TABLE OF CONTENTS 4 NEWS FROM PETDER 1 EXECUTIVE SUMMARY IMPORTANT GLOBAL DEVELOPMENTS IMPORTANT DEVELOPMENTS IN THE INDUSTRY

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3 2013 SECTOR REPORT Disclaimer: Sector Reports are prepared for informational purposes only to inform the public and members on the developments in the sector and are not intended as a substitute for professional consultancy service.therefore, Petroleum Sector Reports should not be regarded as a consultancy service. The businesses need to be aware of the fact that the decisions taken based on data offered in the Petroleum Sector Reports might not lead to the results expected. While reasonable efforts have been made to ensure the accuracy of the reports content, Petroleum Industry Association assumes no responsibility for any inaccuracy, omission, or any loss or damage arising in connection with any action or decision taken as a result of using or relying on the information in the reports. Businesses need to consider this fact while taking actions or decisions

4 TABLE OF CONTENTS 1 EXECUTIVE SUMMARY IMPORTANT GLOBAL DEVELOPMENTS IMPORTANT DEVELOPMENTS IN THE INDUSTRY 3.1 Automation System New Customs Law Petroleum Market Law Amendment Amendment to Anti-Smuggling Law Amendment Regarding Letters of Guarantee Provision of Non-fuel Products Coastal Plant Permits and Ministry Project for Building Joint Buoys Biofuels LPG Penalties The Process Regarding Carriage of Dangerous Goods National LPG Stock Customs Bonded Warehouse Circular Volatile Organic Compound Emissions Seveso Directive Soil Pollution Regulation Postponed Inspection Companies to be Authorized by EMRA LPG Responsible Director Legislation and the Obligation of Keeping a Register E-invoice Regulations Developments Regarding National Marker NEWS FROM PETDER PETDER Meets Energy Journalists Association Waste Oil Management Project Annual Meeting EMRA and LPG Industry Meet in Bolu Presentation on Control of Volatile Organic Compounds Presentation at Argus Base Oil Conference Information on Waste Motor Oil on TV Press Release on Prices PETDER Has Become a Member of Traffic Safety platform Presentation at ADR Summit Lubricants Meeting PETDER Lubricants Technical Committee TSE Meeting Representatives of EMRA and the Industry Meet in Şile Draft Law Meeting in Bolu Gas&Power Turkey Energy Summit Petroleum Fair EPDK and Sector Workshop National Marker Practice Stakeholders Meeting 29

5 5 PROJECTS Waste Motor Oil Management Project Social Responsibility Projects One Barrel One Tree Traffic Safety Platform Fuel Committee TV Spot 33 6 SECTOR STATISTICS Crude Oil and Fuel Prices Special/Differentiated Products and Europe Turkey Comparisons Indirect Taxes and Market Volumes Factors Affecting European Situation and Price Comparisons Market / Trading Volumes Oil and LPG Industry Statistics Automotive Fuels (Gasoline, Diesel, LPG) Consumption Diesel Consumption Gasoline Consumption LPG Autogas Consumption Total Automotive Fuels Consumption Black Products (Fuel Oil, Heating Oil) Consumption Fuel Consumption (Gasoline, Diesel, Kerosene, Heating Oil, Fuel Oil) Lubricants Consumption 45 7 OTHER INDUSTRIAL STATISTICS Number of Motor Vehicles Automotive Fuel Consumption Based on Gross Domestic Product LEGAL REGULATIONS ABOUT PETDER REFERENCES

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7 TABLES Table 1: Petroleum Products Comsumption Figures ( ) 10 Table 2: 2013 Automotive Fuels Tax/Price 11 Table 3: Number of Licensees in Petroleum and LPG Markets 39 Table 4: Import, Export and Consumption Figures of Lubricants in Turkey 47 Table 5: Fuel and LPG Consumption 49 FIGURES Figure 1: PETDER Waste Motor Oil Management Project Amounts of Waste Oil Collected 31 Figure 2: PETDER Waste Motor Oil Management Project Funds Used Each Year 31 Figure 3: Changes in the average prices of Brent crude oil ($/barrel), diesel, gasoline and autogas LPG 34 Figure 4: Price comparisons of standard and special diesel types 35 Figure 5: Indirect Taxes Collected from Fuel and LPG over the years 35 Figure 6: Breakdown of Indirect Tax Revenue Collected from Automotive Fuels in 2012 and Figure 7: Trade Volumes in Fuel 38 Figure 8: Trade Volumes in LPG 38 Figure 9: A comparison of the number of fuel stations of the distributor companies 39 Figure 10: Total Diesel Consumption 40 Figure 11: Shares of standard diesel fuel and special/differentiated diesel fuel in total diesel consumption 40 Figure 12: Change in total gasoline consumption over the years 41 Figure 13: Shares of 95, 97 Octane gasoline and gasoline with additives in total gasoline consumption 41 Figure 14: Change in LPG Autogas consumption over the years 42 Figure 15: Change in the amount of automotive fuel consumption over the years 42 Figure 16.a: Gasoline and LPG Autogas Consumption in 2012 and Figure 16.b: Automotive Fuels Consumption 43 Figure 17: Change in Black Product Consumption over the years 43 Figure 18: Change in Total Fuel Consumption 44 Figure 19: Shares of Fuel Types in Total Fuel Consumption 44 Figure 20: Lubricant Consumption in Turkey 45 Figure 21: Shares of Lubricant Product Groups (%) 45 Figure 22: Vehicle Oil Consumption in 2012 and Figure 23: Motor Oil Consumption in 2012 and Figure 24: Industrial Oil Consumption in 2012 and Figure 25: Shares of Product Groups in Industrial Oils in Figure 26: Antifreeze and Hydraulic Brake Fluid Consumption in 2012 and Figure 27: Number of Vehicles in Traffic and Change in Automotive Fuel Consumption 50 Figure 28: Number of Vehicles in Traffic According to Fuel Types 50 Figure 29: Yearly Automotive Fuel Consumption Rate and GDP Growth Rate 51

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9 In order to consistently develop the fuel market, which is of great importance for national economy, it is necessary to adopt free market mechanisms to ensure progress and improvement of free competition environment. Ahmet Erdem PETDER Chairman Petroleum Industry Association (PETDER), as a representative of the downstream fuel industry successfully since 1996, has been trying to find solutions to the problems in the industry and striving to ensure competitive and steady market activities in the industry. Our Association, representing almost 80% of the sector with its 14 members, has been building steady and permanent communication networks both through its positive relations with the public and the comprehensive information and data shared with the public, and enhances these networks continuously. In 2013, PETDER continued to emphasize illegal and illicit fuel and Number 10 Oil problems which cause significant tax loss. Besides the loss of lives and property, illegal and illicit fuel activities cause substantial tax loss and unfair competition, impair the performance and development of the industry. PETDER has been carrying out Waste Motor Oil Collection Project since 2004 striving to leave our children a green environment with One Barrel One Tree Project. With 82 distributors, 109 storage facilities and 12,892 dealers in the petroleum market, 77 distributors, 101 storage facilities and 10,300 dealers in LPG market, 60 billion TL tax (SCT+VAT) and a magnitude of 112 billion TL, the oil sector is an important sector in Turkey. In order to consistently develop the fuel market, which is of great importance for national economy, it is necessary to adopt free market mechanisms to ensure progress and improvement of free competition environment. PETDER Sector Reports, published annually, not only provide information on PETDER activities but also summarize the main issues which the industry focuses on through the year and present statistical data in the industry. I express my thanks to PETDER staff who contributed to the preparation of 2013 report and I wish this report will be beneficial to the sector and the public. Ahmet Erdem PETDER Chairman 5

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11 As PETDER, we keep the sector and the public informed on the developments and sectoral issues through this Sector Report, our web site, Waste Motor oil Collection Project Annual Activity Report and our monthly petroleum bulletins. Niyazi İlter PETDER Secretary General This report, prepared by PETDER, contains sectoral developments, PETDER activities in 2013 and significant statistical data. The report, besides providing important information for the players in the industry, also undertakes the mission of enlightening and informing the public. In addition to the previous year reports, includes information on global developments in the industry. We aim to enlarge the scope and content of the report in the following years by evaluating PETDER s relations with international institutions. In, we also present our brief comments along with the statistical data. The first part of the report provides information on the important developments in 2013 and the meetings and events PETDER attended or organized. The second part contains sectoral figures and charts. As PETDER, we keep the sector and the public informed on the developments and sectoral issues through this Sector Report, our web site, Waste Motor oil Collection Project Annual Activity Report and our monthly petroleum bulletins. I wish will be beneficial to all agencies and institutions in the sector. Niyazi İlter PETDER Secretary General 7

12 1 EXECUTIVE SUMMARY IMPORTANT DEVELOPMENTS IN THE SECTOR In 2013, the oil industry continued to fight illegal and illicit fuel activities and strived to take more efficient steps to fight smuggling. In this regard, in 2013 PETDER pointed out the consequences of defining illegal fuel based on national marker. According to one of the definitions of illegal fuel set forth under Anti-Smuggling Law no.5607, fuel that does not contain the sufficient amount of national marker as specified by EMRA is defined as illegal fuel. Because of such a definition, fuel that is in compliance with technical regulations and is legal in all other aspects might be defined as illegal fuel due to technical problems such as measurement errors or inconsistencies between devices, which might lead to a shut down of the whole plant (excluding refineries) and smuggling charges followed by legal proceedings. EXECUTIVE SUMMARY The oil sector recommends that the definition of illegal fuel in the Law, based on national marker is amended. Insufficient level of national marker should be taken as preliminary data but further evidence and one of the other conditions set forth under the definition should be sought to press smuggling charges. It was observed that illegal fuel activities continued in 2013 under different names and character at different levels. With the measures taken in recent years, the amount of illegal fuel has decreased significantly. It is necessary to eliminate the causes in order to solve illegal fuel problem completely. In this regard, it was recommended that the very high taxes levied on fuel be decreased to a reasonable level gradually in time and zero SCT practice in marine and aviation fuels be replaced with SCT refund practice. The fuel industry does not only cover a range of commercial activities but also serves as a means for the state for collection of taxes amounting up to 65 billion TL. The necessity of adding exclusive license provisions to the Petroleum Market Law for distributors in the sector was hightlighted. Useful implementations such as national marker and automation should be supported with field audits to be conducted in cooperation and coordination with public authorities. In this regard, the content of the automation practice regulated with EMRA Board Decision No.1240 has been an important agenda item in the sector. Automation system is an essential practice in fighting illegal fuel and is supported by the industry. However, with the Board Decision, EMRA s authority as a public auditing body has been removed and this responsibility has been transferred to distribution license holders. Integrating a public factor like audit/writing an official report/commencing legal proceedings into a commercial relation between two legal entities shall cause serious problems in terms of Distributor-Dealer relations. PETDER has recommended that distributors liabilities to follow the inconsistencies in the automation system continue but the decisions to suspend supply and initiate judicial proceedings be rendered by EMRA and that the responsibilities of distributors be terminated upon termination of dealer contracts. Similarly, in Article 17 of LPG Market Law no.5307, it is stated that in case of LPG supply that does not comply with technical regulations, it may lead to cancellation of licenses. However, it is also stated that in the event that it is determined that LPG supplied is incompliant with technical regulations (violating technical regulations in terms of odour) but there is no malicious intent, debasement or bad faith, licenses should not be cancelled. 8 Another issue PETDER focused on in 2013 was failures and short periods in renewal of licenses within the scope of Regulation on Procedures and Principles Regarding Granting Operating Permits to Coastal Plants. Coastal plants in marine terminals and warehouses are of utmost importance in fuel supply. Coastal plant operating permits are granted by the Ministry of Transportation, Maritime Affairs and Communications

13 within the scope of the Regulation published in the Official Gazette no Interruption of operating permits and temporary or short term permits hinder the supply process. PETDER has expressed that the term of coastal plant operating permits should be 5 years as in the past and that the regulation should be amended to provide enough time to plants where there is a need for harmonization with the legislation, so as to maintain sustainability of activities at such plants operating under permits obtained before. Another agenda item in 2013 was the amendment regarding letters of guarantee in fuel import made with Article 10 of Customs Regulation dated 21 November 2013 and the increase in the amount of guarantees. More than 12 million tons of fuel products are imported by refineries and distributors every year. Importers holding an approved entity status are no more able to give a specified lump sum bank letter of guarantee and it became an obligation to provide a bank guarantee for bonded warehouse and import phases and for each transaction separately, amounting up to 220% in total. Although it is accepted and supported that there is a need for amendment in bank guarantee practice for the purpose of preventing illegal fuel activities, it is also considered to be an unsustainable practice as the sum that will remain locked up will reach 10 billion TL. An amendment in the Regulation is recommended to enable the bank letters of guarantee to be returned as soon as taxes are paid, to help prevent illegal fuel activities in bonded warehouse and import phases and ensure working with a sustainable high and fixed global letter of guarantee. PROJECTS Waste Oil Management Project Following the Regulation on Control of Waste Oils issued by the Ministry of Environment and Forestry, which has now been abolished, PETDER initiated the Waste Oil Management Project in 2004 in order to fulfill the members liabilities resulting from the Regulation by collecting the waste motor oil generated at car maintenance and repair shops, fuel stations and public car maintenance stations by licensed and authorized personnel under appropriate conditions. EXECUTIVE SUMMARY Waste motor oil collected by PETDER within the framework of the project are processed at facilities licensed by the Ministry of Environment and Urban Planning to eliminate the negative impacts on environment and human health and public awareness is raised on the negative impacts of waste oil and how it should be reclaimed. In the last 9 years, 142,352 tons of waste motor oil collected was either recycled as raw material and energy or disposed at licensed facilities. The amount of waste motor oil collected by PETDER and delivered to facilities licensed by the Ministry of Environment and Urban Planning totaled 18,715 tons. In addition, PETDER plants one tree for each barrel of waste motor oil collected with 1 Barrel 1 Tree Project. PETDER planted 16,500 tress in 2013 and the total number of trees planted within the framework of the project reached 56,500. PETDER is the only institution authorized by the Ministry of Environment and Urban Planning for the collection of waste motor oil. Traffic Safety Platform Fuel Committee PETDER became a member of Traffic Safety Platform on 15 July 2013 and Ahmet Erdem was appointed head of the Fuel Committee of the Platform. PETDER plans and carries out Fuel Committee activities with its members. 9 10

14 INDUSTRIAL STATISTICS Crude Oil and Fuel Prices The fluctuations in world oil prices continued in 2013 and as a result of these fluctuations, fuel pump prices received much media coverage. Brent oil started 2013 with $111 per barrel in the international markets, and by February 2013 reached $119 per barrel, its highest level in By the end of December 2013, the price of Brent Oil was around 112$. The changes in crude oil prices directly affected the price of fuel products in the Mediterranean markets and in February 2013, gasoline with $/ton and diesel with $/ton reached the highest level of the year. Indirect Taxes and Industry Volumes The total amount of the indirect taxes collected from fuel and LPG industries has continuously increased every year. According to calculations based on consumption figures, the indirect taxes collected from petroleum industry in 2013 increased by 17.6% compared to the previous year and reached 60.1 Billion TL. The figure below displays the amount of indirect taxes collected from the petroleum industry (including LPG) since It is calculated that the indirect taxes collected from the petroleum industry since 2007 have totaled 294 Billion TL. EXECUTIVE SUMMARY 10 Petroleum and LPG Industry Statistics As of the end of 2013, there were 4 refineries, 77 distributor companies, 12,623 fuel stations operating in the petroleum market with EMRA licenses. In the Liquefied Petroleum Gas (LPG) market, 73 distributor companies, 10,089 autogas stations were operating with EMRA licenses. Data indicates that number of autogas stations keeps increasing. The number of stations decreased for the first time in 2011 and there was a slight increase in The number of fuel distribution companies peaked in The number of LPG distribution companies continues to increase Table 1: Petroleum Products Comsumption Figures ( ) Petroleum Products (m 3 ) Fark 95 Octane (with additives)* %1,2 Unleaded 97 and Higher Octane* %-13,9 Total Gasoline (m 3 ) %0,2 Diesel* %2,8 Diesel (Other)* %17,5 Total Diesel (m 3 ) %6,8 Autogas* (m3) %1,2 Total Automotive Fuels* (m 3 ) %5,1 LPG Products (tons) Fark Bulk* %-21,2 Bottled* %-5,4 Autogas* %1,2 Total LPG (tons) %-1,1 Lubricants (tons) Fark Vehicle Oils %-2,8 Industrial Oils %8,7 Marine Oils and Greases %12,1 Total Lubricants (tons) %2,9 *Calculated based on EMRA Oil and LPG Sector Report figures and PETDER data. Fuel data are consolidated from 13, lubricants data are collected from 6 distributor companies on a voluntary basis.

15 Table 2: Automotive Fuels Tax/Price Data ( ) Turkey Pump Prices (Tl/lt)* Fark Taxed Gasoline (95 Octane) 4,19 4,50 %7,4 Taxed Diesel (Standard 10ppm) 3,64 3,93 %8,0 Taxed Autogas (LPG) 2,32 2,51 %8,2 Gasoline without tax (95 Octane) 1,66 1,85 %11,4 Diesel without tax (Standard 10ppm) 1,78 1,95 %9,6 Autogas without tax (LPG) 1,25 1,37 %9,6 Price of Petroleum and Products in International Markets ** Fark Brent (USD/Barrel) 112,5 109,6 %-2,5 Brent (TL/ Barrel) 214,6 209,2 %-2,5 Gasoline, CIF Med (TL/1000lt) 1.992, ,8 %-4,9 Diesel, CIF Med (TL/1000lt) 1.877, ,9 %-4,0 LPG, CIF Med (TL/1000lt) 1.768, ,8 %-9,2 Total Indirect Taxes (Billion TL) *** Fark Fuel SCT 31,0 37,6 %21,1 Fuel VAT 13,3 15,1 %13,8 LPG SCT 4,9 5,4 %11,3 LPG VAT 1,9 1,9 %2,5 Total Indirect Taxes 51,1 60,1 %17,6 * Calculations based on data from 8 fuel companies (Istanbul European Side) published on EMRA website. ** Source: Argus Monthly Report *** Calculations based on total consumption data from EMRA. (For fuels, white and black products are included, lubricant is excluded) EXECUTIVE SUMMARY 1112

16 2 GLOBAL PROJECTIONS World Energy Outlook report, published annually by the International Energy Agency founded in 1974 with its headquarters in France, provides detailed data and projections on oil, natural gas, coal and reneable energy sources as well as global energy trends. Following is a brief summary of the information on oil industry provided in 2013 report. GLOBAL PROJECTIONS AND DEVELOPMENTS 12 Global oil demand increases steadily in the New Policies Scenario to 99.7 mb/d in 2035, up from 87.4 mb/d in The rate of demand growth is slowed by government policies, including efficiency measures, and higher prices. Demand grows briskly in non-oecd countries, with China alone accounting for around 50% of the net increase worldwide, more than offsetting a steady decline in OECD regions brought about by efficiency gains, inter-fuel substitution and saturation effects. Major importers are becoming exporters, while countries long-defined as major energy exporters are also becoming leading center of global demand growth. The center of gravity of energy demand is switching decisively to the emerging economies, particularly China, India and the Middle East, which drive global energy use one-third higher. China is about to become the largest oil-importing country and India becomes the largest importer of coal by the early 2020 s. The United States moves steadily towards meeting all of its energy needs from domestic resources by Together, these changes represent a re-orientation of energy trade from the Atlantic basin to the Asia-Pacific region. The decline in oil use in OECD countries accelerates. China overtakes the United States as the largest oil-consuming country and Middle East oil consumption overtakes that of the European Union, both around The shifting geography of demand is further underlined by India becoming the largest single source of global oil demand growth after Oil consumption is concentrated in just two sectors by 2035: transport and petrochemicals. Transport oil demand rises by 25% to reach 59 mb/d, with one-third of the increase going to fuel road freight in Asia. In petrochemicals, the Middle East, China and North America help push up global oil use for feedstocks to 14 mb/d. Brazil is set to become a major exporter of oil and a leading global energy producer. Based mainly on a series of recent offshore discoveries, Brazil s oil production triples to reach 6mb/d in 2035, accounting for one-third of the net growth in global oil production and making Brazil the world s sixthlargest producer. All of the net growth in global oil demand comes from the transport sector in emerging economies. Although passenger light-duty vehicles (PLDVs) remain the biggest component of transport demand, road freight demand increases more quickly, approaching the level of demand from PLDVs today by Fuel-economy standards for trucks are much less widely adopted than for PLDVs. Oil production, net of processing gains, is projected to rise from 84 mb/d in 2011 to 97 mb/d in 2035, the increase coming entirely from natural gas liquids and unconventional sources. Output of crude oil (excluding light tight oil) fluctuates between 65 mb/d and 69 mb/d, never quite reaching the historic peak of 70 mb/d in 2008 and falling by 3 mb/d between 2011 and Light tight oil production grows above 4 mb/d in the 2020s, mainly from the United States and Canada. Non-OPEC output rises to above 53 mb/d after 2015, a level maintained until the mid-2020s. The increase is due to rising unconventional supplies, mainly from light tight oil and Canadian oil sands, natural gas liquids, and a jump in deepwater production in Brazil. After 2025, non-opec output falls back to 50 mb/d in The United States overtakes Russia and Saudi Arabia before 2020 to become, until the mid-2020s, the world s largest oil producer. Output by OPEC countries collectively 1 Light tight oil

17 AND DEVELOPMENTS accelerates through the projection period, particularly after 2020, to 46 mb/d in 2035, their share of world oil production rising from 42% to 48%. Iraq sees the biggest absolute increase in output. The rise of unconventional oil (including LTO) and natural gas liquids meets the growing gap between global oil demand, which rises by 14 mb/d to reach 101 mb/d in 2035, and production of conventional crude oil, which falls back slightly to 65 mb/d. The average annual increase in global energy demand for transport is 1.3%. This growth rate is quite low compared to the past. The net growth is completely due to the demand from non-opec regions. While it is projected that the number of automobiles and trucks will increase two-fold between 2011 and 2035, it is expected that the improvement in automobile technology will lead to major developments in average vehicle fuel economy. It is projected that global demand for diesel in road transport will increase by 6.4% million barrel/day and for gasoline by 2.1% million barrel/ day between 2011 and While petroleum based fuels continue to constitute a major part of the energy demand in transportation, demand for electricity for hybrid and electric powered vehicles grows. Use of liquefied or compressed natural gas also increases (it is projected that the demand in road transport will increase by 4.8% until 2035) However, despite the proven technology, it is observed that this market is either minimum or does not exist in many countries due to problems in use fuel for vehicles and lack of supply infrastructure. GLOBAL PROJECTIONS AND DEVELOPMENTS 1314

18 3 IMPORTANT DEVELOPMENTS 3.1 AUTOMATION SYSTEM IMPORTANT DEVELOPMENTS IN THE SECTOR 14 EMRA and other interested parties have had several meetings on the obligation of setting up and operating the automation system implemented in July Imposing an obligation on Distributors to take action before Prosecution and other relevant Public Authorities regarding determinations through the automation system and nonagreements pursuant to As is in current practice, nonagreements determined by Distributors should definitely be inspected and investigated by the Authority and in the case that the nonagreement requires legal action; the Authority should be the lawful authority to commence legal and judiciary proceedings. the arrangement made in EMRA Board Decision in 2013, bears the risk of causing serious problems both in terms of operational and legal liabilities. As this legal liability to carry out audits is given to EMRA as per article 25 of Law no.5015, it is considered that this duty imposed on the Authority cannot be transferred to distributors or any other player in the sector through such an implementation. Therefore, as is in current practice, nonagreements determined by Distributors should definitely be inspected and investigated by the Authority and in the case that the nonagreement requires legal action; the Authority should be the lawful authority to commence legal and judiciary proceedings. In addition, it is obvious that integrating a public factor like audit/writing an official report/commencing legal proceedings into a commercial relation between two private undertakings completely subject to private law provisions shall cause serious problems in terms of Distributor-Dealer relations. Arrangements regarding automation practice until now do not completely distinguish between the liabilities of the dealer and the liabilities of the distributor who are two separate legal entities. Despite all appeals and explanations regarding the situation, the liabilities of dealer undertakings have not been clearly specified and any problems, misimplementations, negligence and impossibilities which result from the activities of dealer undertakings have been handled as the liability of distribution companies. The situation persists in the recent Draft and dealer license holders are not mentioned in the Draft even in situations where they should legally share joint liability. As per provisions in the Draft, distribution companies are forced to suspend fuel supply whereas no action or administrative measure to be taken exists in the case that dealer license holders continue sales. 3.2 NEW CUSTOMS LAW The Law amending the Customs Law and Decrees Having the Force of Law was discussed and approved by the GNAT General Assembly on 1 April 2013 and published in the Official Gazette no dated 11 April Pursuant to the law, those who have been convicted for their wrongful acts contrary to Anti-Smuggling Law shall not be issued a license. Distributor license holders shall not supply fuel to the dealers where dealer audit system is not established or where the audit system established does not comply with the regulations issued by the Authority. In the event that the results of the national marker measurements conducted with mobile control devices are not valid, the sample taken shall be delivered to the laboratory in 5 business days at the latest. The laboratory shall conduct the required analyses in 15 days before the sample properties undergo any change and submit the results to EMRA in 3 business days at the latest. The Authority shall take administrative measures to prevent illegal fuel sale until the accredited laboratory results are submitted. An administrative fine at an amount of 1 million Turkish Liras shall be imposed on those who carry out activities subject to a license without holding a license and those who do not add national marker. In the event that the same act for which an administrative fine has been imposed is repeated within 2 calendar years, the above fines shall be twofolds. The administrative fines shall be decided by the Authority within no later than 3 months after the

19 IN THE SECTOR preliminary inquiry and investigation are completed. At all types of facilities except the refineries where illegal fuel activities are observed, all the activities subject to license shall be suspended temporarily by the Authority until the decision of non-prosecution or the final court order. In the meantime a license for the facility shall not be issued for any other real or legal person. The license of the license holders shall be cancelled based on the final court order. A license shall not be issued for the facility subject to license until the administrative fine imposed on the license holder is paid. In the event that the smuggling act is only about the level of the national marker, the national marker level of the fuel is appropriate based on the results of the analyses conducted by the accredited laboratory or the origin of the fuel is officially documented and certified as having entered free circulation in Turkey by legal means, the temporary suspension decision shall be lifted by the Authority. 3.3 PETROLEUM MARKET LAW AMENDMENT The Draft Law contains important amendments to Law no.5015 including provisions which authorize the Ministry of Energy and Natural Resources regarding the oil industry and authorize the Offices of the Governor for granting dealer licenses. Important points in the comments on the draft are sumamrized below: Independent Dealer System With the Fuel Market Draft Law, a new category under the name of independent dealer which did not exist in law no.5015 was created. According to the draft law, these independent dealers will be able to open and operate a station Independent dealers not affiliated with a distributor will be out of routine distributor controls in regard to product quality, service quality, cleaning, security and stock reconciliation. without signing a dealer contract with a distribution company, import fuel and add national marker to the fuel and thus, carry out activities both as a dealer and a distributor in the industry. Past experience in the sector has revealed that the fuel market is in need of efficient inspection and surveillance. Independent dealers not affiliated with a distributor will be out of routine distributor controls in regard to product quality, service quality, cleaning, security and stock reconciliation, it will not be possible to determine the origin of the product and will pose a threat due to the possibility of nonregistered activities. Independent dealers will also rule out traceability completely, which is one of the most significant features of the oil market today, and make it impossible to track unregistered activities in the industry retrospectively. Amendments to Monitoring from Headquarters and Licensing One of the major amendments to licensing in the draft is that while all market activities are subject to a license by the Ministry, dealer licensing will be cancelled and local authorities will be authorized to grant dealer certificates. Local authorities already grant non-sanitary enterprise permits. However, in the event that the final permit or certificate is granted by local authorities and is not registered and published, it will be difficult to track cancellations and delivery to unauthorized dealers. We are of the opinion that licensing and monitoring upon obtaining the necessary permits from local authorities are of crucial importance in order to maintain order in the industry and that abolishing such practice will have adverse effects on the industry and national economy. Administrative Sanctions In the current legislation where incompliance with national marker levels alone leads to prosecution for smuggling, sealing the whole facility (fuel station etc) rather than the tank or pump inspected and suspending all activities may lead to unnecessary, unfavourable and unfair consequences for the undertaker. In addition, the fact that incompliance with technical regulations may lead to cancellation of licenses, as in the case of LPG, is an administrative sanction which might cause serious problems. IMPORTANT DEVELOPMENTS IN THE SECTOR 1516

20 Restrictions The principle of freedom of contract exists in Turkish law. However, introducing restrictions in terms of contract terms and other issues might prevent the sector from responding to technological and economic developments in a timely manner. Basically such issues are within the scope of Competition Law and it is considered that there is no need for regulation of these issues within the scope of Fuel Market Draft Law. In this regard, it is recommended that the restriction on the sales the distributors carry out through the stations they operate is lifted and that the limit is increased from fifteen percent to fifty percent of the total domestic market share of a distributor. IMPORTANT DEVELOPMENTS IN THE SECTOR 16 Requirement to Review the Definition of Smuggling In Article 3/11 of Anti-Smuggling Law no.5607, definition of smuggling is based on national marker levels. However, past experience has indicated that a definition based only on national marker levels might lead to incorrect and serious results. Therefore, with an amendment to Law no.5607 in the draft, detection of smuggling should be supported with automation data and other documentation and instruments. Marine and Aviation Fuels and Lubricants Should Also Be Included in the Draft Law Marine fuels, aviation fuels and lubricants, which are important components of the oil market are left out of the scope of the Draft Law. However, these basic products of the oil market have been receiving much attention as they have frequently been subject to illegal fuel activities. Therefore, we believe that it will be beneficial to place these products within the scope of the Draft Law as activities requiring a license. 3.4 AMENDMENT TO ANTI-SMUGGLING LAW Past experience has indicated that a definition based only on national marker levels might lead to incorrect and serious results. Detection of smuggling should be supported with automation data and other documentation and instruments. Law Amending Customs Law and and Certain Laws and Decree-Laws was published in the Official Gazette no dated and the provisions of this Law amending Customs Law and Anti- Smuggling Law no.5607 came into force as of the day of publication. Amendments to the law are briefly listed below: Penal provisions on illegal fuel in Law no.5015 and penal provisions on smuggling of tobacco products and alcoholic beverages in Law no.4733 have been transferred to Law no Illegal petroleum has been replaced with illegal fuel, all products used or may be used as fuel have been included in the definition of fuel and all acts in fuel smuggling have been regulated. Fuel has been defined as Fuel products such as gasoline, kerosene, jet fuel, diesel, fuel-oil, liquefied petroleum gases, natural gas, and petroleum derivatives used as a substitute for fuel and blends, and other products used as a substitute for fuel. A provision for a more severe punishment for those who sell illegal fuel with extra effort by using tanks, hidden mechanisms and equipment has been added to the Law. As a disincentive in the fight against illegal fuel, the Draft Law allows publication of names of those whose verdict of conviction regarding types of smuggling is finalized. Pursuant to Article 3 or Law no.5607; those who produce, offer to the market or sell, have in stock, despite being aware of its illegal nature, purchase for commercial purposes, the fuel which is subject to National Marker practice but does not contain any or a sufficient amount of national marker, as specified by Energy Market Regulatory Authority, shall be penalized with imprisonment of two to five years and a judicial fine of up to twenty thousand days. Those who manufacture fuel from or supply as fuel the non-fuel products such as solvents, lubricants, base oil, asphalt and such petroleum products, and produce, offer to the market, sell, have in stock, purchase for commercial purposes despite being aware of their illegal nature, transport or store such products for such purposes without obtaining a license from the Energy Market Regulatory Authority, will be penalized with imprisonment of two to five years and a judicial fine of up to twenty thousand days. Those who keep a fixed or mobile tank, mechanism or equipment violating the specifications set forth in the license documents in order to obtain, sell or use illegal fuel or illicit national marker in any market activity will be penalized with imprisonment of two to five years and a judicial fine of up to twenty thousand days.

21 3.5 AMENDMENT REGARDING LETTERS OF GUARANTEE Customs Regulation was amended with the regulation published in the Repeated Official Gazette dated 21 November With this amendment, refineries and distributors holding an approved entity status are no more able to give a specified lump sum bank letter of guarantee and it became an obligation to provide a bank guarantee for bonded warehouse and import phases and for each transaction separately, amounting up to 220% in total. Although the measures to prevent tax fraud are believed to be beneficial, the guarantee amounting up to 10 billion TL will remain locked up in the industry disturbing the financial structure of the industry. PETDER has conveyed its comments and recommendations to the state institutions regarding the following: Reducing the letter of guarantee rate which is nearly 220% to 100%; enabling giving global guarantees throughout Turkey and using these guarantees both in bonded warehouses and import, Not requiring a bank letter of guarantee for past imports that are not yet concluded and speeding the transactions at tax offices, Expediting the process for releasing the locked up guarantees, Eliminating regional differences in practice 3.6 PROVISION OF NON-FUEL PRODUCTS Although the measures to prevent tax fraud are believed to be beneficial, the guarantee amounting up to 10 billion TL will remain locked up in the industry disturbing the financial structure of the industry. With the Communique on Procedures and Principles of Supplying Non-Fuel Petroleum Products From Inland and Foreign Sources published in the Official Gazette No dated 24 April 2013 and effective as of 2014, obtaining a Letter of Conformity has been required. The institutions already holding a Certificate Of Approved Entity Status granted by the Ministry of Customs and Trade have been subject to an official categorization by public authorities in terms of reliability of trade and auditability. In order to minimize administrative burdens and manage possible risks, this official evaluation should be considered in the Communique and a letter of conformity should not be requirred in case of holding a Class A or B Certificate of Approved Entity Status but an obligation of notification should definitely be imposed. Rapid technological developments and new products developed according to customer demands result in a need for immediate change in the type and composition of products. In this regard, in the case of changing the base oil which is the main input and starting to use another base oil which had not been used before, being able to use only 15,000 tons of the main input base oil constituting approximately 70% of a company with a capacity of 100,000 tons might lead to serious problems. Therefore, we believe that if lubricants license holders are able to import base oil with a notification rather than a letter of conformity, operational difficulties will be eliminated. IMPORTANT DEVELOPMENTS IN THE SECTOR It should not be a requirement to obtain a new letter of conformity only after expiry of the former letter of conformity. Such implementation experienced in the past resulted in suspension of base oil supply during the two-month period until the new letter conformity is obtained and caused substantial additional storage costs. Companies should be able to apply for a new letter of conformity before the previous one expires and the new permit should be granted upon expiry of the former in order not to cause supply problems. Within the scope of the regulation, lubricant production license holders who want to import the substances set forth under Annex 1 as finished product are not able to list such products as raw material in their capacity reports as they do not use them as raw material in production but directly supply to the market and therefore are not included within the scope of letter of conformity applications. Therefore, they are not able to import these products. The industry expects that an amendment is made so as to allow lubricant producers import the products under Annex 1 as packaged products. 1718

22 On the other hand, limiting the supply with 250 kg without a letter of conformity creates unnecessary costs due to delivery planning and unnecessary use of resources and work load during the sales process of lubricant producers who produce the products listed under Annex 1 in Turkey. The Communique allows 250 kg of products per delivery in the sales process. However, as the companies, which require such products in the production process, require high tonnage of such products in order to sustain their production, such a limit per delivery is not convenient. As a result of this, companies using these products may have to pause production when their inventory runs out. IMPORTANT DEVELOPMENTS IN THE SECTOR 18 Similarly, a parcel of products such as rust removers (500 ml, aerosol), multi-purpose lubricants (200 ml, aerosol) supplied to the market in small packages weighs approximately 10 kg. Pursuant to the Communique, it is possible to deliver only 25 parcels to the supplier. This results in extremely high delivery costs for these products of which thousands of parcels are sold a year and has negative impacts on trade bringing it almost at a standstill. 3.7 COASTAL PLANT PERMITS AND MINISTRY PROJECT FOR BUILDING JOINT BUOYS In 2013, there were some delays in the renewal process of Coastal Plant Operating Permits granted by the Ministry of Transportation, Maritime Affairs and Communications and this resulted not only in difficulties in supply in the industry but also additional costs. Pursuant to Turkish law, coastal facilities of oil companies may not carry out activities subject to license without a coastal plant operating permit granted by the Ministry. Within the scope of the Ministry of Transportation, Maritime Affairs and Communications project to building a single dolphin/pier to serve the piers and buoys belonging to neighbouring plants, PETDER attended meetings held by the Ministry and contributes to the project with a working group formed within the Association. 3.8 BIOFUELS Within the scope of Technical Regulation Communique on Gasoline Types, distributor license holders are obligated to blend minimum 3% (V/V) domestic agricultural ethanol to the gasoline types delivered to their dealers within a calendar year. However, this obligation might not be fulfilled completely due to several reasons as the oxygen content of gasoline provided by refineries is close to the maximum value set forth in the standard, problems in measurements conducted after adding national marker and limited supply capacity of distributor license holder companies which do not have their own storage facilities. On the other hand, pursuant to the Council of Ministers Decision, in the event that auto biodiesel manufactured from oil collected from domestic sources is blended into diesel and sold by distributors, 2% of the SCT already charged for diesel with biodiesel will be refunded to distributors. Distributor license holders are obligated to blend minimum 3% (V/V) domestic agricultural ethanol to the gasoline types delivered to their dealers within a calendar year. Pursuant to the regulation, in the event it is detected that 20 liters of biodiesel manufactured from waste vegetable oil is blended into one thousand liters of diesel sold by distributors, all SCT paid for 20 liters of biodiesel will be refunded. Past experience in biodiesel regarding the additional financial burden that SCT refund implementation will bring and the process of manufacturing biodiesel from waste vegetable oil indicate that the issue requires close monitoring.

23 3.9 LPG PENALTIES Pursuant to Article 17 of Liquefied Petroleum Gases (LPG) Market Law which reads as The licenses of those who supply illegal products or products of which the country of origin are indefinite or products that do not comply with the technical regulations shall be cancelled. LPG that does not comply with technical regulations shall be confiscated upon court order. Those who supply such LPG shall be held liable to compensate any damage incurred, there were demands of cancellation of licenses and confiscation regarding the undertakings where odor criteria could not be met during EMRA inspections. The sectors efforts towards abolishing the provision requiring cancellation of the licenses in case of incompliance with technical criteria and imposing an administrative fine in such cases remained inconclusive and the law amendment regarding the situation was not carried out THE PROCESS REGARDING CARRIAGE OF DANGEROUS GOODS Regulation on Carriage of Dangerous Goods by Road was published by the Ministry of Transportation, Maritime Affairs and Communications on 23 October 2013 and became effective as of 1 January The Regulation sets forth the procedures and principles regarding the rights, responsibilities and working conditions of the personnel employed in sending, receiving, filling, loading, unloading, packaging, carrying and drivers or operators of all vehicles carrying dangerous goods, in order to ensure carriage of dangerous products on public highways safely and systematically without posing a threat to human health, other living things and the environment. Pursuant to the Regulation, dangerous substances will be transported on public highways, in compliance with ADR provisions, in an economical, controlled, swift and safe manner so as not to harm human health and to minimize their adverse impacts on the environment. During carriage of dangerous goods on highways; it is an obligation to use packaging tested and certified with a UN number by an institution authorized by the Ministry and to use labels, signs and orange plates as set forth in ADR. Pursuant to the Regulation and ADR provisions, it is an obligation for the drivers who carry dangerous goods on national and international roads to hold Carriage of Dangerous Goods Driver Training Certificate (SRC5)/ADR Driver Training Certificate as of the date of effect of the Regulation. Activities within the scope of this Regulation will be subject to supervised by the Ministry and a Ministry Circular on inspections has been published. Pursuant to the temporary article in the Regulation, the vehicles used for the domestic carriage of dangerous goods and operating without a Vehicle Compliance Certificate/ADR Compliance Certificate at the date of effect of the Regulation, are obliged to obtain the certificate of compliance, in accordance with the procedures and principles specified by the Ministry or an agency/institution authorized by the Ministry until the dates listed below: 31/12/2014 for vehicles manufactured between , 31/12/2015 for vehicles manufactured between , 31/12/2016 for vehicles manufactured between , 31/12/2017 for vehicles manufactured before 1985, It is projected by PETDER that implementation of ADR will contribute to achieving international standards and creating a competitive environment; decrease the number of accidents during transportation and have positiveconsequences in regard to public health. Regulations under ADR legislation obligate all companies engaged in domestic road transport to achieve and maintain these standards. IMPORTANT DEVELOPMENTS IN THE SECTOR One of the areas to focus on and discuss during ADR harmonization process is the training and certification of the employess in the sector. The aim of the trainings to be conducted should be forming a common course of conduct in regard to ADR. As the quality of the trainings improves, so will the number of conscious drivers decreasing repair and scrap costs and transportation costs. Testing, Certification And Inspection Regarding Carriage Of Dangerous Goods Will Be Carried Out By Turkish Standards Institute At the ceremony held on 6 March 2013 with the attendance of the Minister of Transport, Maritime Affairs and Communications Binali Yildirim and the Minister of Science, Industry and Technology Nihat Ergun, the Ministry of Transport, Maritime Affairs and Communications delegated its authority on operations and procedures regarding the packaging, testing, certification and inspection of tanks to TSE. With the delegation of authority, TSE has been the authorised institution to conduct the operations and 1920

24 procedures regarding the testing, certification (designating UN number) and inspection of packaging, tanks and such containers. The ADR certificate of conformity / vehicle certificate of conformity for the vehicles manufactured to be used for the carriage of dangerous goods by road will be issued by TSE at the first inspection after the type approval. Amendment To The IMDG Code Circular Regarding the transport of dangerous goods by sea, the Circular on the IMDG Code Trainings proposing amendments on principles regarding the drivers entering port facilities has been renewed by the Ministry of Transportation, Maritime Affairs and Communications as of 27 March IMPORTANT DEVELOPMENTS IN THE SECTOR Within the scope of the circular; as all the operations and procedures in all modes of transport are to be carried out through the General Directorate, it has been decided that the trainings, which the drivers are to receive as a requirement of ADR and IMDG Code, are to be combined under SRC 5 Training Curriculum and given as a single training. For the drivers who will undertake the transportation of dangerous goods carried by sea from the port facilities to the land facilities or from the land facilities to the port facilities, a valid and suitable SRC 5 Certificate or Certificate of Attendance to the IMDG Code Functional Training will be sufficient to enter the port facilities NATIONAL LPG STOCK Pursuant to Article 16 of Petroleum Market Law no.5015, refinery, fuel and LPG distribution licensees are obliged to keep minimum 20 times the average supplied daily product amount at their own storage or licensed storage facilities whether as a whole or separately according to their status. The amount of LPG consumption in Turkey in 2013 totaled 3.7 million tons and LPG reserve capacity is 293,000 tons. Pursuant to the relevant provision of Petroleum Market Law, it is obligatory to keep minimum 20 times of the average supplied daily product amount, which equals to 203,000 tons. When issues such as safe stock limits of tanks, limited areas to build new tanks, the difficulty of the process and test periods are taken into consideration, keeping such an amount of stock requires all LPG storage tanks in Turkey to be kept almost full at all times. All LPG products in the inventory of distribution companies, in vessels, tankers en route should be calculated within national stock amounts. Data above leaves a question mark as to the legality and reliability of 20 day-stock of LPG in Turkey. In order to ensure feasibility of national stock liability for LPG industry, the following recommendations have been made: The obligation of keeping 20 times the average supplied daily product amount in the Law should be changed as 10 times and a regulation should be made stipulating keeping such stock at all times in order not to allow any expressions open to abuse such as 3 months average. All LPG products in the inventory of distribution companies, in vessels, tankers en route should be calculated within national stock amounts, The Law should be amended so as to allow exchange of different types of products (gasoline instead of LPG etc) taking into consideration EU legislation and regulations by petroleum department CUSTOMS BONDED WAREHOUSE CIRCULAR 20 Upon changing the definition of bonded warehouse area with the Circular issued by the Ministry of Customs and Trade on 13 August 2013, the whole terminal area including the tanks subject to customs is accepted as bonded warehouse and as a result, all modifications and operations while operating a terminal will be carried out under the control of Customs VOLATILE ORGANIC COMPOUND EMISSIONS Pursuant to 22. Group Facilities (Crude Oil, Petroleum and Fuel Filling and Storage Facilities) in Annex-5 of Industrial Air Pollution Control Regulation by the Ministry of Environment and Urban Planning on 3 July 2009, it is an obligation to set up vapour recycling units at fuel terminal as of 1 January The

25 Ministry conducted a twinning project, which was initiated in July 2011 and continued for two years, for the purpose of harmonizing Turkish legislation on control of emissions caused by volatile organic compounds with EU legislation and specifically drafting this legal regulation, in the light of EU Directives 94/63/EC, titled Directive on the control of volatile organic compound (VOC) emissions resulting from the storage of petrol and its distribution from terminals to service stations and 2009/126/EC, titled Directive on on Stage II petrol vapor recovery during refueling of motor vehicles at service stations. The industry has attended all meetings including the kick off and closure of this project and made a major contribution to the project. During the twinning project, a technical support component was implemented in order to set forth the impacts of the two directives on Turkey. The sector worked in coordination with the Ministry and the project team in technical support component studies and a high quality database was created. The industry expects that the control of volatile organic compounds is conducted siultaneously at storage terminals, tankers and fuel stations with a technically supported legislation by utilizing the results of the twinning project and the technical support project, and taking into consideration the date of transition set as 1 January 2008 in the Regulation SEVESO DIRECTIVE Regulation on Control of Major Industrial Accidents, prepared by adapting Seveso-II Directive to Turkish legislation came into force after being published in the Official Gazette no dated 18 August The Regulation aims to prevent major-accident hazards, minimize the adverse impacts of such accidents to environment and human health if they occur, determine the necessary measures to be taken for efficient and continuous protection and risk management in establishments containing dangerous substances within the facility for the purpose of manufacture, storage and/or sale. Within the scope of Seveso Notification System under Environment Information System which is the software portal of the Ministry of Environment and Urban Planning, the companies holding the Dangerous Chemical Substances listed in the Annex of Regulation on Control of Major Industrial Accidents are obligated to notify the Ministry of the substances and amounts in their inventory and prepare their Safety Reports and Emergency Plans. In 2014, this Pilot Inspection Project will be carried out by the Ministry of Labour and Social Security Directorate of Work Inspection Board to ensure that the workplaces within the scope have technical, process safety control, consultancy and Safety Management System and Policy for Prevention of Major Accidents in written format and to check conformity of all processes, organization and technology. All the industries will be examined through inspections at 80 companies. The main inspections will begin on 1 January SOIL POLLUTION LEGISLATION POSTPONED Pursuant to Regulation on Control of Soil Pollution and Point-Source Polluted Sites by the Ministry of Environment and Urban Planning, published in the Official Gazette no dated 8 June 2010; the obligation of those, who are angaged in or will be engaged in the activities listed under Table 2 of Annex 2 in the Regulation, to fill in the Activity Preliminary Data Form in the Polluted Sites Information System and submit it to the Provincial Directorates of Environment and Urban Planning as of 8 June 2013 was postponed to 8 June 2015 pursuant to a regulation made on 14 June In order for the activities at fuel stations and fuel storage facilities to be followed easily and for sites with a high risk of pollution to be detected by the Ministry and Provincial Directorates within the scope of the Regulation, a Technical Guideline has been prepared by experts within the scope of TS Fuel Stations Safety Requirements Standard and submitted to the Ministry by PETDER. IMPORTANT DEVELOPMENTS IN THE SECTOR 2122

26 3.16 INSPECTION COMPANIES TO BE AUTHORIZED BY EMRA With EMRA Decision no published in the Official Gazette dated 19 July 2013 and the Regulation Amending the Regulation on National Marker Implementation in t he Petroleum Market, it is stated that independent inspection companies shall be authorized by EMRA. Article 7 specifying the procedures and principles for independent inspection companies was added to the decision LPG RESPONSIBLE DIRECTOR LEGISLATION and THE OBLIGATION OF KEEPING A REGISTRY IMPORTANT DEVELOPMENTS IN THE SECTOR An important amendment was made in the legislation for responsible directors at LPG autogas stations. The obligation to have a responsible director at each station was revised so as to enable a responsible director to serve at maximum 3 stations. With the latest amendment, it is expected that the problems about finding a responsible director for LPG autogas stations will be mitigated. The Board also abolished the obligation of keeping a registry prepared and approved by TMMOB at LPG autogas stations. However, the responsible directors are still liable to keep such records E-INVOICE REGULATIONS Procedures and principles of using electronic invoice were set forth under the Tax Procedure Law General Communique (Serial no:397) issued by the Ministry of Finance on 5 March In addition, electronic bookkeeping was implemented pursuant to Electronic Book General Communique no.1 by the Ministry of Finance and the Ministry of Customs and Trade, published in the Official Gazette no dated 13 December Certain taxpayers were held liable to use electronic invoice and electronic book with the Tax Procedure Law General Communique (Serial No: 421) published in the Official Gazette dated 14 December 2012 and numbered E-invoice is an electronic document of which data format and standard is determined by the Revenue Administration and which involves all the information that should be displayed on an invoice, and all transmission between the seller and buyer is conducted on a single platform (Revenue Administration). The aim of the implementation operated by the Revenue Administration is to create a secure, time and cost efficient system in a single format and standard between the buyer and the seller. Pursuant to Tax Procedure Law General Communique no.421; The aim of the e-invoice implementation operated by the Revenue Administration is to create a secure, time and cost efficient system in a single format and standard between the buyer and the seller. Entities holding a lubricant license under Petroleum Market Law no dated , and entities with a minimum gross sales revenue of 25 million Turkish Liras (TL) as of December 31, 2011, among those who had purchased goods from these license holders in 2011, Entities, which produce, build, or import goods that are in list (III) of Private Consumption Tax Law no dated and with a minimum gross sales revenue of 10 million Turkish Liras (TL) as of December 31, 2011, among those who had purchased goods from these license holders in 2011, The obligation to start using e-invoice as of was postponed until April 2014 providing a transition period for the industry DEVELOPMENTS REGARDING NATIONAL MARKER The industry continues to highlight the problems and unfair proceedings which the definition of smuggling based only on national marker levels will cause. Despite the fact that national marker is an essential element in the fight against illegal fuel activities, insufficient level of national marker not supported with further evidence and the definition of illegal fuel based only on national marker level

27 has caused several problems. The sector is of the opinion that further evidence should be sought prior to the initiation of the judicial proceedings. Upon starting to add national marker to bioethanol in 2013 problems continued to grow and PETDER, EMRA and TUBITAK discussed possible solutions. IMPORTANT DEVELOPMENTS IN THE SECTOR 2324

28 4 NEWS FROM 4.1 PETDER MEETS ENERGY JOURNALISTS ASSOCIATION PETDER and EGAD (Energy Journalists and Media Association) came together at the meeting held at Ankara Mövenpick Hotel on 4 January At the meeting, PETDER Chairman Ahmet Erdem, Secretary General Dr. Erol Metin and General Director of Total Oil Turkey Antoine Tournand PETDER evaluations and projections with EGAD members. PETDER Chairman Ahmet Erdem highlighted the continuous increase in energy consumption and pointed out that oil has a share of 30% in Turkey s primary energy consumption and the fuel sector, with a volume of 100 billion TL, is a vital element of Turkish economy. Erdem also added that the prices in Turkish fuel market are lower and the market is more competitive compared to Mediterranean markets. NEWS FROM PETDER Petroleum Market Law and free market period have made great contributions to the sector Erdem noted that Petroleum Market Law and free market period have lead to significant developments in the sector such as registered steady growth, an increase in tax revenue and the number of new players in the sector, and a decrease in illegal/illicit fuel problem. Erdem stated that the licensing process is of utmost importance for registering market players and that 80,000 measurements are conducted every year within the scope of marker practice. SCT refund system and determination of the Government will help eliminate Number 10 Oil problem PETDER Secretary General Dr. Erol Metin noted that Number 10 Oil was the most critical problem in the sector between and added that the tax loss resulting from Number 10 Oil Problem exceeded 5 billion TL in the last 5 years. Metin also reminded that implementation of SCT refund system serves as a measure against Number 10 Oil problem and underlined that Number 10 Oil activities have decreased significantly in recent months. He also added that they had received positive feedback from the field and hoped that the problem will disappear completely in 2013 with the determination of the Government. Definition of illegal fuel should be changed Erdem reminded that the new draft law was approved by the Council of Ministers to fight illegal fuel problem and that additional and efficient measures towards the fight against illegal fuel are being discussed. He highlighted that the national marker is the initial and essential element but the definition of illegal fuel based only on national marker level is not sufficient and that further evidence should be sought prior to the initiation of the judicial proceedings. Automation system should also be implemented for Autogas LPG Erdem stated that although the automation system is still undergoing enhancement, instant monitoring at the stations is possible and that it should also be implemented at autogas stations in order to protect public health and prevent tax loss. 4.2 WASTE OIL MANAGEMENT PROJECT ANNUAL MEETING 24 PETDER shared the 2012 results of the Waste Oil Management Project with the participants of the project at the meeting held in Istanbul Point Hotel on Monday, 1 April During his speech at the meeting, PETDER Projects and External Affairs Coordinator Aydin Ozbey stated that PETDER is an Authorised Institution authorised by the Ministry of Environment and Urban Planning, for the nationwide collection of waste motor oil and recovery of waste oil as product/energy at licensed facilities or transport it for disposal and that the amount of waste motor oil collected by PETDER in 8 years has totaled 123,637 tons. Some of the waste motor oil collected was recycled as raw material or energy at licensed facilities and the remaining was either exported for technology development or disposed.

29 PETDER 4.3 EMRA AND LPG INDUSTRY MEET IN BOLU Representatives of the LPG Industry and EMRA came together at the workshop held in Bolu on 15 March The Ministry of Energy and EMRA, TOBB Turkey LPG Council, Turkey LPG Association, PETDER, MUSLPG Association and representatives of the private sector attended the meeting where the current situation and the future of Turkey s LPG market and important agenda items were discussed. At the workshop, the representatives of the industry made evaluations regarding the market and expressed the existing problems and the solution offers regarding these problems. 4.4 PRESENTATION ON CONTROL OF VOLATILE ORGANIC COMPOUNDS A presentation called Turkish Oil Sector and the Harmonisation Process for the VOC Directive was made at the opening meeting of the Technical Support Project for the Control of Emissions of Industrial Volatile Organic Compounds in June 2013, held under the coordination of the Ministry of Environment and Urban Planning and financed by the European Union and the Turkish Republic. At the meeting, evaluations were made regarding the general structure of the Oil Sector in Turkey and the harmonisation process to the Directive on the control of volatile organic compound (VOC) emissions resulting from the storage of petrol and its distribution from terminals to service stations (94/63/ EC) and the Directive on Stage II petrol vapor recovery during refueling of motor vehicles at service stations (2009/126/EC). Another point highlighted at the presentation was the necessity of planning the transition period for the harmonisation with EU directives simultaneously with the banning of top filling of all the gasoline tankers and making them suitable for bottom filling. NEWS FROM PETDER 4.5 PRESENTATION AT ARGUS BASE OIL CONFERENCE At the Argus European Base Oil Markets 2013 Conference held by ARGUS at Ceylan Intercontinental Hotel on 21 March 2013, the import, export and the legal regulations in the base oil market and the developments in the market were discussed. PETDER made a presentation at the conference on the general structure of the Turkey s Lubricant Market, supply demand balance and the legal regulations. At the presentation it was stated that the real amount of lubricant consumption in Turkey in 2012 was 400 thousand tons, approximately 150 thousand tons of lubricant was exported and the amount of refinery production and import was 1 million 250 thousand tons. It was also stated that the difference of 700 thousand tons between the supply and demand was not used as lubricant but as fuel. 2526

30 4.6 INFORMATION ON WASTE MOTOR OIL ON TV PETDER Projects and External Affairs Coordinator Aydın Özbey gave information on PETDER s waste motor oil collection activities in a TV program called 24 Doğa broadcast on 24 TV. During his speech, Özbey highlighted the fact that PETDER is the only institution authorized to collect waste motor oil. 4.7 PRESS RELEASE ON PRICES In July 2013, the press release provided below was published for the purpose of informing the public on the discussions regarding the changes in the fuel prices. The increase in prices results from the supply demand equilibrium in the international markets, changes in the prices of crude oil and processed products and the increase in the exchange rate of US dollar. Approximately 90% of the fuel consumed in Turkey is produced from imported crude oil or is imported as finished petroleum product (gasoline or diesel). Therefore, the fuel prices in Turkey are changing based on the changes in the international gasoline and diesel prices in the Mediterranean region and the US dollar exchange rate. NEWS FROM PETDER Since the beginning of May, US dollar exchange rates increased significantly especially in developing countries due to the developments in international markets. These changes also affected Turkey and the US dollar gained significant value. On the other hand, the gasoline price in the Mediterranean market increased by 10% after July. The reason of this increase was the increase in the price of crude oil, seasonal demands and the additional demand directed to the Mediterranean market due to the pressure in the Far East markets. Although there were similar developments regarding diesel, diesel prices in Turkey did not increase as much as gasoline as the price increase in international markets was not at the level of the increase in gasoline prices. The increase in prices has negative impacts on the fuel sector. The increasing prices of fuel products negatively affect the consumers as well as the fuel sector. 1. The increases in pump prices are not observed in the gross profit of distribution companies and dealers. 2. Increasing prices also increase the need for the operating capital and the financing cost in the sector. 3. The increasing legal fuel prices lead to increased consumption of non-registered products. The positive results of the fight against the illegal fuel and the precautions are observed but the problem is still an important agenda item for Turkey s economy and the sector. 4. The increasing fuel prices decrease the consumption and narrow the business volume of the sector. It is projected that a decrease in international product prices and US dollar exchange rates will have a positive effect on the prices. We, as the Turkish fuel sector, hope that such developments will follow. 4.8 PETDER HAS BECOME A MEMBER OF TRAFFIC SAFETY PLATFORM Following PETDER Chairman Ahmet Erdem and PETDER Secretary General Niyazi İlter s visit to Traffic Planning and Support Department Head Yılmaz Baştuğ, PETDER became a member of Traffic Safety Platform. As a result of the meetings, Ahmet Erdem was appointed Head of Fuel Committee of the Platform. Traffic Safety Platform Fuel Committee held its first meeting in Istanbul with the participation of representatives of General Directorate of Security, fuel industry and the press. 26 During his speech at the meeting, PETDER Chairman Ahmet Erdem noted that there are various things institutions and individuals can do to prevent traffic accidents. Erdem reminded that most of the activities in the sector are carried out in traffic and pointed out that carrying out activities without being involved in accidents indicates that it is a well-run company. He also added that according to PETDER data, member companies traveled over 118 million kilometers for fuel transportation in 2012 and no accidents involving death occurred within this period. Erdem also stated that what has been achieved in regard tp traffic safety until now should not be deemed sufficient and added if all drivers follow the rules, observe speed limits, ensure seasonal maintenance of their vehicles, do not drive while intoxicated and do not use mobile phones while driving, the number of traffic accidents will be minimized.

31 4.9 PRESENTATION AT ADR SUMMIT Trailer Industry Association (TREDER) held a meeting with the stakeholders in the sector on 6 November 2013 to discuss the ADR Regulation which would be in force as of 1 January The New Period in Carriage of Dangerous Goods was evaluated by representatives of public and private sectors at the Trailer Summit. Experts evaluated the current situation in regard to trainings, safety consultants, gradual transition, the condition of vehicles available and safe transportation legislation. At the meeting, PETDER expressed its opinion that a swift and determined transition to ADR is necessary. It was stated that PETDER member companies have made great efforts and spent substantial funds to raise awareness in carriage of dangerous goods and to raise the standards of equipment used and the personnel, that PETDER has always highlighted the importance of switching to ADR at every meeting as a requirement of health, safety and environment policies, that this transition should be carried out persistently and any legal regulation on this will be supported by PETDER. It was highlighted that the practices by PETDER members provide a significant advantage in the transition period to ADR. It was noted at the meeting that there are over 20 thousand tankers only in the fuel sector, almost all vehicles used for transportation in fuel distribution hold ADR certification and that leading distribution companies have been carrying out transportation activities with such vehicles since the beginning of 2000s. It was stated that although product supply by company transportation is in compliance with HSE-S guidelines and is an advantage in the transition period, the amount of products transported this way would not be over 20%. PETDER attaches great importance to the advantages of switching to ADR In the period after 1 January 2014, the gap regarding statistics which is important especially in Carriage of Dangerous Goods will be filled. The database to be formed is of utmost importance tobe able to make evaluations. In addition, reporting of accidents to the Ministry and investigation of these accidents by Accident Investigation Boards formed under the Ministry with the participation of nongovernmental organizations to understand the root causes of accidents will be an important gain for taking lessons and avoiding further accidents. By increasing the number of trained personnel, the number of conscious people in public and private sectors will increase which will lead to expertise in fire, spill and emergency response. Environmental pollution resulting from spills will be minimized with improvement of vehicle/equipment quality and trainings. NEWS FROM PETDER 4.10 LUBRICANTS MEETING Lubricants Meeting was held in Ankara in February with the participation of representatives of PETDER, EMRA and TSE. EMRA and TSE experts were present at the meeting. Some of the issues discussed at the meeting were renewal periods for TS Standards with Revision/Amendment under Lubricants Communique, evaluation of the period after the publication of Lubricants Communique, Draft Communique on Import of Non-Fuel Products, TSE Standards and outcomes of PETDER Waste Oil Management Project PETDER LUBRICANTS TECHNICAL COMMITTEE - TSE MEETING A meeting on TSE standards on Lubricants was chaired by TSE Technical Deputy Secretary General Cevdet Özmen in Ankara in November The main issues discussed at the meeting were the transition period for standards set as 6 months by EMRA instead of 18 months, inconsistent applications due to delegation of the authority regarding lubricant certification to other cities from the headquarters, samples taken by TSE during interlude controls, the laboratories where samples were sent for examination and experimentation and experimentation costs. It was demanded that the tests during annual interlude controls be conducted under the supervision of TSE staff at accredited laboratories of lubricant companies which serve as subcontracting laboratories for TSE. It was stated that the foregoing will be discussed in detail at the workshop to be held in

32 4.12 REPRESENTATIVES OF EMRA AND THE INDUSTRY MEET IN ŞİLE 2nd Oil Industry Evaluation Merting was held with the participation of the representatives of EMRA, PIGM, Tupras and NGOs in the fuel sector, PETDER, ADER, AKADER, PUIS and TABGIS. Developments in the sector were discussed at the meeting and the participants were informed on EMRA s new application Navistasyon. At his opening speech, Köktaş highlighted that the Turkish petroleum sector has seen a rapid growth especially since 2005 when Petroleum Market Law no.5015 was enacted and Energy Market Regulatory Authority was authorized for regulating and auditing the petroleum market. The meeting continued with the presentation prepared by sector representatives discussing the problems of the sector and solution recommendations. The main topics of the discussions were the Amendment of Anti-Smuggling Law and its impacts on the sector and considerations on 5015 Petroleum Market Draft Law. Sector representatives pointed out the problems regarding national marker and automation practice and evaluated the current situation regarding Number 10 Oil. The main problems pointed out regarding national marker were that although the levels are found sufficient at the measurements at facilities and terminals, the measurements in distribution chain may yield different results, the results of measurements may be different in different containers of the same tanker, the results verified by the devices at the facilities may not be verified by the reference device, facing problems at measurements after adding national marker to ethanol. NEWS FROM PETDER 28 It was highlighted at the meeting that the SCT refund system implemented for the solution of Number 10 Oil problem had positive consequences and base oil import decreased by 20% in the first quarter. It was also pointed out that waste vegetable oils continued to be a problem and that there were still ambiguities regarding the issue DRAFT LAW MEETING IN BOLU Fuel Market Draft Law by the Ministry of Energy was discussed at the workshop held in Bolu on 14 December Undersecretary of the Ministry of Energy Metin Kilci and PIGM General Director Selami İncedalcı were present at the meeting where PETDER, ADER, AKADER, Turkish LPG Association, TOBB LPG Council, TOBB Petroleum Council, ANA, LPG SİAD, SSDGD, PÜİS, TABGİS, MÜSLPGDER and Tüpraş were represented by two representatives. Sector representatives expressed their opinions on the draft to Undersecretary Kilci at the meeting. The common demands of most of the representatives of the sector were that national marker level should not be the only criteria for illegal fuel, dealer permits should be granted by a central authority rather than local authorities, new criteria should be set for entry into the industry and incompliance with technical criteria should not lead to cancellation of licenses. Undersecretary of the Ministry of Energy Metin Kilci concluded the meeting stating that opinions of the scetor would be taken into consideration.

33 4.14 GAS & POWER TURKEY ENERGY SUMMIT Gas & Power Turkey Energy Summit, of which PETDER was oneof the sponsors, was held in Trabzon on 6-7 June 2013 with the participation of Minister of Energy and Natural Resources Taner Yıldız. PETDER Chairman of the Board Ahmet Erdem made a speech on the developments in the petroleum market and the future projections of the industry. Erdem noted that the volume of the sector exceeded 100 billion and that SCT and VAT revenue constituted half of this sum. Erdem stated that the most significant step in the fight against illgal fuel was the amendments in Customs and Anti-Smuggling Laws and that those amendments had proven effective. Erdem noted that they work in cooperation with public authorities in case of a problem and added that illegal fuel is a pecuniary and intangible loss for dealers as they lose reputation PETROLEUM FAIR 4.16 EMRA AND SECTOR WORKSHOP Local and foreign companies operating in oil, LPG, lubricant and equipment sectors attended the 11th International Petroleum Istanbul 2013 Fair held in TUYAP Fair Convention and Congress Center between April PETDER had a booth in the fair and the key speakers of the conference were Head of EMRA LPG Market Department Cemalettin Tüney, Head of Inspection Department Mehmet İbiş and Head of Petroleum Market Department Taner Mutlu. The workshop where EMRA and PETDER members were present was held in Ankara Mövenpick Hotel on 10 December The main issues discussed at the meeting were national marker, national stock, biofuels and notifications. At the meeting, sector representatives expressed the problems they faced in these areas and EMRA made two presentations on Petroleum Market Information System and National Oil Stock. NEWS FROM PETDER 4.17 NATIONAL MARKER PRACTICE STAKEHOLDERS MEETING A meeting on national marker practice was held at TÜBİTAK UME, Gebze Premises on 12 July 2013 with the participation of representatives of PETDER, EMRA, TÜBİTAk and players in the sector. The main topics discussed at the meeting were national marker practice and developments and participants highlighted important points regarding the practice. 2930

34 5 PROJECTS 5.1 WASTE MOTOR OIL MANAGEMENT PROJECT Pursuant to Regulation on the Control of Waste Oils issued by the Ministry of Environment and Urban Planning on 21 January 2004, motor oil producers and importers are held liable to collect used motor oils which have been offered to the market. Within the scope of the Waste Oil Management Project initiated by PETDER on 19 April 2004, activities have been conducted in order to meet the provisions of this Regulation. Within the framework of the cooperation protocol signed with the Ministry of Environment and Urban Planning on 30 July 2004, waste motor oils used in motor vehicles are collected from car care services, fuel stations and state car care stations by licensed and authorized teams under appropriate conditions within the scope of the Waste Oil Management Project. Pursuant to Regulation on the Control of Waste Oils amended on 30 July 2008, Petroleum Industry Association has been licensed as an Authorized Institution by the Ministry of Environment and Urban Planning on 4 September With the regulation, it has been prohibited for real or legal entities other than authorized institutions or motor oil producers to collect waste oils. PROJECTS The project also aims for processing of waste oils in facilities licensed by the Ministry of Environment and Urban Planning without causing any damage to the environment and human health, locating waste generators and raising awareness. Since the beginning of the project in May 2004, the amount of waste motor oil collected and the number of collection points across the country has increased each year. Waste motor oils generated at motor oil change spots are collected by licensed vehicles with National Waste Transportation Form and delivered to licensed facilities to be recovered (as energy or raw material) or disposed based on their categories and adequate legal documentation is prepared and the waste generators are not charged for any of these activities. All the additional costs incurring while providing these services in accordance with the law across the country regardless of amount or limit are covered by PETDER and the waste oils which might pose a threat to the environment and human health are turned into a contribution to the economy by being processed at refining and regeneration facilities, cement, lime and iron-steel factories to be recovered as energy or raw material or through disposal within the scope of the principles specified by the Ministry of Environment and Urban Planning. The amount of waste oil collected by PETDER in 2013 totalled 18,715 tons. In 2013, 14,584 trips were made to waste motor oil generators by PETDER and 18,715 tons of waste motor oil was collected and delivered to facilities licensed by the Ministry of Environment and Urban Planning on re-export basis. 1,969 tankers of waste motor oil was delivered to licensed facilities in The number of participating companies was 76 by the end of 2013 and the amount of motor oils offered to the market by these companies in 2012 totaled 178,017 tons according to their declarations in The resources used for the Waste Oil Management Project by PETDER in the last 9 years has reached 29 million TL. 11,777 tons of the waste motor oil collected in 2013 was collected from car care services, 1,774 tons from industrial vehicle parks, 988 tons from state institutions, 704 tons from municipalities, 1,191 tons from construction and mining industry, 217 tons from oil production facilities, 1,752 tons from military institutions, 156 tons from shipping companies, 126 tons from fuel stations and 30 tons from washing and lubricating stations

35 tons Figure 1: Waste Motor Oil Management Project Amounts of Waste Oil Collected TL PROJECTS Figure 2: PETDER Waste Motor Oil Management Project Funds Used Each Year 7,742 tons of the waste motor oil collected in 2013 was collected from Marmara Region, 2,615 tons from Aegean Region, 3,037 tons from Central Anatolia Region, 1,772 tons from Black Sea Region, 1,958 tons from Mediterranean Region, 788 tons from Southeastern Anatolia Region and 803 tons from eastern Anatolia Region. 3132

36 Environmental Benefits of PETDER Waste Motor Oil Management Project: 18,715 tons of waste motor oil collected by PETDER in 2013 would contaminate 18,715 billion cubicmeters of fresh water. 18,715 tons of waste motor oil collected by PETDER in 2013 would contaminate the annual fresh water supply necessary for 88 million people. 18,715 tons of waste motor oil collected by PETDER in 2013 would contaminate 16% of the total underground and surface water supplies. With 18,715 tons of waste motor oil collected by PETDER in 2013, it is possible to produce electricity sufficient for the annual electricity need of 32,300 people. PROJECTS 32

37 5.2 SOCIAL RESPONSIBILITY PROJECTS ONE BARREL ONE TREE 1 Barrel 1 Tree Project was initiated with the protocol signed with the Ministry of Environment and Urban Planning on 3 September After the preparation of the visuals and presentation materials, the project was announced to the public with a press release on 6 September 2010 upon approval of the Ministry of Environment and Urban Planning. 1 Barrel 1 Tree Project, initiated for the purpose of increasing environmental benefits of collecting waste motor oils by planting one tree for each barrel of waste motor oil collected from state institutions, aims to; contribute to keeping account of more waste motor oil with the support of state institutions, protecting the environment and human health, raising public awareness about the harms of waste motor oil, preventing illegal activities carried out under the name of Number 10 Oil with the support of the public institutions. Within the framework of this project financed by PETDER, by planting one tree for each barrel of waste motor oil collected from state institutions, 56,500 trees, 16,500 of which were planted in 2013, have been planted in 3 years in return for the waste oils collected. The number of trees planted is going to increase over the years. Website of 1 Barrel 1 Tree Project, has been online since the end of The website provides information on participating companies, project phases and forestation areas as well as presenting the project overview TRAFFIC SAFETY PLATFORM FUEL COMMITTEE PETDER became a member of Traffic Safety Platform on 15 July 2013 and Ahmet Erdem was appointed head of the Fuel Committee of the Platform. PETDER plans and carries out Fuel Committee activities with its members. The first meeting of the Traffic Safety Fuel Committee, which aims to improve and extend traffic safety practices in the fuel sector and Turkey in general, was held at Istanbul Police Training and Congress Center on 29 November 2013 with the support of PETDER and its members. PROJECTS TV SPOT A TV spot has been prepared by the Ministry of Energy and Natural Resources with the cooperation of Petroleum Industry Association. The spot aims to raise public awareness on points to take into consideration while using fuel and efficient use of fuel. The 45-second-TV spot broadcast on 11 April 2013 for the first time was shown for 593 times on 15 national channels in 6 months. The total advertising cost of the broadcast would equal 3,210,590 TL. 3334

38 6 SECTOR 6.1 CRUDE OIL AND FUEL PRICES The fluctuations in world oil prices continued in 2013 and as a result of these fluctuations, fuel pump prices received much media coverage. Brent oil started 2013 with $111 per barrel in the international markets, and by February 2013 reached $119 per barrel, its highest level in By the end of December 2013, the price of Brent Oil was around 112$. The changes in crude oil prices directly affected the price of fuel products in the Mediterranean markets and in February 2013, gasoline with $/ton and diesel with $/ton reached the highest level of the year. SECTOR STATISTICS When the averages of 2012 and 2013 are compared, it is observed that Brent oil price which was $/ton (214.6 TL/ton) decreased to $/ton (209.2 TL/ton) with a decrease of 2.5% in TL currency. As a result of this change, it is calculated that in 2013, the average decrease in gasoline CIF prices was 4.9%, in diesel prices 4.0% and in LPG prices 9.2% in Mediterranean markets. The figure below demonstrates reflection of the decrease in the world markets on Turkish Oil Market (and pump prices). Another inclination that attracts attention in this period is that the prices of gasoline and diesel in the world oil markets and the Mediterranean market are drawing closer to each other Brent (USD/Barrel) ($ / Varil) Diesel, Motorin, Gasoline, Benzin, LPG LPG (USD ($ / / ton) tons) Benzin Gasoline (95) Motorin Diesel Otogaz Autogas LPG Brent Figure 3: Changes in the average prices of Brent crude oil ($/barrel), diesel, gasoline and autogas LPG ($/ ton) in the Mediterranean markets between Source: Argus SPECIAL / DIFFERENTIATED PRODUCTS AND EUROPE TURKEY COMPARISONS According to technical regulations published by EMRA, the content of sulphur in all diesel types introduced to the domestic market in 2011 was restricted to 10 ppm effective from April 1st, Therefore, all the products (standard and special) offered at the stations are in full compliance with EU standards and the standard diesel sold from the pump can be used in all types of vehicles. 34 In addition to this important development, from the beginning of 2011, many companies in the sector began to offer their customers differentiated diesel products besides the standard 10 ppm diesel fuel. As a result of this, differentiated diesel products, in parallel with the European countries and other developed countries, have been among the most preferred products in Turkey. It can be observed in Figure 4 that special diesel types (tax-free) were offered to consumers in Turkey at a lower price compared to Italy, France and Spain in 2013.

39 STATISTICS , , ,7 5 0 İtalya Italy İspanya Spain France Fransa Turkey Türkiye Figure 4: Price comparisons of standard and special diesel types (2013, kurus/lt) 6.2 INDIRECT TAXES AND MARKET VOLUMES The total amount of the indirect taxes collected from fuel and LPG sectors has continuously increased every year. According to calculations based on consumption data, the indirect taxes collected from these sectors in 2013 reached 60.1 Billion TL. The figure below displays the amount of indirect taxes collected from the oil sector (including LPG) since It is calculated that the indirect taxes collected from the Oil Sector since 2007 have totaled 294 Billion TL. SECTOR STATISTICS 70 Milyar TL Billion TL SCT ÖTV/Excise KDV/VAT VAT Figure 5: Indirect Taxes Collected from Fuel and LPG over the years Source: EMRA, PETDER, TCMB 3536

40 Most of the indirect taxes in the fuel market are collected from diesel fuels as they have the highest consumption rate. This resulted from the shift from gasoline to LPG due to lower tax rates and the increase in diesel consumption. Indirect taxes collected from diesel fuel constitutes the largest share among the indirect taxes collected from fuel companies. This is a result of the increase in diesel consumption as well as the shift from gasoline to LPG due to lower tax rates. In 2013, indirect taxes imposed on gasoline pump prices have been 2.91 TL/lt (60.8% of the pump price). This amount was 2.24 TL/lt for diesel (52.7% of the pump price), 1.30 TL/lt for autogas LPG (47.9% of the pump price). The total percentage of the indirect taxes in the pump prices has changed over the years due to oil prices, amount of SCT applied and exchange rates. Among all automotive fuels, the highest tax was applied to gasoline in terms of both amount and percentage and the lowest tax was applied to autogas LPG. In 2013, average SCT amounts applied were as follows: TL/lt for gasoline, 1,5945 TL/lt for diesel, and 0,8837 TL/lt for LPG autogas. SECTOR STATISTICS Billion Milyar TL TL ,4 6,7 6,6 37,3 %17,6 45,1 Figure 6: Breakdown of Indirect Tax Revenue Collected from Automotive Fuels in 2012 and 2013 Source: EMRA, PETDER, TCMB 7,3 7,2 0, Diesels Motorinler Benzinler Gasolines LPG Black Siyah products Ürünler FACTORS AFFECTING EU SITUATION AND PRICE COMPARISONS Indirect taxes have the largest share in fuel prices in Turkey and generally in the EU. Although there were fluctuations in 2013, in average share of taxes Turkey was ranked as the second country after Italy in 95 Octane Unleaded Gasoline and sixth after the UK, Sweden, Italy, Ireland and Finland in diesel. Besides the difference in figures in indirect taxes, another issue to be taken into consideration is the difference in tax collection methods. In Turkey, the SCT paid by distributors ex-refinery is collected after sale, creating a financing cost. In addition, the SCT accrued until the 15th is to be paid until the 25th of the same month and the SCT accrued until the 31st is to be paid until the 10th of the following month. In some EU countries these periods are extended. For instance, in Italy, the SCT accrued within the month is to be paid until the 15th of the following month and in Spain until the 20th of the following month. 36 There are three components of fuel prices in Turkey: Product prices Taxes (SCT and VAT), Market profit margin shared by three legal entities, involving gross profit margins of refineries, distributors and stations. A direct comparison of taxed and tax-free fuel prices in Turkey and in EU countries leads to inaccurate and incomplete evaluations. In addition to several factors affecting the margins in the countries, profit margins might change in time based on these. There are also significant differences between EU countries themselves depending on the conditions in each country.

41 It is necessary to take into consideration the following factors when making a comparison of fuel prices in Turkey and in EU countries. Both in the EU Oil Bulletin and in the surveys conducted by EU on the prices announced in this bulletin, it is stated that comparisons between prices and price trends in different countries should be carefully made. In the weekly oil bulletin, the extent that standard categories are representative of the total sales of a given product, differences in product quality, in marketing practices, in market structures; In the survey report, discount sales in the countries, application of different methodologies in price reporting, variations in biofuel components and differences in taxation systems are highlighted. There are significant differences between the market dynamics in these countries and Turkey Fuel is sold only at self-service stations in some European countries and at self-service stations along with regular stations in others. The operating models shaped by distributor/dealer station ownership in these countries are different from those in Turkey. The average sales per station in some countries are 2-3 times the average sales of stations in Turkey. In all these countries, the share of pipelines in fuel transportation is far above Turkey. In most of these countries tax collection methods are different than in Turkey and do not require additional financing for the companies. Comparing these prices with the station retail prices in turkey leads to inaccurate results. There are differences in price indication methods Countries notify their prices to the EU Oil Bulletin in different methods such as weekly average/single day, including/excluding discount sales, lowest price, supermarkets/hypermarkets and including/ excluding self-service stations. Therefore, it is stated in reports that it is important to pay attention to such factors when making comparisons. There are additional costs due to legal obligations in Turkey which do not exist in these countries. High taxes imposed on liquid fuel products as a fact and requirement of our economy result in illegal and illicit liquid fuel activities and the industry has to deal with this problem constantly. Unlike several European countries, the main additional costs in Turkey as a result of the measures and other legal obligations, which have been imposed to prevent such activities and which PETDER supports, are; dealer automation system, National Marker practice, road transportation, SCT financing, cash register operation and maintenance, annual EMRA payments, national stock, dealer sampling, e-book/e-invoice/e-register costs, Bank Letter of Guarantee SECTOR STATISTICS Such factors as a result of legal obligations have reached significant amounts in terms of investment and operating costs. Differences in national economies There are significant structural differences between the general economic structure in Turkey and in the other European countries and as a result of such differences, the inflation rate and financing costs are much higher in Turkey. This situation creates additional costs in loans and bank guarantees and when using credit cards. In the Recommendations section of the EU Oil Bulletin in which the prices in European Union countries are compiled and shared, it is stated that some Member States expressed concerns that inconsistencies in the reporting process might impede direct consumer price comparisons. When making price comparisons with or without tax between countries the factors listed above should be taken into consideration and comparisons should be interpreted accordingly (Sayfa 6) 3 (Sayfa 2, Data Comparability) 4

42 6.2.2 MARKET / TRADING VOLUMES The total financial magnitude of the fuel sector in 2013 reached billion TL with an increase rate of 12.4% compared to 2012, as a result of an increase in consumption and taxes. The following two graphs below demonstrate sector magnitudes calculated for fuel and LPG comparatively and independently. In the same period, the LPG market volume reached 12.4 Billion TL with an increase of 2,5%, white products market volume increased by 14.5% reaching 98.1 billion TL and black products market volume decreased by 1.2% totaling 1.2 billion TL. SECTOR STATISTICS Milyar TL Billion TL ,6 12,1 85,7 White products Figure7: Trade Volumes in Fuel (billion TL) Source: EPDK, PETDER, TCMB 12,4 98, LPG Black products Beyaz Ürünler LPG Siyah Ürünler 1, ,5 0,4 Billion Milyar TL TL ,9 4,7 6,8 7,4 6, Autogas Otogaz Bottled Tüplü Dökme Bulk Figure 8: Trade Volumes in LPG (billion TL) Source: EPDK, PETDER, TCMB

43 6.3 OIL AND LPG INDUSTRY STATISTICS As of the end of 2013, there were 4 refineries, 77 distributor companies, 12,623 fuel stations operating in the petroleum market with EMRA licenses. In the Liquefied Petroleum Gas (LPG) market, 73 distributor companies, 10,089 autogas stations were operating with EMRA licenses. Data indicates that number of autogas stations keeps increasing. The number of stations decreased for the first time in 2011 and there was a slight increase in The number of fuel distribution companies peaked in The number of LPG distribution companies continues to increase. Table 3: Number of Licensees in Petroleum and LPG Markets *4 out of 6 licensed refineries are active Source: EMRA Refinery Licenses* Fuel Stations Number of Distributor Licenses LPG Stations LPG Distributor License The number of fuel stations of each company are given in Figure 9. It is observed that there is a decrease in the number of fuel stations of the top five distribution companies SECTOR STATISTICS PO Opet Shell BP Termo Balpet Total Moil Alpet Starpet Kadoil Turkuaz Aytemiz Akpet Soil Lukoil Teco Parkoil Enerji Euroil Petline Best Npet TPPD VTM Türkoil Delta JetPet Ozan United Full RMG Damla Antoil Pasific 3940 Figure 9: A comparison of the number of fuel stations of the distributor companies (between ) Source: EMRA

44 6.3.1 AUTOMOTIVE FUELS (GASOLINE, DIESEL, LPG AUTOGAS) Diesel Consumption Based on data compiled by PETDER, total consumption of diesel fuel types (diesel fuel and diesel fuel - other) in 2013 reached 20.1 million m3 with an increase of 6.8% compared to Million Milyon m ,7 3,4 13,5 13,2 4,0 5,0 11,9 11,5 6,0 5,1 4,5 13,0 13,6 14,0 0 SECTOR STATISTICS Diesel Motorin Motorin Diesel (other) (Diğer) Figure 10: Total Diesel Consumption (million m 3 ) Source: EMRA, PETDER As a result of the removal of high sulphur off-road diesel from the market following EMRA Communiqué, all diesel fuels at the pumps are being offered to consumers in Turkey as low sulphur (10 ppm) diesel fuel as of April 1, 2011 and gasoline and diesel fuels are in full compliance with EU standards. Therefore, the restriction of the sulphur content of the gasoline and diesel fuels to 10 ppm as a result of the harmonisation process to EU Legislation regarding fuel quality, the amount of pollutant emissions are expected to decrease significantly. According to the report published by PETDER in September 2010, a decrease of 9,900 tons per year in the amount of emissions is expected. Fuel distribution companies continue to widen the product range of the special/differentiated diesel and gasoline products in parallel with the consumer demands in order to meet the quality and performance expectations of the consumers. Special/Differentiated Diesel Fuel consumption increased in 2013 constituting 30.1% of total diesel fuel consumption. It is believed that this increase is a result of the consumers realization of the benefits of the product and the small difference in the prices of the two products % 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 27,4% 30,1% 72,6% 69,9% Standart Standard Motorin diesel Special Özel/farklılaştırılmış / differentiated motorin diesel Figure 11: Shares of standard diesel fuel and special/differentiated diesel fuel in total diesel consumption Source: EMRA, PETDER

45 Gasoline Consumption In 2013, total gasoline consumption increased by 0.2% compared to 2012 totaling 2.5 million m³. For the first time in recent years, gasoline consumption remained at the same level with the previous year. 4,0 Million Milyon m 3 3 3,5 3,0 2,5 2,0 1,5 1,0 0,5 0,2 0,4 0,1 0,1 0,3 0,3 0,0 0,2 0,2 0,2 0,1 2,7 2,6 2,6 2,5 2,4 2,3 2,3 0,0 U. K. gasoline Benzin (RON 95) 95) U. K. Benzin gasoline (RON (RON 97) 97) Katkılı Blended K. u. Benzin gasoline Figure 12: Change in total gasoline consumption over the years Source: EPDK, PETDER Gasoline 95 Octane has the highest share (94.3%) in total gasoline consumption. The consumption of unleaded gasoline with additives that is used in older vehicles declined drastically almost reaching a near end. SECTOR STATISTICS 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 0,0% 0,0% 6,6% 5,7% 93,4% 94,3% U. K. gasoline Benzin (RON 95) U. K. gasoline Benzin (RON 97) Katkılı K. Benzin 4142 Figure 13: Shares of 95, 97 Octane gasoline and gasoline with additives in total gasoline consumption Source: EPDK, PETDER

46 LPG Autogas Consumption LPG Autogas consumption, which was 4.8 million cubic meters in 2012, increased by 2% in 2013 and reached 4.9 million cubic meters. The chart below displays LPG consumption in the last 7 years Millon Milyon m3 m ,6 3,8 4,1 4,4 4,7 4,7 4,8 4,9 1 SECTOR STATISTICS Total Automotive Fuels Consumption Figure 14: Change in LPG Autogas consumption over the years Source: EMRA, PETDER The total automotive fuel consumption increased by 5.1% compared to the same period of the previous year and reached 27.4 million m3 in The following figure demonstrates the consumption progression for the last eight years for all automotive fuels. 30 Millon Milyon m ,1 2,8 3,4 3,5 0,8 1,6 3,6 3,8 4,1 4,4 3,3 3,0 2,9 2,8 2,7 3,4 4,0 5,0 4,8 2,5 5,1 4,9 2,5 6,0 5 12,3 12,5 13,5 13,2 11,9 11,5 13,6 14, Diesel Motorin Diesel Motorin (other) (Diğer) Total Toplam gasoline Benzinler LPG Autogas Otogaz Figure 15: Change in the amount of automotive fuel consumption over the years Source: EMRA, PETDER

47 Among the automotive fuels, the share of diesel increased while the shares of gasoline and LPG Autogas in total consumption decreased. The charts in Figure 16.a and Figure 16.b indicate that while the share of autogas (LPG) in automotive fuels gets smaller, LPG consumption has reached twice the amount of gasoline consumption. Autogas constitutes 17.8% of the total automotive fuel market. 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 66,0% 66,2% 34,0% 33,8% Gasoline Benzinler LPG Otogaz Autogas Figure 16a: Gasoline and LPG Autogas Consumption in 2012 and 2013 (volume based %) Source: EMRA, PETDER Black Products (Fuel Oil, Heating Oil) Consumption Figure 16b: Automotive Fuels Consumption (volume based %) Source: EMRA, PETDER In 2013, black product consumption totaled approximately 534,000 tons with a decrease of 22.9% compared to the previous year. In this period, heating oil consumption totaled 114,000 tons with a total decrease of 28.6% and Fuel Oil consumption totaled 420,000 tons with a total decrease of 21.2%. Hence, the progressive decline in black products continued in 2013 due to the wide penetration of natural gas into the market. The changes in black products consumption can be seen clearly in the following graph. 3,0 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 18,5% 17,8% 9,5% 9,1% 72,0% %72,0 %73,2 73,2% Motorinler Diesel Gasoline Benzinler LPG Otogaz Autogas SECTOR STATISTICS 2,5 0,5 0,4 2,0 Millon ton Milyon Ton 1,5 1,0 0,5 2,1 2,3 0,3 1,6 0,2 0,2 0,2 0,1 0,6 0,6 0,5 0,4 0,0 Fuel oil Oil no:6 No:6 Heating Kalorifer oilyakıtı 4344 Figure 17: Change in Black Product Consumption over the years Source: EMRA, PETDER

48 6.3.3 FUEL CONSUMPTION (GASOLINE, DIESEL, KEROSENE, HEATING OIL, FUEL OIL) Total fuel consumption totaled approximately 19.1 million tons in 2013 with an increase of 5.0%. As the chart below demonstrates, fuel consumption after having excelled in 2007 and 2008 has fallen back in 2009 and This change is in great part due to the contracted consumption of black products because of the transition to natural gas, the adverse effects of the economic crisis in 2009 and the negative effects of Number 10 Oil consumption over diesel consumption. SECTOR STATISTICS Milyon Ton Millon ton ,5 0,4 2,1 2,3 2,6 2,3 2,3 2,9 11,4 11,1 0,3 0,2 1,6 0,6 2,3 2,1 3,4 4,2 10,1 9,7 Figure 18: Change in Total Fuel Consumption Source: EMRA, PETDER 11,0 11,5 11,8 The shares of fuel types in total fuel consumption are given below and no significant change has been observed in 2013 compared to Black products decreased by 1% while diesel increased by 1%. 0,2 0,6 2,0 3,8 0,2 0,5 1,9 4,3 0,1 0,4 1,9 Diesel Motorin Diesel Motorin (other) (Diğer) Gasoline Benzinler Fuel oil Oil no:6 No:6 Heating Kalorifer oil Yakıtı 5,1 Motorinler Diesel 86% Black Siyah products Ürünler 4% 4% Motorinler Diesel 87% Siyah Black products Ürünler 3% 3% Benzinler Gasoline 10% Benzinler Gasoline 10% Figure 19: Shares of Fuel Types in Total Fuel Consumption (%) Source: EMRA, PETDER

49 6.3.4 LUBRICANT CONSUMPTION Developments in the Lubricant Market (Mineral and Synthetic) are followed through data compiled by PwC from lubricant producers on a voluntary participation basis under coordination of PETDER. The shares of these companies in the total lubricant market have been determined through comparing data from EMRA, PIGM and Ministry of Environment and Urban Planning. Based on this data, total domestic lubricant consumption in 2013 increased by 2.9% compared to the same period of the previous year and totaled 416,000 tons. 450 Thousand Bin ton tons Vehicle Taşıt Yağları oils Endüstriyel Industrial oils Yağlar Marine Deniz Yağları oils Greases Gresler Figure 20: Lubricant Consumption in Turkey In 2013, total lubricant consumption shares were as follows; 50% Vehicle oils, 38% industrial oils, 6% marine oils and 6% greases. SECTOR STATISTICS Deniz Marine Yağları oils %6 6% Gresler Greases %6 6% Endüstriyel Industrial oils Yağlar 38% 38% Vehicle Taşıt oils yağları Yağları 50% Figure 21: Shares of Lubricant Product Groups (%) 4546

50 The figures displayed in the table below indicate that in the recent years an excessive amount of surplus lubricants, which have been imported as base oil to be used in lubricant industry, used and sold in the diesel market and used in illegal market activities under the name of Number 10 Oil, has been supplied to the market. Table 4: Import, Export and Consumption Figures of Lubricants in Turkey Source: TÜİK, TÜPRAŞ, PETDER 2013 SECTOR STATISTICS Base Oil (tons/ year) Base Oil Import Lubricant Import Additives and Preparations Import Base Oil Refinery Sales SUPPLY to the Market (A) Base Oil Export Lubricant Export Additives and Preparations Export Lubricant Domestic Sales Total DEMAND (B) DIFFERENCE (A-B) Demand surplus in lubricants exceeded 1 million tons in 2011 but decreased to 477,308 tons with the measures taken. Despite the significant decrease in the surplus lubricants, there are still steps to be taken. Vehicle Oils (Motor Oils, Gear and Transmission Oils) Turkey s total vehicle oil consumption totaled 210,000 tons with a decrease of 2.8% in 2013 compared to the previous year. While the amount of gear and transmission oils consumed in 2012 was 36,000 tons and motor oil consumption was 181,000 tons, in the same period of 2013, gear and transmission oil consumption totaled 35,000 tons and motor oil consumption totaled 176,000 tons Thousand Bin tons Motor Yağları oils Gear Dişli ve and Transmisyon Transmission Yağları Oils Figure 22: Vehicle Oil Consumption in 2012 and 2013

51 In 2013, consumption of motor oils decreased by 2.8% compared to the same period of the previous year and totaled 176,000 tons. In this period, motor oils share in total lubricant consumption was approximately 42%. The figures below provide comparisons of motor oil consumption. 200 Thousand Bin ton tons Ticari Commecial Araç Passenger Binek Araç Motorcycles Motosiklet vehicles vehicles Figure 23: Motor Oil Consumption in 2012 and 2013 Industrial Oils Total consumption of industrial oils totaled approximately 157,000 tons with an increase of 8.7% in 2013 compared to the previous year. During this period, industrial oils had approximately a 38% share within the total lubricant products. The comparative charts of industrial oil consumption are given below SECTOR STATISTICS Thousand Bin ton tons Diğer Other Trafo Transformer Yağlar oils Dişli Gear Yağları oils Metal İşleme Processing Yağları Oils Proses Processed Yağları Oils Hidrolik Hydraulic Yağlar Oils Figure 24: Industrial Oil Consumption in 2012 and

52 Other Diğer 18% Transformer Trafo Yağlar Oils 9% 9% Hydraulic Hidrolik Yağlar Oils 45% %45 Dişli Gear Yağları Oils 5% Metal İşleme Processing Yağları Oils 6% 6% Processed Oils Proses Yağları 17% 17% Figure 25: Shares of Product Groups in Industrial Oils in 2012 SECTOR STATISTICS Special Products (Antifreeze and Hydraulic Brake Fluids The total amount of antifreeze and hydraulic brake fluids produced in lubricant production facilities decreased by 18.3% compared to previous year s figures and totaled 34,000 tons. Thousand tons Bin ton 45,0 40,0 35,0 30,0 25,0 20,0 15,0 10,0 5,0 0,0 38,8 31,0 3,2 3, Hydraulic Hidrolik Fren Brake Sıvısı Antifreeze Antifriz Fluids Figure 26: Antifreeze and Hydraulic Brake Fluid Consumption in 2012 and

53 Table 5: Fuel and LPG Consumption Figures M U. Gasoline with Additives m U. Gasoline 95 m U. Gasoline 97 + m Total Gasoline m Kerosene m Diesel m Diesel (other) m Total diesel m Heating Oil Ton Fuel oil-6 Ton Autogas m mton Q U. Gasoline with Additives Ton U. Gasoline 95 Ton U. Gasoline 97 + Ton Total Gasoline Ton Kerosene Ton Diesel Ton Diesel (other) Ton Total diesel Ton Heating Oil Ton Fuel oil-6 Ton Black products Ton Total white products Ton Total fuel Ton LPG Auogas Ton Total automotive Ton SECTOR STATISTICS 4950

54 7 OTHER INDUSTRIAL 7.1 NUMBER OF MOTOR VEHICLES OTHER INDUSTRIAL STATISTICS Based on data from Turkish Statistical Institute, the total number of vehicles registered as of the end of 2013 was 18,215,460 and the shares were divided as follows; 52.0% automobiles, 16.3% vans, 15.1% motorcycles, 8.7% tractors, 4.2% trucks, 2.3% minibuses, 1.2% buses, and 0.2% special purpose vehicles. There was a significant increase in the number of diesel and autogas LPG powered vehicles while there was a slight increase in the number of gasoline powered vehicles. Number of gasoline powered vehicles has a downward trend. When the breakdown of fuwl types of automobiles registered to traffic as of the end of 2013 is analyzed, it is observed that the number of LPG powered vehicles is 3,852,336, the number of diesel powered vehicles is 2,497,209 and the number of gasoline powered vehciles is 2,888,610. The change in the total number of vehicles in traffic and automotive fuel consumption is displayed in the chart below. Million vehicles Milyon Adet Araç Million Milyon tons automotive Ton Otomotiv fuel Yakıtı Diğer Other Trucks Kamyon, Kamyonet Minibuses, Minibüs, Otobüs buses Automobiles Otomobil Automotive Otomotiv Yakıtları fuel consumption Tüketimi Figure 27: Number of Vehicles in Traffic and Change in Automotive Fuel Consumption Source: TÜİK, PETDER, EPDK 22,0 21,0 20,0 19,0 18,0 17,0 16, ,58 1,51 1,17 0,94 0,76 0,57 0,50 28,22 32,58 35,60 38,44 40,17 41,27 41,48 70 % ,80 13,94 15,67 18,31 21,64 24,29 26, ,40 51,96 47,56 Figure 28: Number of Vehicles in Traffic According to Fuel Types (million) Source: TÜİK 42,31 37,42 33,87 31, Gasoline LPG Unknown Benzin Dizel LPG Bilinmeyen

55 STATISTICS 7.2 AUTOMOTIVE FUEL CONSUMPTION BASED ON GROSS DOMESTIC PRODUCT Inflation rate decreased slightly in 2013 remaining at the level of 7.5%. Growth rates that are regarded as one of the most significant macroeconomic indicators are also closely followed by the oil sector. As the economic growth rates are related to industrial growth and transportation sector, they serve as an important indicator of the growth figures in the diesel fuel market. Turkish economy completed 2012 with a growth rate of 2.1% and grew by 4% in The chart below displays the changes in economic growth rates and total automotive fuel consumption. A general overview indicates that a there is a parallel between economic growth and automotive fuel consumption. However, although this balance was disturbed especially in the period after 2010, it remained stable after Yakıt tüketiminde 2012 ve 2013 te GSYIH rakamlarının üzerinde bir büyüme gerçekleşmiştir. Bunun bir kısmının kaçak ve kayıt dışı akaryakıt ile mücadelelerden sağlanan ilerlemelerden kaynaklandığı düşünülmektedir. % Gross Gayri Safi Domestic Yurtiçi Product Hasılaya Growth Göre Rate Büyüme Oranı , ,4 0, , ,3 9, ,8 Automotive Otomotiv Yakıtlarının Fuel Consumption Tüketim Rate Oranı 8, ,4 4,1 2, ,1 4, OTHER INDUSTRIAL STATISTICS -6-4,8 Figure 29: Yearly Automotive Fuel Consumption Rate and GDP Growth Rate (%) Source: TÜİK, EMRA and PETDER 5152

56 8 LEGAL REGULATIONS JANUARY 2013 LEGAL REGULATIONS 1 January The Ministry of Finance Stamp Act General Communique (Serial No: 56) 1 January The Ministry of Finance Real Estate Tax Law General Communique (Serial No: 61) 1 January The Ministry of Finance Act of Fees General Communique (Serial No: 69) 1 January The Ministry of Finance Act of Fees General Communique (Serial No: 70) 1 January Council of Ministers Resolution pertaining to the Specification of Deduction Rates, Stamp Tax and Charge Rates in Certain Tax Laws and the Rates and Sums regarding Several Taxes, Funds and Deductions applied to Some Products and Services 1 January Council of Ministers Customs Tariff Schedule with Statistic Positions Breakdown 3 January EMRA Regulation amending the Regulation pertaining to the Procedures and Principles to be enforced during Audits, Preliminary Investigations and Investigations in the Liquefied Petroleum Gases (LPG) Market 4 January The Ministry of Transportation, Maritime Affairs and Communications Regulation amending the Road Transport Regulation 5 January EMRA Board Decision 10 January The Ministry of Customs and Trade Regulation on Facilitating Customs Transactions 10 January The Ministry of Customs and Trade Regulation amending Customs Regulation 10 January The Ministry of Customs and Trade Communique amending Customs General Communique (Customs Transactions) (Serial No: 16) 11 January EMRA Regulation amending Petroleum Market Information System Regulation 13 January EMRA Announcement regarding new licenses 13 January The Ministry of Labour and Social Security Regulation on Occupational Health and Safety Committees 18 January The Ministry of Environment and Urban Planning Communique pertaining to the Road Transport of Wastes 22 January Council of Ministers Resolution regarding the Transfer of TPIC s ownership to BOTAS 24 January EMRA Announcement regarding the Physical and Chemical Characteristics of National Marker (GN) and Material Safety Information 31 January EMRA Regulation amending Petroleum Market License Regulation 31 January The Ministry of Labour and Social Security Regulation amending Occupational Helath and Safety Services Regulation FEBRUARY February Professional Competency Board Occupational Standards (Port Pump and Storage Area Operator, Fuel and Autogas Supply and Filling Staff) 4 February EMRA Board Decision regarding fines and penalties 7 February The Ministry of Customs and Trade Regulation amending Customs Regulation 8 February The Ministry of Labour and Social Security Regulation on the Repeal of the Regulation on Heavy and Dangerous Work 20 February EMRA Announcement regarding the ethanol to be blended to Fuel and Gasoline marked with National Marker within the framework of National Marker Practice 21 February The Ministry of Energy and Natural Resources Regulation amending the Regulation on Energy Sector Research Development Projects Support Program 21 February The Ministry of Science, Industry and Technology Communique on Chapter 8 and Chapter 9 of Portable Fire Extinguishers (Ts En 3-8, Ts En 3-9/Ac) (Communique No: Msg-Ms-2013/2) 21 February The Ministry of Finance Tax Procedure Law General Communique (No: 424) 25 February EMRA Announcement regarding licenses 25 February The Ministry of Environment and Urban Planning Draft Communique on Waste-Derived Fuel, Additional Fuel and Alternative Raw Material 27 February The Ministry of Transportation, Maritime Affairs and Communications Regulation amending the Ports Regulation

57 MARCH March The Ministry of Transportation, Maritime Affairs and Communications Regulation on the Arrangement of the Maritime Trade Statistics 1 March Council of Ministers Law Amending the Groundwater Law and Nationalization Law 3 March TSE Announcement regarding the Cancellation of the contracts granting the right to use Service Competence Certificate 11 March The Ministry of Science, Industry and Technology Communique on Transportable, Refillable Steel LPG Cylinders in Usage (TS 5306) 11 March The Ministry of Transportation, Maritime Affairs and Communications Announcement regarding the Authorization of Turkish Standards Institute by the Ministry of Transportation, Maritime Affairs and Communications, to conduct operations and procedures regarding the Testing, Certification and Inspection of Packaging, Tanks and Containers 15 March Council of Ministers The Law on the Approval of Participation in the International Agreement on the Legal Liability for Oil Pollution Damages Caused by Ship Fuels, accepted on 23 March March Council of Ministers The Law on the Approval of Participation in the Protocol of 1997 amending the International Convention for the Prevention of Marine Pollution from Ships, 1973, as modified by the Protocol of March EMRA Board Decision regarding fines and penalties and licenses 27 March The Ministry of Finance Tax Procedure Law General Communique (No: 425) 27 March The Ministry of Transportation, Maritime Affairs and Communications Circular on the amendment of IMDG Code APRIL April Ministry of Environment and Urban Planning Regulation Amending Environmental Impact Assesment Regulation 5 April Ministry of Customs and Trade Regulation Amending Customs Regulation 11 April Council of Ministers Law Amending Customs Law and Certain Laws and Decree Laws 19 April EMRA Announcement Regarding the Licenses Granted and Expired Within the Provisions of Petroleum Market License Regulation 24 April EMRA Regulation Amending Petroleum Market License Regulation 24 April EMRA Communiqué On The Procedures And Principles Of Supplying Non-Fuel Petroleum Products From Domestic And Foreign Resources 25 April Ministry of Labour and Social Security Regulation on Minimum Safety and Health Requirements For The Use Of Work Equipment By Workers At Work 25 April Ministry of Customs and Trade Communique (Return to Country of Origin) (Serial No:4) Amending Customs General Communique (Return to Country of Origin) (Serial No:2) LEGAL REGULATIONS MAY May Ministry of Transportation, Maritime Affairs and Communications Accident Investigation Board Regulation 15 May Ministry of Labour and Social Security Regulation on Procedures and Principles of Occupational Health and Safety Trainings of Employees 15 May Ministry of Customs and Trade Regulation Amending Customs Regulation 16 May Ministry of Internal Affairs, Ministry of Environment and Urban Planning, Ministry of Transportation, Maritime Affairs and Communications Regulation Amending Road Traffic Regulation 17 May Ministry of Science, Industry and Technology Communique on Workplaces Providing Maintenance and Filling Service for Fire Extinguishers Guidelines (TS 11827) (Communique No: MSG-MS-2013/10) 18 May TSE Announcement on termination of the right of use of TSE trademark 5354

58 JUNE June Ministry of Customs and Trade Communique (Operating under the control of Customs) (Serial No:4) Amending Customs General Communique (Operating under the control of Customs) (Serial No:3) 8 June EMRA Board Decision 11 June Turkish Petroleum Law (Law No. 6491) 12 June Ministry of Customs and Trade Regulation Amending Customs Regulation 14 June Ministry of Labour and Social Security Communique on Class (C) Occupational Safety Experts who can be Employed in Very Hazardous Works 14 June Ministry of Customs and Trade Customs General Communique (Resolutions of Tariff- Classification) (Serial No: 15) 15 June Ministry of Science, Industry and Technology Regulation Amending Measuring and Measuring Instruments Type Approval Regulation 18 June Ministry of Labour and Social Security Regulation on Emergency Situations in the Business Place 25 June Ministry of Customs and Trade Communique (Transit Operations) (Serial No:5) Amending Customs General Communique (Transit Regime) (Serial No:3) 29 June EMRA Communiqué On The Procedures And Principles Of Supplying Non-Fuel Petroleum Products From Domestic And Foreign Resources JULY 2013 LEGAL REGULATIONS 5 July Ministry of Finance Tax Procedure Law General Communiqué 11 July Ministry of Environment and Urban Planning Regulation Amending the Regulation on the Control of Soil Pollution and Point-Source Pollution Sites 11 July The Confederation of Turkish Tradesmen and Craftsmen Regulation Repealing the Regulation on Commercial Vehicle Driving License Trainings and Exams 13 July Ministry of Labor and Social Security Regulation on Occupational Trainings of Personnel to be Employed in Hazardous and Very Hazardous Works 17 July Ministry of Labor and Social Security Regulation on Health and Safety Measures to be taken at Main and Additional Workplace Buildings 19 July EMRA Regulation Amending the Regulation on National Marker Implementation in the Petroleum Market 19 July EMRA Decision No: July Ministry of Environment and Urban Planning Regulation on the Control of Odor Causing Emissions 20 July Ministry of Finance Special Consumption Tax General Communiqué 20 July Ministry of Labor and Social Security Regulation on Duties, Authorities, Responsibilities and Trainings of Workplace Doctors and Healthcare Personnel 26 July Ministry of Science, Industry and Technology Regulation Amending the Type Approval Regulation (97/68/At) on Measures Against the Emission of Gaseous and Particulate Pollutants from Internal Combustion Engines to be Installed in Non-Road Mobile Machinery 26 July Communiqué on Block Exemption in Specialization Agreements (Communiqué No: 2013/3) 28 July Ministry of Labor and Social Security Regulation on Protection of Employees from Noise Risks Section One 28 July Ministry of Science, Industry and Technology Communiqué on Hose Clamps Worm Gear, Steel (TS 12091) (Communiqué No: MSG-MS-2013/19) AUGUST August Ministry of Customs and Trade Regulation Amending Customs Regulation 3 August Ministry of Customs and Trade Communique (Processing Under Customs Control) (No.5) Amending Customs General Communique (Processing Under Customs Control) (No.3) 6 August Ministry of Labor and Social Security Regulation on Health and Safety Measures While Handling Carcinogenic and Mutagenic Substances 12 August Ministry of Labor and Social Security Regulation on Health and Safety Measures While Handling Chemical Substances 11 August TSE Companies Whose Service Competence Certificates are Cancelled and Contracts are Terminated 15 August Ministry of Labor and Social Security Communique on Formation and Duties of Personal Protective Equipment Technical Committee

59 16 August Ministry of Science, Industry and Technology Communique on Gas Cylinders 20 August Ministry of Labor and Social Security Regulation on Laboratories Conducting Occupational Hygiene Measurements, Tests and Analyses 20 August Ministry of Customs and Trade Regulation Amending Customs Reconciliation Regulation 22 August Ministry of Labor and Social Security Regulation on Protection of Employees from Risks About Vibration 22 August TSE Companies Whose Service Competence Certificates are Cancelled and Contracts are Terminated 23 August Ministry of Labor and Social Security Regulation on Occupational Health in Temporary or Fixed Term Employments 29 August Ministry of Labor and Social Security Communique on Qualifications and Procedures and Principles for Assignment of Occupational Health and Safety Representative SEPTEMBER September Social Security Institution Employer Implementation Communique 3 September Ministry of Labor and Social Security Communique Repealing the Communique on Occupational Trainings of Workers to be Employed in Heavy and Dangerous Works 4 September Ministry of Science, Industry and Technology Weighing Instruments Examination Regulation 5 September Ministry of Science, Industry and Technology Communiqué on Marking and Labeling Packages 18 September Ministry of Science, Industry and Technology Type Approval Regulation on Advanced Emergency Break System for Certain Categories of Motor Vehicles AB September Ministry of Science, Industry and Technology Type Approval Regulation on Advanced Emergency Break System for Certain Categories of Motor Vehicles AB September Ministry of Science, Industry and Technology Communiqué on Implementation of UN EEC Regulations on Wheeled Vehicles and Components and Parts Used in Those Vehicles 25 September Ministry of Science, Industry and Technology Regulation Amending the Regulation on the Type Approval of Motor Vehicles in Respect to Emissions from Heavy Duty Vehicles and in the Matter of Access to Vehicle Repair and Maintenance Information 25 September Ministry of Science, Industry and Technology Regulation Amending Regulation on Type Approval of Motor Vehicles and Trailers 26 September Social Security Institution Communique Amending Social Security Institution Health Practices Communique OCTOBER October Ministry of Environment and Urban Planning Communique Amending the Communique on Recycling Certain Nonhazardous Wastes 3 October Ministry of Science, Industry and Technology Communiqué on Oil and Natural Gas Industry Steel Drill Pipes 3 October Ministry of Transportation, Maritime Affairs and Communications Amendment to Accident Investigation and Inspection Board Regulation 3 October Ministry of Customs and Trade Communique Amending Serial No October Ministry of Customs and Trade Communique Amending Serial No 90 3 October Ministry of Environment and Urban Planning Environmental Impact Assessment Regulation 3 October Ministry of Science, Industry and Technology Communique on Steel Drill Pipes 5 October EMRA Regulation Amending Petroleum Market License Regulation 5 October Ministry of Science, Industry and Technology Amendment to Type Approval Communiqué on Air Conditioning Systems Emissions of Motor Vehicles AT 5 October Ministry of Economy Communique on the Temporary Suspension of the Actvities of International Audit Company 6 October EMRA Board Decision Amending Board Decision no.1240 on Procedures and Principles Regarding Dealer Audit System of Distribution License Holders in Petroleum Market 7 October Prime Ministry Climate Change and Air Management Coordination Board 8 October Council of Ministers Board Decision October Ministry of Labor and Social Security Regulation Amending the Regulation on Duties, Authorities, Responsibilities and Trainings of Occupational Safety Experts 12 October Ministry of Science, Industry and Technology Type Approval Regulation on Mass and Size LEGAL REGULATIONS 5556

60 of Motor Vehicles and Trailers 23 October Prime Ministry Private Health Insurance Regulation 24 October Ministry of Transportation, Maritime Affairs and Communications Regulation on Carriage of Dangerous Goods by Road 26 October Ministry of Science, Industry and Technology Communiqué on Cylinders Liquefied Petroleum Gas (LPG) 26 October EMRA Board Decisions NOVEMBER 2013 LEGAL REGULATIONS 56 5 November Ministry of Labor and Social Security Dust Control Regulation 5 November Ministry of Environment and Urban Planning Regulation Amending Regulation on Control of Waste Oils 5 November Ministry of Environment and Urban Planning Regulation Amending Regulation on Control of Hazardous Waste 7 November EMRA Regulation Amending Petroleum Market License Regulation 11 November Ministry of Environment and Urban Planning Regulation Amending the Regulation on Control of Worn-out Tyres 12 November EMRA Legal Entities Who are Granted a License and Whose Licenses are Cancelled 21 November Ministry of Customs and Trade Regulation Amending Customs Regulation 24 November Ministry of Science, Industry and Technology Communiqué on Polyethylene Attachments of Plastic Pipe Systems Used for Transportation of Gas Fuels 24 November Ministry of Science, Industry and Technology Communiqué on Manufacturing, Examination, Test and Marking of Gas Cartridges Non-refillable-Metallic for LPG With or Without Valves Used in Portable Devices 27 November Prime Ministry Regulation Amending the Regulation on Implementation of Highway Motor Vehicles Compulsory Liability Insurance Tariff 27 November Prime Ministry Tariff and Instructions Amending Compulsory Highway Transportation Liability Insurance Tariff and Instructions 27 November Prime Ministry Tariff and Instructions Amending Dangerous Goods Compulsory Liability Insurance Tariff and Instructions 27 November EMRA Regulation on the Procedures and Principles to be Followed in Audits, Preliminary Investigations and Inspections in the Petroleum Market 28 November Ministry of Science, Industry and Technology Communiqué on Polyethylene Attachments of Plastic Pipe Systems Used for Transportation of Gas Fuels 28 November Ministry of Science, Industry and Technology Communiqué on Copper and Copper Alloy Seamless Round Pipes For General Purposes 28 November EMRA Fines and Notices by Publication 28 November Ministry of Finance Communique No.27 Amending Special Consumption Tax General Communique No November Ministry of Finance Communique No.28 Amending Special Consumption Tax General Communique No November Social Security Institution Communique Amending the Employer Implementation Communique 29 November Ministry of Science, Industry and Technology Communiqué on the Assignment of Kalibra International Metroloji Ltd. Şti. as Accredited Institution within the scope of Regulation on Measuring Instruments 29 November Ministry of Science, Industry and Technology Communiqué on Hardened and Tempered Steel Cylinders with Tensile Strength 1100 Mpa or More 29 November Ministry of Economy Regulation Amending the Regulation on Import Safeguard Measures 30 November Ministry of Environment and Urban Planning Regulation on Exhaust Gas Emissions and Gasoline and Diesel Quality DECEMBER December Council of Ministers Decision on Determination of Special Consumption Tax 2 December Ministry of Customs and Trade Communique Amending the Communique on Commercial Books

61 2 December TSE Announcement of Cancellations 3 December Ministry of Customs and Trade Regulation on publication of names of those whose verdict of conviction regarding types of smuggling is finalized 10 December Ministry of Science, Industry and Technology Regulation Amending the Regulation on Fees for Measurements and Examination and Stamping of Measuring Instruments 11 December Ministry of Environment and Urban Planning Regulation on Classification, Labeling and Packaging of Substances and Mixtures 11 December Ministry of Environment and Urban Planning Regulation on Test Methods to be used for Determination of Physico-Chemaical, Toxicological and Ecotoxicological Properties of Substances and Mixtures 12 December Ministry of Science, Industry and Technology Regulation Amending Regulation on Inspection of Measuring Instruments 13 December Ministry of Customs and Trade Customs General Communique (Decisions on Tariffs- Classifications) 13 December Ministry of Customs and Trade Customs General Communique Customs Transactions No: December Council of Ministers Bylaw Repealing the Customs Undersecreteriat Inspection Board Bylaw 14 December Ministry of Customs and Trade Communique (Transit Regime) Amending Customs General Communique (Transit Regime) 14 December Ministry of Customs and Trade Communique Amending Customs General Communique (Customs Tarfiff Schedule Explanatory Notes) 16 December EMRA Legal Entities Who are Granted a License and Whose Licenses are Cancelled 18 December TSE Announcement of Cancellations 20 December Ministry of Interior Regulation Amending Highway Traffic Regulation 21 December Ministry of Customs and Trade Communique Amending Customs General Communique 24 December Ministry of Science, Industry and Technology Communiqué on the Implementation Measures of the Regulation on Type Approval of Hydrogen Powered Motor Vehicles 24 December Ministry of Labor and Social Security Regulation on Support of Occupational Health and Safety Services 25 December Ministry of Environment and Urban Planning Environment Measurement and Analysis Laboratories Competence Regulation 25 December TSE Companies Whose Service Competence Certificates are Cancelled and Contracts are Terminated 26 December Ministry of Science, Industry and Technology Communiqué on Safety Rules for Liquefied Petroleum Gases Supply Stations Road Vehicles 26 December Ministry of Labor and Social Security Communique Repealing the Communique on Class (C) Occupational Safety Experts who can be Employed in Very Hazardous Works 29 December EMRA Penalties 29 December Ministry of Finance Tax Procedure Law General Communique No: December Ministry of Labor and Social Security Regulation on Prevention and Mitigation of the Effects of Major Industrial Accidents 30 December EMRA Communique on Fines to be Imposed in 2014 under Article 16 of Law Amending Liquefied Petroleum Gases (LPG) Market Law no.5307 and Electricity Market Law 30 December EMRA Communique on Fines to be Imposed in 2014 under Article 19 of Petroleum Market Law no December Ministry of Finance Value Added Tax General Communique No: December Ministry of Finance Act of Fees General Communique No: December Ministry of Finance Act of Fees General Communique No: December Ministry of Finance Stamp Tax Law General Communique No: December Ministry of Finance Tax Procedure Law General Communique No: December Ministry of Finance Motor Vehicles Tax General Communique No: December TSE Communique on Fees to be Charged by Turkish Patent Institute in December EMRA Penalties 31 December EMRA Participation Fee and License Fees 31 December Ministry of Finance Special Consumption Tax General Communique No: December Council of Ministers Turkish Customs Tariff Schedule with Statistic Positions Breakdown LEGAL REGULATIONS 5758

62 9 ABOUT PETDER PETDER was established on 23 September 1996 by a group of leading fuel distribution companies with the aim of supporting a spectrum of activities ranging from production to consumption of oil products. PETDER has thirteen members. These members are Alpet, Aytemiz, Belgin, BP, Gulf, ExxonMobil, Opet, Petline, OMV Petrol Ofisi, Shell, Shell & Turcas, Total, Turcas and Turkuaz. Founding members of PETDER are BP, ExxonMobil, Opet, Petrol Ofisi, Shell and TOTAL. PETDER was founded with the aim of; Protecting the environment and human health by improving the measures to be taken during clearance, storage, transportation and marketing of crude oil and petroleum products, Ensuring that petroleum products are delivered to end users in compliance with the standards set by relevant authorities, Discussing technical and administrative measures to be taken towards protection of ends users and the environment after sale and consumption of the products, Discussing administrative measures and determining technical applications regarding the foregoing. ABOUT PETDER Since its establishment, PETDER s primary aim has been to serve as a professional nongovernmental organization equipped with strong, reliable and objective principles and has always worked towards this goal. PETDER s main activities are; the provision of the safe and economic supply of gasoline, LPG and lubricants oils to the market, maintenance of transparent, fair and stable industrial environment, prevention of unfair competition, any act violating consumer and human health, improving industrial standards. Activities and important developments in the industry are shared with the public through sector reports published periodically. PETDER is in cooperation with EUROPIA, which represents the European fuel industry. Waste Oil Management Project Following the Regulation on Control of Waste Oils, PETDER initiated the Waste Oil Management Project in 2004 in order to fulfill the members liabilities resulting from the Regulation by collecting the waste motor oils generated at car maintenance and repair shops, fuel stations and public car maintenance stations by licensed and authorized personnel under appropriate conditions. Waste motor oils collected by PETDER within the framework of the project are recycled, used as energy or disposed at facilities licensed by the Ministry of Environment and Urban Planning to eliminate the negative impacts on environment and human health and public awareness is raised on the negative impacts of waste oil and how it should be reclaimed. PETDER is the only institution authorized by the Ministry for the collection of waste motor oil. One Barrel One Tree Social Responsibility Project PETDER provides free of charge service with licensed transportation vehicles across Turkey and plants one tree for each barrel of waste oil collected in cooperation with the Ministry of Environment and Urban Planning and the Ministry of Forestry and Water Affairs. 58 Within the framework of this project financed by PETDER, 40,000 trees have been planted in two years in return for 8,318 tons of waste oil collected. The number of trees planted is going to increase over the years. Traffic Safety Platform Fuel Committee PETDER became a member of Traffic Safety Platform on 15 July PETDER plans and carries out Fuel Committee activities with its members.

63 Management System Certification PETDER has been the first non-governmental organization which was granted the three certificates TS EN ISO, TS EN ISO and TS and certified in three areas of Quality, Environment and occupational Health. PETDER has had both the activities of the Association and Waste Oil Management activities certified by S&Q Mart Certification Company accredited by TÜRKAK and aims to sustain the policy it has committed at each phase of its activities. BOARD MEMBERS Chairman Ahmet ERDEM (The Shell Company of Turkey Ltd.) Vice Chairman Martin THOMSEN Accounting Member Adnan ÜNAL Board Members Tamas MAYER Antoine TOURNAND Ekrem EKMENCİ Yılmaz TECMEN Ahmet İzzet EKE (BP Petrolleri A.Ş.) (Petline Petrol Ürünleri A.Ş.) (OMV Petrol Ofisi A.Ş.) (Total Oil Türkiye A.Ş.) (Opet Petrolcülük A.Ş.) (Turcas Petrol A.Ş.) (Aytemiz Akaryakıt Dağıtım A.Ş.) ABOUT PETDER MEMBERS 5960

64 ORGANIZATION Niyazi İLTER Secretary General ABOUT PETDER Serkan BEREKET Management and External Affairs Coordinator Yasemin DAĞ Corporate Communications Executive Zeynep ERSEN Financial and Customer Relations Executive Ebru AYDIN Management and Office Assistant Volkan SİĞİNÇ Operations Manager 60 Hasan HIRAOĞLU Planning Executive Osman AKSOY Planning Executive Serdar BEKDEMİR Planning Specialist

65 COMMITTEES PETDER committees in different fields of expertise carry out studies and activities with regulatory authorities and the stakeholders in the industry and study current and legal developments in their fields. The committees mainly meet once a month regularly and also when deemed necessary. PETDER committees are; Law Committee Supply Committee Corporate Communications Committee LPG Sectoral Board LPG Technical Committee Lubricants Technical Committee Automation Committee Health, Safety and Environment Committee Transportation Committee Taxation Committee CONTACT INFORMATION Istanbul Head Office Piyalepaşa Bulv. Ortadoğu Plaza No: 73/10, Okmeydanı, Şişli / Istanbul Turkey Phone: Fax: info@petder.org.tr Ankara Representative Office Dumlupınar Bulv. No: 266 Tepe Prime İş Merkezi, C Blok D: 98, Çankaya / Ankara Turkey Phone: Fax: ABOUT PETDER 6162

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67 10 REFERENCES Data regarding Oil and LPG sectors is based on EMRA Oil and LPG Sector Report. Fuel data used in this report have been compiled from statements provided by 13 fuel distributors whose aggregate market share is calculated to be above 85% of the market and reported to the independent research organization on voluntary participation basis. For data on fuel distributors who did not participate in this voluntary data formation system, calculations were made using data from previous periods obtained from EMRA. Lubricant data used in this report is reported to PETDER through an independent audit organization on a voluntary participation basis. Inflation, GDP, CPI, exchange rates, vehicle numbers and total vehicle station data is obtained from Turkish Statistics Institute (TurkStat) and the Central Bank public reports. Crude oil prices and pump tax values are obtained from Argus and European Commission sources. Turkish pump prices used in this report are obtained from EMRA and company websites. Data related to European pump prices is obtained from: France: Ministry of Industrial Economy and Employment : Spain: Ministry of Industry, Tourism and Trade Precios/Informes/InformesMensuales/Paginas/Ind Italy : Greece : Treasury EU Data: European Commission, EC Oil Bulletin, observatory/oil/bulletin_en.htm Data regarding the sector margins is based on PwC report. 63

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70 Istanbul Head Office Piyalepaşa Bulv. Ortadoğu Plaza No: 73/10, Okmeydanı, Şişli / Istanbul Turkey Phone: Fax: Ankara Representative Office Dumlupınar Bulv. No: 266 Tepe Prime İş Merkezi, C Blok D: 98, Çankaya / Ankara Turkey Phone: Fax: info@petder.org.tr