1. Today’s Vision – Tomorrow’s Reality? Session Presenter Bill Hall Managing Director, Mega Projects WorleyParsons SESSION 1

3. Agenda  Many challenges today  Commodity pricing – fundamental shifts  Equipment and labor costs  Project execution impacts  Strategies to meet the challenges

4. Significant Challenges: Today and Tomorrow  Annual Engineering Graduates in 2006 USA 60,000 China 200,000  Average USA “Professional Workforce” Age in ECC industries Over 50 years old  And many more issues But even more critical: What is happening in overseas markets?

5. Commodity Pricing - Fundamental Shifts

6. Global Metals Outlook

8. 14Mta

9. Fundamental Pricing Shift

10. Steel Prices to Surge “There is a strong view within the Chinese industry that miners will achieve the 85 percent increase, exceeding a 65 percent rise already agreed with a key Brazilian miner.” The Australian Financial Review April 2008

11. Equipment and Labor Costs

12. Equipment Costs Rise

13. Labor Costs Rise 1990-2000: 3% YOY increase 2000-2008: 4% YOY increase

14. Project Execution Impacts

15. Project Delays

16. Increasing Risk

17. Increasing Development Time

18. Increasing Engineering Backlogs

19. Strategies to Meet the Challenges

20. Strategies  HSE performance  Workshare  Accepting increased responsibility  Partnering  Early engagement  New technologies

21. Strategies  HSE performance

22. Strategies  HSE performance  Workshare

23. Strategies  HSE performance  Workshare  Accepting increased responsibility

24. Strategies  HSE performance  Workshare  Accepting increased responsibility  Partnering

25. Strategies  HSE performance  Workshare  Accepting increased responsibility  Partnering  Early engagement

26. Strategies  HSE performance  Workshare  Accepting increased responsibility  Partnering  Early engagement  New technologies