PETROVIETNAM GROUP

PETROVIETNAM DRILLING AND WELL SERVICES CORPORATION

ANNUAL GENERAL MEETING OF

SHAREHOLDERS 2013

BUSINESS PERFORMANCE IN 2012 &

BUSINESS PLAN IN 2013

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BUSINESS PERFORMANCE IN 2012

P V D R I L L I N G

Global Economy 2012

P V D R I L L I N G 3

No solutions for Eurozone debt crisis yet. Crisis has spread out from Greece to Portugal, Italia…

GDP growth rate of US reached 2.2%, unemployment rate fell below 8%

China experienced lowest growth rate for the last 13 years: weak domestic demand, falling inflation

“Disputes over sea

territories in the East Sea are getting

more severe as more countries participate

in”.

“Asia-Pacific region is still well-coping with ongoing difficulties” - WTO

P V D R I L L I N G

Vietnam Economy 2012 “Global downturn had spread negative impact on business activities leading to squeezing production, high inventories, high bad debt level. Large number of enterprises contracted their production, postponed their operation and even went bankrupt” – GSO

GDP growth rate was lower than expectation and year 2011 (5.9%)

Inflation fell to one-digit number due to the Government’s attempt in

inflation controlling; however there were signs of deflation in the last year.

Real estate frost

2012 was the hardest year for Vietnam real estate market with two serious

problems: high inventories and large bad debt

5.0%

GDP

6.8%

CPI

Difficulties for enterprises

“Difficulties for enterprises still remain as 55.000 enterprises shut down in 2012” – Ministry of Planning and Investment

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P V D R I L L I N G

Oil and gas market

90

91 103

110

102 96 97

86 85

86

97 99

100 103

106

103

94

83 88

94

97

86 89 91

50

70

90

110

130

2011 2012

Under impact of global economic

situation and political turmoil in

the Middle-East region

Due to high level of crude oil price, oil

contractors have intensified their E&P

activities

Crude oil price remained at high level

(above 90 USD/barrel)

Expenditures for E&P activities

amounted to USD 604 billion, increased

by 4% compared to 2011

Barclays and Bloomberg IHS Petrodata

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P V D R I L L I N G

Drilling market

Utilization rate of jack-up increased from 67% (2011) to approximately 85% (2012)

Drilling market has recovered from decline during 2008-2011 period

IHS Petrodata

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P V D R I L L I N G

Drilling market

Average day rate for premium jack-up rigs in South East Asia during 2012 was approximately 129K – 156K USD/day

130

123 125

160

137 137

125

134 135

151 151 151

60

80

100

120

140

160

180

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

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P V D R I L L I N G

Key activities in 2012

SUCCESSFUL operation of

deep-water rig

PV DRILLING V (TAD)

For the first time ever, PV Drilling has operated safely and efficiently the TAD (one of the most modern semi-submersible tender assist drilling rig worldwide) in harsh weather

PV DRILLING I – Cuu Long JOC

PV DRILLING II – Lam Son JOC

PV DRILLING III - Vietsovpetro

Ensco 107 (hired rig) - Thang Long JOC and Mitra

Ocean Patriot (hired rig) - Idemitsu

Signing many CONTRACTS

to provide DRILLING RIGS

and other DRILLING-

RELATED SERVICES at

better price

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P V D R I L L I N G

Business activities of PV Drilling in 2012

Established

REPRESENTATIVE

OFFICE in Kuala

Lumpur - Malaysia

Established JOINT

VENTURE with foreign

partner

This is the first step in international expansion progress and will generate growth from 2014 onwards

Operation of the Oil spill control base in Vung Tau and the Nasos II ship increased oil spill control capacity of PVN.

Inaugurated OIL SPILL

CONTROL BASE

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P V D R I L L I N G

Business activities of subsidiaries

Owned drilling rigs Hired rigs

PV DRILLING I

PV DRILLING II

PV DRILLING III

KEY HAWAII

PV DRILLING 11

Professional

drilling

crews

ENSCO 107 OCEAN PATRIOT (the semi-submersible drilling rig)

PV DRILLING V (TAD)

NAGA2 WEST TUCANA

Operate from Q3/2013

Contracts expired at the end of Q2/2013

Safety operation of owned and chartered drilling rigs

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P V D R I L L I N G

Efficiency of owned drilling fleet

11

99.09 98.92 99.76

98.65

99.36

92.05

100 100 100

92.91

97.43

100 100

89.92 95.97

98.32

99.79

91.88 98.52

77.08

97.29

98.68 99.26

0

20

40

60

80

100

120

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

PV DRILLING I PV DRILLING II PV DRILLING III PV DRILLING V

%

Average efficiency ratios (%)

98.99 99.69 98.18 95.16 99.73

PV

D I

PV

D II

PV

D II

I

PV

D V

PV

D 1

1

P V D R I L L I N G

Business activities of subsidiaries

PVD Well Services

• Focused on developing key services: tool rental, tubular running

• Supplied new services such as: Solid Control, MPD, Filtration

• Invested 2 tubular running equipment sets, 36” hole-opening tools

PVD Offshore • Higher manpower supply contracts contributed significantly to above-10% growth of revenue and profit.

• Developed new services:

o Rope access;

o Underwater inspection;

o Flange & Wellhead components fabrication

PVD Logging

• Maintained stable market shares of Mud logging, Slickline…

• Provided Well testing service to Thang Long JOC, Pearl Oil, Cuu Long JOC

• Invested equipment for Slickline and MPLT services

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P V D R I L L I N G

Business activities of subsidiaries

• Transformed PVD Tech to JSC

• Capital contribution in Vietubes and operation of PVD-OilState JV increased domestic proportion of threading service, in turn, enhance competitiveness and growth of profit in upcoming years

PVD Tech

• Maintained stable market share of Manpower service, increased mark-up rate for important customers: Premier Oil, Cuu Long JOC, Hoang Long – Hoan Vu JOC...

• Supplied Equipment Rental service (MudCooler, SteamBoiler rental), installed Hi-pressure Bulk Tanks for Bien Dong POC

• Developed Mud Cooling, H2S, Habitat Safety Control services…

PVD Invest

• Developed Manpower supply service

• Branding for training services (maritime-safety training, technical training)

• Facilitated investment to improve training quality

• Invested Simulator tools, Emergency Breathing System, Rigging sets for technical training

PVD Training

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P V D R I L L I N G

Business activities of subsidiaries

• Expanded customer base (Mitra Energy, Thang Long JOC)

• Diversified services: directional drilling, wireline logging, liner hanger, well completion, fishing, intelligent well services

• Well maintained cementing, stimulation, tubulars, casing, well testing, OCTG managing services…

PVD Baker Hughes JV

BJ – PVD, PVD Tubulars

Management, PVD – PTI

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P V D R I L L I N G

Total asset

PV DRILLING I

PV DRILLING 11

PV DRILLING II

PV DRILLING III

PV DRILLING V

CAGR 22%

(2007-2012)

4,330

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2007 2008 2009 2010 2011 2012

VND Billion

8,633

12,368

14,640

18,535

19,084

P V D R I L L I N G

Business performance in 2012

10,100

11,929

Budget 2012 Actual 2012

Revenue increased by 18% vs. Budget 2012

• Drilling fleet was operated smoothly

with average operating efficiency

over 95%

• Growth in manpower and experts

manpower services deriving from

continous and long-term drilling

campaigns of oil operators

• Significant growth in trading service

from providing conductors to Bien

Dong POC

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P V D R I L L I N G

Business Performance in 2012

Consolidated NPAT increased by 15% vs. Budget 2012

1,150

1,322

Budget 2012 Actual 2012

• Increased drilling rigs’ operating

efficiency and effective control of

operating and administrative

expenses.

• Increased insourcing proportion of

high-technical services and

successfully expanded new

services such as Solid Control,

MPD and Filtration.

• Inspection and threading services

are highly efficient.

• Effective control of administrative

expenses.

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P V D R I L L I N G

Revenue and Profit by subsidiaries

Drilling Division 42%

PVD Offshore 4%

PVD Well 7%

PVD Logging 7%

6PVD Tech 17%

PVD Invest 10%

PVD Training 1%

PVD Deepwater 12%

Revenue

Drilling Division 54%

PVD Offshore 10%

PVD Well 9%

PVD Logging 6%

PVD Tech 3%

PVD Invest 2%

PVD Training 1%

Joint Venture 3%

PVD Deepwater (62%) 13%

Consolidated Net Profit after Tax

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P V D R I L L I N G

Key Achievements in 2012

The Best Drilling Contractor

in Asia, 2012

Up to March 10th 2013, PV

DRILLING I achieved 6 years

without Lost Time Incidents

(Zero LTI).

PV DRILLING II & III achieved 3

years without Lost Time

Incidents (Zero LTI).

Certifications of the International Association of Drilling Contractors (IADC).

Enhanced credibility and effective operation & management of PV Drilling’s rigs.

Was honored to receive “The Best Drilling Contractor in Asia, 2012” awarded by World Finance Magazine.

Certificate for Information

Transparency Effort

Was one of 15 listed corporations that were awarded by the State Securities Commission of Vietnam certificate for their information transparency efforts through years.

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P V D R I L L I N G

Conclusions for 2012

2012 was a memorable year with full of outstanding achievements, marking significant progress in PV Drilling’s journey to become a reliable drilling contractor in international and regional markets.

NPAT increased by over 24% illustrating accomplishment of the Corporation in leading technology innovation, accompanying with developing key drilling technical services and co-operating with international partners to provide high-quality services, satisfy demanding requirements of oil contractors in the region and all over the world.

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Business Plan

in 2013

P V D R I L L I N G

Macroeconomic Forecast for 2013

World economy: Highlights appear but risks remain • Stimulus programs released by the United States and Japan go into effect in 2013,

making positive impact on global demand. • The Eurozone sovereign debt crisis remains a major threat to the world economy’s

recovery.

Vietnam’s economy: expects to recover in 2013, depending on efforts to solve bank bad debt and reconstruct economy to regain business confidence. • GDP growth is predicted to slightly increase in 2013 and inflation rate remains at single

digit.

• Macroeconomic reform efforts such as interest rate and tax reduction, along with bank bad debt solution will clear capital flows and help corporations overcome difficulties.

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P V D R I L L I N G

Prospect of Drilling Market in Vietnam

14 14 12.5

15.1 15 16 15.5 14.1 13 14 12 12

62.9 63 64.1

70.3 69.3 73.6 75.3 71.3 70 69.2

66.4 62.3

95 93 92

98 94

97 99

91 90 85

81 75

Jan

-13

Feb

-13

Mar

-13

Ap

r-13

May

-13

Jun

-13

Jul-

13

Au

g-1

3

Sep

-13

Oct

-13

No

v-1

3

Dec

-13

Demand in Vietnam Demand in SEA

Utilization (%) SEA

110

120

130

140

150

160

170

SEA Vietnam

140K – 156K

130K – 150K

Drilling day rate in Vietnam is lower than in the SEA

Xu hướng các nhà thầu rút các giàn đang cho thuê tại Việt nam mang ra các nước khác trong khu vực

Các chương trình khoan tại Việt Nam thường ngắn và không hấp dẫn

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110

120

130

140

150

160

170

Southeast Asia Vietnam

P V D R I L L I N G

PV Drilling will face more challenges in hiring rigs to ensure revenue growth

International contractors move rigs out of Vietnam due to higher attraction from other regions.

Drilling campaigns in Vietnam are short-term, seasonal and fluctuate to weather conditions.

Several major projects are not executed due to changes and delays in oil contractors’ schedules.

Shortage of local expert, dependence on foreign source of manpower with high expense; PVD is still in the process for succession.

PVD’s rig fleet is still small, making it difficult to penetrate the international market. Time-consuming process of investment application caused PVD to miss the opportunities of purchasing/building new rigs.

Clients’ rigid requirements in technical and safety term reduced the supply source.

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P V D R I L L I N G

Budget NPAT increase 2.9% vs. Act. 2012

Budget revenue decrease 5.5% vs. Act. 2012

Business plan in 2013

11,929 11,275

Actual 2012 Budget 2013

1,322 1,360

Actual 2012 Budget 2013

Uncertainties in hiring rigs lead to

dependence of revenue on external

factors, such as, drilling market and

whether hired rigs adapt to technical

requirements of oil contractors

NPAT is estimated to increase

due to rise in profit margin of high-

tech services, profit from joint

ventures and improved day rate

since the end of Q2/2012.

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P V D R I L L I N G

Budget NPAT increase 2.9% vs. Act. 2012

Budget revenue decrease 5.5% vs. Act. 2012

Business plan in 2013

11,929 11,275

Actual 2012 Budget 2013

1,322 1,360

Actual 2012 Budget 2013

Uncertainties in hiring rigs lead to

dependence of revenue on external

factors, such as, drilling market and

whether hired rigs adapt to technical

requirements of oil contractors

NPAT is estimated to increase

due to rise in profit margin of high-

tech services, profit from joint

ventures and improved day rate

since the end of Q2/2012.

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If PV Drilling continues to maintain the market share of hired rigs, promote new technical

services, optimize cost control and receive great support from PVN, the expected profit will

reach VND 1,500 billion.

P V D R I L L I N G

6%

13%

64%

9%

8%

Investment plan 2013

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Investment of parent company in subsidiaries and other JVs

Investment of subsidiaries

Investment in equipment, warehouses

Investment in new JU rig

Investment items transferred from 2012

Số kế hoạch

(tỷ đồng)

I Các khoản đầu tư chuyển từ 2012 sang 160

II Đầu tư năm 2013 1,533

A Đầu tư của Công ty mẹ 1,327

1 Đầu tư trang thiết bị, nhà xưởng 362

1.1 Bộ cần khoan 43

1.2Mua thiết bị chống phun trào dự phòng

(BOP) và thiết bị khác phục vụ giàn khoan179

1.3 Trang thiết bị phục vụ CNTT, khác 60

1.4 Mua đất xây văn phòng và nhà thay ca 80

2 Đầu tư liên doanh 965

2.1 Đầu tư giàn khoan Jack-up (liên doanh) * 735

2.2Đầu tư liên doanh và tăng vốn đơn vị thành

viên230

B Đầu tư của các đơn vị thành viên 206

1 Mua săm trang thiết bị SXKD 97

2 Thiết bị xưởng Đông Xuyên 51

3 Đầu tư liên doanh 53

4 Đầu tư khác 6

TỔNG CỘNG 1,693

STT Hạng mục đầu tư 2013

(* ) Liên doanh sẽ vay 3.000 tỷ đồng, trong đó tương ứng 50% (*) Liên doanh sẽ vay 3.000 tỷ đồng, trong đó tương ứng 50% của PV Drilling là 1.500 tỷ đồng

Tổng số tiền đầu tư 2.693

Đầu tư thêm giàn khoan (**) 1.000

Investment plan

Investment items transferred 2012 160

Investment in 2013 1,533

Investment in a jack-up rig (*) 1,000

Total 2,693

(*) Expected to invest in one jack-up rig during beginning of 2014 costing USD 230 million, PV Drilling will contribute 70% in which 30% from shareholders’ equity, equivalent to VND 1,000 billion

P V D R I L L I N G

Strategies to achieve 2013’s objectives

Ensure stable business and operation performance

Operating owned rigs safely and efficiently

Safe operation Zero LTI

Efficiency TAD: 95%

Efficiency JU: 98%

Efficiency Landrig:

98%

Cooperating with prestigious drilling contractors around the world

Well managing joint venture projects to increase economic efficiency

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P V D R I L L I N G

Ensure stable business and operation performance

Intensify the key services and develop new ones.

Investment in technical innovation

Proceed to deploy the Science and Technology Development Fund

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Strategies to achieve 2013’s objectives (Cont.)

P V D R I L L I N G

Health– Safety – Environment – Quality (HSEQ)

Zero LTI

In operation of both offshore

and onshore rigs

Complying with international

standards including

ISO 9001:2008

ISO 14001:2004

OHSAS 18001:2007

Is maintained and upgraded

regularly

Managing the Online

Medical Data

PV DRILLING

Health: - Talk - Online

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Strategies to achieve 2013’s objectives (Cont.)

P V D R I L L I N G 31

Developing

The Brand Identity System & Corporate Culture of PV Drilling

Human Resource Management

Leadership Competency Development

Roadmap (the first phase was implemented

since 2012)

Drilling Crew Succession Planning program

(implemented since 2012)

Upgrade and develop skillful, technical-

expertise crew who can replace foreign

experts.

Strategies to achieve 2013’s objectives (Cont.)

P V D R I L L I N G

Human Resources Policies

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Employee Stock Ownership Plan (ESOP) is launched in order to retain

skillful and talented employees, motivate employees to work and dedicate to

achieve the business target

- Đạt KHSXKD 2012: phát hành ưu đãi 1.000.000 cổ phần

- LNST 6 tháng đầu năm 2013 đạt 60% Kế hoạch: phát hành ưu đãi 500.000 cổ phần

- LNST năm 2013 đạt 120% Kế hoạch: phát hành ưu đãi 500.000 cổ phần

Thị trường lao động cho giàn khoan và các dịch vụ kỹ thuật ngày càng cạnh tranh gay gắt, đội ngũ lao động có tay nghề, trình độ chuyên môn cao bị thu hút bởi những chính sách tìm kiếm nhân tài của các công ty nước ngoài; dẫn đến chảy máu chất xám, nguồn nhân lực thiếu ổn định, ảnh hưởng đến sự phát triển bền vững của Tổng Công ty

Establish and upgrade the Compensation & Benefits (C & B)

• Based on job evaluation of each title in order to improve the business efficiency.

• Timely and fair reward for those who have contributed to PV Drilling.

Labor market for drilling and technical services is under aggressive competition, skillful staff and

experts are attracted by headhunting policies of foreign companies leading to brain drain, unstable

employees’ mentality, in turn, affect the sustainable development of the Corporation

P V D R I L L I N G

Conclusion 2013

In 2013, global and Vietnam economies may not have overcome all difficulties, thus, there will be more factors affecting business activities.

PV Drilling will penetrate new markets, drill deeper with high technology, expand its scope of advanced technical service provision, then, ensure stable growth rate, add sustainable value for shareholders.

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P V D R I L L I N G

PETITION:

1. Approval on Business Performance Report in 2012

2. Business Plan in 2013

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