Imagination at work.

Davide Franceschi March 24th, 2015

GEs Operating Rhythm

GE proprietary and confidential

Companys profile

GE Outlook

3

GE proprietary and confidential

Creating competitive advantage in the GE Store

O&G Revenues $18,7B OP $2,6B OP @19%

4

GE proprietary and confidential

Purposeful portfolio moves

5

GE proprietary and confidential

6

GE proprietary and confidential

GE consolidated results

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GE proprietary and confidential

2014 General Electric Company - All rights reserved

GE Oil & Gas today From extraction, to transportation, to end use

8

Subsea Systems

$3.5B Subsea production

systems

Turbomachinery Solutions

$5.4B LNG, on- and offshore,

pipeline

Downstream Technology

Solutions

$1.7B Refinery and gas

distribution

Drilling & Surface

$4.9B BOPs and risers,

onshore trees,

Artificial lift

~45,000 employees ~$19B revenues 14

Delivering customer solutions by applying systems-level engineering across the value chain

Measurement & Control

$3.8B Valves, controls, diagnostics

8

GE proprietary and confidential

Our technology solutions Subsea Systems Subsea trees & wellheads

Subsea power & processing

Controls

Manifolds

Flexible risers

Flow lines

Specialty connectors & pipes

Measurement & Control Asset condition monitoring, control sensing

& inspection solutions

Optimization & diagnostic software

Pipeline inspection and integrity services

Control & safety relief valves

Fuel dispensers & payment terminals

Fuel control & retail systems

Drilling & Surface Drilling risers

Blow-out preventers

Electric submersible pumps

Logging while drilling & wire line tools

Surface wellheads & flow control

Logging services

Well Performance Services

Lufkin

Artificial lift: rod lift, gas lift, plunger lift, progressive cavity pumps, hydraulic pumping units

Service & repair

Engineered industrial gears

Fluid film bearings

Turbomachinery Solutions Turbomachinery equipment and services for the upstream, midstream and LNG segments including:

Gas turbines

Axial & centrifugal compressors

Electric motor driven compressors

Turn-key industrial modular solutions

Turboexpanders & heat exchangers

Contractual & maintenance services

Upgrades & industrial applications

Monitoring & diagnostics

~45,000 employees

~$19B revenues 14

Delivering customer solutions by applying systems-level engineering across the portfolio

Downstream Technology Solutions Equipment & services for the refinery & petrochemical, distributed gas and industrial applications including:

Steam turbines

Reciprocating compressors

Distributed gas solutions small LNG & CNG

Pumps, valves & distribution systems

Blowers & compressors

Maintenance services & remote monitoring & diagnostics

9

GE proprietary and confidential

A Turbo Machinery company

Well Support Pressure Control

Electrical Submersible Pumps

Logging Services

Developed a Service

model

Expanded in Inspection

Technologies

Entered the Drilling &

Production segment and

Subsea

Expanded to sensing and

flow

Ideal partner for new

challenging O&G

developments

$1

$2

$4 2007

$10

~$16

~$20

1994 1997 2004 2008 2011 2013

Where we are now growth of GE Oil & Gas Orders - $ in billions

10

GE proprietary and confidential

Our technology solutions 45,000 employees across the globe

Subsea Systems

Turbomachinery Solutions

Drilling & Surface

Downstream Technology

Solutions

Measurement & Control

Aberdeen Houston Florence Houston Boston

Advanced turbomachinery equipment and services for the upstream, midstream

and LNG segments

Drilling, completion & production solutions for

unconventional resources, deepwater

drilling & EOR applications

Comprehensive systems & expertise

for reliable subsea

production, control and optimized life-of-field

2014 General Electric Company

Equipment & services for refinery, petrochemical,

distributed gas & industrial

applications

Asset condition monitoring, control sensing & inspection solutions delivering healthcare for the industry

11

GE proprietary and confidential

Turbomachinery Solutions 6,000+ PEOPLE ACROSS 6 CONTINENTS

Offshore

Adjacent segments

Pipeline

Floating LNG

AN INTEGRATED BUSINESS

HIGH-TECH PRODUCTS &

SERVICES

PROJECT MANAGEMENT

CONTRACTUAL & MAINTENANCE

SERVICES & UPGRADES

SERVING KEY SEGMENTS

LNG Onshore

DRIVERS

Aeroderivative Gas Turbines

Heavy Duty Gas Turbines

Synchronous & Induction Electric Motors

COMPRESSORS

Centrifugal & Axial

Integrated

Direct Drive High Speed

Subsea

Turbo expanders

TURN-KEY SOLUTIONS

Industrial Modules Waste Heat Recovery

OUR PORTFOLIO

2014 General Electric Company

COMPACT CONTROL

SYSTEMS

AIR COOLED HEAT

EXCHANGERS

12

GE proprietary and confidential

Key Turbomachinery Solutions hubs

2014 General Electric Company

Where we are

Headquarters

Regional Hubs

Manufacturing Facilities

Service Shops

Edmonton, Canada

Houston, USA

Rio de Janeiro, Brazil

Florence, Italy Massa, Italy Avenza, Italy Vibo Valentia, Italy Talamona, Italy

Aberdeen, UK

Le Creusot, France

Maracaibo, Venezuela

Moscow, Russia

Abu Dhabi, MENAT Doha, MENAT

Beijing, China

Jandakot, Australia

Kuala Lumpur, Malaysia

Gurgaon, India Port Harcourt, Nigeria

Hassi R' Mel, Algeria

Barcelona, Spain

Port of Spain, Trinidad

Fot, Hungary

Recife, Brazil

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GE proprietary and confidential

O&G Operational view

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GE proprietary and confidential

O&G 2014 results

15

GE proprietary and confidential

GE Op Mechanism

Finance Competency Model

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GE proprietary and confidential

Vision - CFO Agenda

Finance Vision: Partners in Building Shareowner Value Through Integrity, Excellence, and Leadership

Leadership Development Business Partners Drive Initiatives Services, Globalization, Simplification VCP, ROIC, Fastwork Digitization Providing Real Time Management Information and Solutions Controllership Fundamental

18 GE proprietary and confidential

GEs Operating Rhythm

Quarterly Earning Release to communicate externally the performance

The annual drumbeat that keeps the Company moving

Linkage of Processes and Meetings Form a Powerful Operating System to accelerate

Business and Cultural Change.

19

GE proprietary and confidential

How we oversee risk

20

GE proprietary and confidential

GE Oil & Gas Op Mechanism

Executive summary

2

3

4

1

Drive & influence behaviors

Aligned with key O&G and GE HQ events

Designed to be more action-oriented, topical, allow cross-functional engagement & best practices sharing

Solid Predictability is not an option

22

GE proprietary and confidential

Organizational Structure GE Oil & Gas

Latam MENAT Sub S Africa

Russia & CIS

China APac

TMS DTS D&S

Lufkin SubSea M&C

ENG Quality Finance

Communic. Marketing Global

Supply C.

IM HR

Legal Biz Dev

CEO

Regions Business P&Ls

Functions

Project Management

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GE proprietary and confidential

Project Mgmt

Portfolio Analysis

Planning

Risk Management

Stakeholders

23/03/2015 24

Biz Model

Orders

Revenues

Op Profit, rate %

CFOA

Business Model

Project Management

Financial Plan & Analysis

= +

Dynamic loops between Project Directors & FP&A

Opportunities

Customers

Projects

Bids

FEEDs

Biz Objectives

Orders

Revenues

Op Profit, rate %

CFOA

Project Directors

Financial Planning

Sales Force

C- suite

From tendering to execution

24

GE proprietary and confidential

Turbomachinery Project Organization

TM - OTR

PROJECT

MANAGER

PROJ. QUALITY

MANAGER

PROJECT

ENGINEER

MFG Fullfillment Cells

SOU Fullfillment Cells

DESIGN ENGINEERS *

PROJECT

PLANNER INSTALLATION

MANAGER

SITE TEAM *

WARRANTY

MANAGER

TM - QUA ENG Supply

Chain Global

Service

Operations Finance

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GE proprietary and confidential

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GE proprietary and confidential

Portfolio Orientation & Implementation

Targets

PM & Funct. Measured on Same Target

Shared Team Accountability

Operating rhythm

Projects

So

urc

ing

TGT

$/%

Ma

nu

factu

ring

En

gin

ee

ring

$/% $/%

Merge Project & Financial Rhythms to drive all functions on a common

goal

$/%

Projects $/% $/% $/%

23/03/2015 27 27

GE proprietary and confidential

Project Execution Phases... Key Processes ITO/OTR Hand-off

Project Contract Activation Project Plan Creation Project Budget Baseline Customer Kick Off Meeting Pre-inspection Meeting

Engineering Project Design Reviews Project Documentation Mngt . (VDR)

Sourcing Material Procurement Management Supplier Deviation Request Mngt .

Manufacturing Manufacturing Plan Reviews NC Mngt . during production phase

Shipping Meeting Packing & Shipment Transportation/Handling Process

Events directly involving Customers 28

GE proprietary and confidential

Installation & Warranty Phases... Key Processes

Site Survey & Pre-Installation

Meeting Warranty

COD Site

Start

Warranty

Expiration

Planning and Monitoring Red Flag Review Technical Briefing Technical Package for Installation Management of NC detected at site

Site Survey Pre-installation meeting

Warranty Claim Mngt Hand-Off from TM to CSA

Installation Contract

Erection Pre-Commissioning

& Commissioning Start-Up

RFR

Oil Flushing

Mechanical

Completion RFR

Green Light RFR

Loop Checks

Events directly involving Customers

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GE proprietary and confidential

Project Control & Risk Milestones Approach

Launch Execution Shipment Installation Warranty

Risk Reviews

Customer Milestones

Project Control Review

Project Risk Reviews - @ Milestones

Identify/Capture main Prj Risks for each milestone

Risk Check-List, Risk Priority Number Action/Mitigation Plan & Risk Register Update

Project Control Reviews Monthly

Schedule, budget, quality and any other aspect related to project Issue & risk management

Internal Reviews

Pre-PO

Impact

Low High

1 3 9

High 9 9 27 81 Red Significant Risk

3 3 9 27 Yellow Proceed with caution

Low 1 1 3 9 Green No concern

Gray Not yet evaluated / No risk

Pro

babili

ty

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GE proprietary and confidential

Project Budget unique baseline

Keep As Bid cost estimation constantly aligned

Freeze As Bid versions

Order booking As Sold Budgetformally communicate

As Sold Budget to Hand-Off (RAC) playersshare and analyze

Input As Sold Budget into BOM structure

As Sold true-up meeting with Finance/PM

Support AE to update cost estimate

Superviseupdate financial plan

Analyze and check Order Plan consistency

Attend Hand-Offcontribute!

Provide dummy template for BOM costing recast

Validate and upload in Oracle

As Bid Budget

As Sold Budget

Hand-Off (RAC)

Project Budget

Commercial Ops Team Finance Team

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GE proprietary and confidential

Month 1

1 2 3 4 5

8 9 10 11 12

15 16 17 18 19

22 23 24 25 26

29 30 31 1 2

Project finance rhythm

Calendar

QMI 1

3

KPIs weekly pacing ... Operations + Finance

Month 2

1 2 3 4 5

8 9 10 11 12

15 16 17 18 19

22 23 24 25 26

29 30 31 1 2

Month 3

1 2 3 4 5

8 9 10 11 12

15 16 17 18 19

22 23 24 25 26

29 30 31 1 2

As Sold As Delivered

Backlog review + B&B/ TO GO + Prodty

BC

E

BC

E

BC

E

Project reviews

BCE ( Project Margin review)

2

3

1

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GE proprietary and confidential

Rigorous process to track/ review project costs for long term contracts

Drive productivity initiatives and project margin expansion

Scalable and digitized process

Formal reviews with key stakeholders Finance to lead

Project margin review process

Highlights

33

GE proprietary and confidential

Operations Finance

B1) MATERIALS (EXTERNAL SUPPLY)

Sez Item Sub-item Description Q.tyUnit Cost

(Euros)

Total Cost

(Euros)

100 0010 -

100 0050 Outer casing -

100 0100 Suction Head flange -

100 0101 Discharge Head flange -

100 0310 0010 Shaft 1 7,000.00 7,000.00

100 0310 0020 Impeller 1 12,000.00 12,000.00

100 0310 0030 Impeller 1 5,000.00 5,000.00

100 0310 0040 Impeller 4 3,500.00 14,000.00

100 0310 0050 Impeller -

100 0310 0060 Impeller -

100 0310 0070 Impeller -

100 0310 0080 Impeller -

100 0310 0090 Impeller -

100 0310 OTH Completion parts 1 18,000.00 18,000.00

100 0221 0010 Inner Casing 1 21,000.00 21,000.00

100 0221 0020 Inner Casing -

100 0221 0030 Inlet Diaphragm 1 4,000.00 4,000.00

100 0221 0040 Inlet Diaphragm -

100 0221 0050 Interph./Disch. Diaphragm -

100 0221 0060 Models -

100 0221 0070 Intermediate Diaphragm 1 5,000.00 5,000.00

100 0221 0080 Intermediate Diaphragm 4 4,500.00 18,000.00

100 0221 0090 Intermediate Diaphragm -

100 0221 0100 Intermediate Diaphragm -

100 0221 0110 Intermediate Diaphragm -

100 0221 0120 Intermediate Diaphragm -

100 0221 OTH Other 1 1,500.00 1,500.00

100 0160 -

100 0161 -

COST CONTROL SEZ. 100

Sez100

0

AL JUBAIL

CUSTOMER :

END USER :

PROPOSAL # :

PLANT :

Rotor

Rotor

Rotor

Rotor

Diaphragms set

Diaphragms set

Diaphragms set

Diaphragms set

Suction end cover

Discharge end cover

Diaphragms set

Rotor

Diaphragms set

Diaphragms set

Diaphragms set

Diaphragms set

SCOPE of SUPPLY :

Rotor

Rotor

Description

Outer casing assembling accessories

Rotor

Rotor

Diaphragms set

Diaphragms set

Diaphragms set

Rotor

Diaphragms set

Project Budget

Unique baseline for measurement Built on BOMcommon ITO/OTR language Shortened process available @ Hand-off

Earlier visibility to protect/enhance margin Monthly rhythm calendar & dashboards Leakages RCA WF basedfunctions involvement

Project Reviews

OTR ITO

Feedback to ITO

Leverage on lessons learned Enable cost estimation improvementSource Books + Configuration Mgmt On Line & Oracle based tools

0

20

40

60

Q1 '08 Q2 '08 Q3 '08 Q4 '08 Q1 '09

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40

60

Q1 '08 Q2 '08 Q3 '08 Q4 '08 Q1 '09

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40

60

Q1 '08 Q2 '08 Q3 '08 Q4 '08 Q1 '09

Sourcebooks

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20

40

60

Q1 '08 Q2 '08 Q3 '08 Q4 '08 Q1 '09

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20

40

60

Q1 '08 Q2 '08 Q3 '08 Q4 '08 Q1 '09

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40

60

Q1 '08 Q2 '08 Q3 '08 Q4 '08 Q1 '09

0

20

40

60

Q1 '08 Q2 '08 Q3 '08 Q4 '08 Q1 '09

Sourcebooks

Project budget loop back

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GE proprietary and confidential

Simple Understandable

Forward Looking

Provide Operational Explanations

Provide Accountability

Focus Efforts In the Right Places

Broadly applicable across businesses

Accurate Timely

Cost effective

Difficult to manipulate

Attributes of good performance metrics

35

GE proprietary and confidential

Q& A