data for periodical assessment of members’ emissions and efficiency improvements (BP,PT,S) Report on results to members, regulators and other stakeholders in order to demonstrate industry sector performance (BP,I,PT,S) Communicate Industry’s environmental credentials and increases in efficiency alongside its role in serving world trade (PT)

Leading the way; Making a difference Greenhouse Gas Emission Reduction Desired Outcome: IF MBM legislation were to be implemented, support/ promote most practical & transparent alternative at IMO, not at regional level Tactics: Continue to monitor/ influence IMO, US & EU legislators and contribute to rule development by providing information on the likely fleet-wide impacts of various MBMs (I, PT) Participate in the UNFCCC process alongside IMO where appropriate and beneficial (I,PT)

Leading the way; Making a difference Air Emissions Reduction Desired Outcome: [Global switch to use cleaner fuels] Should this policy decision continue to be pursued ? Tactic: Use opportunities, conferences, publications, articles to present advantages of use of clean fuels as major factor in reducing air + GHG emissions (I) Desired Outcome: Revised EU Sulphur Directive aligned with MARPOL Annex VI Tactics: Continue work with EU DG Environment and members of EU Parliament and Council as well as other stakeholders to guide decision making (I)

Leading the way; Making a difference Desired Outcome: Members fully advised to make right choices for compliance with ECA requirements (and on how to assess and select scrubbers) Tactics: Issue guidance to Members for compliance with ECA requirements (BP,S) Issue list of critical issues members should investigate when assessing/selecting scrubbers (incl. justifications and clarification of issues) (BP,S) Gather feedback from Members on their decision making regarding ECA compliance and experience with measures taken (BP) Update INTERTANKO guidelines on Bunkering, Fuel Switching etc. (BP) Ensure guidance and critical issue lists are continuously improved as experience is gained either through additional information from manufacturers or feedback from members (BP,S) Monitor and liaise with refining industry with regard to changing refining processes and fuel availability issues and push to see global sulphur cap of 0.5% enforced in (I) Assess to the extent possible availability of adequate marine fuels (S) Air Emissions Reduction

Leading the way; Making a difference Ballast Water Treatment Desired Outcome: Members able to achieve compliance with current and future ballast water discharge standards on a regional and international basis and remain compliant in future. Tactics:Installation and Operation of BWTS Provide Members with information on physical installation & operation of ballast water treatment systems through knowledge sharing in relevant Committee meetings and through the Weekly News and Environmental Bulletins (BP,S) Based on the experience gained by members, develop and promote best practices on the installation and operation of BWTS through updates of the INTERTANKO Ballast Water Treatment Systems Guide (BP) Monitor and report on the progress of INTERTANKO’s members in meeting current ballast water discharge standards in order to positively and proactively influence any future amendments and changes to regional and international ballast water legislation (I,PT)

Leading the way; Making a difference Tactics:Regulatory Focus (compliance and enforcement) Engage with regional and national authorities with a view to promoting the implementation of the International Ballast Water Convention as a single, international regulatory regime (I) Develop a comprehensive document outlining the various technical, practical and compliance challenges of installing and operating BWTS on tankers in order to positively and proactively influence the regulatory authorities responsible for developing the type approval and PSC enforcement processes for BWTS (I,PT) Promote a robust and practical type approval process adequate to ensure the compliance of the vessel once the system is installed on board (I,S) Positively and proactively influence the PSC compliance and enforcement process drawing particular attention to the need for uniformity and harmonization with the type approval process (I) Ballast Water Treatment

Leading the way; Making a difference Global Maritime Security Threats Desired Outcome: Members suitably informed to enable them to protect their vessels and crew from maritime security threats. Tactics: Proactively engage in the debate on best practice, collate member feedback and look for innovation which may lead to more secure vessels (BP,S) Provide clear advice on the most recent trends and best practice to members on request (S) Continue to develop and promote best practices and BMP guidelines as requirements evolve in cooperation with key partners, striving for a common voice (BP,I,S) Maintain the timely advice issued through the INTERTANKO Security Bulletins which are collated from key sources, but primarily UKMTO and ensure that lessons learnt from incidents are clearly shared with the membership (BP,S)

Leading the way; Making a difference Global Maritime Security Threats Desired Outcome: Key stakeholders positively and proactively influenced so that policies and positions are developed for the benefit of the whole Industry to ensure freedom of navigation. Tactics: Continue to participate in and contribute to the international efforts to eradicate piracy. This includes work with the five UN WG’s for PCS, IMO, Industry partners, UKMTO, MSCHoA, NATO, EC, FCO/DfT (I,PT) Use feedback and firsthand experience from members at suitable speaking events to strengthen the Industry voice and ensure it is heard (I,PT)

Leading the way; Making a difference Global Maritime Security Threats Desired Outcome: Members suitably informed of international, regional and national sanctions that affect their trading patterns, to enable them to make informed decisions on lawful trade. Tactics: Monitor international, regional and national sanctions and provide regular guidance to Members via Weekly News, targeted bulletins, and in response to individual questions (S) Work with key partners including the International Group of P&I Clubs and other shipping industry associations to ensure sanctions legislation is clear, workable and properly targeted (I)

Leading the way; Making a difference Tanker Safety & Performance Desired Outcomes: INTERTANKO members proactively positioned as top performers in terms of tanker safety and performance: zero fatalities, zero pollution, zero detentions Tactics: Develop guidance and best management practices with members and other industry bodies on issues which are key to tanker safety & performance (BP,I) Provide information to members so that they have a clear understanding of the requirements set by IMO, regulators/ administrations, OCIMF, oil majors, charterers and class societies amongst others (S) Work with ship inspection organisations, oil companies and port state authorities to ensure that the global ship inspection and vetting regime is unified and streamlined resulting in fewer inspections per ship per year (BP,I,PT)

Leading the way; Making a difference Tanker Safety & Performance Tactics (contd): Provide leadership on the development of guidance and best management practices for key industry practices/ policies within industry bodies, national regulatory bodies and the IMO, to influence the development of regulations (BP,I,PT) Review tanker safety and performance databases and ensure that what is being measured is optimum and presented in the most useable format. Propose updates as necessary and promote a framework of continuous improvement (PT,S) Actively collate and promulgate the latest initiatives regarding tanker safety and performance to members within an open and positive feedback process (BP,S)

Leading the way; Making a difference Sustainability Desired Outcome: (Development and provision of tools, models and information to assist Members to continue operating) to be reviewed Tactics: Provide members with the most up-to-date tanker market information on a regular basis (S) Develop the optimal speed model (S) Investigate alternative methods to handle additional bunker costs(I) Expand Worldscale Committee mandate and task committee to engage in discussions with brokers (S)

Leading the way; Making a difference Human Element Desired Outcome: No unfair treatment or criminalisation of seafarers Tactics: Develop Terms of Reference for Criminalisation Working Group and co-ordinate Working Group to study criminalisation and effect on safety/recruitment Enable best practice to be followed in reporting and investigation of incidents, thereby enable lessons to be learned. Raise awareness of criminalisation of seafarers and detrimental local laws and judgments for all instances of criminalisation Engage with governments / IMO to promote UNCLOS and MARPOL and to bring national laws into line Desired Outcome: Well trained, competent crews Tactics:

Leading the way; Making a difference Key Focus Areas Safety/TechnicalSeafarersEnvironment Marine Operations Regulatory / Legal Information Top priorities for 2012 Damage stability Inert gas Shipyard standards Class standards Fuel quality Mercury in crude Criminalization Crew competence Shore access Fair treatment of Seafarers GHG emissions Ballast water Reception facilities Air emissions Piracy Vetting Port State Control Chemical operations Sanctions Limits of liability insurance Oil spill compensation Tanker market Panel meetings IO web page Other work plan issues Tanker design Structural Integrity Machinery/equipm ent Fuel switching Safe tank entry Gas detection Biofuels Cargo properties Crew visas Seafarer ID docs Accommodation sp. Cadet berthing Ship recycling Anti-Fouling Waste management Noise pollution Response mgmt. Hull biofouling Ship striking mammals Loadlines off SA Lifesaving app Pilotage Port & Terminals Navigation issues Offshore operations Ship/Ship transfer ISPS Code Security Officers Ship sec alert sys Accident investigations Conflict in law UNCLOS Legislation Charter parties FDIP Demurrage Intellectual property Worldscale Anti-corruption Weekly News Annual review/ report Publications Presentations Tanker statistics Incident analysis Workshops Seminars Bulletins Global political/ economic environment