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BID PROPOSAL FOR THE CONSTRUCTION OF

THE SOUTH-CENTRAL PIPELINE LINKING THE


GAS FIELDS OF LARDISTAN TO ROTLANDA.

SUBMITTED BY

ORONERO PIPELINES
(“OroNero”)
A subsidiary of Oro Nero Corporation
U2005/3070211-220

APRIL 2009

Oro Nero Corporation 2009 Page 0


Contents
COMPANY PROFILE................................................................................................................................3
BIDDER - ORO NERO CORPORATION.....................................................................................................3
EXPERIENCE.......................................................................................................................................4
BALANCE SHEET...................................................................................Error! Bookmark not defined.
TECHNICAL DESCRIPTION..................................................................................................................5
PHYSICAL CHARACTERISTICS..............................................................................................................5
EFFICIENCY LEVEL..............................................................................................................................6
ROUTE DESCRIPTION AND LOCATION................................................................................................6
TECHNOLOGY....................................................................................................................................7
CONSTRUCTION PLAN...........................................................................................................................9
SCHEDULE........................................................................................................................................10
MILESTONES....................................................................................................................................11
BACKGROUND AND REFERENCES FOR SUBCONTRACTORS.................Error! Bookmark not defined.
CONTRACT SUMMARIES FOR SUBCONTRACTED ACTIVITIES...........................................................12
ENVIRONMENTAL IMPACT ASSESSMENT........................................................................................12
OPERATIONS, MAINTENANCE AND QUALITY ASSURANCE PROCEDURE..............................................14
ECONOMIC ANALYSIS..........................................................................................................................16
ESTIMATED COSTS...........................................................................................................................17
CONSTRUCTION...............................................................................Error! Bookmark not defined.
GAS SUPPLY AND DEMAND.........................................................................................................18
FINANCE.......................................................................................................................................18
OPERATIONS....................................................................................Error! Bookmark not defined.
ESTIMATED REVENUES....................................................................................................................18
RATES...............................................................................................................................................18
SUMMARIES OF PRO FORMA CONTRACTS WITH SUPPLIERS, SERVICE PROVIDERS AND CUSTOMERS
.........................................................................................................................................................19
NO:1....................................................................................................................................................19
GAS TRANSPORTATION CONTRACT.....................................................................................................19
BETWEEN.............................................................................................................................................19
LARDISTAN GAS COMPANY.................................................................................................................19
AND.....................................................................................................................................................19
ORO NERO PIPELINES LIMITED............................................................................................................19
DATED: 10TH FEBRUARY, 2008............................................................................................................19
ARTICLE 1 – SCOPE OF CONTRACT.......................................................................................................20

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ARTICLE 2 – RATE SCHEDULES AND GENERAL TERMS AND CONDITIONS............................................20
ARTICLE 3 – TERM................................................................................................................................20
ARTICLE 4 – CORRESPONDENCES........................................................................................................21
ARTICLE 5 – BANKRUPTCY OF LARDISTAN GAS COMPANY..................................................................21
ARTICLE 6 – LAW OF CONTRACT..........................................................................................................21
SUPPLY ARRANGEMENTS....................................................................................................................22
GAS SUPPLY SOURCES.....................................................................................................................22
UPSTREAM TRANSPORTATION AND STORAGE ARRANGEMENTS....................................................22
BACKGROUND DESCRIPTION, REFERENCES AND CREDIT RATINGS ON ALL POTENTIAL SUPPLIERS/
SERVICE PROVIDERS........................................................................................................................23
FINANCIAL ARRANGEMENTS...............................................................................................................24
SUMMARY OF COMMITMENT LETTERS...............................................Error! Bookmark not defined.
PROOF OF FINANCIER’S CREDIT-WORTHINESS....................................Error! Bookmark not defined.
CORPORATE AUTHORIZATIONS...........................................................Error! Bookmark not defined.
RISK MANAGEMENT............................................................................................................................24
CONSTRUCTION RISK.......................................................................................................................24
PRICE RISK........................................................................................................................................24
OPERATIONS RISK............................................................................................................................24
POLITICAL RISK.................................................................................................................................24
REGULATORY RISK...........................................................................................................................25
LEGAL RISK.......................................................................................................................................25
ENVIRONMENTAL RISK....................................................................................................................26
LEGAL & REGULATORY.........................................................................................................................26
APPLICABLE LAWS AND REGULATIONS............................................................................................26
PERMITS REQUIRED WITH ESTIMATED TIMELINE............................................................................26
SUMMARY OF COMPLIANCE PLANS................................................................................................27
SUMMARY OF CONTRACTUAL AGREEMENTS..................................................................................27
SMART DEVELOPMENT........................................................................................................................27
PROJECTIONS OF ANTICIPATED ECONOMIC, ENVIRONMENTAL AND SOCIAL IMPACT....................28
LOCAL CONTENT & HUMAN RESOURCE DEVELOPMENT.............................................................28
HEALTH, SAFETY AND ENVIRONMENTAL PROTECTION...............................................................28
ANALYSIS OF PROJECT’S ANTICIPATED CONTRIBUTION..................................................................29
PROGRESS REPORTING SCHEDULE..................................................................................................29

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BIDDER - ORO NERO CORPORATION

COMPANY PROFILE
Oro Nero Pipelines is a subsidiary of the popular Integrated Energy Conglomerate, Oro Nero
Corporation (Oro Nero). Oro Nero Pipelines was incorporated 15 years ago under the laws and
statutes of Angoria to enable it focus on its core business which is getting Oil and Natural gas from
the producers to the end users.

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Figure 1 Structure for Oro Nero Corporation

The Parent company holds 75% of the stock in Oro Nero Pipelines and Oro Nero Corporation
is also listed in various stock exchanges worldwide including the New York Stock Exchange (NYSE)
under the symbol, “ORO”. The remaining 25% equity is publicly held. Oro Nero Pipelines is listed
under the symbol, ‘ORP’.

Oro Nero Pipelines has consistently given positive Returns on Investments to shareholders
for the past 12 years, with earnings showing a cumulative average year on year growth of 21.3%
over the period.

Oro Nero Pipelines formerly existed as Angorian Pipe Co., a moribund state enterprise which
was sold during the privatization program of the Angorian Government in 1993. Oro Nero
corporation successfully bid for and purchased 75% equity in the company and completely
revamped it, turning it into what it is today.

The Board of Oro Nero comprises ten members; four (4) of whom (inclusive of the Chairman
of the Board) are Non-Executive Directors, while six (6) are Executive Directors. The Directors are
listed in the Directors’ report. The Company’s Board is made up of a crop of seasoned professionals
who have excelled in their various professions including oil and gas and law and possess the
requisite integrity, skills and experience to bring independent judgment to bear on Board
deliberations.

In line with best practice, the Company in June 2008 appointed Mr. Victor Alete and Mr.
Rapt Ejike as Independent Directors based on the Angorian criteria on the appointment of
independent Directors and the core values enshrined in the Company’s Code of Corporate
Governance. Both Directors do not have any significant shareholding interest or any special business
relationship with the Company.

The Executive Directors of the company along with their Ranks are as follows:

1 Mr. Peter A. Banigo CEO, Oro Nero Corporation

2 Mr Amadi Ambrose MD, Oro Nero Pipelines

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3 Ms Akrasi Esther Exective Director, Quality Control

4 Mr Victor Alete Non- Executive Director

5 Mr Awara Iwah Executive Director, Finance

6 Mr Alozie Chigozirim Executive Director, Risk Management

7 Mr Omoni Ejike Rapt Non-Executive Director

8 Ms Favour Amadi Executive Director

9 Mr Amore Femi Deputy Managing Director, ORP

10 Mr Chinedu Executive Director

EXPERIENCE
Oro Nero pipelines Inc, a division of the Oro Nero Corporation has been into the business of
construction, maintenance and operation of oil and gas pipelines for over 15 years. Oro Nero
Pipelines is committed to linking all oil and gas pipelines to their markets for effective exploitation.

Our International certificates and permits, as well as a substantial body of project-specific


technical analysis place Oro Nero in the best position to develop the South-Central Gas Pipeline.

In addition, our expertise and project management skills, as well as multi-jurisdictional


regulatory experience provide unparalleled access to major markets worldwide and ensure the
timely construction of a technologically sophisticated and environmentally sound transportation
system, and mitigate the risk of delays.

The company, which has the vision of being the number one reference when quality
pipelines are mentioned, has satisfactorily completed so many projects spanning the globe which are
mentioned below:

1.) 1994-1997. The 600 mile, 48”, Angorian South North pipeline. This cost a total of $750
million
2.) 1995-1997. The 365 km, 48”, 56” pipeline linking Calabar and Ajaokuta, both in Nigeria.
3.) 1997-1999 The 800 mile, 42”, Oil pipeline linking West African Gas Markets to Nigerian
Suppiles. This cost $1.3bilion.
4.) 1999-2001. The 1,442 mile, 52" Alaska Gas Pipeline in the Mackenzie valley.
This was constructed at the cost of $2.8billion within schedule
5.) 2000-2001 The 375 mile, 32" south-west gas pipeline linking the gas fields in Nigeria's Niger
Delta to Lagos. $500million
6.) 2000-2003 The 2615 mile 42" linking Libya to the UK. This cost 5$5 billion
7.) 2002-2005. The 4000 mile, variable Diameter, North American Gas Supply Network. This
Cost a total of $12 billion.
8.) 2003-2006, The2600 mile, 28” Ukraine Georgia Supply System. This cost $3.2 billion.
9.) 2005-2007, The 1200 mile, 36” mixed product line linking Russia to the FSU. $1.8 billion
10.)2006-2008 The 1592 mile, 42” pipeline linking South Africa to Angola. $2billion
11.)2007-? The 1635 mile, 35” Iran – China oil line. Estimated at $2.6 billion

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As can be seen above the company has vast experience in pipeline construction and works
within schedule, regardless of the terrain encountered.

TECHNICAL DESCRIPTION.
Oro Nero has prepared a natural gas pipeline development plan to facilitate the
commercialization of the Lardistan south basin natural gas reserves.

Oro Nero proposes to construct a 960-mile natural gas pipeline from Lardistan to major
cities in Rotlanda. For planning and design purposes, Oro Nero is analyzing a 36-inch diameter (“NPS
36”), high-pressure (2,500 psia) pipeline that has an initial design capacity of 750 MMcfd and can be
expanded very efficiently to approximately 800 MMcfd by adding incremental compressor units.

The pipeline when constructed would have the following major technical features:

 Tubes of high grade (X80) corrosion resistant steel with inner and outer smooth polymer
coating produced during the manufacturing process

 Cathodic protection of the linear part of the offshore section (with anodes placed during
construction and operational during service life)

 Tunnelling would be employed for construction in mountain ridges

 Concrete coating of the pipes would be carried out at coastal sections

 Compressor stations

PHYSICAL CHARACTERISTICS
Total Pipeline length: 960 MILES
Length on land: 768 MILES
Length in Water: 192 MILES
Type: Longitudinal SAW
Initial Throughput: 750 MMCF
Expansion Potential to: 800MMCF
Operating Pressure: 2500psia
Initial Compressor Stations: TWO (2)
Heater Stations: ONE (1)
Meter Stations: TWO (2)
Pipe Steel Grade: X80 (GRADE 550) CARBON STEEL
Pipeline Diameter: 36”
Pipe Wall Thickness: 1.45”

EFFICIENCY LEVEL
The South Central pipeline would operate at an efficiency level of 99.9%with all measures
taken to minimise and eliminate downtime.

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ROUTE DESCRIPTION AND LOCATION

Figure 2 Pipeline Route Location and Description.

The pipeline will receive pipeline quality gas 1 at Lardistan’s South Basins where it will
proceed southward along the described ROW till it gets to the river where it will cross
before it gets to Rotlan City.

Oro Nero’s proposed pipeline route is the certificated ANGTS route that has been
sanctioned by both the Lardistani Senate and Rotlan Parliament.

There would be camps for workers (temporary) built along the ROW and also, two
compressor stations and a Gas Treatment Plant would also be constructed.

The pipeline route consists of Hilly Terrain, Highways, Mountains, a River,


Ecologically Sensitive Forests and Built – Up areas which can all increase cost of
construction.

TECHNOLOGY
For so many years now, Oro Nero has led and participated in numerous technical
and economic studies and proposals for pipeline projects worldwide. In the process, Oro
Nero has analyzed, in considerable detail, large-diameter pipeline design and construction.
Armed with almost half a century of experience operating large-diameter, high-
pressure natural gas pipelines, compressor stations and measurement stations in regions
where winter temperatures can drop below -40°F, Oro Nero has the expertise to develop
the Lardistan pipeline.
Oro Nero has continuously improved upon its cold climate expertise by incorporating
learning into the operating procedures of existing facilities and into the design criteria for
1
Pipeline quality gas is obtained by removing most of the heavy hydrocarbons, moisture, CO2 and other
impurities from the natural gas stream.
Oro Nero Corporation 2009 Page 6
new projects. Oro Nero’s active research program has focused on material, strain-based
design and structural reliability; fracture behaviour and control; frost heave and thaw
settlement in permafrost and discontinuous permafrost areas; trenching techniques;
horizontal drilling methods; buoyancy control and advanced software development.
The application of many of these technological advancements has increased
efficiencies, safety and environmental protection while decreasing costs. A sample of
technological advancements which we would employ:
High-strength pipe materials
X80 (Grade 550) – Oro Nero first installed X80 pipe on its system in 1994. Since that
time, Oro Nero has installed approximately 3000 miles of large-diameter X80, including
projects dealing with discontinuous permafrost in Northwestern Alaska. The use of X80
continues to lower pipeline material and construction costs by reducing pipeline weight and
reducing construction impacts on the right-of-way.
Fracture control plans – Such plans are now an integral element of any regulatory
application in support of new projects. Oro Nero has developed fracture control plans for
pipelines. Oro Nero engineers have applied and upgraded their knowledge and experience
to control the propagation of longitudinal fractures, and to understand the gas
decompression behaviour that is a key aspect of this phenomenon. These approaches have
been validated through some full-scale fracture tests.
Frost heave and thaw settlement – Frost heave and thaw settlement are unique winter
pipeline design challenges. Numerous transitions to and from permafrost and the related
frost heave and thaw settlement can induce excessive stress and strain on the pipe.
Lardistan’s discontinuous permafrost, especially in the mountainous regions, Oro
Nero the experience it needs to design pipelines for Lardistan.
Strain-based design – This concept specifies the pipe material characteristics
required to meet expected strain loads. Oro Nero is a leader in the development and
application of strain-based design methodologies. We have an in-depth understanding of
material and structural behavior, an extensive operations database, and advanced analytical
models to support design innovations
Mechanized welding – Mechanized welding will be essential for mainline welding of
any pipeline project. Automated and higher productivity welding, with minimum
intervention by the welder, will be a distinct advantage in harsh conditions and short
construction seasons. Oro Nero and BP Exploration are developing a new, fully automated
pipeline welding system. Advanced mechanized welding has been accompanied by the
introduction of mechanized ultrasonic inspection. Oro Nero has led the industry in the
application of this technology. Advanced welding design, processes and inspection ensure
the structural integrity of the field weld.
Advanced monitoring, control and communication systems – Oro Nero operates
one of the largest and most sophisticated gas pipeline systems in the world. We use leading-
edge software to operate our SCADA system, employing a variety of telecom options to
communicate with our remote sites, which allows us to choose the right telecom solution
based on site requirements and cost. Our systems are highly available (99.9 percent), fully
redundant with a remote hot standby contingency site. By applying new technology, Oro
Nero has gone from 14 control centres with a supervisory gas control centre down to a
single gas control centre.

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S/N ITEM REMARKS

PRELIMINARIES

1 Economic Analysis of 1 Month


demand and Supply for the
Natural Gas

2 Pipeline Route Selection 1 Month

3 Pipeline Design 2 Months Determination of pipe and


components and technical
specifications

4 Environmental Impact 1 Month


Assessment

5 Public Consultation 1 Month

6 Land Acquisition & 3 Months 10m wide along ROW,


Requisition acquisition, 15m wide on one
side, requisition(for working
period).

For scraper station and Valve


station separate block lands
of required size have to be
acquisition

7 Obtaining of permits 2 Months Easement rights,


Environmental permits

7 Compensation 1 Month

Preparation of Access 3 Months


Roads, Camps, Movement
of equipment to staging
sites

CONSTRUCTION STAGE

1 Survey and Staking 1 Month

2 Front End Grading ! Month

3 ROW Topsoil stripping 1 week

4 Pipe Hauling & Stringing 1 Month

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5 Field Bending of Pipe 2 Weeks

6 Line Up & Initial Welding 3 Weeks

7 NDT of welding joints 3 Weeks Dye Penetrant, Radiographic,


etc

7 Trenching 2 Months Use of Wheel ditcher &


Backhoe

8 Holiday Testing

8 Inspection and Repair of 3 Weeks


Coating

9 Lowering of Pipe into Trench 2 Months

10 Laying of riverbed portion 6 Weeks The S-lay Method would be used and a
robotic trenching machine

Installation of valves and other 1 Month


fittings

11 Padding, Backfill& Rough Grade 6 Weeks

POST-CONSTRUCTION STAGE

1 Testing 3 months

hydrostatic testing 2 weeks Pressure at 1.5 times design pressure, Give


notification to residents.

Drying of Pipeline 2 weeks Use dry air to push foam pigs to collect
water

Purging 2 weeks Removal of Air

2 Final Tie-In 1 month

3 Top-soil Replacement 3 months

4 Final Cleanup & Full Restoration 5 months

Commissioning 1 week First Gas transmitted

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SCHEDULE

Several crews known as "spreads" will build the pipeline in sections. The plan
assumes that the pipeline will be separated into five construction sections for each
year of construction. The spreads will construct sections ranging in length from 150
to 200 miles.
The peak field workforce is estimated to be between 6,500 and 7,000 people
for the pipeline’s construction.

A sample of the engineering, field data and technical information compiled to


date for the Lardi portion of the South Central Pipeline includes the following:
• Field Test Programs
 Frost heave
 Fairbanks frost heave test site
 Chilled pipe test sites
 Differential heave test sections
 Heat pipe test site
 Soil uplift resistance program
 Surface disturbance test sites
 Full scale pipe burst and bend tests
• Field Data Gathering Programs
- Geotechnical field program
- Bore hole drilling programs for pipeline centreline, mineral material sites, and
compressor station and other sites
- Mapping programs
- Geophysical studies, including soil resistivity, slope stabilization
reconnaissance, fault studies, pipeline centreline studies, and seismic
refraction

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- Laboratory testing programs
- Geotechnical databases
- River and stream surveys, including stream entry studies and disturbance of
stream and wetland crossings
• Technical Information
- Technical reports based on integration of data and engineering- Design
criteria manuals for all components of the pipeline, compressor and meter
stations, operations control centre and supervisory control systems, and
telecommunications, for example:
o Frost Heave Design Criteria and Methodology
o Geotechnical/Geothermal Analysis
o River, Stream, and Wetlands Crossings
• Technical and environmental plans, pursuant to Stipulation 1.6.1 of the Federal
Grant of Right-of-Way
• Pipeline alignment sheets, as revised
• Mineral Material Acquisition Plan
• Authorization to Proceed (“ATP”) Application Plan
• Notice to Proceed (“NTP”) Application Planning

CONTRACT SUMMARIES FOR SUBCONTRACTED ACTIVITIES


Rotlanda Steel Coy: Supply of X80 Carbon Grade steel Pipes and fittings

Environment Watch International: Environmental Impact Assessment (EIA)

Julius Berger International- Access roads, surveys, trenching

WeldNet International- Welding, Coating and Bending

Magnifico Inspection Coy: Inspection & Testing

Lardi Earthworks: Supply of Gravel, etc

Lardi Gardens: Restoration & Clean Up

ENVIRONMENTAL IMPACT ASSESSMENT


The Environmental Impact Assessment (EIA) for the South Central Gas project
would be carried out by an Independent third party agency, the Environmental
Watch International (EWI).

The EIA which would be provided on request, contains information on

 The reason for the choice of the pipeline route chosen compared with
alternatives,

 Risk analysis for gas leakage, which would show the consequences of any gas
leakages both on land and water to humans, wildlife and property.

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 Protective Distance to other activities, this would be a report showing
protective distances which would be observed from other operations that
might be potentially risky.

 Consequences of Cable Crossings, This would be a description of conditions


that will apply in the matter of the gas pipeline’s crossing other types of sea
bed cables (DC cables, AC cables, other types of cables).

 Consequences to the fishing industry, the consequences to the fishing industry


of the planned gas pipeline would be elucidated since the pipeline would cross
a river.

 Disturbance of sediment etc. The Environmental Impact Assessment will


show the effects of the laying of pipelines within various sections of the route
in terms of the disturbance of sediment, and the consequences of these
effects on ecosystems, fish, etc., and what other effects may be expected to
be of consequence to the ecosystem.

 Local consequences for communities in Lardistan and Rotlanda, this would


show what ways host communities would be affected in connection with
accidents, installation works and operation/maintenance of pipelines and the
service platform in terms of environment, harbours (use of the same, need for
the establishment of emergency harbours etc.), road blockage and business
(purchase of goods and services), etc.?

 Research and improvement measures during installation work A report would


be made of what opportunities and preconditions may exist in connection
with the planned installation work to increase knowledge of the Geography of
both countries by means of study and research work and to carry out
measures to bring about a positive effect on the Baltic Sea from an
environmental perspective.

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OPERATIONS, MAINTENANCE AND QUALITY ASSURANCE PROCEDURE
The South Central gas pipeline, due to the nature of material it carries, Natural
Gas, would be maintained in the strictest manner and to the highest of quality
standards. The pipeline would run for 24 hours, 365 days every year.
The pipeline would, like all our previous projects, be fitted with the
SCADA (Supervisory Control & data acquisition system) which any leakage or
vandalism problems can be handled immediately minimising impact on the
environment.
The pipeline, in addition to automated checks by the devices stationed
along its length, would also be manually inspected physically by staff from the quality
control unit of the company once every three months and all leaks detected would
be fixed within 24 hours.
The quality control unit is adequately funded for this purpose. Prompt
response to all defects found is necessary to prevent loss of sales, customer
inconvenience and service disruption.
Major repairs may be carried out once in a while on the pipeline due to
internal defects, leaks or in order to install large connections. Traditionally,
considerable amounts of Gas are lost during pipeline repair which is why our
company, to reduce/ eliminate the occurrence of these, uses the most modern
methods in maintenance such as Hot Taps and Composite Wraps while Pipeline
pump downs are carried out for major repairs to recover vented gas.
All trenches dug in the course of maintenance and repair are
immediately covered up and restored after the curing time for all repair has elapsed.
Oro Nero conducts its business so that it meets or exceeds all applicable laws
and regulations and minimizes risk to our employees, the public and the
environment. It is these principles that guide Oro Nero during all phases of project
development, including engineering design, field studies, construction, operation and
maintenance, and eventually decommissioning.
Oro Nero is committed to maintaining its position as an industry leader in
health, safety and environmental (HS&E) practices, to maintaining a safe and healthy
workplace and to protecting environmental quality. We believe excellence in HS&E
practices is vital to the well-being of all people everywhere and essential to all
aspects of our global business.
It is Oro Nero’s intention to design, construct and operate the pipeline to meet or
exceed all applicable safety standards, building on half a century of experience in
cold weather pipeline design and construction.
The following factors would be addressed in the design of the pipeline material,
strain-based design and reliability-based design;
• Fracture behaviour and fracture control;
• Frost heave and thaw settlement in permafrost areas; and
• Advanced design software development.
Construction and environmental focus areas would include:
• Trenching techniques in permafrost areas;
• Horizontal directional drilling techniques in permafrost areas; and
• Buoyancy control in permafrost areas.
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Ultimately, the goal of the project is to provide safe and reliable delivery of
natural gas to customers without adverse effect on employees, contractors, the
public, or the environment. Managing the integrity of a gas pipeline system is the key
to accomplishing this goal. Operational excellence is achieved by implementing a
comprehensive system of integrity management that includes, among others, the
following items:
• Operating procedures – Oro Nero’s operation and maintenance activities are
governed by over 650 individual procedures that promote safety, environmental
protection and efficiency in the operation of the pipeline. These procedures are
known as Oro Nero Operating Procedures (“OOPs”). OOPs are developed and revised
in conjunction with our pipeline and plant maintenance plans, safety and
environmental protection programs, and in response to legislated requirements in all
applicable regulatory jurisdictions in which we operate. OOPs are maintained
electronically and are accessible at all locations across the organization. Electronic
links with our state-of-the-art computerized maintenance management system
allows for efficient access to the OOPs for field technicians at the same time as they
are reviewing and issuing maintenance work orders.
Results and findings from the execution of maintenance tasks are captured
and trigger reviews and updates to the TOPs, thus facilitating continuous
improvement. Finally, a change-management program ensures that legislative
amendments that may impact the OOPs are communicated, analyzed and
incorporated into the OOPs when appropriate, and that staff receive timely
notifications when OOPs are revised.
Advanced monitoring, control and communication systems – Oro Nero operates
one of the largest and most sophisticated gas pipeline systems in the world. We use
leading-edge software to operate our SCADA system, employing a variety of telecom
options to communicate with our remote sites, which allows us to choose the right
telecom solution based on site requirements and cost. By applying new technology,
Oro Nero has gone from 14 control centres with a supervisory gas control centre
down to a single gas control centre. Pipeline integrity and maintenance – Oro Nero
uses an industry-leading integrity management program to ensure pipeline integrity
and the safety of employees and people who live near the pipeline system. The
program uses advanced inspection and mitigation technologies applied within a
comprehensive risk-based methodology. Risk assessment is used to identify potential
integrity threats for initiation of inspection or mitigation activities. Results from the
inspections for known or suspected integrity threats are then fed back into an
information database to plan future programs. Our integrity management programs
have led to a reduction in costs such that, on a volume-distance basis, our operations
costs are less than half the industry average.
Compression operation and maintenance – Oro Nero is the lowest-cost operator of
gas compression facilities worldwide. Our compression maintenance costs (capital
and expense) are approximately one-third of average industry costs. We continue to
look for improvements that will lower costs and improve the efficiency of our
compressor fleet.
Geographic information systems – Oro Nero leads Angoria’s gas transmission
industry in the integration of facility and environmental data to achieve operational
efficiencies and support sophisticated maintenance planning.
Oro Nero Corporation 2009 Page 14
In fact, Oro Nero received the 2001 Excellence Award from the Geospatial
Information Technology Association; Oro Nero was recognized for exceptional design
and application of GIS technology, the first in the industry to receive such an award.
HS&E Management System – Oro Nero’s integrated HS&E Management system
captures, organizes, and documents the company’s commitment and expectations
for effectively managing HS&E responsibilities and risks. There are two major aspects
of the system: the framework and the continuous improvement cycle. It is modelled
after ISO 14001, an international standard for environmental management systems.
Our approach is risk-based, the same as our pipeline integrity program. By
considering the likelihood, frequency and consequence of events, we are able to
place our first priorities on those areas which show the greatest exposure. Our
record in safety is among the best in our industry. Oro Nero Pipelines, in all its years
of doing business, has never had any serious incident reported on any of its
pipelines. This is as a result of the company sticking to quality standards set by
various regulatory and professional bodies such as the ASTME (Angorian Society of
Mechanical Engineers), World Materials Foundation (WMF),

ECONOMIC ANALYSIS
The South Central Gas pipeline project would be a very financially viable
project as there is a wide market for the Goods in question and also, there is a global
trend of a shift towards the use of clean fuels for industrial and domestic use as a
result of the climate change phenomenon.

Our company, over the years, with our vast experience, has developed an
economical, cost effective means of constructing and managing gas pipelines and this
project, would be the recipient of years of expertise in pipeline management.

Our company conducted an economic evaluation of the project, which is


attached with this proposal. From the evaluation, it can be seen that with the
available pipeline parameters and the lowest possible tarrif rate of $1.30, the project
yields a Net Present Value (NPV) of approximately $991 and an IRR of 13%. This
shows a very profitable venture even with leap year revenues ignored and
contingencies included.

ESTIMATED COSTS
The South Central Gas pipeline project is estimated to cost a total of
$1,700,000,000 (One Billion, seven Hundred Million Dollars only) of which 25% would
be spent in the first year, 50% in the second year and 25% in the third year.

This figure includes the value of the financing which would be obtained in
respect of the pipeline.

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The construction phase of the pipeline project would take the shortest time and the
largest chunk of the budget in our projections (50%).

Extension in the time estimated for construction would unnecessarily inflate


the cost of the pipeline which is why our company employs the segmenting method
where work goes on simultaneously at different points. From experience, this has
been seen to reduce time, and hence cost factors by a factor of as much as 5.

The break down for the construction cost of the pipeline is as follows (prices in
$MM).

Cost in $MM Percentage of Total

Material Costs 273 16%

Labour 1025 60%

Miscellaneous 342 20%

ROW and Damages 69 4%

TOTAL 1709 100%

The pipeline would be constructed at an average cost of $1.3MM per mile


onshore and $2.5MM/mile offshore for its total length of 960 miles and with 80% of
its length onshore.

Operating costs have been estimated to stabilize at a maximum of


$26,000,000(Twenty Six Million Dollars) annually, with fixed cost per year at
$16,000,000 and a variable operating cost per MMMcf of $0.02.

In calculating the costs for the pipeline, an O & M contingency of 20% was
added to the calculated value yearly to make up for contingencies in O&M costs that
may be associated with lack of skilled labour, poor infrastructure, bureaucratic
changes and the like that commonly delay projects and increase costs.

GAS SUPPLY AND DEMAND


The financial projections for the South Central pipeline, have all been made,
based on assumptions that a fixed amount of gas at a fixed tariff rate would pass
through the pipeline on a daily basis, uninterrupted, for 30 years, for this reason, we
have to ensure that the pipeline always has enough gas for supply to end users and
also, that there are users that need the amount of gas available for use immediately
(since gas cannot be stored for long periods).

Oro Nero pipelines has entered into long term gas shipping contracts with
existing upstream gas production companies for about 600 MMcfd of gas deliverable

Oro Nero Corporation 2009 Page 16


by 2012 and also, other contracts have been signed with companies which won in
the just concluded Lardistani Licensing round for the unexplored basins in the
southern area of Lardistan which would be deliverable in 2014 hence completing the
supply requirements of 750 MMcfd.

FINANCE
The South Central Pipeline would be financed by a consortium of investor-
lenders who would provide a total of 25% or $406,559,999 of the project sum at an
interest rate of 12% to be amortized over 10 years. The financiers include
Internacionale Credit Suisse, HSBC,FCMB.

The pipeline would also be insured by the International insurance group AIG in
order to mitigate against losses and to pay workmen compensation.

ESTIMATED REVENUES
Revenues for the pipeline in question would be obtained from tariffs on the amount of
Natural gas which passes through the Gas pipeline. Currently, the tariffs are estimated at $1.3 per
Mcf of Gas based on the average estimated throughput of 700MMcfd of gas, the yearly revenues are
estimated as follows:

700 000MMcf * $1.3 * 365 days = $332,150,000

This is a low estimate since the pipeline is estimated to stabilize production at 750 MMcf per
day and also, leap-year revenues have been ignored to allow for any unforeseen breaks in
production. This is the gross revenue from the pipeline before various costs would be taken into
consideration.

RATES
The tariff rates for the South Central gas pipeline are estimated at about $1.3 per Mcf of
Gas. This tariff is acceptable by both the Lardistani & Rotlan Governments and is the base on which
the financial estimates for the project have been based. The breakdown of the tariff is as follows:

US$/Mcf %

Operating cost 0.10 7.69

Maintenance Reserve 0.10 7.69

Miscellaneous 1.10 84.61

TOTAL 1.30 100

SUMMARIES OF PRO FORMA CONTRACTS WITH SUPPLIERS, SERVICE


PROVIDERS AND CUSTOMERS

Oro Nero Corporation 2009 Page 17


NO:1

GAS TRANSPORTATION CONTRACT

BETWEEN

LARDISTAN GAS COMPANY

AND

ORO NERO PIPELINES LIMITED

DATED: 10TH FEBRUARY, 2009.

This contract is made as of the 10th day of February, 2008 by and between the ORO
NERO PIPELINES LIMITED and LARDISTAN GAS COMPANY, a Lardistani company, pursuant
to the following recitals and representations: Whereas, Oro Nero Pipelines Limited has
received and accepted a certificate of public convenience and necessity issued by the
Federal Energy Regulatory Commission, authorizing Oro Nero Pipelines Limited to manage,
construct and operate a pipeline gas transmission. Whereas Oro Nero Pipelines Limited has
entered into gas transportation agreement with the Lardistan Gas Company herein called
Gas supplier(s), for the transportation of up to 120MMcf of natural gas per day; whereas
Oro Nero Pipelines Limited and Lardistan Gas Company now desire to establish the terms
and conditions under which Lardistan Gas Company render services to Oro Nero Pipelines
Limited by entering into this Gas transportation contract.

Now therefore, in consideration of the mutual convenants and agreement herein


assumed, Oro Nero Pipelines Limited and the Lardistan Gas Company agree as follows:

ARTICLE 1 – SCOPE OF CONTRACT


1. On the commencement date and each day thereafter, Lardistan Gas Company shall
cause the input quality for each receipt point hereunder, not to exceed the
maximum input. Quantity for each receipt point, to be delivered to Oro Nero
Pipelines Limited at the receipt point(s).

2. On the commencement date, Lardistan Gas Company shall make the equivalent
quantity corresponding to the input quantity, not to exceed the maximum equivalent
quantity for each delivery on behalf of Oro Nero Pipelines Limited on a firm basis.
Oro Nero Corporation 2009 Page 18
3. Lardistan Gas Company shall be solely responsible for securing faithful performance
by gas supplier(s) in all matters which may affect Oro Nero Pipelines Limited’s
performance hereunder, and Limited shall not be liable hereunder to Lardistan Gas
Company as a result of the failure of Gas supplier(s) to so perform

ARTICLE 2 – RATE SCHEDULES AND GENERAL TERMS AND


CONDITIONS
This contract and all terms and provisions contained herein are subject to the provisions of
Rate Schedule FTS and the general terms and conditions of Oro Nero Pipelines Limited’s
FERC gas tariff and as such, may be revised and superseded from time to time, which Rate
Schedule FTS and general terms and conditions are by this reference made a part thereof.

ARTICLE 3 – TERM
1. This contract shall be effective as of the date first therein above written; provided
however, that Lardistan Gas Company shall be under no obligation to receive or
deliver any quantities of natural gas and Oro Nero Pipelines Limited shall be under
no obligation for any payment(s) hereunder prior to the commencement date.

2. This contract shall be enforced and shall continue to be effective until a date which is
at least one month from the commencement date, pursuant to any effective
provisions for termination of this contract by Lardistan Gas Company as stated in
Rate Schedule FTS or the general terms and conditions for transportation service,
provided however that if the FERC authorizes Lardistan Gas Company to abandon
service to Oro Nero Pipelines Limited on an earlier date. This contract shall terminate
as of such earlier date.

ARTICLE 4 – CORRESPONDENCES
All correspondences to Oro Nero Pipelines Limited shall be addressed to:

The Manager

Power Operations

Oro Nero Pipelines Limited

P. O. Box 860

ANGORIA, AN 62157.

Correspondences to Lardistan Gas Company shall be addressed to:

The Manager

Gas Transportation Operations

Lardistan Gas Company


Oro Nero Corporation 2009 Page 19
P. O. Box 1460

Republic of Lardistan.

Either party may change its address under this article by a written notice to the other party.

ARTICLE 5 – BANKRUPTCY OF LARDISTAN GAS COMPANY

Subject to the requirements of section 7 of the National Gas Act, Lardistan shall not
be required to render or continue to render sales on behalf of any Oro Nero Pipelines
Limited that has applied for bankruptcy under the bankruptcy code or on behalf of any
lardistan gas company which, at Oro Nero Pipelines Limited’s request , fails within a fifteen
(15) day period to desmonstrate and maintain credit worthiness, provided however, that
Lardistan Gas Company shall render or continue to render transportation service for any
such Oro Nero Pipelines Limited which prepays for such service or which, upon fifteen (15)
day notice by Oro Nero Pipelines Limited, furnishes good and sufficient security bond or
other good and sufficient security as Lardistan Gas Company in its reasonable discretion
deems acceptable of a continuing nature and in an amount equal to the cost of performing
the transportation service request for a two month (2) period.

ARTICLE 6 – LAW OF CONTRACT


The interpretation and performance of this contract shall be in accordance with and
controlled by the laws of LARDISTAN and applicable federal law and regulation IN WITNESS
THEREOF, the parties here to have caused this contract to be duly executed in several
counterparts by their proper officers duly authorized, as of the date first herein above
written.

ATTEST: ORO NERO PIPELINES LIMITED

-------------------------------------------------------------------

By Mr Ambrose .O. Amadi (PERSONNEL DIRECTOR )

ATTEST: LARDISTAN GAS COMPANY

-------------------------------------------------

By Ms Akrasi Esther (DIRECTOR GENERAL )

Oro Nero Corporation 2009 Page 20


SUPPLY ARRANGEMENTS
GAS SUPPLY SOURCES
Oro Nero has reviewed publicly-available reserve estimates and has determined that
there is sufficient supply within the region to support this project proposal. These reserve
estimates, show that proven natural gas reserves on state lands in Lardistan total
approximately 29.7 Tcf, the vast majority of which is located in the south of Lardistan which
are yet to be exploited fully.
With estimated production of 700MMcf/day this reserves would last an estimated
116 years. However, the life of the project would no doubt be extended because this
reserve figure does not include reserves on other Lardistan South Slopes. With respect to
undiscovered fields, the Minerals Management Service indicated in a January 2001 study,
that undiscovered, technically recoverable, conventional natural gas resources in Lardistan
could be as high as 100 Tcf of gas.

UPSTREAM TRANSPORTATION AND STORAGE ARRANGEMENTS


The natural gas obtained from the suppliers would come from different sources to the South
Central Gas Line. This would bring up a transportation problem for the project. Oro Nero pipelines
would undertake to invest in

1. A Gas Gathering pipeline Network to collect the gas from sources of production to link to the
main trunk line for onward delivery to Rotlanda.

2. A central gas treatment plant to remove impurities and refine the gas to pipeline quality gas
before it gets to the trunk line.

Sometimes, gas might need to be stored for a variety of purposes such as

 Balancing the flow in the pipeline system to maintain operational integrity to ensure
pipe pressures are kept within design parameters.

 Maintain volume delivered and withdrawn from the pipeline system

 Levelling production in times of fluctuating demand such as winter, summer


demand.

 Insuring against unforeseen accidents

Therefore, the company would also build an Underground facility to protect against these
situations and would also utilize line-packing in storage of the gas.

BACKGROUND DESCRIPTION, REFERENCES AND CREDIT RATINGS ON ALL


POTENTIAL SUPPLIERS/ SERVICE PROVIDERS

Oro Nero Corporation 2009 Page 21


FINANCIAL ARRANGEMENTS
Oro Nero pipelines has concluded arrangements with several banks to provide the loan sum
of approximately $400MM as soon as the proposal has been approved Letters from these banks are
all attached. The Loan would be repaid over a ten year period beginning from when production
starts, hence, payments can easily be made from earnings from the pipeline

Loan

26%
33% HSBC
FCMB
UBA
GTB

21%
20%

Figure 3 Financiers and their contributions

The partner banks and their contributions are shown in the chart.

RISK MANAGEMENT
CONSTRUCTION RISK
During construction of the pipeline, some issues might come up such as natural disasters,
delay in supply of materials, system failure due to substandard material, and so on. The company
observes the highest codes of quality in existence and also has already put in contingency plans in
place for any of the imaginable scenarios.

PRICE RISK
In the day to day operation of the pipeline, there is interaction of demand and supply forces
which can lead to volatility in prices of Natural Gas. This Risk has been taken care of as contracts for
transportation of the Gas have been signed with both parties agreeing to a tariff rate for 30 years.

OPERATIONS RISK
Problems such as shortfalls in through put and so on, which might be experienced during the
running phase of the gas pipeline have all been taken care of. The pipelines are all linked to an
underground storage system for emergency and other purposes and also, Natural gas loss during
maintenance procedures is highly minimized through the advanced techniques we employ in
maintenance of our pipelines.

Oro Nero Corporation 2009 Page 22


POLITICAL RISK
Lardistan: The current political party in power, the hope for people party is made up of a
younger generation of politicians whose priorities have been to clean up corruption and open up the
economy. Since 1989, there have been four freely contested democratic elections with no
disruptions.

There have not been any serious internal conflicts for religious, ethnic or political reasons since the
1987 coup and any which have occurred have been non-violent.

There does not seem to be solid evidence of military’s intent to take control of government and it is
believed that this would continue to be the case in the nearest future.

Rotlanda: Rotlanda has a well-functioning multiparty democracy. The political system is one of the
most stable in the region with over 50 years of democracy since its independence from Angoria.
2004 is presidential election year in Rotlanda and due to the increase in unemployment and
percentage of population living below poverty level, there ahas been a mild upsurge of crime and
social unrest in the country.

Opposition parties, indigenous groups and international NGO's oppose this pipeline for a variety of
reasons ranging from un-sustainability, potential adverse environmental impacts and violation of the
property rights of indigenous groups Risk Mitigation

Rotlanda: The completion of the pipeline to Rotlanda would be the beginning of a new era in
industrialisation as industries would be attracted to set up in the country with availability of a cheap
and steady gas supply, environmentally, the company has an enviable record of constructing in line
with environmental best practices so we would ensure that there is minimum environmental impact
on the proposed pipeline route.

For the Indigenous groups, since they claim the lands as ancestral, the company would give them
access to areas and also assign them the responsibility of protecting the parts of the pipeline which
crosses their area. Projects which are also of utmost importance to each community would be
awarded for each in the vicinity of the pipeline.

For the political parties, it is believed that the ruling NRP would keep power in the upcoming
elections and if not, the opposition parties would see the viability of the proposed project as it would
create jobs, increase the country’s GDP hence reviving the failing economy of Rotlanda

REGULATORY RISK
There is a risk of regulatory bodies from either country changing rules and regulations on
pipeline operation and also a risk of price caps being fixed on tariffs which may hurt revenue
projections on the pipeline. This risk, though minimal, has to be taken as one of the risks of business
and in the worst case scenario, the pipeline, being as hugely profitable as it is now, would still
recover costs of construction and operation and would also yield some returns to investors.

LEGAL RISK
There

Oro Nero Corporation 2009 Page 23


ENVIRONMENTAL RISK
The South Central pipeline would pass through areas recognized as havens for rare species
and would also run a risk of harming its immediate environment in the event of gas venting and so
on, the company Oro Nero pipelines, from the date of construction to de-commissioning, works
closely with environmental consultants to ensure that the existence of the pipeline has minimum
impact on the flora and fauna of its immediate environment. In the construction phase, before
construction, samples and photographs are taken of plants which exists on the ROW and when the
pipes have been buried, an attempt is made to replant everything as they where to avoid natural
imbalance.

LEGAL & REGULATORY


APPLICABLE LAWS AND REGULATIONS
1. Investors, Lardistan citizens, legal entities (consortium) which are engaged in the
construction of natural gas turbine plant will and are using their own borrowed or
attracted fund. There will be adequate protection of foreign and Lardi investment
participation in the oil/gas resources of Lardistan and the protection of legal
interests of persons engaged in oil and gas operations in Lardistan.

2. The terms and conditions for tenders or auctions shall be defined by the agency and
registered at the Ministry of Justice of Lardistan one month prior to the
announcement of auction.

3. Comprehensive Environmental Response, compensation and liability Act. The


environment must be protected and compensation paid where applicable.

4. Clean Air Act: This Act is designed to protect and enhance the nation’s air resources
so as to promote the public health, welfare, and productive capacity of the populace.

5. Article1.22 under general provisions of the Petroleum Industry Reform Law of Lardistan ,
““Force Majeure” – Acts of God, strikes, sabotages and other industrial disturbance, civil
unrest, war, blockade, earthquakes, avalanches, epidemics, flood and similar events, which
are out of reasonable control of Parties and which are impossible to eliminate by Parties.
Force Major does not include deterioration of Investor’s financial condition provided that it
is not connected to the above listed events. In such cases advantages under Force Major
conditions does not apply to the amount payable by Parties under Agreement.”

PERMITS REQUIRED WITH ESTIMATED TIMELINE


The regulations most generally applied for the construction of pipelines are the ANSI
codes B31.4 and B31.8. These both refer to API 1104 for specific welding requirements.
Another well known code is BS 8010 which refers to BS 4515 for welding aspects
There is also likely to be a range of local requirements covering land purchase, rights
of way, easements, conservation, etc.
Certificates / Permits
Permits held by ORO NERO include the following:
Oro Nero Corporation 2009 Page 24
• FERC Conditional Certificate of Public Convenience and Necessity
(1 FERC ¶61,248 (1977)), issued: December 16, 2007
• Clean Water Act Section 404 Wetland Permits
- Rotlanda River Permit (File No. Rotlan River 120), originally issued: January 4, 2004
(effective date)
• Two Clean Water Act Section 401 Certifications (issued in conjunction with the
Section 404 Wetland Permits)

SUMMARY OF COMPLIANCE PLANS


Oro Nero Pipelines Limited shall be committed to contracts terms and conditions
within the duration of the contract. In line with Oro Nero Pipelines LTD’S compliance
plans, a periodic review of terms and agreement shall be displayed for examination and
execution.

SUMMARY OF CONTRACTUAL AGREEMENTS


 We shall construct a pipeline for the transportation of Natural gas and
operate it for a period of 30 years

 We shall develop a pipeline system capable of delivering a steady throughput


of 750 MMcf/ day expandable to 800 MMcf per day

 We shall ensure at least 25% engineering procurement to be of Lardi origin.

SMART DEVELOPMENT
Oro Nero pipelines, from years of operating various pipeline systems scattered around the
globe has come to realise that there is no feasible long term development without the input,
Participation and support of the stake holders or community. The company is globally admired as a
development partner, touching lives and making improvements to conditions on ground in any part
of the world where we operate.

Oro Nero is guided by the vision of being the energy company most admired for her
partnership and performance. In the pursuit of this vision, the company has been pivotal in
promoting the ideas and programmes that foster sustainable development in facets of her
operational terrains. We do this through a corporate responsibility programme targeted at
improving the quality of life by contributing to schemes that stimulate socio-economic
growth. In the same vein, Lardistan stands to benefit considerably from the project in two
broad-based areas. These are the provision of basic infrastructure and business and human
capital development.

 INFRASTRUCTURE PROGRAMMES.

 Upgrading of existing infrastructure.

 Road construction.

 Provision of portable water.

Oro Nero Corporation 2009 Page 25


 Provision of health care delivery system(buildings and equiping of
medical doctors and nurses quaters as well as a number of cottage
clinics) that will address critical medical issues.

 Communities, most of whom have completed land claims will benefit


from increased property and resource revenue.

 BUSINESS AND HUMAN CAPITAL DEVELOPMENT.

 Youth empowerment through training( carpentry, heavy equipment


operators, labourer occupational groups ), trades, transportion and
other areas where skills are in abundance.

 Making the community a stakeholder in the operations of the sector


by minimization of community related disruption of operations.

 Encouragment of indigenous contractors.

 Provision or micro credit.

 Employment of skilled and unskilled labour.

 Award of scholarships (primary, secondary and tertiary ).

PROJECTIONS OF ANTICIPATED ECONOMIC, ENVIRONMENTAL AND SOCIAL


IMPACT
LOCAL CONTENT & HUMAN RESOURCE DEVELOPMENT
In cognisance of the local content laws of Lardistan which stipulate that 25% of materials
used in construction of the pipeline must be of Lardi origin, Our Company has decided to go the
extra mile by ensuring that 30% of the workforce & materials initially increasing to 75% by the end of
the life of the pipeline are all of Lardi & Rotlan origin.

This increase would be as a result of our intensive human resource optimization and
technology transfer program which we carry out in all communities were we operate. The
scholarships we award are given to bright students who, on undertaking to work with us, are sent on
an intensive program at any station in our vast network to learn the basics and also advanced
techniques which we employ in managing projects..

HEALTH, SAFETY AND ENVIRONMENTAL PROTECTION


Oro Nero has a very strict record of compliance to HSE requirements and regulations at
every operating location. The company recognizes that protecting its workers is a very simple yet
effective way of increasing productivity. We ensure that all workers and visitors, once on site, put on
their complete personal protective equipment (PPE) and also, our workers are sent on trainings,
seminars and workshops on HSE in order to increase compliance.

ANALYSIS OF PROJECT’S ANTICIPATED CONTRIBUTION


The South Central pipeline project would be of immense benefit to both nations and also all
communities along its ROW. The pipeline would touch various aspects such as:

Oro Nero Corporation 2009 Page 26


1. Increase in the GDP of both countries: The existence of the pipeline would result in an
immense increase in the GDP of both countries, Lardistan would benefit as the nation would
have a further means of monetizing its gas resources hence an additional revenue stream,
also, and the country would benefit from taxes paid by the company. In Rotlanda, the
availability of a cheap source of fuel for power, industries and businesses would reduce the
cost of production, increasing the level of productivity & hence, increasing the GDP of the
country.
2. Employment: The South Central pipeline would greatly reduce the unemployment level of
both countries with our plan to train & employ 70% of staff locally in the long term. The
pipeline estimates to directly employ 6000 -7000 people in the construction phase & provide
indirect employment to over 50, 000 people in the construction phase alone. This would
have a positive impact on the unemployment rate in both countries.
3. Infrastructural development: As part of the company’s social responsibility program, the
company would build and maintain projects which are of utmost importance to communities
along its right of way. These can be schools, water projects, primary health-centres and so
on.

PROGRESS REPORTING SCHEDULE

Oro Nero Corporation 2009 Page 27

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