SBM Offshore · 2013-08-21 · To learn more The CSR Report can be downloaded at , whose Corporate...

SBM OffshoreCorporate Social Responsibility Report 2007

‘Sharing our Future’

To learn more

The CSR Report can be downloaded at www.sbmoffshore.com, whose Corporate Social Responsibility section provides additional information.

ContactsTo let us know what you think of the report and the issues covered in it.Please send your comments to [email protected]

This report has been issued by the Corporate Communications Department at SBM Offshore.

Leendert Poldervaart Corporate Communications Manager – SBM Offshore

CSR CoordinatorDebra Hoelsaether

[email protected]

CSR Committee of SBM Offshore consists of 6 people from all 4 execution centres

We would also like to thank everyone at SBM Offshore who contributed to the report.

Photography Lithography and printingSBM Offshore N.V. B.V. Drukkerij De EendrachtPhoto Serge-Henri, Valbonne, France (page 8) Schiedam

Design and lay-out BindingStijlmeester Communicatievormen Boekbinderij van Wijk B.V. Utrecht, the Netherlands Utrecht, the Netherlands

Frontcover page Célia Picco 2 years, The Single Buoy Nursery in Monaco.

This Annual Report is printed on paper without the use of chlorine. It is biodegradable and recyclable.

Disclaimer

Some of the statements contained in this report that are not historical facts are statements of future expectations and other forward-looking statements based on management’s current views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance, or events to differ materially from those in such statements. Such forward-looking statements are subject to various risks and uncertainties, which may cause actual results and performance of the Company’s business to differ materially and adversely from the forward-looking statements. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in this Report as anticipated, believed, or expected. SBM Offshore NV does not intend, and does not assume any obligation, to update any industry information or forward-looking statements set forth in this presentation to reflect subsequent events or circumstances.

14th of May 2008

1. INTRODUCTION 4-91.1 SBM Offshore - A Birds Eye View 41.2 2007 Activities 61.3 A Message From Our CEO 8

2. REPORTING SCOPE 10-132.1 Introduction 102.2 Reporting Segments 112.3 Environmental Management Systems 122.4 Human Resources (H.R.) Management 132.5 Social Accountability 13

3. CORPORATE PROFILE 14-213.1 History of SBM Offshore 153.2 Corporate Activities 163.3 Corporate Responsibilities 173.4 Corporate Business Strategy 173.5 Joint Ventures 20

4. SUMMARY OF KEY ACHIEVEMENTS & CHALLENGES 2007 22-254.1 Commitments, Accomplishments and Future Targets 24

5. BUSINESS PRINCIPLES & CORPORATE GOVERNANCE 26-315.1 Corporate Governance and Management Systems 265.2 Quality Assurance Management Systems and Framework 30

6. HEALTH, SAFETY, ENVIRONMENT (HSE) & SECURITY 32-436.1 Exposed Work Hours 326.2 Reporting Segments 336.3 Onshore Operations 366.4 Offshore Production 386.5 Environmental Responsibility and Offshore Production 406.6 Environmental Performance Indicators 41

7. SOCIAL RESPONSIBILITY & LOCAL DEVELOPMENT 44-597.1 Human Resources Management 457.2 Performance and Career Development Reviews 527.3 Employee Benefits 527.4 Myanmar Operations 547.5 Local Development in Angola 567.6 Community Engagement 58

8. LOOKING TO THE FUTURE 60-618.1 Renewable Energy Developments 608.2 Green Power Generation 608.3 Wave Energy Converter Project 618.4 Reducing the Ecological Impact of Current Operations 61

9. APPENDICES 62-679.1 PricewaterhouseCoopers Assurance Report 629.2 Glossary of terms in this CSR Report 649.3 GRI Content Index 67

SBM OffshoreCorporate Social Responsibility Report 2007

Selected 2007 Performance Summary

SBM Offshore currently employs 4,402 people worldwide and is present in 15 countries.

SBM Offshore I Corporate Social Responsibility Report 2007�

(1.1) SBM Offshore – A Birds Eye View

Total Employees worldwideHeadcount end of 2007

4,402 Including part-time and temporary staff

Main Execution CentersIn 2007

4Houston, Kuala Lumpur, Monaco and Schiedam

Net Profit Million (US$ Million)End 2007

266.8 Net Profit 2006 - 23.3%

Turnover (US$ Million) 2,871 Compared to US$ 1,990 in 2006

Total Manhours (Millions)SBM Group (excluding Subcontractors)

8.5Group Worldwide including Fleet of Offshore Production Units

Offshore Production UnitsLease/Operate Fleet 2007 (in operation)

15 Asia, Brazil, West Africa and the Caspian

Total Production Hydrocarbons MMBLS01/01/2007 – 31/12/2007 Lease/Operate Fleet 2007

297Fleet production in Asia, Brazil, West Africa and the Caspian

Main Clients 10 Mostly Major IOCs and NOCs

Organisational Profile

SBM Offshore N.V., hereafter also referred to as “the Company”, is a multinational group of companies

selling systems, leasing/operating offshore production units, and providing services to the offshore oil

and gas industry. SBM Offshore is listed on the Euronext Amsterdam as part of the AEX Index. The

Company has been publicly listed on the Euronext since 11th October 1965, originally under the name

IHC Holland and later listed as IHC Caland N.V.

On 1st May 2005 IHC Caland N.V. was renamed SBM Offshore N.V and the shares were subsequently

listed under this name.

SBM Offshore’s engineering and project management resources are currently operating from four [4]

main execution centres:

1. Schiedam, the Netherlands

2. Fontvieille, Monaco

3. Houston, the United States of America

4. Kuala Lumpur, Malaysia

Corporate functions are located in:

1. Schiedam, the Netherlands

2. Fontvieille, Monaco

3. Marly, Switzerland

In addition to these main centres, there are permanent establishments for regional marketing and

sales, local management of onshore construction activities, and offshore production located in several

countries.

SBM Offshore I Corporate Social Responsibility Report 2007 �

SBM Offshore > INTRODUCTION

SBM Offshore Worldwide

(1.2) 2007 Activities

Divestment of non core-business

The sale of NKI, a company performing airport infrastructure

activities located in the Netherlands took place, but not before

the continuity of employment of NKI employees was secured.

Neither the employee headcount nor H.R. performance

indicators concerning NKI are included in this report.

Investments

During the year 2007, US$ 551 MM was invested mainly in

offshore production assets within lease and operation contracts.

The main units under construction are Mondo and Saxi FPSOs

for ExxonMobil in Angola, BC-10 FPSO for Shell in Brazil, Kikeh

FPSO for Murphy Oil in Malaysia, the Thunderhawk Semi-

submersible for Murphy Oil in the USA and Yme Mopustor for

Talisman in Norway.

Lease/Operate

Throughout 2007 SBM Offshore had twenty-one (21) long-

term lease/operate contracts in hand for floating production

and/or storage units: fifteen (15) owned or part-owned units

in operation under lease/operate contracts, one (1) newly

converted offshore production unit installed and prepared

for production start-up early 2008, and five (5) units currently

under construction. In 2007, the Company also performed the

operational management of the FPSO Serpentina, a client-

owned offshore production unit operating offshore in Equatorial

Guinea.

The 15 floating production units that were operating during

2007 were located in Asia, Brazil, the Caspian Sea and West

Africa. These facilities consist of Floating Production Storage

and Offloading Systems (FPSO), Floating, Storage and

Offloading Systems (FSO) and one Mobile Offshore Production

Unit (MOPU).

All units in operation performed without any major problems

during the year with a combined average throughput rate just

above 800,000 barrels per day. Around 297 million barrels of

hydrocarbons were exported from the fleet in the year 2007,

representing a total of 517 tanker offloading operations. Total

production uptime of the fleet reached 99%.

The Company’s offshore production unit, the FPSO Firenze

stopped production on 30th April 2006 and was demobilised

from the Aquila field in the Adriatic Sea in the summer of 2007,

when the lease contract with AGIP was terminated.

�

Monaco

Schiedam

Kuala Lumpur

Houston

Execution Centres

Shore Bases

Lease Units

Future Lease Units

Corporate functions

SBM Offshore I Corporate Social Responsibility Report 2007

Marly

Financial Results

The two business segments of the Company are the turnkey

sales of facilities and services, which does not require

employment of any substantial capital and the lease and

operate activities which is capital intensive.

Financial reporting is made in accordance with these seg-

ments.

All operating companies (excluding NKI) contributed positively

to the results of the Company in 2007. The execution of many

of the contracts was shared between execution centres

benefiting from the synergy and the complementary nature

of the different disciplines and specialisations available in the

respective companies of SBM Offshore. The implementation

of Corporate Engineering Standards and the harmonisation of

reporting and risk control systems common across the execution

centres have further increased the Company’s capability in

the execution of a large variety of projects. Combined with the

capacity growth, this has allowed the Company to handle a

turnover 44% higher than previous years.

�

Item (US$ million)

Net Profit

Operating Profit (EBIT)

EBITDA

Capital Expenditure

Total Equity

Turnover

Total Assets

Shareprice (e) 31st Dec. 2007

AEX-index

Market Capitalisation US$

2007

266.8

302.0

548.3

551.0

1,337.7

2,871.2

3,634.6

21.60

515.8

4,557.6

2006

216.3

254.3

477.5

309.0

1,119.0

1,989.7

2,940.4

26.05

495.3

4,830.6

GROWTH %

23.3%

18.8%

14.8%

78.3%

19.5%

44.3%

23.6%

-17%

4.1%

-5.7%



(1.3) A Message From Our CEO

SBM Offshore is and

always has been a socially

responsible company. Its

success is primarily due

to responsible business

and best management

practices deeply rooted in

the heart of our activities

since the Company’s

inception 50 years ago.

While we strive to deliver

maximum value to our

shareholders, we also

place the interests of all

the stakeholders at the top of our priorities. This includes

those of our employees, of the industry including our clients

as well as our contractors/vendors from whom we outsource

equipments and services, and of the society at large including

in particular the host countries where oil and gas is being

produced through our systems.

The Company has come a long way since the very first CALM

Buoy installation in 1959. Twenty years later, in 1979, SBM

Offshore became a pioneer in offering an integrated oil and

gas production service through the investment in F(P)SOs. As

a result, the lease and operate business of FPSO’s became a

major component of the Company’s activities.

Our core business is servicing the oil and gas sector and our

Clients provide today’s most widely used energy sources in

the world.

Over the next twenty years the world’s energy needs will

increase to a level far above the present one while the share

of crude oil as an energy source will irremediably decrease

and be replaced by other fuels including of course primarily

natural gas but also other non-hydrocarbon related sources.

Our aim during this period is to grow the Company through

playing an increasing role, offering to the industry the most

relevant technologies to bring energy to the world. Obviously,

economic parameters will always be heavy factors in the

equation but social impact considerations will carry more and

more weight in our choices and decisions.

Our Company has a direct stake in concerns relating to the

future of energy and the preservation of our climate. One of

our corporate beliefs is to undertake and develop, as best as

possible, new groundbreaking technologies.

Minimising greenhouse gas emissions and making the

transition to a lower-carbon economy must not only appear in

our selection of the best technologies, but should play a major

role in our future business strategy.

We consider that our broad experience and long history in

offshore activities enables us to extend our technologies to

enter successfully into e.g. the wind and wave energy industry.

By doing so, we will contribute to reversing the negative

impact of fossil fuel emissions through the supply of clean

fuels - a strategy to help sustain and grow the supply of clean

and “green” (or rather blue) marine energy. The Company is

actively pursuing promising projects on this subject.

This is SBM Offshore’s first separate CSR report covering the Company’s corporate

social responsibilities and its non-financial performance during the reporting year

2007.

8 SBM Offshore I Corporate Social Responsibility Report 20078 SBM Offshore I Corporate Social Responsibility Report 2007

Our commitment to responsible business management is

expressed in our Code of Conduct. Here our responsibilities

towards all stakeholders are declared. The Code of Conduct

is the basis for the daily performance of our business activities

and the staff is actively accountable for compliance with this

Code.

On moral issues, Rules of Conduct relating to Suspected

Irregularities are established with a Whistle-blowing Policy

to encourage reporting of any ethical breach. Moreover, we

strongly support and enforce equal opportunity principles

and the Company does not differentiate between nationality,

gender, race or religion.

In our line of business, ethical conduct and a continuous focus

on industrial safety and environment impact takes precedence

and is of highest importance to the Board of Management.

We aim at continuous improvement to maintain and advance

our HSE performance. Our employees are instructed and our

contractors and subcontractors are committed to adhere to

our standards.

In the course of 2007 the Company has successfully

constructed and installed a wide range of different products

each based on diverse and complex technologies. This past

year’s safety record has been satisfactory and we are proud

of the low accident frequency rate involving our employees.

Nevertheless, we deeply regret the three (3) fatalities that

occurred during the year of 2007 to our subcontractors’

personnel.

Integrating our own internal activities, onshore and offshore

on our vessels and the activities of our subcontractors on the

construction sites, the results are quite good when compared

to the average industry performance and still, our aim is for

further improvement.

Our Social Responsibility takes a particularly high profile in the

host countries where we operate. There, the local authorities

and communities are key stakeholders in the Company as we

consider it our duty to run our activities in a way that maximizes

the local social benefit. The quality of our social performance in

these countries flags high priority in the definition of our global

business strategies.

A good example of these principles is our development

programme in Angola as further explained in this report.

Indeed, Angola plays a large role in our operating activities

and we have taken the challenge of a step change in the

local social and industrial benefits arising out of our activities.

It represents a substantial investment both in financial terms

and in resources, but it is considered an essential move to

reconcile both the business objectives and the local social

interests. This initiative represents a major challenge; however,

it should not be seen as a change in our business principles.

Globally, the Company will continue to outsource equipment

and construction services. This should simply be taken as a

clear sign that Sustainable Development stands high in our

agenda when it benefits host countries.

In the spring of 2007, a survey was performed by one of

our stakeholders to benchmark our social, economic and

environmental performance against those of our industry

peers. These results were discussed externally and internally.

The analysis was utilised to assess our performance and to

further improve the Group’s CSR reporting practices. The final

conclusion was to provide a separate CSR report expanding

our reporting scope, stating the Company’s performance and

future objectives starting with the reporting year of 2007.

This CSR Report is based on the G3 Sustainability Guidelines

of the Global Reporting Initiative and hereby details how SBM

Offshore is aiming to satisfy these objectives.

I am confident that you will find this first CSR report to the

point, informative and essential to build a more comprehensive

judgement on the Company’s performance.

Sincerely,

Didier Keller

April 2008

�SBM Offshore I Corporate Social Responsibility Report 2007


10 SBM Offshore I Corporate Social Responsibility Report 2007

(2.1) Introduction

This report is the first independent CSR report issued by SBM Offshore based on Global Reporting Initiative (GRI) G3 and

to which the Company reports on the C+ level. The reported performance indicators are in line with the GRI Guidelines

and form part of the non-financial reporting scope. In this report, SBM Offshore will present the Company’s performance

during the full calendar year from 1st January to 31st December 2007. SBM Offshore recognises the critical importance of

providing factual sustainability performance data. This report is a significant improvement on the diversity and coverage of

the data presented in the CSR section of the Annual Report 2006 and SBM Offshore is committed to furthering this trend

in the future. The Company’s intention is to publish a corporate CSR report on an annual basis.

Stakeholder DialogueTo date, SBM Offshore has not yet engaged in any stakeholder dialogue specifically dedicated to its overall CSR performance and reporting. However, SBM Offshore has throughout its growth at all times encouraged an open and respectful engagement with our stakeholders. This takes place at annual shareholder’s meetings; with our Company employee delegates whenever the need arises to discuss a specific issue and lastly with NGO’s.

The main stakeholder groups identified in this report are our employees, clients and business partners; capital providers; shareholders; suppliers; NGOs, local authorities and local host communities in the countries where we have a presence.

Annual Shareholders minutes of meeting are published on our company website; http://www.sbmoffshore.com/Corporate Governance

‘’Corporate social responsibility is the continuing commitment by businesses to

behave ethically and contribute to economic development while improving the

quality of life of the workforce and their families as well as of the local community

and society at large’’ World Business Council for Sustainable Development

11SBM Offshore I Corporate Social Responsibility Report 2007

SBM Offshore > REPORTING SCOPE

(2.2) Reporting SegmentsThe reporting scope is split into two main segments; Onshore

Operations and Offshore Production.

Onshore Operations will report on the performance of the

four (4) execution centres and corporate functions offices and

services. The report will include the project construction site

activities for working hours and lost time incidents / accidents.

In 2007, SBM Offshore concluded 8 major projects at the

construction sites in Asia, the United Arab Emirates, and in

West Africa.

Offshore Production will report on all main activities from twelve

(12) offshore production and storage units that were operating

during 2007. As previously mentioned, during this year the

offshore fleet consisted of fifteen (15) offshore production

units actively in operation and currently under lease/operate

contracts to various Clients and one (1) being installed on

site offshore Angola and preparing for production start-up of

early 2008. The CSR reporting scope will only include offshore

production units operating under lease/operate contracts

where SBM Offshore has full operational management,

and where the Company is the owner or holds a controlled

interest a shareholder in a Joint Venture (JV) partnership.

The JV partnerships are those entities over whose activities

the Company has joint control, established by contractual

agreement. The report will only take into account the JV’s

where the Company owns 50% of the shares and upwards.

The FPSO Mondo was completed at the yard in August 2007

and in December 2007 it was being prepared for operational

start-up with first oil in January 2008. The manhours spent for

these preparations are included in the total offshore production

manhours, but the environmental performance indicators are

not included in the Offshore Production segment of this report,

as the unit was not in production before 2008.

The following 3 offshore floating, storage and/or production

units are excluded from the reporting scope:

FSO N-KOSSA II currently operating offshore Congo, is Joint Venture

majority-owned by MAERSK with a 51% share ownership and SBM Offshore

49%. The Unit is operated and managed by JV Company; Gasman Congo.

The lease of this unit was extended in 2007 and expires in 2011.

FPSO MYSTRAS currently operating offshore Nigeria is a Joint Venture with

SAIPEM with a 50% percent share ownership. The operational management

for the offshore production is controlled by SAIPEM.

FPSO KIKEH currently operating offshore Malaysia is a Joint Venture

majority-owned by Malaysia International Shipping Corporation Berhad

(MISC) with a 51% share ownership. FPSO KIKEH started production

in August 2007 offshore Malaysia and is fully operated and managed by

a second JV Company; Malaysian Deepwater Production Contractors

(M.D.P.C.).

Health, Safety, Environment (HSE) & SecurityStatistics for manhours and incident reporting from Onshore

Operations and Offshore Production will be stated in total

manhours for the group as a whole and for each segment

separately as per the two-tier reporting system. The Lost Time

Accident Frequency (LTAF) and Lost Time Incident (LTI) statistics

from the Onshore Operations and Offshore Production units

are based on the U.S. Department of Labor’s Occupational

Safety & Health Administration (OSHA) International Industry

Standards. The statistical data for all incidents reporting on HSE

are registered and managed through the in-house corporate

database; SIRS (Single Incident Reporting System).

(2.3) Environmental Management Systems

The Environmental Management Systems (EMS) for the fleet

of offshore production units are in line with international ISO

14001 requirements. Environmental Management Systems

and stringent codes of practices are in place onboard each of

SBM Offshore’s production units where SBM Offshore controls

the operational management for the offshore production. The

offshore production sites, including their respective shore-

bases, are all functioning under SBM Offshore Management

Systems and the offshore production units are either ISO 14001

compliant or certified. The total Brazilian fleet, consisting of four

(4) FPSOs, has externally verified ISO 14001 certification. This

was obtained at the end of 2007 and the audit was performed

by American Bureau of Shipping (ABS).

During the course of 2008, the fleet of five (5) offshore

production units, currently offshore Angola will prepare for

external verification of their ISO 14001 management systems.

All audits and compliancy certifications will be performed and

issued by American Bureau of Shipping (ABS).

Please see Compliancy matrix in Section 3.4 “Corporate Responsibilities” for a

detailed overview.

Emissions ReportingOnshore Operations will report on the four execution centres’

indirect energy usage as well as that of the corporate functions

offices. The construction yards are not included in the

reporting scope as the responsibility for the yard’s environment

management is that of our subcontractors.

Offshore Production will report on environmental performance

indicators where the Company is in charge of the operational

management for the offshore production. Emissions data

results collected from the lease/operate production units are

calculated from the direct energy consumption essential to

operate each of the offshore production units.

SBM Offshore however does not own the well stream fluids and

gas forming the product that is produced offshore, although

the Company is operating the offshore production units on

behalf of its Clients. All emissions stated in this report are a

total for the twelve (12) offshore production/storage units and

analysed by geographical region included in the reporting

scope. It is worth noting that in Brazil, our Client, Petrobras

reports externally on all measured emissions relating to

offshore production in Brazilian national waters. This includes

the four (4) Brazilian offshore production units on long-term

lease/operate contracts with SBM Offshore. SBM Offshore has

chosen to include the Brazilian offshore production units in the

environmental performance summary concerning the offshore

production, although these results are also reported separately

by our Client.

The emissions calculation from the offshore production units

is performed using as the basis for the calculation, the method

from the UK offshore operators association limited (UKOOA).

A tiered approach is used; this means that the most accurate

available measure is used and the higher the tier the higher

the accuracy.

The regional shore-bases are excluded from the offshore

production reporting scope and this applies to environmental

performance only.


13

(2.4) Human Resources (H.R.) Management

Performance indicators in this report cover 100% of the SBM

Offshore group. The report takes into account all permanent

employees, all part-time employees, all local employment staff

from agencies, and all crew working onboard the offshore

production units. SBM Offshore’s subcontractors’ performance

executed at the construction yards will be reported to illustrate

the amount of Manhours incorporated into the engineering and

construction activities invested into a product.

The H.R. section is divided in two sections: Blue Collar and

White Collar employees.

Blue Collar is defined as: personnel working in project execution

and construction activities, including the personnel of our

subcontractors and offshore personnel employed onboard the

offshore production units.

White Collar is defined as: staff working at our administration

and engineering offices and four execution centres. The H.R.

reporting indicators includes our permanent and part-time

workforce ratio, broken down into workforce ratio of female

versus male. Since the offshore engineering industry together

with offshore production is not a female-dominated sector,

the Company employee figures tend to have a high male

ratio. This is not the result of SBM Offshore’s hiring policies,

as the Company promotes equal-opportunity and encourages

more women to take part in the offshore industry sector. The

disparity is related to the offshore sector itself, which attracts

more men than women, thus resulting in a higher percentage

of men employed in general.

Performance Reviews / TrainingEvery year, SBM Offshore has annual performance reviews for

our employees. Globally, the Company utilises the Hay system

to grade and evaluate all permanent staff.

Total training hours for all Company staff, both Blue Collar and

White Collar, are included in the report.

Employee BenefitsSBM Offshore has an attractive pension benefit system for

all employees. As a multinational company, SBM Offshore

operates various pension schemes dependant on the country

in which operations take place.

The schemes are funded through payments to insurance

companies or are defined as multi-employer plans.

The Company has both defined benefit and defined contribution

plans.

(2.5) Social Accountability

SBM Offshore planned to achieve a fleet-wide accreditation of

the Social Accountability Standard “SA 8000”.

The standard is based on conventions of the International

Labour Organisation (ILO) and related international human

rights instruments including the Universal Declaration of

Human Rights and the United Nations Convention on the

Rights for children.

SA 8000 forms a common standard for Companies seeking

to guarantee the basic rights of workers. SA 8000 provides a

framework for independent verification of the ethical working

practices which is relevant to the companies providing services

and goods.

Whilst the implementation of SA 8000 was being planned,

Social Accountability International [SAI] directed the SA 8000

Advisory Board that verification of the standard was disallowed

in Myanmar, until the International Labour Organisation (ILO)

lifted its sanctions. Hence, the planned implementation of

certified SA 8000 as explained in the Compliancy Matrix issued

in the Annual Report 2006, became unattainable.

SBM Offshore respects the ILO and SAI’s approach with regard

to the Myanmar situation and we fully understand the decisions

taken by ILO and SAI. The Company regrets however, that

our previous implementation plan and efforts could not be

certified. Therefore, the decision was taken to continue the

implementation of an in-house Social Accountability manual

based on the precedent set by the SA 8000 Framework. The

manual’s contents were audited by ABS and considered

satisfactory for implementation.

Formal SA 8000 accreditation / certification will not however be

sought due to the reasons stated above.

An overview of technical terms and acronyms used in the CSR report is available

under Section 9.2. Appendices: “Glossary”.


SBM Offshore > REPORTING SCOPE

1�

“�Technology�Creating�Value” has been the motto of SBM Offshore

for many years...

SBM Offshore is a multinational group of companies serving the oil and gas industry through the sale, lease, and/or operation

of offshore production facilities, as well as related services. The Company’s clients are mainly oil and gas corporations, both

private and public sector organisations, including National Oil Companies (N.O.C.). SBM Offshore manages all business, project,

and engineering activities through four key execution centres. These are located in Schiedam (the Netherlands), Kuala Lumpur

(Malaysia), Monaco and Houston (U.S.A.).

In addition to these main centres, there are permanent establishments in fifteen countries for regional marketing and sales, local

management of offshore operations, and construction activities.


Photo of SPM, the Shell Miri Buoy’s installation in 1959

1�

SBM Offshore > CORPORATE PROFILE

(3.1) History of SBM Offshore

In 1965, a number of Dutch shipyards, each founded in the

course of the 19th century, established under the name N.V.

Industrieele Handels Combinatie Holland a limited liability

Company listed on the Amsterdam stock exchange. The main

yards in the Company were at that time Gusto in Schiedam, Smit

in Kinderdijk and Verschure in Amsterdam.

Prior to the creation of IHC Holland, the Gusto yard had already

made a first move into offshore oil and gas related activities in the

1950’s. In 1959, the Gusto yard constructed the first Single Point

Mooring (SPM) facility) under a license agreement with Shell.

The market for SPM systems developed rapidly in the 1960’s.

The decision was taken in 1969 to create a separate Company

for the marketing and further development of SPM systems.

Single Buoy Moorings Inc. (SBM) was founded as a wholly-

owned subsidiary of IHC Holland N.V.

In the late 1970’s the shipbuilding crisis in Europe led to the

closure of several yards in the Netherlands including the IHC

Gusto yard. However, in order to retain the engineering know-

how and experience built up in the yard, Gusto Engineering was

created as designer of the range of offshore-related products of

the yard.

In 1984, the Company became IHC Caland N.V. bringing

together the remaining dredger and specialized shipbuilding

yards on one hand and the offshore activities of SBM and IHC

Gusto Engineering on the other hand.

In the eighties and nineties, the product line of SBM expanded

towards more complex mooring systems for Floating Storage

and Offloading (FSO) and Floating Production Storage and

Offloading (FPSO) systems where a position of market leader

was established. FPSO systems have since become the largest

element of the current Company’s business profile.

IHC Caland made an important acquisition in 1990 with the

purchase of the California-based Company Imodco, which for

twenty years had been the largest competitor in the supply

of SPM systems. In 2000, Imodco relocated to Houston and

continued its traditional business under the name:

SBM-Imodco.

The Company made another major acquisition in 2001 through

the purchase of Atlantia Offshore, specialised in the design

and construction of Tension Leg Platforms. This strategic move

was made in order to complement the range of products of the

Company and to be able to provide all the building blocks for

large deepwater oil and gas field developments.

On 1st May 2005, IHC Caland N.V. was renamed SBM Offshore

N.V.; and hereafter listed as SBM Offshore N.V. on the Euronext

Stock Exchange, Amsterdam.

Atlantia Offshore and SBM-Imodco started to work closely

together and subsequently merged and the combined entity

was renamed SBM Atlantia.

The complete history of the company is published on our company website.

For more information please visit our website

www.sbmoffshore.com - Section; About SBM / History


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(3.2) Corporate Activities

SBM Offshore’s activities integrate engineering, supply, offshore

installation, and operation of offshore facilities for the production,

storage, and export of crude oil and gas. The offshore facilities

consist of the following systems:

Floating Production Storage and Offloading systems (FPSOs),

Floating Storage and Offloading systems (FSOs), Tension Leg

Platforms (TLPs), Monohull and Semi-submersible Floating

Production Units (FPUs), and self-elevating Mobile Offshore

Production Units (MOPUs).

In addition to the supply of these systems on a turnkey basis,

the Company is also in the business of owning and operating

offshore production units. These units are, as a rule, contracted

as long-term charters on a lease/operate basis to clients

worldwide. The contract normally stipulates that SBM Offshore

manages the operation of the leased unit(s).

SBM Offshore’s product line also includes mooring terminals.

These mooring terminals are predominantly based on the

Single Point Mooring (SPM) principle utilised to moor crude

oil and gas carriers in open seas for the purpose of loading or

offloading cargos. Other core products of the Company include

more complex mooring systems; they are of various types

such as weathervaning (permanent or disconnectable) or fixed

heading.

Additionally, SBM Offshore provides design and engineering

services for crane vessels, pipe-lay barges, and drilling units of

all types, such as mono-hull, jack-up, and semi-submersibles.

Moreover, SBM Offshore supplies key components for these

units.

The provision of specialised services such as: maintenance,

spare parts, repairs, and offshore installation forms an essential

complement to the sales of facilities, offering a comprehensive

and integrated service to our Clients.

SBM Offshore is one of the market leaders, both in terms of

market share and technical expertise.

The Company:

• Designs, builds, and installs either on “sale” or on “lease/

operate” basis: FPSOs, FSOs, TLPs, MOPUs, and Semi-

Submersible platforms for the oil and gas industry;

• Supplies mooring systems for FPSOs / FSOs;

• Supplies deepwater export systems and conventional

CALM loading/offloading terminals;

• Provides design and engineering services for drill ships,

jack-up rigs, semi-submersible rigs, specialised vessels,

and topsides for oil and gas production facilities;

• Provides Offshore Contracting and After-Sales Services;

• Evolves via its Product and Technology Development

department.

The Company has carried out development work that will

allow it in the future to:

• Design and supply offshore berthing terminals for LNG

export and import;

• Design, build, own and operate Floating Storage

Regasification import facilities for the LNG industry;

• Design, build, own and operate Floating LNG FPSOs for

the LNG industry.


1�



(3.3) Corporate Responsibilities

SBM Offshore believes that Corporate Social Responsibility is

of increasing importance; to be appreciated as a responsible

member of society and as a quality business partner. Our main

clients, international and national oil and gas companies call

for their business partners to adhere to the highest social and

environmental standards. Furthermore, stakeholders, non

governmental organisations (NGO’s), and rating institutions

are all encouraging enhanced transparency and improved

performance in the economic, social, and environmental

areas.

SBM Offshore recognises this as a valid and legitimate challenge

in a changing world where private companies have control and

influence over their ‘impact’ on society at large, automatically

accompanied by an increasing level of responsibility. For

SBM Offshore, Corporate Social Responsibility represents

doing the right thing. This means good corporate governance

practices; a sound Code of Conduct incorporating an anti-

corruption guiding principle and equal opportunities; taking

all levels of societies where we are present into consideration;

creating interdependency with the local communities where we

operate; scrutinising the impacts we have as a company on the

environment and endeavouring to improve these impacts by

use of the Company’s in-house expertise.

SBM Offshore greatly values the health and safety of all our

employees. A pro-active and competent workforce is the

result of strong corporate values and management support.

SBM Offshore encourages an open dialogue with our

employees and we appreciate their concerns. The SBM

Offshore staff are represented by employee delegates who are

elected annually by the staff internally. The Board holds general

meetings with the employee delegates to discuss concerns and

to listen to propositions for the improvement of general working

conditions and other relevant issues.

Today, responsible businesses strive to minimise the adverse

effects of their activities on all levels of society.

SBM Offshore is not only focusing on lowering the harmful

impact on the environment, but also on raising awareness

with our Clients on efficient engineering designs that can cut

emissions and be cost-effective at the same time. SBM Offshore

believes that in order to be accountable, the businesses of

tomorrow must become proficient at making a positive impact

on the environment. Increasingly, companies will be selling

solutions to aid environmental problems and alleviate the

world’s energy needs. SBM Offshore is already engaged in

this effort through the research and development of greener

technologies and by having a socially-conscious impact on the

sites where we operate.

(3.4) Corporate Business Strategy

The Company aims for integrated competence to manage,

design, supply, install, and operate complete, complex offshore

oil and gas production facilities. The strategy of SBM Offshore

is therefore to place the development of technology at a high

priority level with the objective to continuously generate and

improve cost-effective solutions.

Having in-house access to the technology know-how required

for the growing gas industry, ultra-deepwater developments

and future green energy solutions is a strength.

Concurrently with the development of cost-effective solutions,

in particular for extreme applications, the strategy also includes

creating and maintaining in-house, a comprehensive pool of

resources available within the Group companies for a one-stop-

shop approach. It is the opinion of SBM Offshore management

that one of the main risk-control principles is to avoid having

to subcontract competence when promoting state-of-the-art or

innovative ideas.


The key objectives of the businessstrategy are as follows:

Expand the product line through development of new

technologies:

• Develop innovative, cost-effective technical solutions,

and maintain a position of leader in the supply of offshore

facilities and production services;

• Continue to develop technology for the upcoming gas

market, particularly in the domain of infrastructures to

produce and handle liquefied natural gases (LNG) offshore;

• Develop technical solutions for the production of “green”

energy offshore.

Expand the lease business model, to increase the portfolio

of long-term, predictable revenues:

• Continue to grow the fleet of leased production facilities

(FPSOs and others) while improving the returns on capital

employed;

• Maintain the position of preferred contractor in the oil

and gas production services on the grounds of quality

and reliability. Focus on marketing strategies and

partnerships to leverage that position. Aim for the highest

standard, demanding end of the product line;

• Develop the lease business in the Gulf of Mexico and

expand the concept to that of hub service for ultra-deep

developments;

• Establish a pole position in the market of offshore gas

exploitation and enter this market through leasing LNG

FPSOs and FSRU’s.

Sustain a high level of focus on after-sales services

and offshore contracting, further developing this stable,

predictable business segment.

Corporate Developments

In 2007, the Company focused on several initiatives:

• Revised Code of Conduct, April 2007;

• Improvement of the existing data collection for economic,

social and environmental performance, to enable the group

to report in accordance with the guidelines of the global

reporting initiative, as far as relevant to SBM Offshore;

• Higher safety performance with aim for zero accident and

incidents;

• Continued improvement of the SIRS [Single Incident

Reporting System] for HSE statistics both for offshore

production and land-based operations including our

subcontractors’ construction yards;

• Accomplish our nationalisation programmes wherever we

operate;

• Develop, sustain, and grow the supply of clean and

“green” or “blue” marine energies.

Compliancy Matrix

SBM Offshore has efficient management systems for the different

divisions of its business activities. There is a set of established

and centrally-controlled financial and strategic rules as well as

the Group Management System defining Company procedures

and work instructions. SBM Offshore’s Corporate Engineering

standards ensure a common design approach in the four

execution centres. The standards also facilitate the optimal use

of skills and global resources available for the execution of large

and complex projects.

Corporate Management Systems are built on the basis of the

following internationally recognised standards:

Quality Management Standards ISO 9001;

Environment, ISO 14001;

Occupational Health and Safety, OHSAS 18001;

Social Responsibility [in line with SA 8000];

Safe and Secure Operation of a Ship and Pollution Prevention;

ISM / ISPS [International Ship Management / International Code

for the Security of Ships and of Port Facilities].

Extension of the implementation and certification of management

systems are presented in the updated Compliancy Matrix.

1�



Note regarding Compliancy Matrix: Amendment to Social Accountability Standard

SBM Offshore operates the FSO Yetagun offshore Myanmar, which is leased under a long-term contract. In 2005, it was the Company’s intention to commence the implementation of the international

standard “SA 8000” to comply with the Company’s operations. The implementation strategy was to implement SA 8000 first in Myanmar, then Brazil, and finally the West African operations.

The SA 8000 standard would then be implemented at all our operations sites. Social Accountability International [SAI], directing the SA 8000 Advisory Board, decided that external SA 8000

certifications are disallowed in Myanmar until the ILO [International Labour Organisation] lifts its sanctions against the regime. Hence, the Company’s planned implementation of SA 8000 is not

possible. The implementation plan was altered and an internal system was initiated and is identified in the Compliance Matrix. The SA 8000 reference, as presented in last year’s Annual Report, has

been replaced by Social Accountability.

ISO 9001:2000 ISM OHSAS

18001ISO

14001Social

Accountability ISPS

SBM Offshore Execution CentresMonaco Monaco 2 2 2 2Houston USA 2 2 2 2 2Schiedam Netherlands 2 2 2 2 2KL Malaysia 2 2 2 2 2

SBM Offshore Production UnitsFPSO Kuito Angola 1 4FPSO Xikomba Angola 1 4FPSO Sanha Angola 1 4FPSO Mondo Angola 1 4FPSO Saxi Batuque Angola 1 4FPSO Espadarte* Brazil 1 4FPSO Brasil* Brazil 1 4FPSO Marlim Sul* Brazil 1 4FPSO Capixaba* Brazil 1 4FPSO BC 10 Brazil 1 4FPSO Frade Brazil 1 4FSO NKS 2 CongoFPSO Serpentina EQ Guinea 1 4FPSO Kikeh Malaysia 1 4FSO Yetagun Myanmar 1 4FPSO Mystras NigeriaFSO Okha Russia 1 4FPSO Tantawan Thailand 1 7 4MOPU & FSO Turkmenistan 1 4FPSO Rang Dong 1 Vietnam 1 7 7

SBM Shore BasesAngola 2 2 2Brazil 2 2 2Malaysia 2 2 2Myanmar 2 2 2Nigeria 2 2 2Thailand 2 2 7 2Turkmenistan 2 2 2Vietnam 2 5 5 5 5 5

Target for 2008Target for 2009Externally certified Compliant according to external audits (ABS)Not operated by SBM Offshore

* Specific request from Client for OHSAS18001 1 ISO 9001 not applicable to the fleet, is covered by the ABS SE ISM certification where established2 Management standard not applicable to the offices3 N/A4 Social Accountability standard not applicable offshore5 Shore Base no longer in operation / closed6 N/A7 Operating contract ending mid 2008

• FPSO’s Capixaba / Marlim Sul / Espadarte / Brasil are required to have 18001 external certification • FPSO’s Capixaba / Marlim Sul / Espadarte / Brasil have obtained 14001 certification 4Q 2007• OKHA has 14001 certification


(3.5) Joint Ventures

SBM Offshore considers a Joint Venture (JV) partnership to be

an efficient way of acquiring sustainable business. In the lease/

operate sector of our business, our partners are in general

responsible for a pre-defined part of the project. SBM Offshore

only engages in a JV when it both enhances the opportunity to

secure business and ultimately adds value to the Company’s

performance.

Motives for equity partners are as follows:

• Acquiring access to specific expertise which is not available

within the Company;

• Access to a tanker under construction in order to meet the

required delivery time/schedule;

• Mitigating business risks, especially for units where the

initial lease contract is short;

• Taking mutual advantage of a Client’s preference for

a particular company, which does not itself have the

necessary competence to supply and install a complete

FPSO.

Joint Ventures are those entities over whose activities the

Company has joint control, established by contractual

agreement. Several of our Offshore Floating Production Units

under lease/operate contracts are Joint Ventures and the

offshore production and/or storage units are wholly or partially

operated by SBM Offshore.

This report will account for those Joint Ventures where SBM

Offshore controls 50% or more of the shares.

21



SBM OFFSHORE PRODUCTION FLEET IN 2007 (IN ALPHABETICAL ORDER OF COUNTRY)

UNIT NAME COUNTRYOF OPERATION

J.V. PartnersOwnership %

J.V. OWNERSHIP TITLE

OPERATIONAL MANAGEMENT CLIENT

FPSO KUITO ANGOLA SONANGOL 50%SONASING KUITO LTD SBM OFFSHORE CHEVRON

FPSO XIKOMBA ANGOLA SONANGOL 50%SONASINGXIKOMBA LTD SBM OFFSHORE EXXONMOBIL

FPSO LPG SANHA ANGOLA SONANGOL 50%SONASING SANHA LTD SBM OFFSHORE CHEVRON

FPSO ESPADARTE BRAZIL NONE NONE SBM OFFSHORE PETROBRAS

FPSO BRASIL BRAZIL MISC BERHAD 49%FPSO BRASIL VENTURE S.A. SBM OFFSHORE PETROBRAS

FPSO MARLIM SUL BRAZIL NONE NONE SBM OFFSHORE PETROBRAS

FPSO CAPIXABA BRAZILSTAR, an affiliate of Brazilian strategic partner Queiroz Galvao (QGP) 20%

FPSO CAPIXABA VENTURE S.A SBM OFFSHORE PETROBRAS

FSO LPG NKOSSA II* CONGO (D.R.) MAERSKLIMITED 51%

ANCHOR STORAGE LIMITED

GAS MANAGEMENT (CONGO) LTD

TOTAL

FPSO KIKEH* MALAYSIA MISC BERHAD 51%

MALAYSIA DEEPWATER FLOATING TERMINAL (KIKEH) LIMITED

MALAYSIA DEEPWATER PRODUCTION CONTRACTORS SDN BHD

MURPHY

FSO YETAGUN MYANMAR MITSUBISHI CORPORATION 25%

SOUTH EAST SHIPPING CO. LTD.

BARBER SHIP MANAGEMENT

PETRONAS

FPSO MYSTRAS* NIGERIA SAIPEM 50%FPSO MYSTRAS- PRODUÇÃO DE PETROLEO LTDA

SAIPEM AGIP

FSO OKHA RUSSIA NONE NONEWALLEMUnit operational 6 months per year

SEIC

FSO OGUZHAN / MOPU TURKMENBASY TURKMENISTAN NONE NONE SBM OFFSHORE PETRONAS

FPSO TANTAWAN THAILAND NONE NONE SBM OFFSHORE CHEVRON

FPSO RANG DONG VIETNAM MITSUBISHI CORPORATION 30%

SBM DIAMOND VENTURE S.A. SBM OFFSHORE J.V.P.C.

The financial statements in the Annual Report 2007 generally include the Company’s proportionate share of the Joint Venture entities’ assets, liabilities, revenue,

and expenses, with items of a similar nature on a line-by-line basis, from the date that joint control commences until the date that joint control ceases.

* Not included in CSR Report. Please see Section: Reporting Scope.


(4.1) Commitments, Accomplishments & Future Targets

During the reporting year 2007, SBM Offshore completed a number of large projects. These achievements reflect the determination

of the Company and are the result of hard work accomplished by a dedicated staff.

FPSO KIKEH [J.V. MMHE]Malaysia’s first Deepwater FPSO facility and SBM Offshore’s first deepwater installation in

Asia. The refurbishment, conversion, and integration of the FPSO, as well as construction of

the modules and turret system were completed at the MMHE shipyard, Malaysia.

Yard Completion MARCH 2007

GAPTM Gravity Actuated Pipe Fluid Transfer System

A major achievement during the year was the fabrication installation, hook up, and

commissioning of the GAP™ system for the transfer of multiple live produced fluids on the

Kikeh Field offshore Malaysia for Murphy Sabah Oil Company Ltd.

AUGUST 2007

TRELLINE OIL OFFLOADING LINE

The TrellineTM, a near-surface flow transfer for export of stabilised crude oil was developed in

cooperation with Trelleborg. Following its installation at the Bonga field in Nigeria, it has been

operating in accordance to with expectations.

MAY 2007

P-53 The World’s Largest Internal Turret Mooring System has been built. Designed for 1,084

meters water depth, the 73 meter high turret is fitted in to a 25.2 meter diameter moon-pool.

The unit also features a stack of 11 product swivels, including the world’s largest swivel.

JUNE 2007

NEPTUNE’ SEASTAR® TLP

Delivery of one of the world’s deepest Tension Leg Platforms ‘TLP’, the Neptune TLP is

capable of producing 50,000b/d of oil, 50 million scf/d of gas and 30,000b/d of water.

JUNE 2007

GREATER PLUTONIO DEEPWATER CALM BUOY

SBM Offshore’s first Deepwater Buoy for British Petroleum ‘BP’ installed offshore Angola.

AUGUST 2007

KASHAGAN FLASH GAS COMPRESSION BARGES

3 UNITS

SBM Offshore handed-over of the first two units to Agip KCO. The third barge is still in Dubai

undergoing the last modifications requested by our Client and is scheduled for completion in

March 2008 for shipment to the Caspian Sea.

31st JULY 2007

FPSO MONDO

The FPSO was converted at Keppel TUAS Shipyard in Singapore with engineering performed

in Monaco and Schiedam.

Yard Completion SEPTEMBER 2007

On site Angola OCTOBER 2007

First oil JANUARY 2008

This was the first time the Company executed a project with a joint SBM Offshore/ MISC

project management team. A substantial part of the construction work was subcontracted to

the MMHE shipyard and the project achieved timely completion.

Two challenges with this project were the application of SBM Offshore’s newly developed fluid

transfer technology is concurrent with detailed engineering. The complete system, including

the launch of the GAP™, tow to site, and hook up between the Dry Tree Unit and the FPSO

was performed by the Company’s installation vessel the ‘Normand Installer’.

The Trelline™ concept is based on the utilisation of a bonded rubber hose. The Trelline™, with

a total length of over 2,000 metres and a 20 inch diameter, is suspended between the spread

moored FPSO and the SBM Offshore supplied export buoy at a depth of about 100 metres

under water.

A major engineering challenge in terms of magnitude,

the turret unit includes 75 flexible riser and umbilical slots. It includes over 1,900 metric tonnes

of piping material, more than 7,000 metric tonnes of steel, more than 3,000 valves, and 22 pig

launchers/receivers.

The entire facility was supplied under a turnkey EPCM contract that included design,

engineering, procurement and construction as well as assistance in management of the

installation. Construction began just as the Gulf of Mexico’s coast was ravaged by the one-

two punch of hurricanes Katrina and Rita.

This project was completed at the Sonamet yard in Lobito, Angola. An important feature of

the contracts for deepwater export systems is that a very large part of the construction of the

buoys, as well as the suction piles for the anchoring systems, is performed at local yards in

Angola.

The contract scope doubled during the execution phase.

Two of the barges were shipped from Dubai to Kuryk in the Caspian Sea for final assembly

and commissioning, before offshore installation under the responsibility of Agip KCO.

It is recognized to have met the Client’s production target in the prevailing tight supply market

and increased equipment delivery schedule is a significant achievement.

SBM Offshore’s Installation and Services Vessel, the Normand Installer, executed the FPSO

hook-up and support to riser installation.

Our Achievements Our ChallengesPROJECT DELIVERY / COMMISSIONING 2007

23

SBM Offshore > KEY ACHIEVEMENTS & CHALLENGES 2007

Our Commitments

• Employing people following the principles of equal opportunity

• Communicating in an honest and clear manner

• Striving for continuous improvement of our environmental impact

Our Code of Conduct clarifies the responsibilities of SBM Offshore and of its employees to each other, Clients, Partners, Capital Providers, Suppliers, Society, and the Environment.

In respect of Social Responsibility, SBM Offshore adheres to international standards such as the Universal Declaration of Human rights, the OECD guidelines for multinational enterprises, ILO convention, and the UN Global Compact.

(Excerpt from SBM Offshore’s Code of Conduct)

This is available on the Company website http://www.sbmoffshore.com =>Section: Corporate Governance


2� SBM Offshore I Corporate Social Responsibility Report 2007

Moral Code

Priorities Commitments Accomplishments Future Targets 2008+

Familiarise all employ-ees, contractors, and temporary staff with our principles and practices

Ensure the proper appli-cation of the Code of Conduct

Expanded Code of Conduct revised in May 2007

Awareness of revised Code of Conduct to be made to all of our employees

Whistleblower Policy published on CIS for employees

Establish an external line for reporting on moral issues

Environment

Priorities Commitments Accomplishments Future Targets

Strengthen the Environmental Management System

ISO 14001 EMS system progressively in place for full fleet

Brazil fleet certified by ABS

West African Fleet in 2008

Recycling programs Recycling of office wasteRecycling is performed but not monitored

Commence monitoring the amounts of waste recycled

Emissions monitoring for offshore production

CO2 registers to be kept for all Floating Offshore Production Units

Brazilian Fleet report to Client annual emissions

2 FPSOs starting up in 2008 to begin monitoring in Angola

Health


Health at WorkEnsure better health of employees

Implementation of anti-smoking workshops “Alan-Carr”

Encourage employees to stop smoking.Encourage staff by low subscription fee to join company training facilities

Implementation of two “sports” physical educa-tion training centres for employees

Encourage employees to get fit by offering a very low subscription fee to join company training facilities

Health and Safety PolicyPublish HSE Policy on company website 2008

Health, Malaria & Aids Policies

Available to all SBM offshore personnel and contractors

Health and Safety PolicyPublish Policy on company website 2008

Commitments, Accomplishments and Future Targets

2�

SBM Offshore > KEY ACHIEVEMENTS & CHALLENGES 2007


Safety


Reduce accidents where we have control and direct influence

Keep track of all incidents both for our own people and our subcontractors

New reporting system in place SIRS

Improve analysis of accidents and implementation of corrective actions.

Single Incident Reporting System (SIRS)

Implement SIRS wherever SBM Offshore is present

Already implemented on 80% of Offshore Floating Production Units

All new FPSOs on site in 2008 to use SIRS

Keep Lost Time Accident (LTA) to a minimum

Zero accidents Good performance resultMaintain our progress and target on zero accidents

Human Resources


Social Accountability Implementation

Protect the interests of our employees and those of our subcontractors working in non-OECD countries and socially unstable communities

Social Accountability Manual written and ready for implementation

Myanmar and Brazil shore-bases ready for Social Accountability implementation and internal compliance audits

Brazilian Offshore Units Nationalisation program

75% staff onboard all 4 of our FPSO’s are Brazilian nationals

2 out of 4 FPSO’s now employ 75% nationals offshore

Target for the other existing 2 FPSO’s to be met in 2008

Community Involvement


Child Day-Care Centre, Monaco

Creation of a day-care centre for 30 infants for SBM Monaco employees’ children

Monaco day-care centre completed and funded by the Company

Keep subscription costs to a minimum

Paenal Fabrication Yard, Angola

Development of a Fabrication yard that can boost local Angolese community

Phase one implemented and training school started

Phase two [2] 2009, train and employ full-time 750 nationals at onshore-off-shore division Phase three [3] 2011, train and employ full-time 1000 nationals at ship repair division*Go to Section Social Responsibility and Local Development, page 56


Corporate Principles and PracticesSBM Offshore realises that it is essential to work in a sustainable

way. The Company is exceedingly concerned about the

consequences of our actions either in the form of positive or

negative impact on society at large.

SBM Offshore is committed to operate our business openly and

honestly, guided by the principles laid down in the Company

Code of Conduct, which includes conducting our business with

emphasis on sustainable development.

This is available on the Company website http://www.sbmoffshore.com =>Section: Corporate Governance in addition to the Corporate Intranet Site [C.I.S.]

From principle to practice, the Code of Conduct is the

most important reference document for the Company’s

employees, including contractors and part-time employees,

and henceforward defines the framework for the Company’s

practices and ethics. The Code of Conduct governs our actions

across our business activities wherever we are present.

Corporate Governance StructureSBM Offshore is a Naamloze Vennootschap (Public Limited

Company) incorporated under Dutch law with its statutory seat

in Rotterdam, the Netherlands.

The authorised share capital is divided into ordinary shares

and preference shares. Only ordinary shares have so far been

issued. The ordinary shares are listed at the stock exchange of

Euronext Amsterdam as part of the AEX index. The preference

shares will only be issued under certain circumstances as an

anti-takeover protection measure.

The Company has a two-tier Board structure where the

Supervisory Board consists of five persons. The Board of

Management currently consists of one statutory member

and four non-statutory members. No member of the Board of

Management is a member of the Supervisory Board of any

other listed company. The Company has not granted personal

loans or guarantees or other financial support to any of its Board

of Management members and will refrain from doing so in the

future. None of the members of the Board of Management had

a conflict of interest with the Company during the year 2007.

The Supervisory Board has established an Audit Committee,

a Remuneration Committee, and a Selection and Appointment

Committee.

Dutch Corporate Governance CodeThe Board of Management and the Supervisory Board have

evaluated the corporate governance structure of the Company in

the light of the Dutch Corporate Governance Code (‘the Code’),

as formulated by the Tabaksblat Committee and published on

9th of December 2003. SBM Offshore is obliged to comply (or

explain any non-compliance) with the Dutch code, also known

as “Tabaksblat” after its Committee Chairman at the time, Morris

Tabaksblat.

SBM Offshore has continued to refine procedures and activities

in order to comply with the best practice provisions of the

Tabaksblat Dutch Corporate Governance Code (‘the Code’)

and the deliberations of the Frijns Monitoring Committee.

In 2007, the Company revised the contents of the Code of

Conduct with focus on implementation initiatives. This includes

a communication and implementation process which applies

to all permanent employees, temporary personnel, and

contractors.

(5.1) Corporate Governance and Management Systems

2�SBM Offshore I Corporate Social Responsibility Report 2007

Management Board: Role, Procedures, Remuneration, Conflicts of Interest

Supervisory Board: Role, Procedures, Independence, Expertise & Composition, Chairman’s Role, Key Committees, Conflicts of Interest, Remuneration

Shareholders & General Meetings: Powers, Provision of Information, Meeting Logistics, Investors’ Responsibilities;

Financial Reporting & Audit: Financial Reporting, External Auditor, Internal Auditor

In 2007, the Company revised the contents of the Code of Conduct with focus on implementation initiatives.

This includes a communication and implementation process which applies to all permanent employees, temporary

personnel, and contractors.

Tabaksblat includes chapters on the following:

Detailed provisions within each of these chapters describe what is deemed to be “Best Practice” in the way the

company should be governed, and set out where relevant information should be disclosed such as in an Annual

Report or on the SBM Offshore website, where all relevant regulations can be consulted.

Inevitably, the obligation to disclose compliance with the Code leads to a “box ticking” approach by analysts

seeking to identify well-governed companies. SBM Offshore wishes to be considered as well-governed although

this involves sometimes having to bridge cultural or contextual differences in the process.

The Rules of Conduct relating to Suspected Irregularities or better known as the “Whistleblowing” rules are an

example of this. Tabaksblat states that the company must establish a set of rules which indicate to employees

how they should report internally any suspected irregularities of a general, operational, or financial nature. The

Whistleblowing rules have been developed to observe the Tabaksblat requirements. They are there to protect the

interest of the whistleblower and to formalise a reporting process.

The “Whistleblowing” rules are available on the Company website http://www.sbmoffshore.com =>Section: Corporate Governance, in addition to the Corporate Intranet Site [C.I.S.]

SBM Offshore > BUSINESS PRINCIPLES & CORPORATE GOVERNANCE


REFERENCE DOCUMENT PUBLISHED

Code of Conduct

The Company’s corporate responsibilities are expressed in the Code of Conduct, first published in May 2000 and updated in May 2007. This document lays out the Company’s view of its responsibilities to Clients, Employees, Suppliers, Society / Communities, Environment and Shareholders / Capital Providers. It forms the basis for the Company’s daily performance of its business, and the Company is actively accountable for compliance with this code.

www.sbmoffshore.com

Corporate Intranet Site

Corporate Governance Code

The Board of Management and the Supervisory Board have evaluated the corporate governance structure of the company in the light of the Dutch Corporate Governance Code (‘the Code’), as formulated by the Tabaksblat Committee and published 9th of December 2003.

www.sbmoffshore.com


Rules of Conduct relating to Suspected Irregularities

The Managing Board ensures that employees have the possibility of reporting alleged irregularities of a general, operational and financial nature in the company to the Chairman of the Managing Board or to an official designated by him, without jeopardising their legal position. Alleged irregularities concerning the functioning of Managing Directors may be reported to the Chairman of the Supervisory Board.

www.sbmoffshore.com


Remuneration Policy

Has been designed to ensure that Managing Directors receive for their work a remuneration package, which enables qualified and expert persons to be promoted, retained or recruited if necessary.

www.sbmoffshore.com


SBM regulations concerning inside information

The Managing Board of SBM Offshore having obtained the Supervisory Board’s approval, has adopted regulations concerning inside information and the holding of and effecting transactions in Securities, updated in 2007.

www.sbmoffshore.com


Rules governing Supervisory Board’s principles and Best Practices

The division of duties within the Supervisory Board and the procedures of the Supervisory Board are laid down in the enclosed set of regulations.

www.sbmoffshore.com


SBM Offshore CSR Reference Documents and Monitoring

SBM Offshore has Policies and Rules in place which govern our activities in the various business segments that are ISO

9001:2000 certified. The Company sees it’s responsibilities towards:

• Customers / Clients

• Suppliers

• Employees

• Providers of Capital

• Public Sector

• Environment, Society and Communities

2�SBM Offshore I Corporate Social Responsibility Report 2007

REFERENCE DOCUMENT PUBLISHED

Profile of the Supervisory Board’s Scope and Composition

Based on Article 3.1 of the Rules of the Supervisory Board

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Annual Report

Regulations for the Three Key Committees

The Supervisory Board has established three key committees in accordance with the Code. The composition of the committees and their respective rules are set out as follows: • Audit • Remuneration • Selection & Appointment

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Audit Committee

Based on article 5.1 of the Supervisory Board’s Rules

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Remuneration Committee


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Selection and Appointment Committee


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Protection Policy

The Company remains firmly opposed to a take-over by a third party when in its opinion the ultimate aim of such take-over is to dismantle or un-bundle the activities of SBM Offshore, or otherwise to act against the best interests of SBM Offshore including its shareholders, employees and other stakeholders.

In order to allow sufficient time for an appraisal of an unsolicited public offer for the shares of the Company or any other attempt to take over the Company, Management has, with the cooperation of the shareholders, made use of the possibilities open to a company under Dutch law and in the Dutch business sphere.

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SBM Offshore HSE Charter

SBM Offshore is committed to supporting, implementing and continually improving the Health, Safety and Environmental (HSE) requirements within the Company’s business activities.


Mission Statement

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Annual Report

The SBM Offshore Business Policywww.sbmoffshore.com




1. SBM Offshore Management System Manual Part 1 General

2. SBM Offshore Management System Manual Part 2 Business Systems

3. SBM Offshore Management System Manual Part 3 HSE

4. SBM Offshore Management System Manual Part 4 Security

The corporate system of internal control is published in the SBM Offshore Management System. This compound system of inter-

nal controls consists of a comprehensive set of management systems, organisational structures, work instructions, procedures,

and standards that are utilised to perform the business of the Company and deliver returns to our stakeholders.

Risk ManagementThe Company continues to develop and improve its Corporate Governance systems along the lines of the COSO Enterprise

Risk Management Guidance, although best practices will be adopted and adapted from wherever they originate.

For more information regarding Risk Management procedures, please consult the SBM Offshore Annual Report 2007, Section: Corporate Governance and Risk

Management, page 37.

(5.2) Quality Assurance Management Systems and Framework

31



The SBM Offshore Corporate Mission is:

Towards Clients

• to provide superior products and services through

innovative, fit-for-purpose and competitive solutions for the

offshore oil and gas industry;

• to design, construct, install, maintain and operate such

facilities in a safe and environmentally sound manner.

Towards Employees

• to generate an attitude of enthusiasm and pride

throughout the Company, through promoting

high-technology products and providing a most

favourable environment for professional and personal

development, and to highly reward it.

Towards Shareholders

• to constantly improve our know-how and efficiency, with

the objective to generate returns well above cost of

capital;

• to maintain a high degree of transparency and reliability;

• to provide double digit yearly EPS growth.


(6.1) SBM Offshore’s total amount of exposed work hours from Onshore Operations

and Offshore Production in 2007 was 8.4 million manhours.

The total amount of exposed work hours from our sub contractor’s activities at the

various construction yards for Onshore Operations totalled 44.2 million manhours.

Combined exposed work hours from Onshore Operations and Offshore Production,

including our sub contractors, totalled 52.6 million manhours.

ONSHORE OPERATIONS

SBM Offshore4 EXECUTION CENTRES & CORPORATE FUNCTIONS OFFICES

4,912,362

Main SubcontractorsYard Fabrication / Construction Operations

44,153,500

OFFSHORE PRODUCTIONSBM OffshoreLease/ Operate Fleet Floating Production and/or StorageUnits

3,557,955

COMBINED ONSHORE OPERATIONS & OFFSHORE PRODUCTION

TOTAL EXPOSURE HOURS 2007

52,623,817

(6.2) Reporting Segments

The Health, Safety, Security, and Environment (HSE) section

is split into two parts for reporting purposes. These are the

engineering design and construction phase of a product (referred

to as Onshore Operations), including installation services, and the

fleet of offshore production units that are leased and operated

on long-tem contracts (referred to as Offshore Production).

The reporting scope will commence with Onshore Operations

and then report on Offshore Production.

HSE awareness relative to both parts of SBM Offshore’s

activities has always been a key element of the Company’s

Management System. The system is continuously driven and

enhanced by line supervision, both onshore and offshore. The

Company endeavours to continuously improve the quality of

the implemented HSE procedures and to mitigate all HSE and

security risks. SBM Offshore sees this as a duty of care to protect

all personnel within each and every type of operation from

potential health hazards. Our goal is for no harm to any of the

workforce, either to SBM Offshore employees or the personnel

belonging to our contractors and subcontractors working on

our projects. The most important target is zero accidents and

zero incidents and the highest standards of environmental

protection.

Contractors and SubcontractorsOnshore Operations, with emphasis on construction of

facilities supplied or leased by SBM Offshore, are outsourced

to dedicated subcontractors worldwide. Activities take place

in the Far East (Singapore and Malaysia), the Middle East

(The United Arab Emirates), and the U.S.A.

Subcontractors are selected and approved in accordance with

a strict qualification programme, in compliance with established

Company criteria.

SBM Offshore implements Safety Management at all the

construction yards in close co-operation with our contractors

and subcontractors. SBM Offshore’s contractors and sub-

contractors are required to submit for approval a “Site Specific

Health, Safety and Environmental Plan” for the scope of work

contracted to them. This plan is reviewed, commented on as

necessary, and clarified with the yard’s management prior to

being implemented on a project. Such a plan addresses all

Statutory HSE requirements, those requirements stipulated by

our Client and the SBM Offshore Management System.

SBM Offshore performs audits at construction yards the

Company intends to use, in order to assess the yard’s quality,

health, safety, and environmental performance.

Audit procedures cover policy, leadership and commitment,

management system, responsibilities and procedures,

identification of hazards and risk assessments, competence

assurance and training, compliance with health, safety, and

environmental regulations, storage and waste management,

preventative actions (energy saving, recycling, use of

refurbished equipment, etc.), internal audits, management

reviews, and auditing suppliers. Audits are also carried out

periodically during the construction period.

33

SBM Offshore > HEALTH, SAFETY, ENVIRONMENT & SECURITY


H.S.E. calculations are based on the amount of work

hours spent in 2007; 53 million manhours


The principal objectives of these audits are to confirm that

existing controls are being implemented effectively, identify

any omissions and assist contractors and subcontractors to

improve their management systems. The approval status of a

subcontractor is subject to periodic re-assessment.

Single Incident Reporting System (SIRS)All HSE data for Onshore Operations and Offshore Production is

recorded in the Company’s in-house designed database SIRS.

This is a powerful tool that enhances the ability to identify urgent

problems, longer trends, and their corrective actions, allowing

them also to be tracked to completion. This facility will augment

our ability to better control risks and thereby to reduce costly

incidents.

During 2007, SBM Offshore’s HSE incident investigations,

reporting and recording undertook a rationalisation process

to encompass the Company as a whole and to include its

subcontractors’ HSE performances.

All incident classifications were aligned with those of OSHA,

the American-based Compliance Authority’s methodology for

the reporting of incidents. As a result, it is not appropriate to

compare the Company’s performance statistics recorded up

to the end of 2006 with those of 2007. The recorded data and

resulting statistics which are now presented include all incident

reporting from the Onshore Operations and construction yards

in the same manner as reporting for the offshore production

units.

The objective of SIRS is to record all incidents, irrespective

of severity, that occur in each location where the company

operates; this includes our major subcontractors.

The purpose is three-fold:

• to provide Company Management with an overview of all

incidents that occur throughout the organisation;

• to ensure all incidents are identified and fully investigated;

• to be able to identify negative indicators early.

Onshore Operations statistics will include all incidents and

frequency measurements from our own operations. In addition,

the report will also cover HSE statistics of our subcontractors as

well as a combined total.

Offshore Production statistics will report on the performance of

the offshore production facilities.

3�



Incident classifications and reporting systems are based on the United States OSHA classifications:

Accident: An unplanned or undesired event that can result in harm to people, property or the environment.

Fatality: Death due to work-related injury or illness.

Lost Time Accident (LTA): Statistics are based upon industry OSHA standards, which define an LTA as an accident leading to one or more

working days away from work.

Lost Time Accident Frequency Rate (LTAF): Is calculated by multiplying the total number of accidents by 200,000 and dividing this by the total

number of manhours worked in relation to the activities reported.

Lost Time Incident (LTI): Is defined as an incident or an event that results in a lost-time accident as described above and/or injury to personnel,

or damage to property resulting in production down-time.

Lost Time Injury (LTI): Work related injury or illness that renders the injured person unable to perform any of their duties or return to work on a

scheduled work shift, on any day immediately following the day of the accident.

Medical Treatment Case (MTC): Work related injury or illness requiring more than first aid treatment by a physician, dentist, surgeon or

registered medical personnel.

Near Miss Case (NMC): When an incident takes place that could have resulted in an injury, but did not.

Restricted Work Case (RWC): Work related injury or illness that renders the injured person unable to perform all normally assigned work

functions during a scheduled work shift or being assigned to another job on a temporary or permanent basis on the day following the injury.

Please note: The acronym LTI is used for both terms “lost time injury” and “lost time incident”, as there cannot be a lost time incident without

an injury.

Days Lost Recorded

When calculating lost time days and restricted work case incidents all calendar days (including week-ends, public holidays, etc.) are included

and start from the day following the incident.

First Aid Cases (FAC) are recorded and included in the incident reporting and investigation system but not included in the Injury Frequency Rate

calculations.


(6.3) Onshore Operations

The following incidents occurred from all onshore activities including execution centres.

Recordable Incident ReportingThe charts below show the numbers of all recordable incidents from Onshore Operations (including Restricted Work Cases and

Medical Treatment Cases), together with Near Misses and are divided in to the following categories:

3

Main Subcontractor Incidents: 2007

15

Combined SBM & Subcontractor Incidents: 2007

23

Days Lost Recorded: When calculating days lost for lost time and restricted work case incidents all calendar days (including week-ends,

public holidays, etc.) are included and start from the day following the incident.

First Aid Cases: are recorded and included in the incident reporting and investigation system but not included in the Injury Frequency Rate

calculations.

3�



SBM Offshore deeply regrets three (3) fatalities that occurred to the workforce belonging to our subcontractors. Two cases took

place at the construction yards and the third incident occurred at one of the company’s FPSO’s.

The first incident occurred in May 2007, in Singapore at a subcontractor fabrication facility. A helper was crushed beneath a metal

plate while trying to guide the load by hand during a lifting operation.

The second occurred in August 2007 at a government port facility in Abu Dhabi, United Arab Emirates.

During this incident, a foreman rigger was killed when the lifting assembly he was removing, dropped from its position and caused

him to fall onto the vessel deck.

The third incident took place in May 2007 in Brazil. During a diving operation at an FPSO, a subcontractor’s diver drowned due

to the failure of his air supply. The incident investigation team found that the critical factor leading to this accident was the diving

contractor’s failure to follow standard diving industry practice. The incident resulted in SBM Offshore issuing a stringent set of

procedures for all diving operations under any circumstances and for all personnel involved, including those of our subcontractors.

Compliance with these procedures is essential and mandatory.

In addition to the investigations conducted by police and local H.S.E. compliance authorities, all three fatal incidents were investigated

by our subcontractors with support and assistance from SBM Offshore. Although SBM Offshore was found in no way responsible

or liable, every effort was made to improve the management of H.S.E. on our own projects and to influence the highest standards

of safety performance of our subcontractors and of our suppliers.

Comparative Incident RatesThe OSHA statistics for 2006* showed that the H.S.E. performance of SBM Offshore was well under the industry average as

demonstrated in the table below published by US department of Labor.

A) Oil and Gas Extraction

B) Heavy and Civil Engineering Construction

C) Fabricated Metal Product Manufacturing

* 2006 are the latest figures available in the OSHA database.

US Dept. Labor 2006* Incidence Rates SBMO 2007 Rates

1 2 3 4 5

Oil and GasHeavy

ConstructionFabricated Metal

ConstructionSBMO

SBMO(Including Fatalities)

LTI(Cases with days away from work)

0.5 2.0 1.8 0.0303 0.0418

Fatalities


This section covers the HSE performance of the Company’s Offshore Production Units’ where SBM Offshore has operational

management of production as well as the responsibility for onboard personnel (SBM Offshore’s management personnel, ship-

crew, and short-term visitors onboard; such as subcontractors for maintenance).

Exceptional HSE performance is recognised as an indicator of the effective overall management of SBM Offshore.

In 2007, the amount of manhours for Offshore Production totalled 3.6 million.

The LTAF graph for the last 5 years demonstrates a continuing improvement trend in LTAF statistics for SBM Offshore production

personnel reaching the ultimate of zero LTAF for 2007.

This is the result of the commitment by all employees to ensure that all offshore operation activities are conducted in a healthy

and effective safety manner.

The adoption of common H.S.E. standards fleet-wide and increased cooperation with clients and subcontractors has helped to

develop an increased awareness of safety expectations adjusted to local conditions. This has enabled a process of continual

improvement in health and safety performance. Locally employed professional safety staff combined with organised safety

incentive schemes have helped to produce a more positive approach to safety.

Pro-active policies have contributed to the prevention of diseases such as Malaria and occupational illnesses.

An occupational illness (or disease) is defined by OSHA as, “any abnormal condition or disorder, other than one resulting from

an occupational injury, caused by exposure to factors associated with employment.”

Offshore Health & SafetyThe Company has a duty of care to protect personnel within its operations from the potential health hazards posed by hydro-

carbon processing and by toxic substances. Internal expertise and a management system in this area are supplemented by third

party preparation of Operational Safety Case studies.

All units converted to F(P)SOs since the year 2000 have been made asbestos-free, meaning that all known asbestos was

removed during the conversion period. For the units converted before 2000 the use of a strict policy concerning asbestos is in

place onboard the F(P)SOs. All units apart from New Builds have an asbestos register recording any and all asbestos material’s

type and location.

(6.4) Offshore Production

The 2003, 2004, 2005 and 2006 data entries have not been verified by our external assurance provider PricewaterhouseCoopers

0.99

0.7 0.68

0.55

0.28

0.680.51

0.470.41

0.41

0.44

0.3

0.430.47

0.410.36

0.320.35

0.390.36

0 0 0 0

0.130.11 0.09 0.08 0.07 0.06 0.06 0.05

0 0 0 0

0.15 0.13 0.12 0.11

0 0 0 0

1.5

1.4

1.3

1.2

1.1

1

0.9

0.8

0.7

0.6

0.5

0.4

0.3

0.2

0.1

0

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

2003

2004

2005

2006

2007

3�



Any work in the vicinity of asbestos material is to be executed by a licensed asbestos removal contractor. A code of practice

covering asbestos management, integrating the DOT Merchant Shipping Notice M 1478 ‘Asbestos Health Hazard and Precautions’

and the UK Statutory Instrument Number 2675 ‘Control of Asbestos at Work Regulations’, is applicable to all persons on-board

F(P)SOs of the Company.

SBM Offshore applies other codes of practice covering benzene and mercury management onboard its F(P)SOs.

Security IssuesSBM Offshore operates in some of the more hazardous regions of the world, which necessitates a more rigorous approach to

the safety and security of people and assets in those countries. In this respect, a specialist security advisor was engaged at the

beginning of 2007 when it became apparent that SBM Offshore’s workforce and associates would be facing increasing security

risks.

The unstable situation in the Delta Region of Nigeria has taken priority in this respect and solutions had to be found to ensure the

safety of SBM Offshore travellers, local staff, installation vessels, and others involved in operations in the Region. In May 2007,

FPSO Mystras, located offshore Nigeria and operated by a Joint Venture, was attacked by criminals. When attacked again in

October 2007, the aggressors took 12 hostages after commandeering a visiting supply vessel to gain access to the FPSO. The

hostages were released later the same day, without harm, following local political intervention.

SBM Offshore has participated in every opportunity to meet with its peer companies who also operate in this Region to discuss

the Nigerian situation. The Company has consequently implemented a thorough risk assessment process.

Direction for 2008Although the H.S.S.E. statistical results given above are far better than industry accident levels recorded by OSHA, SBM Offshore

will continue to improve its safety performance in pursuit of the goals set out in Group policies and in the Code of Conduct.

As 2008 progresses, HSE will feature more strongly in the construction activities of the Group with higher standards and rigorous

implementation throughout its operations, including those involving the offshore production units. The following activities are

planned:

• A substantial review of HSE requirements stipulated to subcontractors prior to the invitation to bid stage.

• The thorough review of HSE requirements in negotiations between SBM Offshore and its potential clients. This will

obviate belated discussions of differences in performance expectations after contract signature. Client HSE requirements

are continually increasing in scope and importance. These requirements must be made back-to-back with our sub-

contractors to ensure uniformity of HSE expectations and standards.

• The Single Incident Reporting System (SIRS) will be continuously reviewed and upgraded to better serve the needs of the

company and its clients.

• The development of audio / visual and digital training aids for use at site. These will be, where feasible, provided in the

local languages and often contain self-teaching and self-assessment facilities.

• Providers will be engaged to teach managers and supervisors, both SBM Offshore and subcontractor staff, the skills to

enable them to engage with and influence people at the work area.

• A review of security threats and risk assessments across all regions.

Security will be enhanced by the introduction of more appropriate security procedures and training for personnel who work

and visit the more hostile environments and by improved internal auditing and management of security. Related training will be

provided to local staff, including guards and drivers, in troubled regions.

�0 SBM Offshore I Corporate Social Responsibility Report 2007

Responsible OperationsOur Clients are increasingly concerned that the activities carried

out by SBM Offshore on their behalf are conducted in the most

environmentally friendly manner and do not result in damage to

any of the fragile local ecological systems where SBM Offshore

is present.

SBM Offshore is aware of the potential environmental impacts

associated with the handling of hydrocarbons offshore and

is fully committed to safe operations and protection of the

environment. Within the broad scope of environmental aspects

related to its operations, special attention is paid to avoidance

of oil leakages, to the prevention of unnecessary flaring or

emissions to water and air, and to minimising the use of

energy.

Our Company standards and code of practice tailored for each

unit provides detailed requirements on the control of the work

and integrity management onboard;

• to comply with local environmental laws;

• to comply with MARPOL, the international marine

environmental convention to minimise pollution of the seas;

• to ensure high standard Environmental Management

Systems (EMS), meeting the requirements of ISO 14001;

• to control and reduce pollution emissions and to minimise

waste production;

• to comply with Company procedures for the safe handling,

storage, and disposal of hazardous waste;

• to raise environmental awareness through training and

instruction.

ISO 14001:2004 does not specify levels of environmental

performance but details the requirements for an environmental

management system. Fulfilling these requirements demands

objective evidence, which can be audited to demonstrate that

the Environmental Management System (EMS) is operating

effectively and in conformity to the standard.

During 2007, SBM Offshore’s Brazilian fleet consisting of four (4)

FPSO’s; Espadarte, Brasil, Marlim Sul, and Capixaba obtained

certification that their individual Environmental Management

Systems are in accordance with ISO 14001 objectives and

targets. The external verification was conducted by ABS.

The remainder of the Fleet is ISO 14001 compliant according to

internal audits; steps are being taken to continue the external

verification process with focus primarily on the West African

fleet.

For more information please see Compliancy Matrix Section 3.4.

For the Brazilian fleet of offshore production units, all emission

data is collected and reported to our Client, Petrobras for

incorporation in their emission reporting system on a monthly

basis. All offshore production units have ISM certification. The

purpose of the ISM Code is to provide an international standard

for the safe management and operation of ships and for

pollution prevention.

Operational Integrity AuditIn 2006 SBM Offshore carried out Operational Integrity Audits

in conjunction with ExxonMobil on the FPSO Serpentina in

Equatorial Guinea, and on the FPSO Xikomba in Angola,

receiving scores of 95.8% and 98.3% respectively.

In 2007 the OIA audits were again carried out on the FPSO

Serpentina and on the FPSO Xikomba with the scores in this

year being 97.9% and 97.4% respectively.

(6.5) Environmental Responsibility and Offshore Production

�1


SBM Offshore is a service provider for the oil and gas pro-

ducers. The production of oil and gas provides energy for the

world, but unavoidably creates environmental emissions. SBM

Offshore adheres to the regulations set by international treaties

and the relevant governments. In all its operations SBM

Offshore applies a strict reporting system on environmental

incidents involving leakage of oil or release of gas or chemicals,

irrespective of quantities. The data of environmental incidents

are incorporated and registered in the SIRS database. At the

beginning of every year, an Annual H.S.E. report concerning the

offshore production fleet performance is presented to the Board

of Management. Special attention is given to environmental

issues, such as waste management and an overview of spills.

To ensure that there are no unintentional emissions due to

accident, mal practice, or equipment failure, our designs are

subjected to a structured series of formal safety assessments

where all major accident hazards scenarios are identified and

assessed.

The output from this formal safety assessment process is

documented in design and operational safety cases for

each of our offshore production units which ensure that

appropriate management system arrangements are in place

to manage residual hazards. Unless dictated by contract or

operating country legislation, the SBM Offshore safety cases

are compiled to be generally in line with the United Kingdom

Offshore Installations (Safety Case) regulations 2005 (SCR05).

This ensures that each of our offshore operating units is safe

and operates in such a manner to have minimal impact on the

environment.

Pollution

No major pollution incident involving FPSOs or FSOs has

occurred anywhere in the world at any time, including 2007.

Within the Company, management of pollution risk starts, for

all converted units sold or leased, with stringent hull selection

and refurbishment procedures and the formal interrogation

of the design of process facilities to demonstrate safety and

operability. All units presently owned by the Company have

certified service lives that go far beyond their contractual

commitments.

Once in service, the Company maintains the general integrity

of the fleet through the application of:

• strict operating procedures and preventive maintenance

programmes;

• careful selection and intensive training of high-quality

personnel and direct employment of all positions of

responsibility aboard the units;

• management system accreditation by the Classification

Society ABS and compliance with the requirements of the

International Safety Management (ISM) Code 2002.


(6.6) Environmental Performance Indicators


Fleet Environmental Loss Statistics December 2007

SBM Offshore measures all unintentional and intentional

emissions to land, sea, and air on a regular basis, with registration

being implemented in the SIRS database. In 2007, a total of 37

incidents were registered. This includes the environmental

incidents statistics from the production floating units that are in

Joint Venture ownership, but where operational control is not

managed by SBM Offshore.

For the 12 offshore units included in the reporting scope, 25

incidents were registered. 23 of the reported incidents were

contained spills and not discharged to sea.

Two (2) accidental spills to sea took place onboard two of the

Brazilian production units;

• The first incident small quantities of Marine Gas Oil (MGO)

leaked over board during bunkering and;

• The second, a crude oil release, entered into the sea from

an FPSO loading line as result of bursting disc rupture.

It should be noted that in all other incidents involving leakage of

oil, such leakage has been contained on board the units via drain

systems, which form an integral part of the facilities design.

In 2007, the Company’s Onshore Operations and Offshore

Production emitted CO2.

The primary sources for discharges from Offshore Production

are the Greenhouse Gas Emissions (GHG) from combustion,

which occurs during offshore operations. Main sources of the

combustion GHG are emissions from gas usage for boilers,

gas usage for turbines, diesel usage for engines, boilers and

turbines.

For the Onshore Operations, the calculated CO2 footprint is from

indirect energy consumption. This is mainly electricity purchased

from energy suppliers for office lighting, heating, cooling and

running of office facilities.

This is applicable only to our 4 execution centres and corporate

functions office and the data does not include the shorebases

and sub contactors’ construction yards.

�3



EMISSIONS DATA - SBM OFFSHORE GREENHOUSE GASES (GHG). 2007

OFFSHORE PRODUCTION 12 Units as per chapter 3.5TOTAL GHG AIR EMISSIONS BY WEIGHT Metric tonnes equivalent

Primary GHG emissions from combustion

CO 5,241

NOX 4,202

NO2 149

S02 100

CH4 10,488

VOC 1,150

CO2 1,296,735

CO2 Breakdown by region :

ASIA

CO2

111,657

BRAZIL 831,629

CASPIAN 3,722

RUSSIA 7,176

342,551

CONTAINED SPILLS ONBOARD 23

EXTERNAL SPILLS TO SEA 2

ONSHORE OPERATIONS 4 Execution centres and corporate function office

Indirect energy usage GHG emissions

Total in metric tonnes equivalent CO2 5,184

Electricity usage In million KW hours KWh 9.9

Calculation of CO2 from KWh, based on industry standard DEFRA

WEST AFRICA

�� SBM Offshore I Corporate Social Responsibility Report 2007

SBM Corporate Responsibilities Towards Employees

To generate an attitude of enthusiasm and pride throughout the Company,

through promoting high-technology products and providing a most

favourable environment for professional and personal development, and to

highly reward it….

��

SBM Offshore > SOCIAL RESPONSIBILITY & LOCAL DEVELOPMENT

(7.1) Human Resources Management

SBM Offshore prides itself in being an equal opportunity

employer. The Company considers that cultural diversity

brings an extra dimension and added value to the business.

SBM Offshore employs staff of 40 different nationalities and

the interaction of these varied cultures is seen to be beneficial

in the understanding and resolution of work-related problems.

SBM Offshore regards diversity as strength and an advantage.

Having a diverse workforce contributes to our growth strategy,

providing competitive power, and ability to build stable

relations. The Kuala Lumpur execution centre is an example

of the Company’s growth strategy and contributed significant

additional vigour to SBM Offshore’s existing diverse workforce

and is ideally placed to develop opportunities in the region of

South East Asia.

Total Workforce 2007

On 31st December 2007, the total headcount for SBM Offshore

was 4,402 employees. This figure covers all staff employed

on temporary or permanent contracts, as well as all personnel

employed onshore and those onboard the floating production

units offshore.

The workforce can be broadly divided into the two following

categories: Blue and White Collar.

Blue collar employees are working onshore as construction

workers or employed offshore on the fleet of floating

production units. White collar workers are occupied onshore

with engineering design, support, and managerial positions,

in addition to being present offshore (onboard the offshore

production units as production management).

SBM Offshore’s workforce is distributed geographically in

direct relation with the Company’s strategy of organising its

work of offshore design, construction, and production, plus

construction site locations.


Onshore Operations

Monaco and Worldwide 1,176

Schiedam 461

Houston 705

Kuala Lumpur 193

Marly 22

Construction Sites 258

Offshore Production Production Offshore Fleet 1,587

TOTAL 4,402

Total Workforce by Employment Type

The ratio of female to total permanent staff at the end of 2007 was as follows:

The offshore engineering business has long been dominated by male staff; however, the Company has adopted a recruitment

strategy for onshore staff over the last 15 years to try to employ more women. This initiative has been successful to some degree,

although the number of graduates coming out of engineering schools and universities is still mostly male, and this restricts the

gender ratio in Engineering positions.

The 2,909 permanent staff employees are distributed over six geographical locations and comprise the 4 execution centres,

corporate functions offices, shorebases, services, offshore fleet personnel and construction sites. The offshore production

workforce is predominantly male at 93% with most female representation occurring in the shore-bases on land.

The biggest challenge is to remain an attractive employer providing competitive salaries and benefits which retain the staff for the

long term, while minimising the turbulence caused by replacements. Staff turnover figures are 9% which is fairly low compared to

the average for similar industries in Europe and the U.S.A. and can be attributed to the Company providing equitable remuneration,

good working conditions, and very interesting technical challenges that provide professional satisfaction.

Employment ContractsSBM Offshore employs staff either on a permanent staff contract or temporary (agency) contract. At the end of 2007, the head-

count for permanent staff contracts totalled 2,909 employees representing 66% of the total workforce and the headcount for

temporary (agency) staff contracts totalled 1,493 employees representing 34% of the total workforce.


LOCATION TOTAL MALE FEMALE RATIO

Monaco and Worldwide 904 650 254 (28%)

Schiedam 346 284 62 (18%)

Houston 518 365 153 (30%)

Kuala Lumpur 187 136 51 (27%)

Marly 22 5 17 (77%)

Production Offshore Fleet 863 798 65 (7%)

Construction Sites 69 45 24 (34%)

TOTAL 2,909 2,283 626 (22%)

Female 626 22%

Male 2,283 78%

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Distribution of Part time and Full time staff of Total Workforce

Full time staff consists of 4,286 employees working a normal 40-hour week and part-time staff of 116 persons (2.6%) who are

working less than 40 hours per week. The part time staff are distributed as follows:

The highest percentage of part-time staff are found to be working in Schiedam, representing 14% of the workforce. Most part-time

staff are noted to be women.

Temporary StaffThe Company is well aware of the benefits that are obtained in using temporary staff to meet peak workloads; however, SBM

Offshore does attempt not to exceed a ratio of 1:3 of temporary staff compared to permanent staff, in order to keep core

knowledge and expertise in-house.

The Company particularly limits temporary staff in sensitive areas such as Research and Development, High Pressure Swivel

Technology, Marketing and Sales, Proposal Development, Project Management, and Procurement.

The temporary staff breakdown is distributed over the six geographical locations plus construction site locations.


Total % Men % Women

Monaco and Worldwide 28 18 82

Schiedam 63 43 57

Houston 0 0 0

Kuala Lumpur 2 50 50

Marly 7 0 100

Production Offshore Fleet 15 73 27

Construction Sites 1 0 100

TOTAL 116 38% 62%

Monaco and Worldwide 272 (23%)

Schiedam (Netherlands) 115 (25%)

Houston (USA) 187 (26%)

Kuala Lumpur (Malaysia) 6 (3%)

Marly (Switzerland) 0 (0%)

Production Offshore Fleet 724 (46%)

Construction sites 189 (73%)

TOTAL 1,493 (34%)

The percentage ratio is calculated from the total workforce headcount



Turnover Permanent Workforce

The SBM Offshore staff turnover figure for 2007 was 378 persons (13%) and needs to be explained, because this figure includes 194

persons from the offshore production fleet who are nationals from Angola and Brazil where turnover of staff is at much higher levels

than in the more stable areas of employment in Europe, the U.S.A., and Malaysia.

The figures for the onshore staff areas show a turnover of 184 persons (8.8%). This figure includes not only staff who left to further

their careers at other companies, but also includes secondary effects such as married staff, who have had to leave because their

partner resigned. These we note as leaving for personal reasons, because they do not actually reflect in any detrimental way the

Company’s operations.

Turnover Indicator SBM Offshore Group; 13%

Turnover Indicator for Onshore Operations; 9%

Categories TurnoverEmployees

Total Employees %

Male 124

2,046

6.10%

Female 60 2.90%

Age <30 33 1.6%

Age 30-50 110 5.4%

Age >50 41 2%

Categories TurnoverEmployees

PermanentEmployees %

Voluntary 300

2,909

10.3%

Dismissal 58 2%

Retirement 17 0.5%

Death in Service* 3 0.1%

* Death in Service

Regrettably the Company lost three long-serving employees all due to natural causes in the course of 2007. One was an employee from Monaco with 32

years of loyal service. The two other employees also had a long-service with SBM Offshore and were working in Houston. SBM Offshore sincerely regrets

the loss of employees both on a professional and private level, and the Company extends its deepest sympathies to their families.

��



Regional Turnover SBM Offshore Group

Voluntary Resignation

SBM Offshore investigates every resignation by the means of an interview between the employee and H.R. departments.

The intention is to pinpoint the exact reason(s) for the resignation and the result is to gain knowledge and make the appropriate

changes, if necessary.

Monaco (6.5%) and Schiedam (7.4%) are quite stable areas where turnover is low, but Houston (16.7%) is more dynamic and

suffers from significant market turbulence. This phenomenon is due essentially to employment conditions being less contractual

and the oil and gas market being so present and under-resourced.

Presently in Kuala Lumpur, SBM Offshore can present relatively low statistics (6.4%), but it should be noted that the Company

has only been operating in this area for less than two years.

Location Turnover Employees

Total Employees %

Monaco and Worldwide 57 904 6.3%

Schiedam 25 346 7.25%

Houston 86 518 16.6%

Kuala Lumpur 12 187 6.4%

Marly 4 22 18.2%

Production Offshore Fleet 194 863 22%

Construction Sites - 69 -


Training - Developing CapabilitiesThe average number of training hours per employee, calculated over the entire Company but excluding the offshore production fleet,

was 52.3 hours per employee.

SBM Offshore provides a range of development opportunities to enhance the capabilities of our employees. These include training

courses, international assignments, mentoring, team development days, workshops and seminars. The training programmes

for all staff have continued at a high level throughout the Company. For onshore staff external training is promoted for specific

technical subjects such as welding, finite element analysis, and specialised FPSO technology courses. For internal training, the

main focus is on language lessons and MS Office classes.

The Training Indicators for different employee categories are set out below:

This indicator is split into White and Blue collar workers, as the training undergone by each group is very different.

The White Collar workers are office-based staff in Europe, the U.S.A., and Malaysia. Blue Collar workers consist of personnel

working offshore on our floating production units and the Porto Amboim yard Angolan construction staff.

Internal and External TrainingThe Training Indicator includes hours expended by Engineering, Operations, Project Management staff, Services, Administration,

Management, and other Onshore staff.

36,086 hours / 2,198 employee = 16.4 hours / employee

This training covers both internal training, which is performed by Company staff or consultants, and external training, which is

performed outside the Company’s work centres by specialist training organisations.

The participants are Engineering, Administration, Project Management, and Production Management staff.

Both external and internal training requires careful management so that project priorities are met, focusing and adapting training

in accordance with priorities that are linked to the market and projects.

SBM Offshore focuses training on young graduates and new staff who have been employed from allied industries, ensuring that

they are familiar with the special risks and requirements of floating offshore systems.

The highest indicators are from the engineering division totalling 41.6 hrs / employee.

The lowest indicator is from administration division 14.3 hrs / person, for which Monaco office has the highest amount of staff.

Monaco has a stable and experienced staff population, with adequate training at this level.

Employee CategoryTraining Indicator

TotalNumber of hours

TotalNumber of employees

TotalTraining hours per employee

Engineering 27,219 659 41.3 hours

Operations 62,098 392 158.4 hours

Services 1,408 64 16.4 hours

Administration 3,024 212 14.3 hours

Management 895 60 14.9 hours

Production 68,806 1,661 41.4 hours

�1



Offshore Production StaffTraining Indicator for Offshore Production Staff is 64,298 hrs / 1,305 employees = 49.3 hours / employee

SBM Offshore has a policy of nationalizing its crews and this requires in-depth training programs to be run to initially train staff

who have little or no offshore experience, so that they are competent to work offshore. This training is accomplished in training

schools in both Angola and Brazil and concerns Nationals who have been hired with little professional offshore experience.

For offshore staff, the training programmes focus on National staff specifically to increase the level of local employment at the

shore-bases and fleet. The Company promotes several site-specific training programmes worldwide at the shore-bases and

construction yards, as well as external courses and on-the-job training on the units offshore.


(7.2) Performance and Career Development Reviews

The introduction and implementation of the Competency

System has started to show positive results. The Company

offers quite a wide range of work activities and an increased

response from staff has been noticed to request lateral transfers

to functions which would be more suitable for their abilities. This

means that more people move into the right place without the

Company having to externally recruit. Performance appraisals

have become more meaningful and staff can see their career

path possibilities in a more transparent manner.

Onshore Operations Performance AppraisalPerformance Appraisals are organised by the Human

Resources Department and the results remain confidential.

All Performance Appraisals are made in accordance with the

SBM Offshore Competency System which is based on the

assumption that competencies are underlying characteristics

which enable someone to perform a job better in more

situations, more often, with better results. Competencies are

not the tasks of the job; they are what enable people to do

the tasks. Competencies are a critical factor for successful

performance of a job. Complete appraisals for local hires

working in our shore-bases and construction sites were not

performed. The population eligible for Performance Appraisals

concerns permanent staff only.

The Performance Appraisal indicator for Onshore Operations is

92.5% which consists of 1,667 appraisals completed for 1,803

employees.

Offshore Production Performance AppraisalThe annual appraisal of our offshore production staff covers all

permanent staff, nationals, and the shipping agency (contract)

staff working offshore onboard the production units. All offshore

production staff are appraised in direct accordance with the

offshore work activities, differently focused to the onshore

staff appraisal mentioned above. This appraisal concentrates

on subjects that concern Safety, Teamwork, Professional

Competence and Skill levels, Attitude, Commitment, and

Effectiveness. This appraisal is performed offshore.

The Performance Appraisal indicator for offshore production is

100% which consists of 1,403 appraisals completed for 1,403

employees.

(7.3) Employee Benefits

SBM Offshore operates various pension schemes depending

on the location of the operation. The schemes are funded

through payments to insurance companies or are defined

as multi-employer plans. The payments in each case are

determined by periodic actuarial calculations. The Company

has both defined benefit and defined contribution plans.

A defined benefit plan is a pension plan in which the amount of

pension benefit that an employee will receive upon retirement

is usually determined dependant on one or more factors such

as age, years of service and compensation.

A defined contribution plan is a pension plan under which the

Company pays fixed contributions to public or private pension

insurance plans on a mandatory, contractual, or voluntary

basis. The Company has no legal or contractual obligations

to pay further contributions if the fund does not hold sufficient

assets to pay all retirees the benefits relating to employee

service in the current and prior periods. The contributions

to defined contribution plans are recognised as an expense

incurred in the income statement.

Other Employee BenefitsOther employee benefits relate to other post-employment

benefit obligations, termination, and seniority benefits.

Termination benefits are payable when employment is

terminated before the normal retirement date, or when an

employee accepts voluntary redundancy in exchange for

these benefits. Seniority benefits are paid upon reaching

a pre-determined number of service years. The Company

recognises termination benefits when it is demonstrably

committed to either: terminating the employment of current

employees according to a detailed formal plan without

possibility of withdrawal; or providing termination benefits as

a result of an offer made to encourage voluntary redundancy.

ESOPThe Employee Share Ownership Plan (ESOP) continues to

be offered to staff with a contribution paid by the Company

encouraging employees to invest in SBM Offshore shares.

�3



3-YEAR EMPLOYEE DATA - SBM OFFSHORE GROUP 2005 2006 2007

Total Workforce Employee Diversity

Total number of employees worldwide permanent and temporary 3,164 3,824 4,402

Total number of permanent employees 2,479 2,458 2,909

Total number of temporary employees 685 1,366 1,493

Total percentage of women in permanent workforce n/r n/r 22%

Total Workforce Part-time Contracts (Permanent and Temporary Staff)

Total number of part-time employees n/r n/r 116

Total number of women working part-time1 n/r n/r 72

Total number of men working part-time n/r n/r 44

Percentage part-time workforce n/r n/r 2.6%

Percentage part-time women n/r n/r 62%

Percentage part-time men n/r n/r 38%

Employee Turnover (Permanent Staff)

Total amount of staff turnover percentage n/r n/r 13%

Total amount of staff turnover n/r n/r 378

Due to retirement2 n/r n/r 17

Due to voluntary resignation n/r 1 300

Due to dismissal n/r n/r 58

Death during service (natural causes - non work-related) 0 0 3*

Fatalities (death resulting from a work-related incident or illness) 0 1 0

Occupational Health and Safety

Average absence due to normal illness (percentage days lost through illness per employee)

1.8% 1.8% 2.3%

Total consolidated million Manhours SBM Offshore Land-based Operations (excluding Subcontractors)

n/r n/r 4.9

Total consolidated million Manhours SBM Offshore (Group Worldwide including Fleet of Offshore Production Units)

n/r n/r 8.5

Total million Manhours worked Offshore Production 3.8 3.7 3.5

Lost time accident frequency Offshore Production 0.10 0.05 0.0

Appraisals (Permanent Staff)

Personnel Appraisals completed for Permanent Staff Land-Based Operations n/r n/r 92.5%

Personnel Appraisals completed for Permanent Staff Offshore Production n/r n/r 100%

Competency Training Indicators (Permanent Staff)

Training hours/employee Management (White Collar) n/r n/r 14.9

Training hours/employee Engineering (White Collar) n/r n/r 41.6

Training hours/employee Offshore Production Units Staff (Blue Collar) n/r n/r 49.3

Training hours/employee Construction Yard, Angola (Blue Collar) n/r n/r 578

n/r = not recorded

* These indicators are related to the GRI and this is the first time SBM Offshore has collected this type of information.

* Deaths natural causes: due to non-work related illness or incidents: explanation

The 2005 and 2006 data entries have not been verified by our external assurance provider PricewaterhouseCoopers


(7.4) Myanmar Operations

An affiliate of SBM Offshore has a 15-year lease and operate

contract for an FSO with the Malaysian National Oil Company

PETRONAS, operating in Myanmar waters. The contract was

signed in 1998, the lease commenced in 2000, and the end

date is 2015. Our engagement with Petronas was entered into

prior to the various international appeals for sanctions against

the regime. The contractual commitment does not allow such

disengagement and a breach of contract would immediately

cause a third party to take over the activity, likely resulting in

worse conditions for the workers and their families, and with

no impact on the present regime.

The FSO YETAGUN is located in the Yetagun field approximately

200 kilometres offshore south-east Myanmar in 105-metre

water depth. The product stored onboard for offloading is

a light gas-condensate. Our Client, who is the owner of the

majority of this product, sells it on the international market.

MOGE (Myanmar Oil and Gas Enterprise under the Ministry of

Energy) holds 15% shares of the YETAGUN Field.

SBM Offshore communicated in 2001 that the Company will

not invest or initiate new business in Myanmar under the

current regime. We confirm today that this policy is unchanged

and no further investment has taken place, nor has any new

business been contracted.

What can SBM Offshore do to help?SBM Offshore is indeed concerned about the welfare of

the people of Myanmar. In 2003 the Company was already

committed to the compliance of SA8000 norms in terms of

social accountability in its Myanmar operations. Scrupulous

attention is paid to the protection of the local employees’

rights, and to their training and promotion. The FSO Yetagun

is currently operated with a crew consisting of more than 85%

Myanmar nationals.

In 2005 the nationalisation programme was continued with

the recruitment and internal promotion of National Safety

Supervisors replacing the expatriate Safety Officers. The

promotion of these nationals is a major success, and this trend

will continue for other key positions on the vessel.

The Company seeks to give all our employees the best

employment standards as possible as per our Company

Code of Conduct and Social Accountability Policy. SBM

Offshore operates with standards that in most cases exceed

international human rights and international labour guidelines.

This commitment implies in particular the continuous and

traceable checking in Myanmar of the Company’s suppliers

and sub suppliers in relation to forced labour and child labour

in compliance with Social Accountability standards set-out in

the Company’s Social Accountability manual. SBM Offshore

further audits all suppliers and agencies against these internal

procedures. It is important to note that SBM Offshore cannot

be audited against the actual SA8000 Social Accountability

standard due to the owners of the standard (SAI Inc. of New

York) prohibiting its use in Myanmar. Therefore the Company

and its suppliers in Myanmar are measured against SBM

Offshore’s own internal Social Accountability standards and

procedures – which also meet the requirements of SA8000.

Human Rights and Labour StandardsThe Company engages all senior and national staff for the

offshore fleet operations under direct employment. The

complement of the crews is currently employed through

approved manning agencies with the objective to gradually

fill these positions with national staff. In order to ensure

compliance with the UN Universal Declaration of Human

Rights, the ILO Conventions, and the OECD Guidelines

for multinational enterprises (as addressed in the Code of

Conduct), the Company is in the process of certifying all

operations outside OECD countries in accordance with the

standards issued in our Social Accountability manual. The

Company does not support or work with companies that

sustain forced and compulsory labour. Child labour and forced

labour is not tolerated by SBM Offshore and the Company

actively implements the Social Accountability norms as best it

can into administrative practices.

��


An extract follows from the Social Accountability Manual,

Chapter 7 - regarding child labour. This manual is applicable

to all our operations with special emphasis on non-OECD

countries where we operate;

“SBM Offshore shall not, directly or indirectly (i.e. through suppliers,

subcontractors or sub-suppliers), engage in or support the use of

child labour. At all locations, SBM Offshore shall comply with local and

national requirements on child and young worker labour. In particular,

no employees less than 18 years old of age shall be employed at

any SBM Offshore facility, unless local law stipulates a higher age. In

particular, no child or young worker shall be allowed to be present on

any Marine Unit managed by SBM Production Contractors.”

In any case, the SBM Offshore management in charge of

recruiting staff shall file evidence for the age of recruited staff.

Depending on local situation, the documents listed below may

constitute evidence:

• Birth certificate;

• Passport;

• Local records.

This framework applies worldwide, wherever SBM Offshore

operates.



(7.5) Local Development in Angola

Paenal Fabrication Yard, Porto AmboimOur presence in Angola represents an increasing part of our activities. Therefore Angola has been placed at the top level of our

objectives for sustainable development. On a short-term basis, the Paenal fabrication yard will benefit the offshore oil and gas

industry in providing a minimum employment target of 70% Angolan Nationals. It will also provide skills and jobs to a region of

Angola with a high unemployment rate. In the long term, it will provide the capacity to perform the construction of other types of

facilities for onshore oil development and the non-offshore related sector, such as bridges and industrial equipment. It will also

be able to provide ship repair services not only to Angola but to other parts of West Africa.

The PAENAL Fabrication yard’s mission is to provide state-of-the-art quality fabrication required to successfully develop offshore

projects in Angola. The development of the yard will be in three phases.

KEY FACTS

PROJECT NAME PAENAL FABRICATION YARD

LOCATION PORTO AMBOIM, 52 KM NORTH OF NGUNZA/SUMBE

TOTAL SURFACE AREA 200,000 M² (UPON COMPLETION END 2011)

OWNERSHIP JOINT VENTURE SONANGOL AND SBM OFFSHORE

TASKS TARGETS

EMPLOYMENT OF ANGOLESE NATIONALS

MINIMUM 70%EMPLOYED IN SKILLED JOBS AND ADMINISTRATION

ADMINISTRATION AND MANAGEMENT TEAM

3 YEAR TARGET70% POSITIONS FILLED BY ANGOLESE NATIONALS

YARD SKILLED WORKERS 5 YEAR TARGET70% POSITIONS FILLED BY ANGOLESE NATIONALS

PHASE 1OFFSHORE CONSTRUCTION DIVISION

COMPLETION TARGET END 2008Employ: 250 (total employees), complemented with contractorsProduction 2 - 3,000 tonnes/yearMaximum 500,000 Manhours capacity

PHASE 2ONSHORE-OFFSHORE DIVISION

COMPLETION TARGET END 2009 / 2010Employ: 850 (total employees), complemented with contractorsProduction 8 -10,000 tonnes/yearMaximum 2,000,000 man-hour capacity

PHASE 3SHIP REPAIR DIVISION

COMPLETION TARGET END 2011Major FPSO works can be completedEmploy 1,000 full-time hires;complemented with contractorsMaximum 2,400,000 man-hour capacity

TRAINING SCHOOL WELDING SCHOOL STARTED93 Nationals trained before year end 2007

TRAINING INDICATOR 578 HRS / EMPLOYEE

��


Benefits for the local communityThis new Yard will also be an industrial centre providing space

and services to strategic subcontractors wishing to establish

their business in Angola. This will also help to sustain in a durable

manner the expansion of the targeted activities, including those

non-related to the oil industry. The Yard facility will therefore

need to incorporate the adequate extra space and utilities to

host specialised subcontractor’s requirements.

There will be additional, substantial, and positive economic

effects on the surrounding community.

The following services will be required from external sources:

• hotel accommodation and restaurant facilities;

• shops for the increase in population due to the yard’s

employment;

• airport upgrade to allow fixed-wing and helicopter traffic,

especially night medical-evacuation flight capacity;

• hospital upgrade to complement medical facility;

• fire service for town and the hotel;

• electric power supply to yard and upgrade for town;

• drinking water supply;

• sewage plant;

• local companies for general and technical services.

Paenal Yard Training SchoolRecruitment on the market of skilled workers is difficult, and is not

sufficient to accommodate the expected workload. Considering

the steep increase in demand for workers in Angola, there is

an urgent need to train new personnel. As part of the yard

development, a training school has opened and is a key factor

to the successful expansion of the yard. The training school

is currently in a temporary location in Porto Amboim until the

training facilities of the yard are complete.

The first trades trained in the school were welding, fitting, rigging,

and scaffolding. The newly trained workers will commence with

structural works and as they progress and gain experience, then

they will be moved to more complicated tasks such as Topside

fabrication.

The envisaged training school will initially have a capacity of

approximately 150 trainees per year. The courses have been

made in groups of 30 students and generally last 12 weeks. In

2007, three groups of 30 students have been very successful

and they have already started performing construction tasks for

the yard. In 2008, the training process is continuing.

Formal competence tests are carried out and certificates are

issued to successful graduates. The program is modeled on a

similar training scheme that has been running very successfully

in Nigerdock, Lagos, for the last few years.

SONANGOL and SBM Offshore, through their Joint Venture

company “OPS,” already have an extensive training program

in place in Angola, aimed at the skills needed for offshore

positions. SBM Offshore has drawn on this experience to set up

the training program for the new yard.

Skills Training Overview


Skills

Welders 24

Fabricators 20

Rigger/ scaffolders 22

Painters 5

Crane operators 2

Safety officer 1

Office staff 4

First aid training 15

TOTAL 93

(7.6) Community Engagement

The Company operates offshore facilities in a large number of countries worldwide under long-term contracts and it frequently

undertakes construction activities in the fabrication yards of developing countries. Wherever SBM Offshore operates in the

world, its goal is to be responsive to community needs and to maximise local content by utilising as much as possible in-country

resources and products and by making the maximum use of local manpower. Skill-development and technology-transfer is

pursued through training programmes to improve the technical capabilities of the local labour force. In this matter, SBM Offshore

hereby confirms the policy it has established for several years.

Social Programmes/ Benefits to Local CommunitiesSBM Offshore has taken a number of initiatives to support social programmes in countries where the Group has business

activities. Regular meetings with these organisations and the auditing of their programmes continue to affirm both the legitimacy

and the effectiveness of the Company’s sponsorship.

The Single Buoy Nursery in MonacoIn 2007 the Single Buoy Nursery was opened and is a professionally-run nursery and pre-school for infants and toddlers between

the age of 2 months and four years. Single Buoy Nursery is unique, as it is the first of its kind in Monaco being completely privately

funded. Single Buoy Nursery is managed by an external Company, Babilou, which administers its daily operations. Single Buoy

Nursery was a personal initiative by Mr. Keller, CEO, based upon a suggestion from the Personnel delegates representing the

Monaco staff. The suggestion put forward to Mr. Keller was the need for a day-care centre for SBM Offshore employees’ children

close by the offices. The result was a newly equipped location for infants in the proximity of the Single Buoy Moorings offices at

Fontvieille, Monaco. Presently, 27 children are attending the nursery, which can accommodate 30.


��



Angola

In 2003, SBM Offshore entered into a partnership to assume

the responsibility for the operation, management, marketing,

and development of all on-going and future activities of ESSA

(Empresa de Serviços e Sondagens de Angola Limitada), a

training centre in Luanda developed and owned by SONANGOL.

The centre offers mainly language and safety training courses

to the local industry; major investments were made in 2004

by all parties involved, to modernize and expand the existing

infrastructure. Presently, the centre can take up to 250 students.

The goal of ESSA is to become an Angolan Training Centre of

Excellence by introducing internationally recognized, accredited,

certified, and specialized training programs for the benefit of

the Angolan industry in general, but with a particular priority for

the oil and gas industry. The participation of SBM Offshore in

the ESSA training centre allows the Company to increase the

involvement of national resources in its operations.

In addition, the ESSA training centre which provides education

and offers workshop facilities focusing on basic mechanical and

electrical training, received a process control room simulator

from the Company.

SBM Offshore provides support to two projects: “Casa dos

Rapazes do Palanca”, a school and workshop for boys in

Luanda and “Lar Nossa Senhora das Dores”, an orphanage for

girls’ in Lubango.

Padre Horacio, Angola

SBM Offshore is financially supporting an institution run by an

Argentinian priest, Padre Horacio, who lodges and feeds street

children. Education is given to these children including tuition

on technical subjects such as basic mechanical and electrical

knowledge. SBM is now committed to incorporate some of the

children from this institute in the ESSA project, as mentioned

above, for an electrical enhanced training and the creation of

an electrical workshop.

Brazil

The Group has invested in a process simulator which was

installed mid 2005 in the premises of Senai, in Macaé, Brazil.

Senai is a governmental Brazilian Training Institution which will

develop, together with SBM Offshore Competence Assurance

specialists, training modules for our process operators. The

training of our Brazilian employees working on the FPSO will

be performed by the Senai instructors in Macaé. SBM Offshore

plans to have twelve groups of eight trainees for periods of five

days, which is almost one hundred training sessions of five

days per year. This training action has been implemented to

allow SBM Offshore to achieve its Nationalisation target, which

is 60 percent of its offshore crew in 2005, 70 percent in 2006

and 80 percent in 2008.

Casa do Menor, Brazil

The “Casa do Menor” project consists of promoting

professional qualifications as well as developing citizenship,

for less fortunate teenagers. The project facilitates access to

culture and education amenities. Casa do Menor was founded

18 years ago in one of the poorest neighbourhoods of Rio de

Janeiro by an Italian priest Fr. Renato Chiera. It has developed

a vast social program targeting street kids and teenagers,

homeless boys and girls, some of them already involved in

criminal activities. There is a specially developed facility treating

children suffering from drug addiction, HIV, illness and disability.

The next step of the programme is to get these children, for a

period of time, living within family homes where they learn how

to socialise. Finally, the teenagers are helped to enter into basic

professional education to allow them to access the work market

as apprentices with fundamental professional skills and good

citizenship values. SBM Offshore finances the courses of the

project where the youngsters can learn skills to secure a job

and consequently obtain a decent income.

Nigeria

In 2004, the Nigerdock fabrication yard, in Nigeria decided to

build a training school to increase the skills of its employees.

This initiative was concluded with the opening of a construction

and welding school in early 2005. The first students graduated

on 17 February 2005. SBM Offshore contributed to this “skill

transfer” project with technical assistance for the construction

of the school and substantial financing. Nigerdock employs a

work force from the local communities neighbouring the yard,

providing them with the professional skills required to work for

a shipyard and with revenues to allow an improvement in their

standard of living.

Myanmar

SBM Offshore is sponsoring two programmes under the

umbrella of the United Nations organisation of UNAIDS, UNICEF

and the National AIDS Program.

HIV/AIDS awareness program is running at the Maritime

Institute of Yangon. This education program, which has been

supported by the Group for the last three years, has been given

to 9,939 seafarers with a potential of 60,000 seafarers that could

be reached through this effort.

HIV/AIDS awareness program reached 4,104 employees in

eleven Yangon garment factories mainly populated by young

females, and five other small enterprises in 2004. Indirect

beneficiaries from this training could number approximately

15,000 people from families and communities. This programme,

which has been supported by the Group since mid-year 2003,

proposes to complete the education of 4,000 to 4,500 factory

and industry workers.

SBM Offshore’s Ongoing Social Development Projects

•

•

•

•

•

•

•

•

•

(8.1) Renewable Energy Developments

Experts’ predictions for world energy consumption in the future

will be 20% to 50% higher than that of today, a growth that

may be difficult to meet with fossil fuels leading to a major gap

in supply. Energy derived from clean, renewable resources

may fill much of this energy supply gap. Our vision at SBM

Offshore is to apply creativity and innovation to the expanding

renewable energy market.

SBM Offshore plans to use its in-house expertise to develop

large-scale renewable energy generation equipment that is

complementary to our existing marine-based business. By

doing so, we will help reverse the adverse effects of fossil fuel

emissions through the supply of clean fuels - a strategy to help

sustain and grow the supply of clean and “green” (or “blue”

marine) energy.

SBM Offshore’s Technology Development staff have been

engaged in assessing a range of ocean energy projects since

2006. The sector of the renewables market which is expected

to have the largest near-term potential is the wave energy

sector. The wave energy market is estimated to be around

5.5 TWh/year in the near future*, and the potential long

term future market for wave energy may be as high as 2000

TWh**.

(8.2) Green Power Generation

A new development theme is the generation of electricity in an

environmentally friendly manner. Offshore waters contain an

enormous amount of potential energy and with SBM Offshore

having so much knowledge and experience in providing and

installing systems to operate in the offshore environment where

waves and currents can be significant. We decided to explore

ways of capturing a portion of that energy in a sustainable

manner: green power.

After reviewing various energy potential sources (current

energy, thermal/density, solar, etc.), we concluded that of the

technically feasible options, Wave Energy Conversion systems

(WEC) offered the greatest potential for commercial viability. A

creative team of engineers has therefore been working on a

range of WEC concepts with the ambition to test the first full

scale prototype by the end of 2009.

Sources:

* Commission of the European Communities, DG XVII. “An Assessment of

the State of Art, Technical Perspectives and Potential Market for Wave

Energy”, prepared by ETSU and CCE, 1992.

** Thorpe, T W. “An Overview of Wave Energy Technologies”, A report

produced for the Office of Science and Technology, AEA Technology

Report Number AEAT-3615, 1998.


�1

SBM Offshore > LOOKING TO THE FUTURE


(8.3) Wave Energy Converter Project

The purpose of this project is to validate both the technical feasibility

and commercial viability of producing electricity generated from

wave-induced motions. This will be using a combination of SBM

Offshore’s extensive marine experience coupled with innovative

hydrodynamic-to-mechanical motion-to-electrical conversion

equipment.

Mechanical energy is extracted from waves by causing one

component to move back and forth against another as the waves

pass by. The mechanical motion is then converted to electrical

power and transmitted to shore via subsea electrical cables. The

key to success is simple and efficient conversion and transmission

at each stage of the process. Wave farms will consist of several

tens or hundreds of buoys in arrays, located just a few kilometres

from shore each generating tens or hundreds of kWs and thereby

together generating in the MW range, which would be sufficient

to cover the needs of a small town. The concept of wave energy

absorption is not new; it has been in development for over 30

years. Today’s environmental objectives, backed by political

initiatives, have changed the economic case strongly in favour of

renewables. SBM Offshore sees that a highly competitive clean

energy production system can be developed by combining our

long expertise in design and construction for operation in extreme

environments with emerging power take-off technologies. Today,

we wish to harness wave energy for mankind.

(8.4) Reducing the Ecological Impact of Current Operations

The reduction of the greenhouse gas emissions generated by

process, production, and manufacturing operations is a key

concern for SBM Offshore. In our day-to-day activities, SBM

Offshore is constantly seeking ways to reduce the impact of our

activities, both in the supply of our systems and in operation.

Offshore facilities consume significant quantities of raw materials,

notably steel for the large structures employed. The Company is

a world leader in building lightweight topside production systems

on our facilities to meet high-capacity requirements. Continual

improvement over the years shows steady reductions in weights.

For example, an FPSO built in 2001 had a system weight of 7,200

tons. A comparable system built in 2007 with matching capacity

weighed only 5,000 tons. A recent Front End Engineering and

Design (FEED) study for a major client reduced the topsides

weight of the traditional design contractor system by around

30% (from 21,000 tons to 14,000 tons). This reduction is not

only commercially beneficial, but also substantially diminishes

the demand for scarce resources, additionally lightening the

environmental impact by not needing to supply those resources.

FPSOs traditionally vent some hydrocarbon gas into the

atmosphere each time the cargo tanks are filled. SBM Offshore

is investing in technologies to recover the tank gases via a

compression system, thereby cutting emissions and improving

both the global and local environmental impact. When vented

in calm weather, trace levels of this vented hydrocarbon gas

occasionally sink to the deck and cause compression plant shut-

downs with corresponding flaring of the plant inventory. Tank

gas recovery removes this risk and increases compression plant

uptime, which has a knock-on effect of reducing the number of

such short flaring events. SBM Offshore has both the strategies

and the expertise in place to help create a sustainable supply of

clean energy. With a clear view on the renewable energy sector,

our focus is to deliver “green” technologies and reduce our

carbon footprint.


(9.1) PricewaterhouseCoopers Assurance ReportTo the Board of Management of SBM Offshore N.V.

Assurance reportScope and responsibilities

We have been engaged by the Board of Management of

SBM Offshore N.V., Rotterdam, the Netherlands, to review

the content of the Corporate Social Responsibility Report

for the year ending 31st December, 2007 (hereafter referred

to as the Report).

A review engagement is aimed at obtaining limited

assurance for our conclusions. The detail of review

procedures is substantially less than audit procedures

and consequently a review engagement provides less

assurance than what would be obtained from an audit

engagement.

We do not provide any assurance on the assumptions

and achievability of prospective information (such as

targets, expectations and ambitions) included in the report.

Furthermore we have not reviewed the performance data

for 2006, 2005 or prior years included in the report, and

therefore do not provide any assurance on those data.

The Report has been prepared under the responsibility

of the Board of Management of SBM Offshore N.V. Our

responsibility is to draw a conclusion on the Report based

on our review.

Reporting criteriaSBM Offshore N.V. developed its reporting criteria on the

basis of the G3 Guidelines of the Global Reporting Initiative

(GRI) as explained in the Report in the chapter titled

“Reporting scope”. These reporting criteria include certain

inherent limitations that can influence the reliability of the

information. We consider these reporting criteria to be

relevant and sufficient for our review engagement.

Work performedWe planned and performed our work to obtain a basis for

our conclusion in accordance with Dutch law, including

the Assurance Standard 3410N “Assurance Engagements

relating to Sustainability Reports”, drawn up by the

professional body of Dutch accountants (“NIVRA”).

Our most important review procedures consisted of:

• gaining an understanding of the activities and the

organisation of SBM Offshore N.V.;

• analysing public information to gain insight into

sustainability aspects relevant to SBM Offshore N.V. and

its industry during the reported period;

• evaluating the acceptability and application of SBM

Offshore N.V.’s reporting criteria, in relation to the

information requirements of its intended stakeholders;

• Conducting interviews with responsible officers at

headquarters in Schiedam and the offices in Monaco,

aimed at understanding the data collection and reporting

process and at evaluating the completeness, accuracy

and adequacy of the qualitative and quantitative

information in the Report;

�3SBM Offshore I Corporate Social Responsibility Report 2007

SBM Offshore > APPENDICES

• getting acquainted with and evaluating the design and

functioning of the systems and processes used for

data capturing, collation, consolidation and validation,

including the methods used for calculating and

estimating results;

• performing analytical procedures on a sample basis on

the reported data and accompanying notes;

• reviewing the application of the G3 Guidelines of the

GRI;

• evaluating the overall format and presentation of the

Report, including evaluating the consistency of the

information, in line with SBM Offshore N.V.’s reporting

criteria.

We believe that the evidence obtained from our review

procedures is sufficient and appropriate to provide a basis

for our conclusion.

ConclusionBased on our review procedures performed, we have no

reason to conclude that in accordance with SBM Offshore

N.V.’s reporting criteria:

• the reporting principles are not acceptable or have not

been applied consistently;

• the events described did not take place during the

reporting period or are not presented fully, accurately

and timely;

• the information is not, in all material respects, presented

completely, accurately and adequately.

Amsterdam, 28 April 2008

PricewaterhouseCoopers Accountants N.V.

Originally signed by J. van der Hilst RA


(9.2) GLOSSARY

Glossary of terms in this CSR Report

AGIPAzienda Generale Italiana Petrol), established in 1926 is an Italian automotive gasoline and diesel retailer. It is a subsidiary of multinational petroleum company ENI.

BOE Barrels of oil equivalent.

BPBritish PetroleumA British Oil Company

CALMCatenary Anchor Leg MooringA floating buoy that performs the dual function of keeping a tanker moored on a single point and transferring fluids while allowing the ship to weathervane

CAPEX Capital Expenditure.

CHEVRON American (US) Oil Company

CIS Corporate Intranet Site

CONDENSATES Liquids condensed from a gas stream, made up of a range of heavier hydrocarbons

CO Carbon Monoxide

CO2Carbon Dioxide

COOLTM Cryogenic Offshore Offloading or Loading (COOLTM) terminal

COSO The Committee of Sponsoring Organisations of the Treadway Commission

CRANE VESSELA ship-shape vessel or semi-submersible vessel with one or two cranes for lifting platform modules and structures at sea

CRYOGENICLow temperature processing, generally sub zero. For LNG this can be as low as minus 162˚C

DCU Dry Completion Unit (See DTU)

DEEPWATER More than 300 metres water depth

DEEPDRAFT SEMITM See Semi-submersible

DRILL SHIPA ship-shape vessel for drilling and completing wells in medium to deepwater applications

DSVDiving Support VesselA dedicated vessel, most frequently dynamically positioned, for assistance of subsea saturation diving and installation work

DTUDry Tree UnitA floating facility carrying surface completed wells, i.e. the Xmas trees are located above the surface of the sea, on the floater, as opposed to the seabed

DWB Deed Water Buoy

EBIT Earnings before interest and income taxes.

EBITDA Earnings before interest, taxes, depreciation and amortization.

E/P OR E&P Exploration and Production

EPCIEngineer, Procure, Construct and InstallA form of contracting that provides for turnkey delivery of facilities

ESOP The Employee Share Ownership Plan.

EXXON MOBIL American (US) Oil Company

FEEDFront End Engineering and DesignA study used to analyse the various technical options for new field developments with the objective to define the facilities required

FLOWLINES Pipelines carrying reservoir fluid on the seabed from wells to risers

FOOTPRINT The area affected or covered by SBM Offshore’s operations.

��


FPDSOFloating Production, Drilling, Storage and Offloading systemAn FPSO with capability to drill, complete and work over wells from this facility

FPSOFloating Production, Storage and Offloading system.An FPSO is a floating facility installed above or close to an offshore oil and gas field to receive, process, store and export hydrocarbons

FSRUFloating Storage and Re-gasification UnitA floating vessel that is permanently moored at a site where it can receive LNG from carriers, store and re-gasify the LNG

GAPTM

Gravity Actuated PipeA concept developed by the Group, consisting of a bundle of mid water pipes suspended between surface and seabed

GHGGreenhouse Gas Emissions. Gaseous emissions to the atmosphere that may contribute to global warming.

GTL Gas To Liquids conversion

GRI Global Reporting Initiative

HSE CHARTER The set of clearly defined HSE values applicable to each employee of the Group.

HUMAN RIGHTSBasic standards of treatment to which all people are entitled, regardless of nationality, gender, race, economic status or religion.

HYDROCARBONS Oil, gas and other chemical components carrying hydrogen and carbon atoms

IOC International Oil Company

ISO 9000International standard for quality management. It is intended to help an organisa-tion enhance customer satisfaction by meeting customer and applicable regulatory requirements and to improve its performance in this regard.

ISO 14001International standard for environmental management. It is intended to help an organ-isation to minimise harmful effects on the environment caused by its activities and to improve its environmental performance.

J.V. Joint Venture

J.V.P.C. Japan Vietnam Petroleum Company

LNGLiquefied Natural GasNatural gas (mainly methane) that is refrigerated to minus 162˚C

LNG FPSOFloating Production, Storage and Offloading (FPSO) system for Liquefied Natural Gas (LNG)

LPGLiquefied Petroleum GasButane and propane, separated from well fluid stream

LTA Lost Time Accident

LTAF Lost Time Accident Frequency

LTI Lost Time Injury

MARPOL

Marine PollutionInternational regulations produced by the International Convention for the Prevention of Pollution from Ships, 1973, as adopted by the International Conference on Marine Pollution convened by the International Maritime Organisation, which is the regulatory body in respect of pollution by oil, noxious substances, harmful substances in pack-aged forms, sewage and garbage

M.I.S.C Berhad

MISC Berhad incorporated in 1968 as Malaysia International Shipping Corporation Berhad, is the leading international shipping line of Malaysia. Its main shareholder is Petroliam Nasional Berhad (PETRONAS), the national oil conglomerate of Malaysia. The principal business of the Corporation consist of ship-owning, ship-operating and other logistics and maritime transportation services. With a modern and well-diversified fleet of 139 vessels and a combined tonnage of 8 million deadweight tonnes (dwt).

MMSCFDMillions of Standard Cubic Feet per DayA commonly used unit to measure gas flows





MOPU Mobile Offshore Production UnitA jack-up platform carrying oil, gas and water separation equipment

MOPUSTORMobile Offshore Production UnitA jack-up platform carrying oil, gas and water separation equipment integrated with an oil storage tank located on the seabed

NOC National Oil Company

NON-FLARING OPERATIONS

Operations where the produced gas from an oil field is not allowed to be flared and therefore either has to be exported by pipeline used as a fuel source or re-injected into the well

NO2

Nitrogen dioxide, sources are internal combustion engines and thermal power sta-tions.

NOxNitrogen Oxide. Any binary compound of oxygen and nitrogen, or to a mixture of such compounds:

NGO Non Governmental Organisation

OPS OPS-Serviços de Produção de Petroleo Ltda

RISERS Steel or flexible pipe, which transfer well fluids from the seabed to the surface

PETROBRAS Brazilian State owned Oil Company (Petroleo Brasilia)

PETRONAS Petroliam Nasional Berhad (PETRONAS), the national oil conglomerate of Malaysia

SAKHALIN ENERGY Sakhalin Energy Investment Company Ltd

SBM Single Buoy Moorings

SBM PCSingle Buoy Moorings Production Contractors In charge of Operation and production of the Lease Fleet

SEMI-SUBMERSIBLEA floating unit, with its deck supported by columns to enable the unit to become almost transparent for waves and provide favourable motion behaviour.

DEEPDRAFT SEMITM A semi-submersible unit fitted with oil and gas production facilities in ultra deep water conditions

SO2Sulphur Dioxide

SONANGOL Angolese State owned Oil Company

SPM Single Point Mooring System

STAKEHOLDERThe clients, employees, suppliers, shareholders and communities where we operate,and where the performance of SBM Offshore has a direct effect.

SWIVELMechanical component consisting of a fixed and a rotating part, connected by means of a roller bearing and a sealing arrangement, allowing fluids to pass between the sta-tionary and the weathervaning part of a Single Point Mooring system

TLPTension Leg PlatformA floating production platform positioned and stabilised by at least three separated, vertical tendons anchored to the seabed

FOURSTARTM TLP A four leg battered-column design TLP and will support full deepwater drilling and production payloads

TOPSIDES See FPSO

TREG Time Registration (Company online timesheet registration for working hours).

TRELLINETM

The TrellineTM Large diameter reinforced bonded rubber hose.Suspended in a simple wave of about 2 km, between an FPSO and a deep water CALM buoy, it is used as an alternative to a steel mid-water pipe

TURNKEY SUPPLY Design, construction, installation and delivery of an operational system.

TURRETThe turret system is integrated into or attached to the hull of the tanker, in most cases near the bow, and allows the tanker to weathervane around it and thereby take up the line of least resistance to the combined forces of wind, waves and current

VOC Volatile Organic Compound

VLCCVery Large Crude CarrierOil transportation vessel from 200,000 to 320,000 dwt


��SBM Offshore I Corporate Social Responsibility Report 2007

(9.3) GRI Content IndexGRI

REFERENCE REPORT SECTION

VISION & STRATEGYSUSTAINABILITY, VISION & STRATEGY

1.1 1.3

ORGANISATIONAL PROFILE

NAME OF ORGANISATION 2.1 1.1, 3.1

PRIMARY PRODUCTS 2.2 1.1, 3.2

OPERATIONAL STRUCTURE 2.3 1.1, 1.2, 3.0, 3.5

LOCATION OF HQ 2.4 3.0, 1.1

COUNTRIES OF OPERATION 2.5 1.1, 7.6

NATURE OF OWNERSHIP 2.6 1.1, 3.1

MARKETS SERVED 2.7 1.1, 1.2

SCALE OF REPORTING ORGANISATION

2.8 1.0, 2.2, 3.5, 7.1

SIGNIFICANT CHANGES 2.9 1.2

AWARDS RECEIVED 2.10 6.5

REPORT PARAMETRES

REPORTING PERIOD 3.1, 3.2, 3.3 2.1, 2.2

CONTACT POINT FOR QUESTIONS REGARDING THE REPORT OR ITS CONTENTS

3.4 CSR REPORT INSIDE COVER

REPORTING BOUNDARIES 3.5, 3.6, 3.7, 3.8 2.1, 2.2

BASIS FOR REPORTING INCL JV 3.8 2.2, 3.5

RE-STATEMENTS 3.10 2.5, 3.4

SIGNIFICANT CHANGES 3.11 NOT APPLICABLE

TABLE IDENTIFYING THE LOCATION OF THE STANDARD DISCLOSURES IN THE REPORT

3.12 9.3

GOVERNANCE, COMMITMENTS, AND ENGAGEMENT

GOVERNANCE 4.1, 4.2, 4.3, 4.4 5.1

STAKEHOLDER ENGAGEMENT 4.14 & 4.15 2.1

EMPLOYEES EC3 7.1, 7.2 7.3

ENVIRONMENTAL PERFORMANCE INDICATORS

DIRECT ENERGY AND INDIRECT COMSUMPTION EN 3, EN4 2.3, 6.6

ENERGY SAVED EN5 2.3, 6.6

EMISSIONS, DISCHARGES AND WASTE EN20, EN23 2.3, 6.5, 6.6

NUMBER & VOLUME OF SPILLS EN23 6.6

LABOUR PRACTICES & DECENT WORK

EMPLOYMENT LA1, LA2 2.4, 7.1

LABOUR / MANAGEMENT RELATIONS LA3 3.3, 7.3

HEALTH & SAFETY LA7 2.2, 6,2, 6.3, 6.4

TRAINING & EDUCATION LA10 1.3, 2.4, 7.1

DIVERSITY & OPPORTUNITY LA13 2.1, 2.4, 7.0-7.6

SECURITY PRACTICES HR8 6.4

SOCIAL

SOCIETY SO1 7.4-7.6

PRODUCT RESPONSIBILITY PR1-PR9 NOT REPORTED

Monaco

24, avenue de Fontvieille

P.O. Box 199

MC 98007 Monaco CEDEX

Principality of Monaco

Telephone +(377) 92 05 15 00

Telefax +(377) 92 05 85 00

USA

1255 Enclave Parkway, suite 400

Houston, TX 77077

USA

Telephone +1 (281) 848 6000

Telefax +1 (281) 848 6100

The Netherlands

P.O. Box 11, 3100 AA Schiedam

Karel Doormanweg 66

3115 JD Schiedam

The Netherlands

Telephone +31 (0) 10 2320 000

Telefax +31 (0) 10 2320 101

Malaysia

Block 2B – Level 9

Plaza Sentral

Jalan Stesen Sentral 5

Kuala Lumpur Sentral

50470 Kuala Lumpur - Malaysia

Telephone +60 (3) 2773 53 00

Telefax +60 (3) 2773 5399

www.sbmoffshore.com

SBM Offshore N.V.

Postal address

P.O. Box 31

3100 AA Schiedam

The Netherlands

Street address

Karel Doormanweg 66

3115 JD Schiedam

The Netherlands

Telephone +31 10 232 0900

Telefax +31 10 232 0999

E-mail: [email protected]

Full information regarding

SBM Offshore is available

on the Company’s website

at www.sbmoffshore.com

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