Deliver profitable growth - Technip East North America ... Top 5 in ethylene ... Deliver Profitable...

Deliver Profitable GrowthThierry PilenkoChairman and CEO

Investor PresentationParis, October 17, 2007 - New York, October 19, 2007

2Investor Presentation - Deliver Profitable Growth

Focus and Capitalize on our Strengths

Foster Operational Performance

Conclusion


Focus and Capitalizeon our Strengths


Solid fundamentals and outlook for the oil & gas industry

* assuming 3% per year depletion rate

40

80

120

160

200

20

40

60

80

100

2004 CAPEX in Bn$ Mb/d

Global Oil Production Capacity

Depletion Effect *

Demand Growth ~40% of current production

1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014

CAPEX

OIL SUPPLY AND DEMAND EVOLUTION

Global Oil Demand

Sources: IEA, CERA


High Capex level required to increase production capacities

O&G EXPENDITURES(Average per year)

Deep Offshore Capex

0

5

10

15

20

25

2002 2004 2006 2008 2010

$Bn

+ 13% pa.

Sources: IEA, CAPP, Cedigaz, Douglas-Westwood

LNG Demand

+ 7% pa.

Bcm

0

150

300

450

600

2000 2005 2010 2020

Canadian Tar SandsProduction

0

1

2

3

4

2005 2010 2015 2020

Mb/d

+ 10% pa.

Refining Investments(Average 2006-2010)

$59 Bn per year

Greenfield

Expansion

Upgrade

60%32%

8%

2001 - 2005 2006 - 2010

$420 Bn

$280 Bn

15%

65%

16%4%

12%

67%

14%

7%

Other

E&P

RefiningLNG


Increasing project complexity & technological challenges

SINGLE LNG TRAIN CAPACITYWATER DEPTH RECORDPRODUCTION VS DRILLING

0

500

1,000

1,500

2,000

2,500

3,000

3,500

1970 1980 1990 2000

Drilling

Production

Meter

Sources: Offshore magazine, Technip

Mt/y

0

2

4

6

8

1970 1980 1990 2000 2010


Continuous shift of oil & gas onshore marketstowards the East

88 Mt

Middle East

North America

South America

Europe & Eurasia

Africa

Asia-Pacific

O&G Proven Reserves

2006

O&G Demand Growth

2006 - 2010

EthyleneGas Liquefaction Refining0%

20%

40%

60%

80%

100%28 Mt 7.3 Mb/d 24 Mboe/d2,380 Gboe

Sources: BP Statistical Review, Cedigaz, UBS, IEA

RELATIVE IMPORTANCE OF MIDDLE-EAST AND ASIA

Capacity Addition 2006 - 2010

71%

93%

73%


Evolving customer base with NOCs gaining momentum

SPLIT OF CONTRACT AWARDSIOCs vs. NOCsO & G contractors*

Sources: NPC, Deutsch Bank

0%

20%

40%

60%

80%

100%

2003/2004 2005/2006

* Acergy, Aker Kvaerner, Petrofac, Saipem, Technip, Tecnicas Reunidas

IOCs

NOCs

ACCESS TO WORLD OIL RESERVES

Full IOC Access

NOC ReservesLimited Equity Access for IOC

Russian Reserves

NOC ReservesEquity Access for IOC

1970: 630 Gb

1%

2005: 1,210 Gb

65%

12%


Technip’s global leadership in oil & gas

€ 9.7 Bn

TECHNIP BACKLOGJune 30th, 2007

Other

Petrochems

Refining /Heavy Oil

Gas / LNG

ShallowWater

Deepwater20%

12%

18%

36%

12%

TECHNIPRANKING

RECENT EVOLUTION OF TECHNIP POSITIONS COMMENTS

Top 5 in ethylene

Top 5 in refining

Top 5 in heavy-oils

Top 3 in LNG

Top 5 in gas treatment

Top 2 in GTL

N° 1 in Subsea Deep & shallow water

Top 5 in facilitiesFixed and floating

Proprietary technologies in ethylene

Part of the club of 5 licensors

Multiple grassroots references

Canada and Venezuela, H2 technology

Qatar LNG, Yemen LNG

Middle East references

Oryx

In-house technology (flexibles, umbilicals, …)

Leading edge fleet of specialized vessels

Proprietary platform designs

Float-over solutions

Proven track-record in multiple regions

2%

Source: Technip


Strong Technip relationships with both IOCs & NOCs

Recent projects examples

Shah Deniz, Greater Plutonio, Secco PE

Tahiti, Greater Gorgon, Ras Laffan Ethylene

North Belut, Q Chem, Qatargas 3 & 4

East Area, Qatargas 2, Rasgas 3

Perdido, Na Kika, Qatargas 3 & 4

Dalia, Yemen LNG, Gonfreville, Qatargas 2

Das Island Gas, NEB, Takreer refinery

Akpo, Agbami, Bonny Island

P51 & P52, Roncador

Kikeh, Cili Padi, Petlin & Kertheh LDPE

Al Shaheen, Qatargas & Rasgas

Gasprocessing /

LNG

Refining,Hydrogen,Heavy oils

Petrochems

Khursaniyah, Al Jubail

Subsea Offshorefacilities

Gimboa, Dalia, Kizomba C

Source: Technip


Technip’s presence in key Regions


Focus on our core business: Oil & Gas

Proactive commitment to technology & know-how

€1 Bn investment program to develop asset base

Further expansion in important Regions

Technip strategic initiatives


Technip’s focus on our core business:providing solutions to the oil & gas industry

Offshore

Subsea

Onshore

Strengthen internal capabilities and operational performance

Pursue geographical & technological expansion to develop our global leadership

Industries business segment integrated within Onshore


Onshore / OffshoreLow fixed assets

Negative working capital

High degree of outsourcing & sub-contracting

Process technologies & know-how

A clear oil & gas focuswith two complementary business models

68%

40%

17%

32%

60%

83%

Revenue OperatingProfit

FixedAssets

SubseaFleet and manufacturing units

Capital intensive

Vertical integration

Proprietary technologies

€6.9 Bn €333 M €824 M

TECHNIP FINANCIALS, 2006


A proactive commitment to technology & know-how

Subsea• 3,000 meter water-depth solutions• High pressure / high temperature solutions• Enhanced recovery / flow assurance systems• Subsea processing

Offshore• Spar solutions for 6th generation drilling systems & arctic applications• Extended Draft Platform (EDP) solutions for large deck, deepwater dry-tree completion• Floatover technology for heavier decks & in high swell seas

Onshore• Technologies: H2, heavy oil, Cryomax• Scale up: LNG, ethylene, grassroot refining• Environment: CO2 emission reduction, gasification

“New frontiers” deepwater, innovative platform concepts, technology & process know-how


€1 Bn investment program to expand our asset base

2007-2010 Group Capex: ~ €1 Bn

Vessels

Flexible Pipes

Umbilicals

~5,800Vessel-days/year

~700 km/year

2006 Capacity Capacity Increase(2007-2010)

~700 km/year

+ 40

+ 40

+ 25

2010 Capacity

100

100

100


Further expansion in important regions

17


Create a full-fledged regional organization in the Middle East within two years

TECHNIP PRESENCE IN THE MIDDLE EAST

Relative importance of Middle East

• ~ 50 % of proven O&G reserves

• ~ 55 % of LNG capacity addition (2006-2010)

• ~ 50 % of ethylene capacity addition (2006-2010)

• ~ 30 % of refining capacity addition (2006-2010)

Abu Dhabi operating center

• Among the largest EPC organizations in the region

• Over 1,500 employees

• 3 million manhours per year on projects

• From conceptual and feasibility studies to LSTK

Abu Dhabi

DohaMuscat

Riyadh

Kuwait City

Sanaa


Address new frontier areas

1919


Foster Operational Performance


Technip’s financial performance behind “best-in-class”

OPERATING MARGIN RATIO PER SEGMENT

Source: Technip

13.5%

5.1%

3.1%

8.5%7.3%

10.3%

6.6%

9.7%

2.1%

5.1%

1.6%2.7%

5.2%

3.6%

4.1%3.5% 3.8%

2.2%

0%

2%

4%

6%

8%

10%

12%

14%

16%

2002 2003 2004 2005 2006 H1-2007

Best-in-ClassMargins

Subsea

Onshore

Offshore


Change risk profile

Strengthen execution capabilities

Empower the organization

Commit to excellence in safety & quality

Develop high performance human resources

Five initiatives to increase operational performance


Change risk profile

Reduce share of EPC Lump Sum

Balance reimbursable and fixed price contracts

Reduce exposure to construction risks

Improve risk management at all project stages

DE-RISKING INITIATIVES

TECHNIP ROLES AND RESPONSIBILITIES

EPCMLS

E&PLS

EPCMReimb.

FEEDReimb./LS

Engineering/Project Mg’t

Construction/Installation

Procurement

EPCLS

Contract Value

0%

100%

Lower risk

Source: Technip


Strengthen execution capabilities

Enhance internal resources (headcount & skills):• Project management, contract management

• Quadruple construction management and supervision resources by 2010

Improve project organization & procedures with a particular attention to:• Detailed execution plans with realistic scheduling

• Extensive procurement & sub-contracting campaigns at bidding stage

• Construction strategy and partner(s) / sub-contractor(s) selection

Assess strategic alternatives to further reinforce construction / fabrication activities


A new operational organization to support strategy: focused, empowered & accountable

A Chief Operating Officer (COO) responsible for:

Six Regions with full P&L responsibilities• Focus on project execution and customer relationships• Manage their own resources

A distinct Business Unit for Subsea• Technology and know-how development• Asset management (new and existing vessels and plants)

Eight Onshore/Offshore Product Lines• Marketing coordination across regions• Technology and know-how development


Commitment to excellence in Safety and Quality to become the industry HSE reference

TOTAL RECORDABLE CASES FREQUENCY (TRC)*

Technip Average

Sources: Technip, 3LNG, External Oil & Gas Producers report* Every 200,000 hours

0.00

0.10

0.20

0.30

0.40

0.50

0.60

TechnipLarge LNG project

20072006Peers2006


Attract & develop high performance human resources

A strong international workforce• 22,000 team members highly recognized within the oil & gas community• 77 nationalities • 47,000 unsolicited job applications received in 2006

Key initiatives • Retain and further develop an international company culture

Internal mobility and inter-cultural programsSecuring talent in countries with available resources (India, South East Asia, Mexico...)

• Create a “learning” organization Deploy Technip University (425,000 training hours in 2007)Foster knowledge sharingImplement mentoring program

• Review performance and retention schemesIndividual performance bonuses and incentivesShare-based compensation policy


18,000

Attract & develop qualified resources worldwideTECHNIP HEADCOUNT BY LOCATION

6,000

1997 2001 2007

22,000

Russia, Central Asia

Middle East

Asia-Pacific

South America

North America

Other Europe

Germany

Italy

France

Africa

United Kingdom

India


Conclusion


Key financial goals 2010

Revenue• Double-digit annual growth rate for Subsea• Improved risk profile for Onshore & Offshore

Operating margin ratio• 8% for the Group by 2010

ROCE• Above 15% for the Subsea business


Merger & Acquisition framework

Technip’s leadership expansion in the oil and gas industry

• Complementary assets, technologies and know-how• Geographic expansion• Access to additional construction and fabrication capabilities

Profitability levels consistent with Technip’s financial goals

Value creation for shareholders


How are we going to create shareholder value?

Clear focus on the needs of Oil & Gas customers

Capitalize on our strengths: people, assets, technologies & know-how

Improve project execution performance

Pursue geographical and technological expansion


Safe Harborhis presentation contains both historical and forward-looking statements. All statements other than statements of historical fact are, or

may be deemed to be, forward-looking statements, or statements of future expectations; within the meaning of Section 27A of the Securities Act of 1933 or Section 21E of the Securities Exchange Act of 1934, each as amended. These forward-looking statements are not based on historical facts, but rather reflect our current expectations concerning future results and events and generally may be identified by the use of forward-looking words such as “believe”, “aim”, “expect”, “anticipate”, “intend”, “foresee”, “likely”, “should”, “planned”, “may”, “estimates”, “potential” or other similar words. Similarly, statements that describe our objectives, plans or goals are or may be forward-looking statements. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to differ materially from the anticipated results, performance or achievements expressed or implied by these forward-looking statements. Risks that could cause actual results to differ materially from the results anticipated in the forward-looking statements include, among other things: our ability to successfully continue to originate and execute large services contracts, and construction and project risks generally; the level of production-related capital expenditure in the oil and gas industry as well as other industries; currency fluctuations; interest rate fluctuations; raw material (especially steel) as well as maritime freight price fluctuations; the timing of development of energy resources; armed conflict or political instability in the Arabian-Persian Gulf, Africa or other regions; the strength of competition; control of costs and expenses; the reduced availability of government-sponsored export financing; losses in one or more of our large contracts; U.S. legislation relating to investments in Iran or elsewhere where we seek to do business; changes in tax legislation, rules, regulation or enforcement; intensified price pressure by our competitors; severe weather conditions; our ability to successfully keep pace with technology changes; our ability to attract and retain qualified personnel; the evolution, interpretation and uniform application and enforcement of International Financial Reporting Standards (IFRS), according to which we prepare our financial statements as of January 1, 2006; political and social stability in developing countries; competition; supply chain bottlenecks; the ability of our subcontractors to attract skilled labor; the fact that our operations may cause the discharge of hazardous substances, leading to significant environmental remediation costs; our ability to manage and mitigate logistical challenges due to underdeveloped infrastructure in some countries where are performing projects; and our ability to remain compliant with the obligations imposed by Sarbanes-Oxley.Some of these risk factors are set forth and discussed in more detail in our Annual Report on Form 20-F as filed with the SEC on June 20, 2007, and as updated from time to time in our SEC filings. Should one of these known or unknown risks materialize, or should our underlying assumptions prove incorrect, our future results could be adversely affected, causing these results to differ materially from those expressed in our forward-looking statements. These factors are not necessarily all of the important factors that could cause our actual results to differ materially from those expressed in any of our forward-looking statements. Other unknown or unpredictable factors also could have material adverse effects on our future results. The forward-looking statements included in this release are made only as of the date of this release. We cannot assure you that projected results or events will be achieved. We do not intend, and do not assume any obligation to update any industry information or forward looking information set forth in this release to reflect subsequent events or circumstances. Except as otherwise indicated, the financial information contained in this document has been prepared in accordance with IFRS, and certain elements would differ materially upon reconciliation to U.S. GAAP.

****This presentation does not constitute an offer or invitation to purchase any securities of Technip in the United States or any other jurisdiction. Securities may not be offered or sold in the United States absent registration or an exemption from registration. The information contained in this presentation may not be relied upon in deciding whether or not to acquire Technip securities. This presentation is being furnished to you solely for your information, and it may not be reproduced, redistributed or published, directly or indirectly, in whole or in part, to any other person. Non-compliance with these restrictions may result in the violation of legal restrictions of the United States or of other jurisdictions.

T


For more information, please contact:

INVESTOR RELATIONS

Xavier d’OuinceTel. +33 (0) 1 47 78 25 75

e-mail: [email protected]


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