2. Offshore Plant Korea, Where Success Knows No Limits Index 1. Industry Overview4 2. Competitiveness & Prospects8 3. Government Policies13 4. Cost15 5. Success Case18

3. Industry Overview Global Market Developments & Outlook 3 Korea is leading the global deep-sea drill ship market. China has outrun Singapore and is leading the global jackup market. Lower drillship orders due to the fall in oil prices

4. Order backlogs by Korea and China Industry Overview 4 Domestic Market Developments & Outlook Source: Clarkson Sept. 2014

5. FPSO order backlogs by major country Industry Overview 5 Domestic Market Developments & Outlook  By FPSO order backlog, Korea topped the list with 25 orders in 2014 and had an almost dominant position in the mid- to large-size segment. Source: Clarkson Other

6. Industry Overview 6 Status of Foreign Direct Investment Year Nationality of investor CompanySegment

7. Industry Overview 7 Status of Foreign Direct Investment Year Nationality of investor CompanySegment

8. Competitiveness & Prospects 8 Industry Value Chain Construction & fabrication Key offshore plant market segments include floating semi-submersible, drill- ship, FPSO, LNG-FPSO and LNG-FSRU.

9. Human Resource: Supply & Demand 9 Number employed Unit: People Competitiveness & Prospects

10. Increase in Supply of Skilled Labor 10 Change in skilled labor Unit: People Note: Based on shipbuilding and offshore (excluding others) Source: Korea Offshore & Shipbuilding Association Competitiveness & Prospects

11. Korean Offshore Plant Industry & Infrastructure 11 Ulsan – Offshore plant construction / OSV Busan – Equipment / R&D center / HR development Daejeon – Special research zone / basin Seoul – Engineering South Gyeongsang Province – Construction / testing & appraisal / OSV Competitiveness & Prospects

12. Ocean Engineering Basin in Busan 12 Korean Offshore Plant Industry & Infrastructure  The ocean engineering basin is scheduled for start-up in 2016 in the western part of Busan. In the Galsa Bay Shipbuilding Industrial Park in Hadong, a demonstration bed will be established to test the performance of deepwater energy production facilities. Competitiveness & Prospects

13. 13 Efforts to Enhance Regional Offshore Plant Research Facilities Region Offshore plant research facilities Busan/Geoje Hadong, South Gyeongsang Province Mokpo/Gunsan Government Policies

14. 14 Government Policies & Related Regulations 1 2 3

15. Cost Cost Breakdown 15 Cost breakdown of offshore plant industry

16. Cost Breakdown 16 Key offshore plant materials: Cost breakdown SteelEngine Device / equipme nt Pipe Chamber materials Electrical parts OutfittingOtherShare FPSO4.40.533.711.20.52.01.72.956.9 Semi-Rig4.23.815.53.20.93.82.42.035.8 Drillship3.92.025.02.80.72.61.35.443.7 Cost

17. Profitability Relative to Cost 17 Korean offshore plant industry: Change in operating margin Unit: %

18. Success Case GE’s Investment in Korean Industries 18 Of the reported annual sales of USD 1.8 billion, USD 1.44 billion comes from the manufacturing segment PSV, AHT/AHTS, CSV, ocean energy production solutions, shipbuilding design and project operation GE benefits from greater tax relief, as its investment meets government qualifications RevenueRevenue ProductsProducts BenefitsBenefits

19. Success Case GE’s Investment in Korean Industries 19 GE Power Conversion Training Center

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