1 Oil, Gas & Petrochemical Industry Proposal for Business Implementation in México Eduardo Moreno May,2016 TUV SUD América México, S.A. de C.V (Draft for coments)

2 Executive summary 1. Objectives 2. Business environment 3. Oil & Gas, PEMEX new organization 4. Business key points 5. Pemex strategy, 2015 6. CFE strategy, 2015 7. Private projects detected, 2015 - 2017 8. Factible projects, 2016 - 2017 9. Projects for the TUV SUD focus radar. 10. Actions for grow Index :

3 Current situation: New business area. Net sale 2015-2016 (E) ( first year operation) $ 100,000.00 USD for 2016 (e). Market trends: Low prices oil in the world market. PEMEX: Recovery of oil production levels in Cantarell deposite. Recovery of oil production in north area (Chicontepec, Burgos and Offshore projects). Secondary recovery, Samaria, Cardenas. Pipeline RBI by security reasons. Storage terminals & pipelines for distribution Revamp Refineries for new environmental requirements, Clean fuels. New & upgrading terminals Storage Main Competitors Bureau Veritas, Applus, Germany Loyds, Others. Key products 2015 Testing, inspection, certification, training and engineering Services Action for growth Focus Targets Positioning in the Oil & Gas, Chemical & Petrochemical and industrial sector. Detection of opportunities en the energy Sector. Develop business strategic plan. Promoting activities in the sector Meeting presentation plan in sites Alliances with the EPC companies O&G Participation & handle small and medium size projects contests. Cross check in international bids Open the TUV SUD office in México City. Promotion Intensive promotion activities en the Sector, Goverment & Private. Services Testing, inspection, certification systems, trainnig and engineering Services in the Industrial Sector. Alliances: Participate in projects with EPC contractors of Pemex (ICAF, Swecomex, Saipem, Techint, etc. Engineering & construction companies for public and private RFQ contests. Executive summary

4 Be recognized as one of the best Certification & Inspection Services Provider in the Sector. Work in increase the Size of the Business in México in 5.0 % in 2017 v.s 2016. Establish alliances with the big oil & gas EPC contractors and costumers. Promote the TUV SUD Services in the oil & gas market costumers, EPC contractors & engineering companies. Geographical coverage & service availability based on the Oil & Gas Task Force performance. Develop a strategic business plan to define the business focus in the Energy Sector. Pre-requisite for success Continue to establish high level contacts with top management in EPCCompanies and Pemex Focus on key and strategic accounts where services outsourcing strategies may apply Early detection and involvement in projects – drive specifications 1.0 Objetives:

5 2.0 Oil & Gas business environment In the begin of 2016, SHCP has announced another shortcut in the Federal Budget for 132 MMio MXP, this reduction could be affect to PEMEX’s investment level of projects and reduce the operational expenses and personnel. The second shortcut in PEMEX is for amount of 100 MM MXP, 62% in investment projects, involving reduction in Tsimin Xux, Delta del Grijalva, Burgos and Ku-Maloob-Zaap fields, the setting will deferring the execution of the main Jobs, including reconfigurations of refineries and projects of gasoline and clean diesel (Ultra Low Sulfur). The rest of the cuts will affect the operational side with a consequent reduction in personnel, about 20,000 positions PEMEX is inside an intensive re-organization process to assume the new duties and projects, with a new organization structure. Pemex crude oil production has being decreasing, at the close of 2015, the Oil production reach 2.26 MMBPD. The Cantarell oil deposite producción is decreasing, -51% since 2008, Secundary recovery and new projects will cover the deficit. PEP planning recovery the oil Production of approx. 3.2 MMBPD until 2018. 2014, PEMEX has awarded the five Ultra Low Sulfur Fuels packages, investment estimate is 2,800 Mio USD, to ICA Fluor, Foster Wheeler, Tecnicas Reunidas, Samsung and Cobra. The projects are delayed in engineering phase.

6 3.0 Oil & Gas Pemex, new organizational structure

7 Pemex Business Divisions

8 Slide 8 Pemex Headquarters Pemex Exploration & Production Pemex Exploration & Production Pemex Refining Pemex Petrochemical 1. North 2. South 4. Northeast Marine 3. Southwest Marine Engineering & Project Development (*) Operations Control Environmental and Safety Telecommunications Public Relations. Explotation Region: CEO PEMEX Refineries: Petrochemical Complexs: Corporate Cadereyta Madero Salamanca Tula Minatitlan Salina Cruz TAD’s & Pipelines C & P Stations Cangrejera Morelos Pajaritos Cosoleacaque Independencia Camargo (OS) Escolin (OS) Tula (OS) PTQ Pipelines Pemex Gas & Basic Petrochemical Gas Processing Centers: Burgos Coatzacoalcos / TR Paj. Reynosa Poza Rica Matapionche Cd. Pemex Nuevo Pemex Cactus Arenque La Venta CS, PS & Pipelines PEMEX, operational structure TAD: Terminal de Almacenamiento y Distribución OS: Out of Service (*) Funtions asumited By DCO PEMEX, 140 k employee in México in MéxicoPEMEX, 140 k employee in México in México Fuente: PEMEX Corp.

9 Oil & Gas Basis distributions reserves.

10 Oil & Gas Industry, investment forecast 2010- 2020

11 PEMEX, Investment plan by division Priority on Oil Recovery Production capabilities and Clean Fuels production, Transport infrastructure PEMEX, Investment Plan, 2015: 401 MMio MXP Fuente: Federal Budget, 2015

12 4.0 Business key points PEMEX PEP, focus: Recovery of oil production, 85% of Budget focused on operating and developing new fields, channeled large contracts with international companies with technologies (Halliburton, Schlumberger, etc..). Oil and Gas Production, 13% of PEP budget, operating platforms, pipelines, batteries and terminals apart. Target 2% maintenance (rehabilitation and safe operation). PEMEX Industrial Transforming, focus: Operations, 35% of Budget for Maintenance, Major Maintenance 50% in Refineries, CPG´s, CPQ´s and other process plants and utilities to ensure safe operation, rehabilitation and improvement of operation. (higher conversion and use of utilities). Up grading and improve projects and some new plants and SRU, Cryogenic Matapionche Poza Rica and Compression and Pumping Stations, Control Systems Modernization, Focus: EPC Contractors. Clean Fuels, focus: Development 2015, EPC stage starts at the end, 25% of Budget to long-term projects. Focus; positioning EPC Contractors (ICA Fluor, Foster Wheeler, Técnicas Reunidas, Samsung, Saipem, Techint, Swecomex). Residual Convertion Projects EPC in Tula and Salamanca Refining Centers, actual stage in Engineering by ICA Fluor (Delayed)

13 4.0 Business key points PEMEX Drilling & Services, Focus: Infrastructure, Maintenance and services in oilwells in several Oil & Gas fields. PEMEX Logistic, Focus: Rehabilitation and maintenance of pipelines nationwide. Safety and environmental protection in the pipelines sectors. Upgrading of the safety and control mesurement of the Pumping Stations. Rehabilitation and new investments in the infraestructure loading docks and marine transportation. Infrastructure development, import fuels, handling and fuel distribution. Terminals and Pipelines.5 New TAR's. rehabilitation of 70 TAR´s and tank yard nation wide. PEMEX Fertilizer, Focus: Operational, Rehabilitation and maintenance of the Ammonia plants IV and VI in CPQ Cosolecaque, Ver.

14 4.0 Business key points PEMEX Cogeneration & Services, focus: Generate, manage and market electricity, heat and related services to supply internal costumers and others in the energy services market petroleum, generating economic value and profitability for the Mexican State. PEMEX Ethylene, focus: Rehabilitation and maintenance of Ethylene Plants and Utilities and Support Plants in the CPQ´s Cangrejera and Morelos. Safety and environmental protection Systems in the Complexs, Upgrading of the safety and control mesurement of the Pumping Stations and Controls Bunkers. Rehabilitation and new investments in the infraestructure loading docks and transportation.

15 5.0 PEMEX Strategy, 2015 -2017. Reforma Energetica 2014: 2014, Ronda Cero, Explotation Fields, exclusives for PEP. 2015 Ronda Uno, Definition, explotation fields contracts for private and international groups, in agree the new regulations. 3/21 contracts awarded. end 2015, news RFQ. 2015 – 2016, PEMEX y CFE, will operate under the SHCP Budget Control and the actual legislation. Actual fields explotation, secundary recovery, new developments. Transportation, storage and distribution infraestructure of Gas and Fuels. Clean Fuels, phase diesel continue and start phase gasolines. Main Action Lines: Deep Waters Project, is conditioning to the Oil market prices, up of 73.0 usd/barrel Secondary & Tertiary Recovery Process for Cantarell, Cd, Carmen, Camp. Secondary Recovery Projects en Villahermosa, Tab. Aceite Terciario del Golfo, Secondary Recovery in Veracruz y Tamaulipas. Secondary Recovery en Tamaulipas North Zone. Exploration for develop new production areas in Offshore & Onshore. Construction Fase II del Gasoducto “ Los Ramones”, 42” diameter and 741 Km. longitude, 2,500 MMUSD, investment by TAG Pipelines / Gasoductos de Chihuahua / PMI Holding.

16 5.0 Strategic PEMEX, 2015. Main action Lines (cont.): Clean Fluels in Diesel and Gasolines. Assignations of contracts in phase Diesel, 2014: Residuals conversion project, Tula y Salamanca Refineries (started by IMP/Fluor, phase IB in 2011). Engineering phase. Fuels storage and transport infrastructure. Rehabilitations, mayor maintenances in CPG, Crogenicas y SRU, ductos, ductos, control Systems, Gas Natural Supply. Rehabilitations, mayor maintenances in CPQ´s, ductos, control Systems, Etane Supply. Urea Plant Rehabilitation, EPC (OB) por Cobra Instalaciones, 200 MMUSD. Investment. (Cobra / Jacobs) Engineering Phase. RefineríaMaderoMinatitlánSalamancaSalina CruzTula CompañíaIca FluorTécnicas Reunídas Samsung E&C, CO, Ltd. Foster Wheeler, USA Corp. ACS/Dragad os/Cobra Monto Estimado MMUSD 734.4567.8359.1583.9560.0 Ejecución Días 1,2561,1751,1891,1441,179

17 6.0 Strategy CFE, 2015. Reforma Energetica 2014. 2015 – 2016, PEMEX y CFE, still operating with Government Budget under SHCP y bajo las Leyes actuals. Principales Lineas de Acción: 16 RFQ projects from CFE to private companies, 4,899 MMUSD. 4 Gasoductos y 2 Ramales, for the 4 pipelines the estimate investment is around 1000 MMUSD. Two will be contructed in Texas, Gasoducto Waha-San Elizario, 277 Km and 42 “diameter and 495 MMUSD investment. Tres centrales de ciclo combinado de gas natural in Sonora, Sinaloa y Nuevo León. 3,282 MMUSD investment. Rehabilitation and Upgrading of the power generator and hidraulic turbines in Central hidroeléctrica Temascal, in Oaxaca. 27 MMUSD investment. 8 Transmition lines and subestations, 583 MMUSD investment. Rehabilitation and Upgrading of Nucleoeléctfric Central Laguna Verde 1 and 2 plants, incresing capacity in 268.7 MW, 100 MMUSD investment. Convertion to Combinated Ciclo of the 1 y 2 plants of the Conventional Termoelectric Manzanillo 1, Seven plants convertion from Fueloil to natural gas, betwin 2015 to 2016.

18 7.0 Private Projects detected, 2015 - 2017. – Grupo Alpek: Cogeneración 240 MW Plant in Altamira, Tams. CPQ Petrotemex, 260 MMUSD Investment, EPC in Engineering Phasefase and Mayor equipment adquisition by Petrotemex. (2016). Cogeneración 120 MW in Salamanca, Gto., CPQ. Univex, Investment 130 MMUSD. Thru 2017. Polimers PET Plant Procesing, DAK en Coatzacoalcos. Ver, Thru 2016 – Grupo Mexichem: MVC de 400 MTY Project in Coatzacoalcos, Ver. ( delayet), 300 MMUSD Rehabilitation CPQ Pajaritos Project (joint venture with Pemex PTQ. ), Ver. 200 MTY de MVC, EPC with ICA Fluor. 170 MMUSD. In execution. Proyecto de Co-Generación en CLOROTEC, 140 MW en proceso de configuración. (2017) – Grupo IDESA: Sodium Cianure Cianuro in CPQ IDESA, Morelos, Ver, (2016) – Grupo VITRO: Cogeneración 120 MW Plant in García, N.L.. 130 MMUSD investment. (2016) Expantion capacity Plants in Industria del Alcali a 240 MTY, 100 MMUSD investment. (2016) – Grupo OXITENO : Expantion capacity Surfactants plant in Guadalajara, Jal. 40 MMUSD investment. (2017) – Grupo PEÑOLES: Cogeneración 15 MW plant, includes. Natural Gas pipeline, (2016)

19 8.0 Proyectos de PEMEX factibles de desarrollarse durante 2016 / 2017. Note: The description of the projects in spanish published in the PEMEX Budget aprovated by the SCHP PEMEX, Presupuesto de Egresos, 2016 Proyectos factibles 2016. TOTALAnteriores2016201720182019coments. MILLONES DE PESOS Pemex Etileno Programa de Reaseguro de instalaciones CPQ Cangregera391 143248 Nuevo Modernización del Sistema de Agua Desmineralizada CPQ Morelos 715 11 107597Nuevo Pemex Logística Rehabilitación de ductos a nivel nacional1109 94104348562Nuevo Modern. de Sist.de instr. de Seg. en 11 Estaciones de Transporte Ductos Centro1386 39130219998Nuevo Conf. & Seg SE de 278 motobombas de Ductos y polidusctos SNTD, GTD2338 591022471930Nuevo Mantenimiento Estrategico GAR Golfo471 289182 Nuevo Integridad basada en riesgo, ductos zona norte 413 259154 Nuevo Pemex Fertilizantes Pemex Perforación y Servicios Pemex Transformación Industrial Incremento en la capacidad de ducto Tuxpan 24-18-14 a TAD 18 de Marzo239 119120 Nuevo Proyecto integral ambiental Refineria Cadereyta156 8373 Nuevo Proyecto integral ambiental Refineria Minatitlan76 6210 Nuevo Mantenimiento integral Criogenicas 4 y 6 CPG Burgos 85 72 MRI Pemex Exploración & Producción Proyecto de medición PEP, Transferencia de custodia2041 696804 Ctf. Flujo Prueba de Inyección de surfactantes en campo Tamaulipas - Constituciones169 58111 Rec. Terc. Prueba de Inyección de surfactantes en campo Poza Rica124 7747 Rec. Terc. Total9713 206120859214087

20 8.0 Proyectos factibles de desarrollarse durante 2016 / 2017 (1) ProyectoEmpresaLocalizaciónInversión MMUSD StatusComentario Rehabilitación de ductos a nivel Nacional Pemex Logística Diversas62.0RFQ en procesoSe espera autorización de PEMEX para concurso integrado. Modernización de Sist. de I&C en 11 Estaciones Transporte Ductos Centro Pemex Logística Diversas77.0RFQ en procesoSe espera autorización de PEMEX para concurso integrado EPC Integridad basada en Riesgo (RBI) Ductos Zona Norte Pemex Logística Diversas23.0RFQ en ProcesoSe espera autorización de PEMEX para concurso integrado EPC Cogeneración Pesquería, 900 MW Techint, Ternium Cemex Pesquería Nuevo León 1000.0Proyecto en fase final de Ejecución 06/ 05 /2016, se coloco cotización de P.U. para servicios de PND. Transporte de Gas Natural, ducto el Encino FermacaDiversas530.1Proyecto en fase final de Ejecución Se espera invitación a cotizar servicios de PND. Transporte de Gas Natural La Laguna Fermaca la Laguna La Laguna, Coahuila 372.6Proyecto recién adjudicado en Ingeniería Se espera Invitación para cotizar diversos servicios. (PND, Supervisión, etc.) Recertificación y actualización de ISO 9001, ISO14000 e ISO 18000 ICA FluorCd. De MéxicoN.D.Invitación en proceso Se programo reunión con el área de calidad de ICA Fluor para definir alcance.

21 8.0 Proyectos factibles de desarrollarse durante 2016 / 2017 (2) ProyectoEmpresaLocalizaciónInversión MMUSD StatusComentario Cogeneración Altamira 250 MW Alpek Petrotemex Altamira, Tamaulipas 250.0RFQ en procesoProyecto EPC, Petrotemex esta desarrollando IB/ID y Procura de Equipo Principal. Planta de Cogeneración Coatzacoalcos, 60 MW CYDSACoatzacoalcos Veracruz 50.0RFQ en procesoProyecto EPC retrasado Conversión de Residuales Salamanca, Guanajuato ICA FluorSalamanca Guanajuato 2800RFQ en ProcesoSuspendido, Se espera autorización de PEMEX para reiniciar los trabajos. Conversión de Residuales Tula, Hidalgo ICA FluorTula, Hidalgo3000.0RFQ en procesoSuspendido, Se espera autorización de PEMEX para reiniciar los trabajos. Parque Eólico Ventika 252 MW CEMEXGeneral Bravo, Nuevo León 650.0Proyecto en fase final de Ejecución Se buscara contacto para recibir invitación a cotizar servicios de PND. Mareña Renovable, 132 Aerogeneradores, 396 MW FEMSAOaxaca89.0Proyecto en fase final de Ejecución Se buscara contacto para recibir invitación a cotizar servicios de PND. Proyecto Gasoducto Los Ramones ICA FluorCd. De MéxicoN.D.Proyecto en fase final de Ejecución Se buscara invitación en ICA Fluor para cotizar los servicios de PND.

22 TUV +/- 17% (*) Proyectos PGPB budget Tipo de Proyecto Comentarios 201620172018Total Millons USD multianual MM USD Rehabilitación y mantenimiento de infraestructura de ductos a nivel nacional. RBI Ductos Golfo Sureste, 54Maintenance Administración de la integridad basada en riesgo (RBI) de los ductos, Subdirección de Logística. SEPTEMBER, 2015 2.05.02.09.0 Cruzamientos direccionados de ductos en ríos de la zona sur. 52Other projects Subdirección de Logística OCTOBER, 2015 2.05.02.09.0 Mantenimiento y Seguridad en las Terminales de Gas Licuado. 38Other projects Proyecto de la Gerencia de Proyectos de PGPB. Mantenimiento integral de los sistemas de ductos para etano, petroquímicos básicos y petroquímicos secundarios. 56MaintenanceDuctos petroquímicos 4.010.04.018.0 4 MM USD Premises: 1.- RFQ at the end 2015, start in 2016, award a Team. Conform by a EPC Contractor, PMC and Certificator, in a similar scheme like RBI Ductos Golfo. 2.- (*) The TUV participation would be around ofl 17%, (certification 8% e integrity 9%). 3.- If TUV can win the Project, the anual income could be around of 2.0 Millions USD alt 2016. 9.0 Projects for the TUV SUD focus radar, 2015 - 2016 Note: The description of the projects in spanish published in the PEMEX Budget aprovated by the SCHP

23 Proyectos en cotización, Mayo 2016 ProyectoEmpresaLocalizaciónInversión MMUSD StatusComentario Cogeneración Pesquería, 900 MW Techint, Ternium Cemex Pesquería Nuevo León 1000.0Proyecto en fase final de Ejecución 06/ 05 /2016, se coloco cotización de P.U. para servicios de PND. Transporte de Gas Natural, ducto el Encino FermacaDiversas530.1Proyecto en fase final de Ejecución Se espera invitación a cotizar servicios de PND. Transporte de Gas Natural La Laguna Fermaca la Laguna La Laguna, Coahuila 372.6Proyecto recién adjudicado en Ingeniería Se espera Invitación para cotizar diversos servicios. (PND, Supervisión, etc.) Recertificación y actualización de ISO 9001, ISO14000 e ISO 18000 ICA FluorCd. De MéxicoN.D.Invitación en proceso Se programo reunión con el área de calidad de ICA Fluor para definir alcance. Functional Safety of Machinery Course ABBMonterrey, N.L. 0.20entregada y en definición En espera de decisión por parte de ABB. Cotización ISO9001 SUT SAPRINT México Sutsaprit México Ecatepec, Edo. Mex En procesoCertificación de productos y curso de calidad Se entrego información para definir alcance de cotización Asesoría para Certificación CCC Lunketec de México Cd. De MéxicoEn procesoCertificación de productos Se entrego información para definir alcance de cotización

24 Actions for growth Focus targets: Positioning in the Oil & Gas, Chemical & Petrochemical and Industrial Sector. Detection of opportunities en the Oil &Gas and Energy Sector. Official Registers in PEMEX, CFE and Other Government Institutions- Develop Business Strategic Plan. Promoting activities in the sector Meeting Presentation Plans in sites Industry Events Participation (Evento Alemania- México WTC, Mayo,2016) Alliances with the EPC Companies O&G Participation & Handle small and medium size projects contests. Cross check in international bids with TUV USA. Implementing the TUV SUD office in México City. Promotion Intensive Promotion activities en the Sector, Goverment (Pemex and CFE) & Private. Expos & Fórums participation. Publicity Actions, Industrial Magazines, Printed brochures, etc Direct contact with the costumers. E 11. Actions for growth

25 Actions for growth: Services Testing, Inspection, certification systems, Training and engineering Services in the Industrial Sector. Alliances: Participate in projects with EPC Contractors of Pemex (ICAF, Swecomex, Saipem, Techint, Fermaca, etc. Engineering & Construction Companies for Public and Private RFQ contests. Develop a Market Study: Size of the IS Services Market Identification of Opportunity Segment Market Competitors Competitively Factibles Alliances Focus Sectors Prices Market SWOT Analysis 11. Actions for growth