EPC Execution Strategy for Fertilizer Plants

CONTENTS

I.

HDEC GENERAL INFORMATION

II. FERTILIZER REFERENCES

III. EXECUTION STRATEGY FOR

FERTILIZER PLANTS

About Us

I. HDEC GENERAL INFORMATION

Company Profile

Established in May, 1947 Key Profile Affiliate of Hyundai Motor Group as of April, 2011 Business Lines

Plant Works

(Oil, Gas, Petrochemical)

Power & Energy Works

(Power, Transmission & Distribution)

7,257 Employees as of June, 2011

Ranked 1st in Construction Capability Evaluation by the Korean Government Ranked Largest Intl Contractor by ENR Report in 2010 23rd

Civil & Environmental Works Building Works

Investment & Business Development

Top EPC Contractor

ISO 9001 HSE ISO 14001 OHSAS 18001

 23rd Largest Contractor World-Wide in 2010

4th in the Middle East Market

2nd in the Power Market

Overseas Sites
Saudi Arabia Karan Gas Facilities Project

53

Total Current Value

U.A.E U.A.E Khalifa Port and UAE Nuclear Industrial Zone Project Power Plant

US$ 24.6 Bil

U.A.E Habshan 5 Utilities & Offsites

Qatar Pearl GTL Project PKG C-5 LPU Unit

Libya Tripoli West 1,400MW

Vietnam Bitexco Financial Building

Qatar QAFCO 5&6 Fertilizer

Singapore Jurong Rock Cavern Ph.1 Kuwait Boubyan Sea Port Ph. 1 Kuwait KOC Oil & Gas Pipelines Qatar Ras Laffan C IWPP Qatar Hamad Medical City

 Advancing into overseas market since 1965 Total 723 Projects (US$ 80 Bil.) By Work Categories
US$ 16 bil (50 Projects)
(2Prj)

Power Plant
5% 20%

- Manufacturing Plant - Services

Others

US$ 4.5 bil (61 Projects)

29%

Civil

US$ 23.4 bil (192 Projects)

US$ 12.5 bil (42 Projects)

Process Plant

16% 8%

22%

US$ 6.3 bil (143 Projects)

Electrical

Building

US$ 17.3 bil (235 Projects)

 Hyundai E&C has carried out US$ 80 billion overseas projects since 1965. Projects Carried Out By Korean Contractors

Others : US$ 152 BIL (34%)

18%

(Unit : US$ Bil)

US$ 443 BIL

80

8.4% 37

6.7% 30

6.1% 5.4% 5.2% 4.9% 4.8% 4.4% 27 24

Top 10 Contractors: US$ 291 BIL (66%)

23

22

21

19

1.8%
8

US$ 443 BIL

 Koreas top three credit rating agencies, Korea Investors Service (KIS), Korea Ratings (KR) and NICE Investors Service, upgraded their credit ratings for HDECs corporate bonds by one notch from A+ to AA- as of September 23, 2009. HDEC Credit Rating (2004 ~ )

AAA+

Sep. 2009

Jun. 2008

A
ABBB+

Jun. 2007

Jul. 2006

Sep. 2004

STEEL

MOTORS

CONSTRUCTION

FINANCE
AFFILIATES TOTAL EMPLOYEES TOTAL ASSETS STOCK SHARE SALES PROFIT 50 COMPANIES 177,000 U$ 115.6 Bil 34.88% U$ 135 Bil U$ 10.6 Bil

PARTS

OTHERS

Hyundai Motor Group plans to invest

CAPABILITIES TECHNOLOGY MARKETING SUPPORT GLOBAL NETWORKING FINANCING

US$ 9 Bil in Hyundai E&C within 10 Years

Maintain Competitiveness on Existing Core Business
- Chemical Plant, Power & Water Plant High-Tech Civil & Building Works, etc.

Develop New Opportunity in Green & Future Business

- Environment Plant, Smart Grid Renewable Energy, etc.

OUTCOME
Global High Value-Added Engineering Company

II. FERTILIZER REFERENCES

QAFCO 5 & 6 Project (Ammonia & Urea) / QATAR

CAPACITY QAFCO 5: -No. 2 Ammonia plants 2,300 Tons/day each -No. 1 Urea plant 3,850 Tons/day -No. 1 Urea granulation 3,850 Tons/day QAFCO 6: Urea Plant 3,850 Tons/day LOCATION Mesaieed, Qatar CLIENT Qatar Fertilizer Company (S.A.Q) CONTRACT PERIOD QAFCO 5: Dec 2007 ~ Jun 2011 QAFCO 6: Oct 2009 ~ Sep 2012

PINGDINGSHAN Urea Plant / CHINA

CAPACITY 132,000 MTPY LOCATION Pingdingshan City, Henan Province, China CLIENT China National Chemical Construction Corporation(CNCCC) CONTRACT PERIOD 1995 - 1999

National Fertilizer Complex / THAILAND

CAPACITY P2O5 200,000 TPY NP/NPK 1,000,000 TPY LOCATION Map Ta Phut, Rayong, Thailand CLIENT National Fertilizer Co. CONTRACT PERIOD 1994 - 1997

CHISUI Urea Plant / CHINA

CAPACITY 170,000 MTPY LOCATION Chishui City, Guizhou Province CLIENT China National Chemical Construction Corporation (CNCCC) CONTRACT PERIOD 1993 - 1996

SHAANXI Urea Plant / CHINA

CAPACITY 132,000 MTPY
LOCATION Huaxian City, Shaanxi Province, China CLIENT China National Chemical Construction Corporation(CNCCC) CONTRACT PERIOD 1992 - 1995

IRAQ Fertilizer Plant NO. 4 / IRAQ

CAPACITY 1,000 MT/D Ammonia 1,750 MT/D Urea LOCATION Baiji, Iraq CLIENT Ministry of Industry & Minerals, Iraq CONTRACT PERIOD 1986 - 1989

Asean Bintulu Fertilizer Plant / MALAYSIA

CAPACITY 1,500 TPD Ammonia 1,500 TPD Urea LOCATION Bintulu, Sarawak, Malaysia CLIENT Asean Bintulu Fertilizer Sdn. Bhd., Malaysia CONTRACT PERIOD 1983 - 1985

Korea Fertilizer Plant / KOREA

CAPACITY 590 MT/D Ammonia 1,000 MT/D Urea LOCATION Seoul, Korea CLIENT Korea Fertilizer Co. CONTRACT PERIOD 1966 - 1967

Honam Fertilizer Plant / KOREA

CAPACITY 200 MTD Ammonia 350 MTD Urea LOCATION Naju, Korea CLIENT Honam Fertilizer Co., Korea CONTRACT PERIOD 1959 - 1963

III. EXECUTION STRATEGY FOR FERTILIZER PLANTS

PROJECT MANAGER

CORPORATE QUALITY MANAGER

PROJECT QUALITY MANAGER

PROJECT HSE MANAGER

CORPORATE HSE MANAGER

ENGINEERING MANAGER

PROCUREMENT MANAGER

PROJECT IT COORDINATOR

PROJECT CONTROL MANAGER

COMMISSIONING MANAGER

SITE MANAGER

ENGINEERING ORGANIZATION

PROCUREMENT ORGANIZATION

COMMISSIONING ORGANIZATION

SITE ORGANIZATION

HDEC will act as single contractual entity and provide single point of
responsibility to OWNER

The Project Home Office will be located in Seoul, Korea where OWNERs Team and Contractor`s Team will be located with an integrated office-space arrangement

Project Engineering and Procurement activities carried out in Project Home Office in Seoul, Korea with support from worldwide offices

Project control and review activities involving OWNERs Team will be conducted in Project Home Office

HDEC approach to Engineering and Procurement is based on experience gained during the execution of Fertilizer Projects

Focus and utmost attention are given to Projects critical factors such as: early mobilisation of Licensors material delivery schedule constructability

market condition

SAMPLE

- Ammonia plants - Urea plant - Urea granulation

2,300 Tons/day X 2 3,850 Tons/day 3,850 Tons/day

Project Summary

Status Report

Forecasting

WBS & Schedule based on Web (Primavera P6)

Engineering

Procurement

Construction/ Commissioning

Plant Safety

Safety Design & Review Code & Specifications

Engineering Product Quality

Integrated & Dedicated Engng Team Apply Quality Procedure

Project Timeframe

Identity interface points Early mobilization for early Engng Works

Maximize OWNERs Profit by the successful Engineering and Construction of the Facilities to be operated in Safe and Operable ways through the Best Quality of Engineering

Constructability, Operability & Maintenance

3D Model & Constructability Review

 Design Reviews

Various Design reviews and Studies will be conducted during engineering stage to ensure and validate the integrity of engineering;
P&ID Review HAZOP PHASER SIL HSEIA 3D Model Review Constructability Review FRA (Fire Risk Assessment) QRA (Quantitative Risk Assessment) Human Factor Study RAM Study

 Engineering Tools State-of-the-art computer facilities and industry recognized engineering software program complying with OWNERs requirements will be used Field Engineering The field engineering team will be mobilized to site once the major engineering is progressed to an advanced stage Constructability Review A dedicative Constructability Coordinator will be assigned to the Project Team to coordinate the Constructability Program

 3D Model Review 3D electronic model of the plant will be developed using multidisciplinary PDS (Plant Design System from Intergraph) System. Each discipline will develop its scope of work for and under the result of the 3D Model Review Construction Team For optimizing performance cost, schedule and quality, the construction staff will be involved at the early stage of engineering

 Vendor Material Standardization Development of Prospective Alternative Vendors for Project Benefit subject to Approval

Expediting utilizing overseas procurement offices and specialist resources

Plant Ammonia

Critical Equipment Natural Gas Compressor Process Air Compressor Syngas Compressor Ammonia Refrigeration Compressor Ammonia Booster Compressor Primary/Secondary Reformer Ammonia Synthesis Converter Waste Heat Boiler Co2 Stripping Column Co2 Absorber

Planned PO Date ED + 2 Months ED + 2 Months ED + 2 Months ED + 2 Months ED + 2 Months ED + 2 Months ED + 1 Months ED + 1 Months ED + 3 Months ED + 1 Months

Planned On-Site Date ED + 18 Months ED + 18 Months ED + 19 Months ED + 18 Months ED + 18 Months ED + 18 Months ED + 20 Months ED + 19 Months ED + 18 Months ED + 20 Months

Plant Urea

Critical Equipment Co2 Compressor

Planned PO Date ED + 1 Months

Planned On-site Date ED + 19 Months

Urea Reactor
Urea Stripper HP Synloop Heat Exchangers Carbamate Separator 1st/2nd Carbamate Condensers

ED + 1 Months
ED + 1 Months ED + 1 Months ED + 1 Months ED + 5 Months

ED + 21 Months
ED + 20 Months ED + 20 Months ED + 23 Months ED + 17 Months

HP Ammonia Pump
HP Carbamate Pump

ED + 1 Months
ED + 1 Months

ED + 19 Months
ED + 19 Months

Plant Utility

Critical Equipment Gas Turbine Generator HRSG Service Boiler C.W Pump

Planned PO Date ED + 4 Months ED + 4 Months ED + 1 Months ED + 2 Months

Planned On-Site Date ED + 17 Months ED + 18 Months ED + 19 Months ED + 18 Months

Construction work force through direct hiring as well as

subcontracting Own construction equipment & resources which will be utilised

Strict adherence to Time Schedule as well as cost using local

contractors Adherence to all the Quality and Health Safety & Environment Procedures in line with International practice Overall construction supervision by HDEC Precommissioning / Commissioning stages overlap will be taken up along with Licensor representatives, Process experts from HDEC along with OWNER support

 Mobilization of Construction Equipment acc. to Project Schedule

Equipment 1,200 Ton Crawler Crane 600 Ton Crawler Crane 450 Ton Crawler Crane 250 Ton & Less Crawler Crane 100 Ton & Less Hydro Crane Dozer & Loader Air Comp. & Generator Object Synthesis Converter Reactor & Absorber H/Ex, Vessel Less than 100 Ton Less than 20 Ton Civil and Building Utility and Electric source

Official Hand-Over of Plant Area / Camp Sites & Relevant Bench Marks Establishment of Site Office with Direct Communication with OWNER at Site Prompt Commencement of Early Work in accordance with 90 Days Work Schedule - Topographical Survey - Building / HVAC Basic Engineering - Site Preparation of Camp Area - Site Preparation of Plant Area - Camp Construction - Batch Plant Installation

ED+1M ED+3M

ED+1M ED+1M ED+3M ED+3M ED+4M ED+5M

WITH SYSTEM HANDOVER APPROACH CASE

MECHANICAL COMPLETION COMMISSIONING

SYSTEM
START-UP&OPERATION
SYSTEM-4 SYSTEM-3 SYSTEM-2 SYSTEM-1

TIME
SCHEDULE SAVING

WITHOUT SYSTEM HANDOVER APPROACH CASE

MECHANICAL COMPLETION COMMISSIONING START-UP&OPERATION

Stabilize and PGT

Stabilize and PGT

Bagging

Feed in Urea

Feed in Ammonia

Ammonia Storage

Steam Blowing Urea

Steam Blowing Ammonia

Service Boiler

GT with HRSG

Cooling Water

Natural Gas

Boiler Feed Water

IA, PA, IG, FW

I. Utility
Gas turbine lube oil flushing & Function test HRSG refractory dry out, boil out and Passivation Service boiler refractory dry out, boil out and Passivation

Cooling water system flushing and Passivation

Steam Blowing

II. Ammonia Plant

Lube oil flushing of compressors

Steam blowing for steam networks including around comp, turbines.

Air blowing for all process line by using process air compressor Catalyst loading

(Special requirement for primary reformer and ammonia converter)

High press. N2 leak test for Ammonia synthesis loop Degreasing chemical cleaning for H2S and CO2 removal system Primary reformer refractory dry out Waste heat boiler chemical cleaning and passivation

Natural Gas (CH4)

CO2 Removal Section

CO2

Urea

H2S Removal Section

CO/CO2 Methanation (CH4)

N2 : H2 = 1 : 3

1st Reformer

Steam (H2O)

Ammonia Converter
NH3

2nd Reformer

Air (N2/O2)
(By Process Air Compressor)

NH3 Refrigeration Section

Ammonia Storage Tank
NH3

N2 + H2 + CO + CO2

CO CO2 Conversion
N2 + H2 + CO2

Urea

CH3OH
(Methanol)

O2
(Air)

UREA

CO2

NH3

UREA Polymerization UFC Plant

CH3OH + 02 CH2O(Formaldehyde) + H2O CH2O + NH2CO-NH2 NH2CO-NH-CH2OH

UREA
CO2 + 2NH3 NH2-COO-NH4 (Carbamate) NH2-CO-NH2 (UREA) + H2O

Granulation Conveyor Bulk Hall

NH2CO-NH-CH2OH (Mono Methylol UREA)

Serial. No 1 2 3 4 5 6 7 Start ID/FD Fans

Acticity Description Start Nitrogen circulation and heat reformer Reformer feed in Stream drum passivation Testing of Steam drum PSV HT Shift catalyst reduction & line up Feed process gas to CO2 absorber and produce CO2

Duration(day) 1 2 1 2 1 2 1

8
9 10 11 12 13 14 15 16 17 18 19

Line up CO2 to urea

LTS catalyst reduction and line up Methanator catalyst reduction Receive Ammonia Commissioning Ammonia compressor Commissioning Syn gas compressor Syn gas converter reduction Commission Ammonia recovery Commission Hydrogen recovery Stabilization, Ramp up & Controller Tuning of Unit Reliability Test Performance Test in Ammonia 5

1
7 3 2 2 2 7 5 5 31 14 5

43days

Serial. No 1 2 3 4 5 6 7 8 9 10 11 12 13

Acticity Description Commission of CO2 Compressor Receive Ammonia & Commission Ammonia booster pump Commission HP Ammonia pump HP loop heating HP Loop bolts hot tightening Ammoniation of HP Loop Reactor feed in & melt generation Line up Urea melt to granulation Stablilization, Ramp up & Controller Tuning of Unit Reliability test Performance Test in Urea 5 Ramp up to Over Capacity Urea 5 Overdesign capacity demo test

Duration(day) 6 3 4 1 3 1 1 1 30 14 5 1 1

20days

Serial. No 1 2 3 4 5 6 7 8 9 10 11

Acticity Description Blank Operation with hot air Collect UFC from Qafco Site Collect Urea from Qafco Site Granulator sprayer test with water Urea filling in start up bin Solid dry circulation test Granulation system commissiong Stablilization, Ramp up & Controller Tuning of Unit Reliability Test Performance Test in Granulation 5 Urea Transfer from Granulation to Bulk Storage

Duration(day) 3 0 0 3 2 3 1 30 14 5 1

12days

Year
2011 2011 2010 Pearl GTL Project, Qatar Karan Gas Facilities, Saudi Arabia

Project

Hours without LTA

32,000,000 10,000,000 20,000,000 10,000,000 13,000,000 10,000,000 19,000,000

QAFCO 5 Project(Ammonia & Urea), Qatar

Ras Laffan C IWPP, Qatar Khurais Gas Project, Saudi Arabia New Ethane Recovery Plant, Kuwait Western Libya Gas Field Development Project, Libya

2010
2009 2008 2005

No 1. Performer among 10 Contractors

in STAR (Site Technical Assurance Review) conducted by Shell Global Solutions in 2009 and 2010. Pearl GTL Project / QATAR

WBS & Schedule based on Web (P3 Ver 6.0)

Project Summary

Status Report

Forecasting

Engineering
Tag Index EDIS*/SPF
2/3D Modeling SPP&ID PDS/SP3D BOM & E/R SPMat Deliverables Project Space* Calculation Eng. S/W

Procurement
Inquiry SPMat PO ERP I/F(to be) Expediting SPMat Inspection TOPICS* Transportation SPMat

Construction/ Commissioning
Site material SPMat/IPCS*
Construction IPCS/WIT* QC HCQM*

Pre-Com. HPCM*
Punch Control HPCS*

ERP

SPIN SP3D
Source data for progress calculation

SPPID
Tags for instrument, equipment and line

SPEL
- Deliverables - Relation DB with tag Design data

Progress report

Tag and basic design data

SPMat
(Procurement status monitoring and material control)

Document Control
Engineering Document Procurement Document Vendor Document Correspondence Fax., Letter, E-Mail Construction Document Security & Permission Revision

Status Monitoring
Real time Status Monitoring for Project Document & Workflow Transmittal In/Out (Client, Vendor, Partner) Correspondence In/Out DRN & IOM Delayed Documents & Workflow

Project Collaboration
Project Information Project Calendar Project Bulletin Project Image Bulletin Messenger Project Organization Project Mail System

Progress Report
Drawing & Document Status Report. Behind/Look ahead Report Transmittal In/Out History Report Vendor Data Status Report Etc.

Project Space

Internal Workflow
Interoffice Memorendum(IOM)

External Collaboration
On Line Transmittal for Vendor, Partner and Client Request for Information(RFI/TQ) for Client

Design Review & Verification(DRN) Design Change Notice(DCN) Correspondence Distribution

Piping

Mechanical

Electrical

Instrument

Material Code

E
Material Code Spec & BOQ Report 3D-CAD Interface

C
Site receiving mgt. Forecasting & Reservation

Material Issue

WIT
Welding Inspection & Test System

Spec Gen.

Forecasting & Reservation

3D-CAD (PDS/SP3D) BOM Control

HCQM P
Vendor management Status monitoring Construction & Quality System (to be)

BOM Import

Warehouse Control

Material Take-off

Transportation

Material Receiving

Inquiry

PO

Expediting

Inspection

Transportation

ERP

Contract

TOPICS

Inspection & Expediting

E
P

1. Early P&ID Freezing 2. Quality of Detail Design Drawings

1. Timely Placement of Order for LLI Items 2. Vendor Selection of Key Equipment (Primary / Secondary Reformer, Syngas Compressor, Ammonia Synthesis Converter, Urea Reactor)
1. Bulk Control System (Concrete, Steel Structure, Piping, Cable) 2. Self Performing Construction Company (Reformer, Heavy Lifting, E&I) 3. HDEC Owned Construction Equipment