SCM Dictionary

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TABLE OF CONTENTS

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REFINERY TERMINOLOGY

I.A. Refining

API gravity

An arbitrary scale expressing the gravity or density of liquid

petroleum products devised jointly by the American Petroleum Institute

and the National Bureau of Standards. The measuring scale is calibrated

in terms of degrees API. Oil with the least specific gravity has the

highest API gravity.

Higher API gravity crude (light crudes) have a higher price than

lower ones given their higher quality product yields.

The formula for determining API Gravity is:

API gravity = (141.5/specific gravity at 60 degrees F) 131.5.

Typical API gravity - Brent Dtd 38.5

- Urals Med 31-33

Romanian terminology: Densitatea API

Black products

Diesel oils and fuels oils, i.e. products from the low or heavy end

of the distillation process.

Petromidia:

Romanian terminology: Produse negre

FUEL OIL 2.98

Fuel Oil 2.98

Vaccuum distillate/VGO 5.46

VGO 5.46

PETROLEUM COKE 6.46

Petroleum Coke 6.46

SULPHUR 0.87

Petroleum Sulphur 0.87

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Backcasting analysis

What if analysis performed after the month finishes and we have all

actual data.

We are introducing all these data into the monthly plan simulation

and check were was the major constraint that influenced the financial

result: crude recipe processed, unit capacity constraints, market sales,

blending giveaway.

Catalysts

Any substance that changes the rate of a reaction without itself

being changed in the reaction; catalysts can be solids, liquids or gases,

and they may be individual molecules that are dissolved in a liquid

containing the reacting molecules.

The most common industrial catalysts are solids used in treating

feeds that are liquids or gases.

Romanian terminology: Catalizatori

Cetane number or CN is a measurement of the combustion

quality of diesel fuel during compression ignition. It is a significant

expression of diesel fuel quality among a number of other

measurements that determine overall diesel fuel quality. Cetane

number of a fuel is defined as the percentage by volume of normal

cetane in a mixture of normal cetane and alpha-methyl naphthalene

which has the same ignition characteristics (ignition delay) as the test

fuel when combustion is carried out in a standard engine under

specified operating conditions.

Romanian terminology: Cifra cetanica (CC).

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Crack

Represents the difference between a crude market price and a

product market price. It is generally used as an indicator of expected

refinery profitability based exclusively on market prices. NWE market

uses Brent cracks while Med market uses Urals cracks as indicators.

These spread differentials which represent refining margins can be

quoted in dollars per barrel -by converting the product prices into

dollars per barrel and subtracting the crude price or dollars per metric

tonne by converting the crude price in metric tonne and substracting

it from product price.

Crack formula = Product price Crude price

Gasoline Med crack = Prem Unl FOB Med Urals Med

Romanian terminology:

Crude Oil

A mineral oil consisting of a mixture of hydrocarbons of natural

origin, yellow to black in colour, of variable specific gravity and

viscosity.

Crude is the raw material which is refined into gasoline, heating

oil, jet fuel, propane, petrochemicals, and other products.

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Type:

Sour Crude Oil:

Sweet Crude Oil:

Petromidia: Processing Crude Oil:

Sweet Crude Oil % SZaikinskaya Crude Oil 0,24Azeri Crude Oil 0,15-0,4Siberian Light Crude Oil 0,4-0,6 -0,57Kumkol Crude Oil 0,08Caspian Blend Crude Oil 0,57Aktubinsk Crude Oil 0,74Okarem Crude Oil 0,21Cheleken Crude Oil 0,41Tengiz Crude Oil 0,49Turkmen Crude Oil 0,29K & K Crude Oil 0,29Marine Crude Oil 0,05Poltava Crude Oil 0,08

Sour Crude Oil % SREBCO 1,2-1,45Kazakh/Standard Export Blend Crude Oil1,2-1,45

Iesiri produse/ Primiri m.p

Cumulat 12 luni 2007

tone %

TITEI 3670281 95.90

Sulfuros 2812180 73.48

Titei REBCO 1319085 34.46

Titei Kazach/ Sebco 476065 12.44

Titei Amestec Sour 0 0.00

Titei Iranian greu 950007 24.82

Titei Qarun 67023 1.75

Nesulfuros 858101 22.42

Titei Siberian light 3669 0.10

Titei Cheleken 86722 2.27

Titei Melllitah 47633

Titei Amestec Sweet 538219 14.06

Titei CPC 78567 2.05

Titei Azeri 73719 1.93

Titei Tenghiz 29572 0.77

RAFINARIE

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Other Feedstock

Products processed in refinery units for obtaining valuable

products: methane used for hydrogen production, methanol for MTBE

production, etc.

Urals Med (CIF Augusta): This daily spot price assessment

takes into account cargoes loading from Black Sea ports of

Novorossiisk, Odessa, Theodosia, Kavkaz, Yuzhny and Kerch for delivery

into the Mediterranean.

The assessment basis is CIF Augusta, Sicily/Italy. Cargoes

delivered to other ports in the Mediterranean can also be considered,

with freight costs taken into account. Cargoes for delivery within the

Black Sea are not considered.

Gravity is approximately 31-33 degrees, with a sulfur content of

1.3%. The current bbl/mt conversion factor for Urals crude oil is 7.240-

7.329.

Urals ex-Novorossiisk (FOB): This daily spot assessment takes

into account cargoes traded on a FOB basis at the Black Sea

port of Novorossiisk.

The API gravity is approximately 31-33 degrees, with a sulfur

content of 1.3%. The current bbl/mt conversion factor for Urals crude

oil is 7.240-7.329.

Other feedstock 157096 4.10

Gasoline 4889 0.13

Vacuum Distillate 9064 0.24

Fuel Oil 18472 0.48

Methanol 10238 0.27

MTBE 67845 1.77

Gasoline 0 0.00

Propane for chemical use 31050 0.81

Other feedstock 15538 0.41

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CPC Blend (CIF Augusta): This daily spot assessment takes into

account cargoes loading from Black Sea port CPC Terminal for delivery

into the Mediterranean. The assessment basis is CIF Augusta,

Sicily/Italy.

The API gravity for CPC Blend is 45 degrees and the sulfur content

is 0.6%. The bbl/mt conversion factor is 7.864.

CPC Blend FOB (CPC Terminal): This daily spot assessment

takes into account cargoes loading from the CPC terminal on the Black

Sea.

Azeri Light FOB Supsa: This daily spot assessment takes into

account cargoes loading from the Black Sea port of Supsa.

The API for Azeri Light is 34-34.5 degrees and the sulfur content

is 0.143-0.15%. The bbl/mt conversion factor is 7.374-7.395.

The assessment is expressed as a high and a low.

Kumkol: This daily spot assessment takes into account cargoes of

Kumkol delivered into the Mediterranean on a CIF Augusta basis.

The API is 40-41 degrees and the sulfur content is 0.1-0.2%.

The bbl/mt conversion factor is 7.641-7.686.

H/CAMS

Haverly Crude Assay Management System-crude simulator based

on an assay library used for generating valuable data about the crude

types that we are processing in the refinery.

Loss

The amount by which the total volume of refinery output is less

than the total volume of refinery input for a given period of time. The

processing loss arises when crude oil and other hydrocarbons are

processed into petroleum products that are, on average, more dense

than the input.

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Petromidia:

Loss= Fuel gas for burning + Coke/Catalyst + Technological loss

YEAR 2007: Total Loss = 224,533 mt

Romanian terminology: Consum

Mothball

To place a generating facility in an inactive state so that it can

neither be brought into operation immediately nor counted towards

reserve margin

Romanian terminology: In conservare

Nameplate/design capacity

The full-load continuous rating of a generator or other electric

power production equipment under specific conditions as designated by

the manufacturer. Installed generator nameplate rating is usually

indicated on a nameplate physically attached to the generator.

Romanian terminology: Capacitate proiectata

Netback

Measure the return crude oil producers receive from product

prices after refiners take out their operating costs and transportation

expenses.

This indicates the attractiveness of the produced crude. The

calculation takes into account the location of the market (refinery site),

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the refinery margin calculation and the transportation from wellhead to

the refinery.

Netback formula = Refinery revenue (Operating expenses +

Transportation)

PIMS

Process Industry Modelling System-specialized program used

for economical evaluation of all commercial and technical constraints

that affect a refinery in a well defined period of time.

It is used in budget, monthly operating plan, crude selection, new

units implementation feasibility study, incident evaluation, etc.

Ppm

Parts per million. Typically used to designate amount of metals,

sulphur or other impurities in refined oil products.

Romanian terminology: Parti pe million

Production cycle crack

Production cycle crack represents the difference between current

product market price and Urals market price at the beginning of the

production cycle (25 calendar days back).

Production cycle crack formula: Product price (t0) Crude price (t-25)

Romanian terminology: Crack al ciclului de productie

Refinery cracking processes:

Catalytic Reforming process: (Reformare Catalitica)

Catalytic process on dehydrogenation catalysts

(Platinum/Rhenium) forming aromatic rings and hydrogen.

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This process is the main hydrogen producer from refinery,

resulting also LPG and auto gasoline component.

Catalytic cracking: (Cracare catalitica)

Cracking using catalysts to enhance molecule breaking,

particularly in the production of high-octane gasoline.

Hydrocracking: (Hidrocracare)

While thermal and catalytic cracking produce shorter hydrocarbon

molecules largely by disposing of the excess carbon atoms,

hydrocracking inserts hydrogen atoms to achieve the same effect.

Steam cracking: (Piroliza)

A petrochemical process which produces olefins, particularly

ethylene, and, in some cases, aromatics. Similar to thermal cracking.

Delayed Coker: (Cocsare Intarziata)

Thermal cracking of viscous vacuum residues to produce gases,

gasoline, light and heavy gasoil and coke.

Visbreaking: (Cracare termica)

Thermal cracking of viscous crude residues to make fuel oil.

Refinery capacity

Represents the sum of reported atmospheric crude distillation and

condensate splitting capacity.

Petromidia:

YEAR 2007: Refinery Capacity = 3,827,377 mt

Romanian terminology: Capacitate

Refinery Types

Topping

Crude is a mixture of petroleum products. The topping refinery

just separates the crude into its constituent petroleum products by

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distillation, known as Atmospheric Distillation. Topping Refinery

produces naphtha but no gasoline.

Hydroskimming

The hydroskimming refinery is defined as a refinery equipped with

Atmospheric Distillation, naphtha reforming and necessary treating

processes.

Hydroskimming refinery is more complex than a topping refinery

and it produces gasoline.

Hydroskimming refinery produces a surplus of fuel with

unattractive price and demand.

Cracking

The cracking refinery is, in addition to the above, equipped with

vacuum distillation and catalytic cracking.

The cracking refinery adds one more level of complexity to the

hydroskimming refinery by reducing fuel oil by conversion to light

distillates and middle distillates.

Coking

The coking refinery refers to the one which is equipped to process

the vacuum residue into high value products using the Delayed Coking

Process.

The coking refinery adds further complexity to the cracking

refinery by high conversion of fuel oil into distillates and petroleum

coke.

Catalytic Cracking, Coking and other such conversion units are

referred to as secondary processing units.

The Nelson Complexity Index, captures the proportion of the

secondary conversion unit capacities relative to the primary distillation

or topping capacity.

The Nelson Complexity Index typically varies from about 2 for

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Hydroskimming refineries, to about 5 for the Cracking refineries and

over 9 for the Coking refineries.

Refineries, with high Nelson Complexity Index have the necessary

flexibility in processing a wide variety of crudes and are capable of

achieving higher value addition.

Refinery run

Maximum refinery capacity.

Petromidia:

Refinery run = maximum mt crude oil per day*Utilized available

time

YEAR 2007: Refinery run = 10,427*352 = 3,670,281 mt

Romanian terminology:

Refining margin

Refining margins are the difference in value between the products

produced by a refinery and the value of the crude oil used to produce

them.

Refining margin formula = Product yields*Refinery gate prices

(Operating cost+Crude cost)

Benchmark refinery margins are margin indicators calculated for a

specific market and refinery configuration. (cracking, hydroskimming)

Mediterranean Urals Cracking Refinery margin is calculated using

Urals Med crude and a specific yield on a cracking refinery while the

Rotterdam Brent Topping Refinery margin is calculated using Brent Dtd

NWE crude, specific yield on a topping refinery.

Petromidia:

GROSS REFINERY MARGIN (,000$)= Total Finished Products (EXW

Midia) + Unfinished Products - Crude&Other Feedstock (EXW Midia)

Operating Costs

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GROSS REFINERY MARGIN ($/feedstock bbl) = GROSS REFINERY

MARGIN ($)/ feedstock bbl

Year 2003:

Petromidia Refinery Margin = $4.18/bbl

Urals Med Cracking Benchmark= $3.67/bbl

Romanian terminology: Marja de rafinare

RON

A measure of the detonative quality of gasoline, or otherwise

expressed its tendency to cause "engine knock." The higher the octane

number, the higher the resistance to engine knock.

Octane numbers come in two forms: Research octane number

reflects fuel performance under moderate driving conditions, while the

tests for motor octane number reflect high speed driving conditions.

Tests for both numbers are in fact performed in the laboratory.

Throughput

The volume of crude or product flowing through a pipeline or

processed by a concentrator etc. Yearly refinery throuput is the total

quantity of feedstock that was processed.

Formula: Refinery Throughputs = Crude Oil + Other Feedstock

Petromidia:

Year 2007: Refinery Throughputs = 3,670,281 + 157,096=

3,827,377 mt

Romanian terminology: Supus

Unfinished Products

Partially complete work in process; partially manufactured

products.

Type:

Unfinished Type I (90%): PLT Reformate, FCC Gasoline,

Hydrotreated Kerosene, Hydrotreated Gasoil.

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Unfinished Type II (75%): Straight Run Gasoil, DCK Gasoil,

Vacuum Distillate, Hydrotreated Vacuum Distillate

Unfinished Type III (60%)= Vacuum Residue, SR Gasoline,

NHT Gasoline, iC5, iC4, nC4, etc.

Romanian terminology: Semifabricate

Turnaround

A refinery or petrochemical plant is said to be "in turnaround"

when it is taken out of service of maintenance, usually planned.

Romanian terminology: Revizie - oprire

White products

Gasoline, naphtha, kerosine and gas oil, i.e. products from the

high or light end of the distillation process.

Petromidia:

Romanian terminology: Produse albe

Yield

The percentages of products (gasoline, jet fuel, kerosene, gas oil,

distillates, residual fuel oil, lubricating oil and solid products) that a

refinery can produce from a single barrel of feedstock.

GASOLINE 30.75

Natural gasoline 3.72

Unleaded Gasoline 23.65

Gasoline for chemical use 3.37

JET FUEL 2.98

DIESEL FUEL 36.49

Diesel Fuel 35.39

Heating Oil 0.86

Slurry 0.25

LIGHT FUEL OIL 0.78

GASES 4.52

PROPYLENE 2.12

LIQUIFIED PETROLEUM GAS 4.26

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Yield formula = Product quantity/ Total feedstock quantity *100

Petromidia:

Romanian terminology: Randament

Utilities

The generic term for the refinery plants and units that are not

directly connected with the manufacture of products (e.g. steam

generation, water treatment, power consumed, etc.)

Romanian terminology: Utilitati

Maintenance

Routine repairs needed throughout the life of a well, usually

required more for oil than for gas wells.

Romanian terminology: Mentenanta

2008 %

TOTAL FEEDSTOCK : 100

CRUDE OIL/UNIT 97.05

OTHER FEEDSTOCK : 2.95

FINISHED PRODUCTS: 97.67

GASOLINE 30.75

JET FUEL 2.98

DIESEL FUEL 36.49

LIGHT FUEL OIL 0.78

FUEL OIL 2.98

VGO 5.46

GASES 4.52

PROPYLENE 2.12

LIQUIFIED PETROLEUM GAS 4.26

PETROLEUM COKE 6.46

SULPHUR 0.87

TOTAL UNFINISHED PRODUCTS: 0.00

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Vega refinery terminology

Atmospheric distillation unit (DA)

The device is meant for processing type A3, B, C crude oil, in

order to obtain semifinished products: DA gas, white spirit, petroleum,

gas oil, fuel oil.

Romanian terminology: DA

Vacuum distillation unit (DV)

The vacuum distilation unit is meant for processing DA fuel oil or

Heavy fuel oil max. 1% sulphur in order to obtain raw materials for

catalytic cracking (VGO) and manufacturing Bitumen Unit.

Romanian terminology: DV

The Normal Hexane Unit

The unit is meant for obtaining n-hexane, solvent used in the

process of polymerization olefins and refined edible oils or other types

of extraction gasoline. The raw materials are C5-C6 Cut and Raffinate

(from RR-Midia).

Romanian terminology:Instalatie Hexan

Rectification Unit

The unit is meant for obtaining extraction gasoline with various

distillation limits and white spirit, products used as solvents in chemical,

petrochemical and food industry.

The raw materials are C5-C6 Cut, Raffinate, Naphta gasoline and

Jet.

Romanian terminology:Instalatie Rectificare

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Dearomatization Unit

The unit processes extraction gasoline obtained in the

Rectification Unit in order to obtain ecological solvents.

The raw material is consist of extraction gasolines unfinished

obtained in Rectification unit.

For the aromatic hydrocarbons extraction is used NMP solvent.

The finished products are ecological solvents (SE 30-60, 35-80,

65-80, 70-95, 70-100, 80-110, 80-115, 100-150).

The name of the products is given by the distillation range.

To ensure the the proper quality of the products there is

especially having in view the range of distillation, aromatic

hydrocarbons content and the sulphur content.

Romanian terminology: Instalatie Dezaromatizare

Bitumen Unit

The unit processes the residual asphalt that result from DV Unit

for obtaining road bitumen and special types of bitumen for

waterproofing works.

Since 2007 has been put into operation the department for

obtaining modified with polymers Bitumen (Eurobitumen).

Romanian terminology: Instalatie Bitum

Blending, finishing products Unit (AFP)

The unit is meant for obtaining finished products according to the

fabrication recipes and storing them in order to dispatch.

Romanian terminology: Instalatie AFPE

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Rafination

The raw material is pumped from AFP Unit into the stirrers where

the homogenization level takes place, then follows the level of reactant

treatment, then washing level, finishing and decantation

Finished products are directed by pumping towards AFP unit and

loading rack and from here they are delivered.

Rompetrol Petrochemicals terminology

Polypropylene Plant

Polypropylene is obtained by propylene homo or copolymerisation

process using super-high activity or microspheric catalyst, under

temperature and pressure low conditions.

The temperature is about 70-75C and pressure

10 - 12 kg/cm2G. The molecular weight is generally indicated by the

melt flow index and is controlled by changing the hydrogen flow rate.

The removal of heat of polymerization is done by combination of

jacket cooling and recycle system.

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FLOW SHEET DESCRIPTION:

2. Propane-Propylene splitter

Refinery FCC Propane-Propylene mixture (75%, 92%) is feeding

the splitter. Purified propylene (99.9%) is stored and used in

Polypropylene plant and propane is sent back into the refinery.

CATALYST

PREPARATION

POLYMERIZATION

DEZACTIVATION

AND WASHING

DRYING

PELLETIZING

BLENDING

PACKING PALLETIZING

HEXANE RECOVERY

HEXANE

HEXANE

ATACTIC SOLUTION

SOL. NaOH

ATACTIC POLYMER

CAT.

PROPYLENE

ETHYLENE

HYDROGEN

SLURRY

METHANOL

PROCESS WATER

WET CAKE

DRYING GAS

POWDER

STABILIZERS

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Trading

II. Trading terminology

II.A. Market terminology

Arbitrage

The simultaneous purchase of a commodity/derivative in one

market and the sale of the same, or similar, commodity/derivative in

another market in order to exploit price differentials

Assessment

An assessment is the product of a market survey and the

application of strict methodological rules to determine the repeatable

tradable price range for a commodity during the assessed period.

Platts assessment typically aims to zero in on typical transactable

levels by discarding unrepresentative market information

(out-of-market bids, offers and transactions), and the process differs in

this respect from indexation, which is an inclusive process, averaging all

available market information.

Platts produces indexes in highly liquid markets, for example

North American natural gas; and assessments in illiquid markets, such

as those for physical oil. Platts assessments typically are published as a

low-high range for each instrument.

Backwardation

A market where the price for nearby delivery is higher than for

further forward months. The opposite of backwardation is contango.

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Bearish

Believing that a price will fall. Also describes a market that shows

signs of falling.

Brent blend

The most commonly traded North Sea crude oil. Brent has an API

of about 37.5. The blend is technically a mix of crude from the Shell UK-

operated Brent field and the BP-operated Ninian field. The blend is,

however, commonly referred to simply as Brent.

Bullish

Believing that a price is going to rise.

Cash market

The physical market underlying a futures or options contract.

Contract price

Periodic (monthly/quarterly/annual) price agreed between sellers

and buyers of commodities for term business. Often abbreviated to CP.

Most oil contract prices are "floating", that is they are tied to spot

market assessments published by Platts or other market pricing

services rather than set at outright levels.

Crack spread

The simultaneous purchase or sale of crude against the sale or

purchase of refined petroleum products.

These spread differentials which represent refining margins are

normally quoted in dollars per barrel by converting the product prices

into dollars per barrel and subtracting the crude price.

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Dated Brent

A rolling assessment that reflects the price of physical wet Brent-

Forties-Oseberg, blended crudes from the North Sea Brent and Ninian

systems, and slated to load at the Sullom Voe Terminal, no less than

ten days forward.

Demurrage

Comes from the field of vessel chartering (notably voyage

chartering) and refers to the period during which the charterer remains

in possession of the vessel after the period of time normally given to

him to charge and discharge the cargo (lay time). By extension

Demurrage refers to the amount of money that the charterer will have

to pay to the shipowner for its extra use of the vessel. In commercial

shipping, demurrage is an ancillary cost that represents liquidated

damages for delays, occurs when the vessel is prevented from the

loading or discharging of cargo within the stipulated laytime.

Differential

The difference between two prices. A large and increasing

percentage of all oil transactions are effected on the basis of

differentials, also known as spreads, rather than outright flat prices.

Discount

An amount agreed between buyer and seller to be subtracted

from an existing benchmark.

Futures contract

An agreement to make or take delivery of a commodity at a fixed

date or strip of dates in the future, at a price agreed upon at the time of

dealing.

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Heavy crude oil

Has an API gravity of less than 28 degrees. The lower the API

gravity, the heavier the oil.

Hedge

The reduction of risk by covering anticipated commitments at a

fixed price in the future through a futures or options contract. Buyers

and sellers can hedge

IPE

The International Petroleum Exchange in London. Brent and

Gasoil futures contracts are traded at the IPE and serve as indicators for

European crude and products market.

Light crude oil

Has API gravity higher than 33 degrees. The higher the API

gravity, the lighter the crude oil.

Mark-to-market

To revalue futures/option positions using current market prices to

determine profit/loss. The profit/loss can then be paid, collected or

simply tracked daily.

Mogas

Used in some markets (mainly US) as a substitute term for

gasoline.

NGL

Natural gas liquids. Can include ethane, propane, butane,

isobutane and natural gasoline/condensate.

Not to be confused with LNG, liquefied natural gas. LNG is

artificially liquefied methane, not the heavier fractions defined as NGLs.

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NYMEX

New York Mercantile Exchange. Also known in the energy industry

as "the NY Merc".

Premium

An additional amount agreed between buyer and seller over and

above an existing benchmark. Also, the price paid by an option holder

to an option grantor.

Price reporters

Companies that assess prices of crude and products following

certain methodologies based on information about the deals (spot

market) performed over the day.

Industry participants use prices provided by price reporters as a

reference. The following are currently used within the industry:

Platts prices are most widely used in contracts in the oil

industry, as it was the first reporter to be established back in 1924.

Several changes in assessment methodology, crudes and products

reported have taken place over the last years.

Petroleum Argus focused initially on European product prices

but now has become a worldwide price reporter.

ICIS LOR produces crude and petrochemical price reports. ICIS

LOR prices are widely used in the petrochemical industry.

Reserves

The calculated quantity of hydrocarbons or minerals which can be

extracted profitably from a deposit, classified according to the level of

confidence that can be placed in the data. Standard classifications are:

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Proven reserves Reserves that have been sampled

extensively, for example--in mining--by closely spaced diamond drill

holes or by underground working giving an accurate picture of size and

quality of reserves.

Also called measured reserves. In oil, proven reserves are an

estimate based on seismic and other exploratory data, linked to an

assessment of economic and operating viability.

Recoverable reserves In oil and gas, the portion of a fields

total estimate reserves that can actually be recovered from the field

using currently available technology. Recoverable reserve estimates are

dependent on factors such as reservoir pressure and the density of

strata.

Probable reserves Valuable mineralization not sampled

enough to estimate accurately the terms of tonnage and grade. Also

called indicated reserves.

Possible reserves Valuable mineralization not sampled enough

to estimate accurately its tonnage and grade, or even verify its

existence. Also called inferred reserves. In oil, possible reserves are an

estimate of reserves from an undrilled site or one that has not bee

seismically tested.

Sour/sweet crude

Definitions which describe the degree of a given crude's sulfur

content. Sour crudes are high in sulfur, sweet crudes are low.

Spot market

A market where goods are traded for immediate delivery.

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Spread (options)

An option trade in which two or more open positions are

established in order to trade the differentials and offset risk.

Option spreads may use different strike prices and/or expiry

dates.

Spread-trading

Buying one instrument/commodity and selling another, with a

view to profiting from the change in the gap between the two markets.

II.B. Transport terminology

Barge

A vessel carrying oil, usually on rivers, containing between 8,000

and 50,000 bbl, or weighing 1,000 to 10,000 tonnes. In the US, barges

can be up to, and occasionally over, 100,000 bbl in capacity.

Barrel

A volumetric unit of measure for crude oil and petroleum

products. 1 barrel is 42 US gallons, 35 imperial gallons or 159 liters.

There are roughly 7.33 bbl of crude oil to a tonne, but the precise

conversion obviously depends on the specific gravity of the oil.

Bill of lading

Documentation legally demonstrating a cargo has been loaded.

The bill of lading is signed by the captain of the ship and the contract

supplier. Abbreviated as B/L.

CIF

Cost, insurance and freight charges for shipping products. CIF

prices include these charges.

DAF

Delivered At Frontier. A popular INCOTERM among eastern

European petrochemical producers. A different railway gauge means

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product has to be transshipped before continuing on into Western

Europe.

Demurrage

The detention or delay of a vessel in loading or unloading beyond

the time agreed upon. Demurrage charges are usually incurred for any

delay.

EXW

EX Works. The seller minimizes his risks by making the goods

available at his on premises.

FAS

Free Alongside Ship. Product is sold when the goods in question

are placed on the quay alongside the vessel. FAS is often traded in the

US polymer export market.

FCA

Free Carrier. The rail and road freight equivalent of Free on

Board.

Free on Board

Usually abbreviated to FOB. FOB prices exclude all insurance and

freight charges. Most oil is sold either FOB (effectively priced at the

loading port) or CIF (effectively priced at the delivery port).

Laycan

The range of dates during which a ship will load.

Med

Market abbreviation for Mediterranean.

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NWE

Oil and petrochemicals market abbreviation for Northwest Europe.

P&C

Private and confidential. Used by commodities traders to describe

non-public transactions.

P/C

Part-cargo.

Tankers

Size is typically measured in deadweight tonnes (cargo capacity

for carrying water).

Here are tanker sizes and typical abbreviations (in deadweight

tonnes)

GP General Purpose 16,500 - 24,999

MR Medium Range 25,000 - 44,999

LR1 Large/Long Range 45,000 - 79,999

LR2 Large/Long Range 80,000 - 159,999

VLCC Very Large Crude Carrier 160,000 - 319,999

ULCC Ultra Large Crude Carrier 320,000 - 549,000

Also:

Handysize 35,000

Panamax 65,000

Aframax 80,000

Suezmax (Million barrel) 130,000

Capesize: Any vessel, usually carrying dry bulk cargoes, that is

too big to navigate the Panama or Suez Canals.

29

Tonne

The standard abbreviation is mt.A tonne, or metric ton,

sometimes tautologically referred to as a metric tonne, is defined as the

weight of one cubic meter of water. Rough-and-ready barrel-tonne

conversion factor is 7.33 barrels of crude to one tonne, but obviously

depends on the specific gravity of the crude.

WTI

West Texas Intermediate crude oil. WTI crude is deemed to

be traded at Cushing, Oklahoma. Traders typically refer to the NYMEX

Light Sweet Crude futures contract as the WTI contract, although the

contract allows delivery of other grades.

III. Stockholders / Investors relation

III. A General terminology

Ask price

An indication of willingness to sell at a specific price.

Bid price

The price at which a buyer is prepared to buy.

III. B Indicators

Book value per share

Formula = Book value/ Number of shares outstanding

Number of shares : 17,463,510,000

Dividend yield

Formula = Dividend per share / Current market price per share

Dividend per share: 0

Current market price per share : 640

30

Dividend yield = 0/640 = 0

Earning per share (EPS)

Formula = Net income/ Number of issued shares

Net income: 9,387,032,000,000 ROL

Number of shares : 17,463,510,000

EPS= 9,387,032,000,000/17,463,510,000 =

Earning yield on common stock

Formula = Earning per share/ Current market price per share

Price-earning ratio (PER)

Formula = Market price of the stock/ Earning per share

Price to book ratio

Formula = Market price of the stock/ Book value per share

Breakeven: Marked by or indicating a balance, especially

between investment and return.

n. In both senses also called break-even point.

The point, especially the level of sales of a good or service, at

which the return on investment is exactly equal to the amount invested.

The point at which the energy put into a system is equal with the

energy produced by that system: reaching breakeven in controlled

fusion reactions.

31

I.B. Costs

Petromidia:

Costs

A financial measurement of the resources used or given up to

achieve a stated purpose.

Romanian terminology: Cost

32

Fixed costs

Costs that remain constant in total amount over a wide range of

variations in the level of processing activity.

Romanian terminology: Costuri fixe

Variable costs

The total costs incurred to produce energy, excluding fixed costs

that are incurred regardless of whether the resource is operating.

Variable costs usually include fuel, increased maintenance and

additional labor.

Romanian terminology: Costuri variabile

Manufacturing costs

The Costs incurred to produce or create a product. It includes

direct materials, direct labor, and manufacturing overhead costs.

Direct materials

Are materials that are: (1) included in finished products, (2) used

only in the manufacture of the product, and (3) clearly and easily

traceable to the product.

Direct labor

Is the cost of labor by employees actually working on materials to

convert them into finished products.

Manufacturing overhead

Includes all other manufacturing costs, except that are accounted

for as direct material and direct labor.

33

Prime costs

The sum of direct materials and direct labor costs.

Conversion costs

The sum of direct labor and manufacturing overhead costs.

Product costs

Are costs incurred in the manufacture of products.

Period costs

Are expensed in the period in which they are incurred.

Administrative costs

Non-manufacturing costs that include the costs of top

administrative functions and various staff departments such as

accounting, data processing, and personnel.

Crude oil cost

Is the price paid for a barrel of crude oil on the international

market .

Parts and Consumables

Consumables are those materials or components which are

depleted or require periodic replacement through normal use of the

instrument.

I.C. Stocks

34

Stock Levels

Crude, Product, Semifinished (daily, mo)

Quantity:

Total Stock

Free Stock (pompabil, liber la pompare)

Holding Stock

Technological Stock

Price:

Input Price

Mark-to-Market Price

Value:

Input Value

Mark-to-Market Value

Total StockP/L (,000$)

Crude Stock P/L ($/mt)

Products Stock P/L ($/mt)

I.D. Maintenance

Utilizare timp disponibil

Oprire planificata

Revizie planificata

Timp disponibil planificat (TDP)

Timp efectiv lucrat

Indice utilizare TDP

Timp opriri neplanificate

Opriri realizate

Indice utilizare capital planificat

Fond de timp utilizat