1. business and industrial
2. energy
3. natural gas

GASCO SUSTAINABILITY REPORT 2013
EXECUTIVE SUMMARY
BUILDING ON THE PAST - LOOKING TO THE FUTURE
GASCO has experienced a
remarkable evolution over the past
years. From our modest beginnings
in the 1980s, we have grown into
one of the largest gas processing
companies in the world, now
operating five mega plants with a
designed processing capacity to
reach 8 Billion Standard Cubic Feet
of gas per day during 2014 – that is
nearly the equivalent of half of the
entire UAE’s oil production.
In order to respond to the
ever-increasing demand for energy
and the growing interest in Natural
Gas as an economically attractive
and environmentally benign fuel,
we have invested over US$ 10
Billion in projects, expanded our
processing capacity by a quarter
and doubled our workforce.
To stay on track with our objectives,
first and foremost, we need to
sustain our current operations by
an unfailing attention on asset
integrity and constant focus on
ensuring service reliability,
production effectiveness and
optimized costs. On top of this, we
need to successfully integrate our
new capacity with our existing
operations. In turn, new capacity
means that we need more highly
skilled people – hence our
determined focus on attracting and
retaining top talent and aligning all
our human capability towards our
common goals. Finally, and very
importantly, all this needs to be
done in line with our commitment
to act sustainably as a trustee for
current and future generations.
To ensure that we are all moving
towards the same direction, we
revisited our vision, mission and
business imperatives and continued
to embed our revitalised values.
The Leadership Team is deeply
committed to championing the new
GASCO Way, making sure that our
vision matches our new realities
and that everyone knows what is
expected of them.
I am proud of our achievements,
especially with the backdrop of the
tremendous growth and
unprecedented level of activity, we
managed to improve our
performance against all our
strategic health, safety and
environmental targets. However, it
saddens me that we did not meet
our zero fatalities target due to two
very regrettable accidents.
None of our achievements
would have been possible
without the deep dedication
and commitment of our GASCO
Family: our employees,
shareholders, business partners
and many others. To them, I
wish to extend my deepest
gratitude and look forward to
continuing this journey with you.
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Zayed Bin Sultan Al Nahyan’s vision for the
utilization of the UAE’s vast gas resources. We
were incorporated in 1978 as a joint venture
between ADNOC, Shell, Total and Partex. Our
1981.
GASCO is an ADNOC Operating Company
engaged in the extraction of Natural Gas Liquids
(NGL) from associated and non-associated gas.
Our industrial complex is composed of four gas
processing plants, one fractionation plant and
a pipeline network which together process and
deliver a range of products to both local and
international markets. Our key products include
Naphtha, Condensate and granulated Sulphur.
GASCO plays a strategic role in the hydrocarbon
chain in the UAE, and is a vital enabler of
industrial and economic progress. Other
industries in this highly integrated chain include
on and offshore oil production, petrochemicals,
and infrastructure industries such as steel, cement
and aluminium smelting. As we deliver on our
responsibility as the key supplier of gas and
related products, we literally keep the wheels of
the economy going.
AT THE HEART OF THE UAE HYDROCARBON VALUE CHAIN
ADCO
Associated Gas
Gas dissolved in crude oil,
which is released when the
oil is brought to the surface
through extraction from an
oil reservoir.
Takreer
Non-Associated Gas
Condensate
Ethane
Propane
Butane
Produced from a reservoir
which produces no oil.
The gas is trapped within
porous rock, surrounded
by impermeable rock.
Borouge
Takreer
Ethane
Propane
Butane
Export
ADGAS/ADMA
Associated Gas
Gas dissolved in crude oil,
which is released when the
oil is brought to the surface
through extraction from an
oil reservoir.
Network Gas
ADCO
ADNOC
TAKREER
Propane
Butane
Paraffinic Naphta
Granulated Sulphur
EMIRATES STEEL INDUSTRIES
EMAL
DUSUP
3
BOROUGE
FERTIL
NATURURAL GAS VEHICLES (NGV)
ADWEC
4
average, energy demand in the UAE has grown 9%
per annum over the last ten years and this trend is
predicted to continue for the foreseeable future. At
the same time, the UAE is steadfastly committed to
sustainable exploitation of Abu Dhabi’s oil and gas
reserves, following its long standing sustainable
extraction policy, which is perhaps one of the
most sustainable reserve management policies
internationally.
capacity; secondly, successfully integrating our newly
expanded capacity with our existing one; and, thirdly,
aligning all our processes and human capability so
SIA
LAY
A
M INA
CH IWAN
TA
A
US NCE
FRA
EN
YEMRKEY
TU
To meet the growing demand for energy, our
625
DUSUP
AN
JAP REA
KO
PROPANE
250
ADWEC
Taweelah
BUTANE
PARAFFINIC
NAPHTHA
ARABIAN
GULF
ICAD
875
25
50
GASCO
Pipeline / Maqta
ADWEC
Shuweihat
TAKREER
FERTIL
RUWAIS
PLANT
500
BOROUGE
ESI
1100
40,000
TOTAL IN
4220
HABSHAN
AND BAB
COMPLEX
200
120
5
1800
ADCO
ADCO
Line thickness indicates gas volume in MMSCFD
Dotted line represents NGL line & tonnes/day
EMAL
TOTAL OUT
4220
HABSHAN AND BAB
PLANT
BU HASA PLANT
250
1320
4000
300
120
600
GASCO
AL AIN
INDUSTRIAL
UNITED
ARAB
EMIRATES
ASAB PLANT
Natural Gas – The White Gold
product of oil production, natural gas now fuels
the growth of the UAE. Only in the last few
decades has the value of natural gas been fully
appreciated, and for much of that time, GASCO
has been successfully exploiting Abu Dhabi’s
ensure continued oil production. For this, gas is
compressed and re-injected into the reservoirs.
UAE economy. GASCO plays a leading role in gas
processing, its production counting for about 60%
of natural gas products produced in the UAE and
approximately 10% within the Middle East.
Beyond gas processing itself, our operations are
a vital enabler of oil production. The pressure
levels inside oil and condensate reservoirs
associated, or natural, gas. Both forms of feed
gases are delivered to GASCO by ADCO and
ADMA / ADGAS. The production of associated
the crude oil, then the extraction of Natural Gas
Liquids (NGL), which are then transported to
our Ruwais Fractionation Plant as feedstock. The
residual dry, or lean, gas is then compressed
and fed into the Pipeline Network for use by our
industrial customers.
OUR PRODUCTS
NETWORK GAS
(OR METHANE)
CH 4
ETHANE (C2)
C 2H 6
PROPANE (C3)
C 3H 8
Used as fuel for power
generation by water and
electricity producers such as
Abu Dhabi Water & Electricity
Authority and Dubai Supply
Authority.
Used as feedstock by
BOROUGE, one of
the largest plastics
manufacturers in the world.
Exported to be used as
fuel for energy generation.
BUTANE (C4)
PARAFFINIC NAPHTHA (C+5)
Used as fuel by industries
such as aluminium, cement
and steel. Smaller consumers
such as glass plants in the
Industrial City of Abu Dhabi
and Abu Dhabi hotels.
C 4 H 10
Used for injection into the
reservoirs to enable oil and
condensate production.
Used as feedstock by FERTIL,
a fertilizer manufacturer.
Supplied as gas for Natural
Gas Vehicles in Abu Dhabi.
Exported to be used as
fuel for energy generation
and cooking.
C 5 H 12
Exported to world markets
as feedstock for other
chemicals.
CONDENSATE (C+6)
C 6 H 14
Used by TAKREER as a
feedstock for refining into
Naphtha, Kerosene and
Diesel components, and
exported to world
markets.
6
NATURAL GAS - A CLEANER ALTERNATIVE
Gas is now widely recognized as a safer, cleaner, more environmentally sensible fuel compared to
other hydrocarbon alternatives. In a carbon constrained world, interest in its use is growing rapidly
by all categories of users whether residential, commercial or industrial.
Composed primarily of methane, natural gas produces carbon dioxide and water vapor when
combusted - the same compounds we exhale when we breathe. In fact, the combustion of natural
gas produces 25% less Carbon Dioxide (CO2) than the combustion of petrol and 35% less CO2
than the combustion of diesel.
When compared with petrol, the use of natural gas reduces the emissions of Carbon Monoxide
by 90% , Hydrocarbon emissions by 80% and Nitrogen Oxides by 30% . Natural gas contains
extremely low levels of Sulphur, particulate matter and heavy metals which are all associated with
the combustion of diesel.
as much Carbon Dioxide, less than a third Nitrogen Oxides, and only 1% as much Sulphur Oxides.
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Our Leadership Team initiated a review of
GASCO’s vision and mission in 2013 as it had
been ten years since this had been done last.
Back then we had around 2,000 employees and
our processing capacity was a fraction of what
it is now. At that time we were at the beginning
of our journey and far from our current status
as a world class operator in a complex web of
interconnected hydrocarbon players.
The four key components of this new
statement are:
• Our Identity - who we are and what we do
• Our Aspiration - where we want to go
• Our
how we intend to realize our aspiration.
• Our Cultural Attributes – The GASCO Way
“
THE
GASCO WAY
8
9
We have placed sustainability at the top of
our leadership agenda. To us sustainability
intermingles with all our strategic objectives and
brings both challenges and opportunities to the
table. Challenges such as climate change and
access to energy are now a reality and will grow in
importance in the short term. Opportunities come
from the increasing interest in gas as a cleaner
and economically sensible source of energy. For
us sustainable business practices go hand in hand
positive and inspiring work culture and supporting
our communities. To us sustainability is part and
parcel of how we engage with our stakeholders
and, importantly, how we measure and improve
our performance and hold ourselves accountable.
Our Corporate Identity captures the centrality
of sustainability for us. This directs our everyday
work and frames our targets and action plans for
the future. In turn, our strategic scorecard – or our
For us, sustainability goes beyond cost
considerations. It is as much about how we
minimize our environmental footprint and provide
cleaner energy solutions as it is about ensuring a
basis. Our performance against our 2013 targets
and our new targets for 2014 are highlighted on
the following pages.
Our focus is on expanding our production
capacity, developing our people and embedding
sustainability and excellence throughout our
business practices. To ensure that all this happens
within the boundary of our Corporate Identity,
we set ourselves annual strategic targets, agreed
jointly with our shareholders. The fact that our
shareholders are leading international players
in our sector means that their performance
expectations of us are benchmarked against
international best practice in our industry.
Our strategic targets are set under four quadrants
– Health & Safety and Environment, Operations,
Key Performance Indicators (KPIs) and related
‘contract’ and ‘stretch’ targets. Performance
against targets is monitored on a monthly basis
and reported to shareholders and our Extended
Leadership Team on a monthly and annual basis.
Importantly, our key sustainability focused targets
are fully integrated within our scorecard and are
therefore managed as part of our day-to-day
work. All targets are cascaded throughout the
company via action planning and target setting
for divisions and departments.
Our overall performance in each quadrant for the
to report that our overall performance in 2013
continued to be solid and that we achieved an
overall score of 108 points. Year-end performance
was unfortunately overshadowed by two
occupational fatality incidents. However, as a
trend, GASCO has performed well above the
baseline target of 100 points for the last four years.
Our favourable performance for 2013 was
attributed to several outperforming metrics;
namely Gas Flaring, Emissions, Energy, Reliability
and Availability, Impact on ADCO, Asset Integrity
and Critical Resignations. Our overall performance
was offset by the Total Reportable Incident Rate
score due to the two unfortunate fatalities, higher
High Potential incident rate, progress slippage on
some project milestones, and failure to meet our
70%
OVERALL SCORECARD PERFORMANCE
Overall score
2009
2010
2011
2012
2013
94
111
120
117
108
10
The following provides a summary of our performance. In this summary, we focus on those targets and KPIs
targets in the online version.
HEALTH & SAFETY
AND ENVIRONMENT
Gas processing is a highly complex and
potentially hazardous business with high
impact potential if things are not done to
the highest professional standards. With the
exceptions of fatalities and the HIPO KPI, all
other HSE KPIs achieved their stretch targets.
We met the HIPO follow up action plan stretch
target. The injury rate, or TRIR, performance
was excellent throughout the past four years.
However, the score was cut off by 75% due to
the aforementioned fatalities. Overall this KPI
continues to perform well within best in class
compared to peers in our industry, being over
ten times lower than the average rate based on
a recent industry study.
11
11
commissioning of Habshan Flare Gas Recovery
0.26 % of our total processing capacity. Similarly
air emissions and our own energy consumption
(Energy KPI) indexes have progressively improved,
meeting their stretch targets.
HEALTH AND SAFETY
LOOKING BACK
Targets
Zero Fatalities
Total Reportable
Injury Rate (TRIR) (per
LOOKING FORWARD
2012
Actual
1
2013
Actual
2
2014
Target
0
Zero fatalities will always remain our target.
Unfortunately, we did not achieve it last year
due to two very unfortunate work-related
accidents.
0.10
0.15
0.25
Regardless of our continued excellent
performance, our target remains somewhat
conservative mostly due to the fact that we
work with vast numbers of contractors on our
sites and we do not have direct managerial
control over their performance.
8
13
10
This is a relatively new target and we missed
the maximum threshold target of 12 during
2013. Our new target underlines our goal to
move towards proactive and process safety
based monitoring.
million man hours)
HSE High Potential
Incidents (HIPO)
(number)
Implementation of
Approved HIPO
Action Plans (%)
This target supports the above, applying to
action items approved following above HIPO
89
92
80
Process Safety Event
Rate (PSER)
n/a
0.99
1.20
RAP Implementation
n/a
92
80
(%)
Missed contract target
Met contract target
Gas Flaring
(MMSCFD)
actions.
Process safety targets have been set for 2014.
However, monitoring processes were initiated
during 2013. PSER basically monitors what was
previously measured as ‘loss of containment’ or
leaks. The PSER ratio is calculated as the
number of events at different levels of severity
per man hours worked. Our results for 2013
indicate that there were an average of one Tier
1 or 2 process safety incident per every million
man hours worked. This falls well within widely
accepted performance.
This is a lead KPI supporting the above PSER,
monitoring follow up actions taken after PSER
incidents.
ENVIRONMENT
Met stretch target
New KPI, no target for 2013
LOOKING BACK
Targets
Commentary
LOOKING FORWARD
2012
Actual
2013
Actual
2014
Target
Commentary
The full commissioning of Habshan Flare Gas
Recovery has yielded a notable reduction in our
18.8
17.7
23.1
been set with some caution bearing in mind
going forward.
Air Emissions: C0 2
(Tons / KT production)
Air Emissions:
Non-C02 (Tons / KT
146
152
167
2.31
2.19
2.46
production)
Energy KPI (%)
3.96
3.79
4.07
Our good performance continues here.
However, some caution has been exercised
here as well due to stabilisation of new plants
leading to some additional fuel consumption
especially in Ruwais.
good performance mainly at Habshan, which
counts for 83% of the total non-C02 emissions,
predominantly SOx resulting from acid gas
conversion.
production processes. We achieved a remarkable
3.79 % performance in 2013 - the best ever since
the target was introduced in 2009.
We have taken a conservative approach to
future target setting mostly due to our new
facilities not yet having been included in the
target calculations. However, we expect that
our solid performance here will continue.
12
On a day-to-day basis, delivery of gas to our
customers is determined by their demand, the
pattern of which can vary from day-to-day and
month-to-month. As there is no intermediate
storage facility available for gas, the production,
distribution, and consumption of gas must be
synchronized with both down and upstream
operations. This is managed by close coordination
with all players in the chain, importantly including
our end users. Hence, one of our strategic
priorities is to produce the best quality products
to meet customer requirements in terms of
volume and pattern of demand at optimum
management of costs.
extending the effective operating life of our plants
and equipment is of utmost importance. This
involves, for instance, carefully planning maintenance
shutdowns and asset replacement needs.
13
Reliability and Availability are perhaps two of our
products and maintain our assets. Plant Reliability
is a measure of unscheduled outages. Plant
Availability, in turn, measures the time the plant
was available. Due to the highly integrated nature
effectiveness are crucial in order to prevent any
critical knock-on impacts on either upstream or
downstream operating units in the chain.
Another crucial operational performance
dimension is Asset Integrity. This can be best
described as a management framework that aims
Our performance against Availability and
Reliability targets is consistently comparable
to the very best in the industry. This is a clear
manifestation of seamless operations, forward
planning, optimization of shutdowns and
continuous coordination between GASCO and
ADCO and other downstream operating units.
Our performance relating to Asset Integrity
continues to be strong with 96% of total planned
preventive and corrective maintenance programs
duly implemented. Likewise, nearly 100% of total
major overhaul activities were completed. This year
there was a minor slip in completing our inspections
schedule for HSE critical equipment and systems
due to testing overruns at Asab and Habshan.
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OPERATIONS
LOOKING BACK
LOOKING FORWARD
2012
Actual
2013
Actual
- Associated Gas
Facilities
99.6
99.8
99.3
- Non-associated Gas
Facilities
99.2
99.2
99.3
- Fractionation
99.2
99.7
99.5
- Associated Gas
Facilities
95.6
97.5
95.5
- Non-Associated Gas
Facilities
97.0
97.6
95.7
- Fractionation
98.2
95.7
95.6
Targets
2014
Target
Commentary
RELIABILITY
(time-based %)
Our Availability and Reliability performance
continues to be solid and targets remain as or
even more demanding than before.
AVAILABILITY
(time-based %)
ASSET INTEGRITY
- Maintenance
Compliance Factor
(MCF)
- Remnant Life and
Remedial Strategy
4.80
4.93
4.80
4.90
4.60
4.50
Conceptually, MCF monitors the execution
progress of the Preventive and Corrective
Maintenance programs and therefore
addresses both asset integrity and reliability
objectives. Although the target was revised
upward for 2013 for 4.50 to 4.60, we closed in
on the new stretch target of 4.85.
This measures the planned vs actual implementation of:
- Obsolescence studies
- Risk Based Inspection Studies
- Major overhauling
- Long Term Asset Replacement Plans
Our performance continues to be strong,
outperforming the base target by a good margin.
- Safety Critical
Equipment and
Systems
4.96
4.86
4.90
- Asset Integrity and
Reliability Management
Actions (AIRMS)
3
4
3
Missed contract target
Met contract target
15
Met stretch target
New KPI, no target for 2013
This monitors the testing and inspection of HSE
critical equipment and systems such as relief
valves and safeguarding instrumentation.
Historically, our track record with this KPI has
been consistently strong, however, this year
there was a minor performance slip due to an
overdue testing exercise at Asab.
All planned actions completed.
Our employee numbers have been growing
2005 and 2015 our numbers will have grown by
tenfold. To serve the needs of our newly built
and upcoming processing capacity, we will need
to continue to focus on further recruitment and
everything that follows, such as orientation,
development, integration, etc.
Our recruitment challenge continues to be a
talent in our sector and in the region. This coupled
with our ambitious targets to employ and develop
UAE Nationals, means that our efforts to retain,
attract and develop our talent continue to be crucial
to realizing our business objectives. With concerted
efforts, we exceeded our year-end Emiratization
target closing on 33% .This represents a growing
pool of over 2,000
the ADNOC wide target of 75% by the end of 2017,
equals to nearly 5,000 Nationals, which remains a
highly challenging target.
The People Development KPI measures our
success with our development program aimed
mostly at UAE National graduates via our
Competency Assurance Management System. We
met our target only partially here and will refocus
our efforts in this area as discussed further in the
Employee section.
Filling our critical vacancies remains a concern.
Out of 382
218
integration and promotions. Our below par
performance was mainly caused by slow pace
recruitment and higher attrition in the senior
technical employee category.
We are proud of our retention and attraction efforts
to date, but we cannot rest on our laurels. Hence, we
will reinforce our efforts in employee and leadership
development, communication and engagement. We
anything else is not an option.
1
16
PEOPLE
LOOKING BACK
LOOKING FORWARD
2012
Actual
Targets
2013
Actual
2014
Target
Commentary
Until the end of 2012, the Emiratization
percentage was calculated as a proportion of
Emiratizable based on ADNOC guidance. From
2013, the percentage will be calculated based
on all established positions. Hence, although
the target appears lower, the target in reality
50.3
Emiratization (%)
33.0
39
The number of actual recruits required to meet
the target is almost doubling.
As per ADNOC guidelines, our stretch target
for 2017 is a highly challenging 75%. To reach
this target, we have allocated an annual target
increase; this allocation translates to a 40.5 %
stretch target for 2014.
People Development
(based on quarterly
reporting)
5.95
6.19
11
Similarly to above targets, expectations
regarding performance here were raised by
ADNOC, and we will need to double our
efforts to meet them.
The Organization Capability KPI was restructured for future targets. It now comprises of
ORGANIZATIONAL
CAPABILITY
- Filling Critical
Vacancies
40
- Resignations in Critical
Positions
2.3
- Succession Planning (%)
Missed contract target
Met contract target
Met stretch target
New KPI, no target for 2013
report on our performance internally.
17
This measures our success with our development program aimed at UAE Nationals via our
Competency Assurance Management System.
The score is based on quarterly performance
against four development metrics.
70
3.5
80
1. Filling Critical Vacancies
(ins t e a d o f g e ne r a l re c r uit me nt t a rg e t ),
2. Resignations in Critical Positions, and
3. Long-term Manpower Capability
The third new target focuses on succession
planning, again driven by new ADNOC
guidelines, but also supporting one of our new
business imperatives that calls us to secure the
quality of our future leadership. The KPI is
potential successors who are capable of taking
on the position within three years. At this
stage, given our current organizational
structure and business requirements, we have
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Abu Dhabi Gas Industries Ltd.
P.O. Box 665
Abu Dhabi,
United Arab Emirates.
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