Veli-Matti Reinikkala, Head of Process Automation Hammerfest press trip 2012 Strategy Oil & Gas opportunity

Transcription

1 Veli-Matti Reinikkala, Head of Process Automation Hammerfest press trip 2012 Strategy Oil & Gas opportunity June 17, 2012

2 2011 sales above $ 4 billion 7,500 employees more than 40 countries #1 control systems worldwide 1,000 s of completed projects worldwide Subsea electrification Shore-to-ship electrification Deepwater 24 April 2012 Slide 2

3 Our offering for oil, gas and petrochemical Control system Instrumentation Safety systems Motor / drives Electrification Drives / motors Communication Propulsion / positioning MES Training simulator Power from shore Service / support 24 April 2012 Slide 3

4 Integrated process and power automation Complete portfolio from ABB HV/MV Power Distribution LV Power Distribution Intelligent Switchgear Drives Motors Control Systems Safety Systems Telecom Systems Intelligent Field Instruments Analyzers Consulting Services Main Electrical Contractor Main Automation Contractor Expertise and Consulting services Integrated process and power automation Project benefits Reduced CAPEX (20 percent typical) Faster project startups Reduced engineering Less equipment required Operational benefits Reduced OPEX (20 percent typical) Energy management Operator efficiency and safety Reduced lifecycle costs 24 April 2012 Slide 4

5 Sadara project Saudi Arabia Largest greenfield petrochemical facility Total investment: $20bn, operational by 2016 Largest petrochemical facility ever built in a single phase Two customers, >15 EPC s, 8 countries, >60 PO s Will produce over 3 million metric tons of chemical products Expected to generate over $10bn per year in revenue

6 How is ABB different? Automation expansion Best in class emerging market position Service opportunity Industrial software leadership Strongest power T&D portfolio Market leadership in grids Automation and power synergies November 07, 2011 Slide 6

7 ABB to outgrow GDP by factor 2 Capitalizing on global megatrends Megatrends relevant for ABB s long-term growth How will we capitalize on these trends? Resource Economics Transportion mobility (people, goods) Deep understanding of markets Penetration of key geographic areas Green Electrification Execution around markets and trends Urbanization Digital information Continued investment in R&D Strong sales / distribution Emerging economies and power shift June 17, 2012

8 Building on ABB strength in strategic growth areas Focus on industries growing faster than world GDP 20% Smart grid Market growth CAGR Software DC technology Energy efficiency Data centers Power electronics Mechanical equipment & service Industrial automation Service Oil & gas frontiers Renewables Geographic market penetration 0% 10 World GDP Market size in 2010 ($bn) priority growth areas Geographic market penetration Renewables Smart grid Oil & gas frontiers Data centers Service Energy efficiency Software Leader in industrial automation Mechanical equipment & service Power electronics DC technology & applications 24 April 2012 Slide 8

9 ABB will increase investments through the cycle Investment in core competencies continue to grow More investment into R&D US$ millions, % change in US$ More investment into sales Selling expenses, US$ millions Stronger service business US$ millions % 1'082 1'370 2' % 2' ' % 5' Technology competitive advantage Localization of R&D R&D to revenues spent to equal 4% Product, business and geography Sales investments up >40% Getting closer to the customers Large untapped potential Expansion service offering Getting closer to the customers 24 April 2012 Slide 9

10 Oil and gas industry Market trends driving investments Frontier marketsdeepwater, arctic, heavy oil Emerging market demand for fuel Steep decline rates in existing fields Higher oil prices new norm National oil companies with local content requirements Unconventional gas 24 April 2012 Slide 10

11 Oil & gas: main growth vectors Organic growth EPC Step-outs Service Expansion of our current automation and electrification business Expand definition of EPC business Specific areas with significant market growth Increasing focus on our Service portfolio

12 Oil and gas demand and price trends Oil demand ( ) Million bbls / day % 0.8% Oil price and effective spare capacity USD/barrel 150 Crude MBPD Non-OPEC OPEC Global '80 '85 '90 '95 '00 '05 '10 '15 '20 '25 '30 Spare capacity '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 0 Natural gas demand ( ) BCF / day 2.4% 2.1% Non-OECD 100 OECD Global '80 '85 '90 '95 '00 '05 '10 '15 '20 '25 '30 Natural gas price across regions Natural gas, $/mmbtu '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 Japan, LNG German import US Henry Hub '11 '12 June 17, 2012 Slide 12

13 Oil supply curve Production cost vs. resources Source: IEA World Energy Outlook Production cost: Other conventional oil Deepwater and ultra deep water C0 2 EOR EOR Artic Heavy oil and bitumen Oil shale Gas to liquids Coal to liquids 20 Produced MENA 10,000 0 Resources: (billion barrels) 0 1,000 2,000 4,000 6,000 8,000

14 Deepwater oil & gas Example: Brazil, pre-, post-salt Reaching oil deposits once thought unobtainable Chart 14

15 Deepwater oil & gas Example: Brazil, pre-, post-salt Chart 15

16 Deepwater oil & gas Example: Brazil, pre-, post-salt Chart 16

17 Deepwater oil & gas Example: Brazil, pre-, post-salt Chart 17

18 Deepwater oil & gas Example: Brazil, pre-, post-salt Chart 18

19 Deepwater oil & gas Example: Brazil, pre-, post-salt Chart 19

20 Power from (to) shore solutions HVDC HVDC AC AC HVDC June 17, 2012 Slide 20

21 How it works:

22 Summary Oil & gas presents significant opportunity for ABB Strategic growth sector above 7% between New oil & gas frontiers require power and automation solutions ABB has a strong position given it s unique business scope in power, automation and power electronics In petrochemicals, ABB has become the world leader in control systems Outstanding service business 15 March 2012 Slide 22

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