Issue 03. Pg. 4. Pg. 8. Pg LOOKING FORWARD - CONSTRUCTION SERVICES NOBEL DRILLING

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1 Issue 03 NOBEL DRILLING Pg. 4 CONSTRUCTION SERVICES Pg. 8 LOOKING FORWARD - DENISE HONE LOOKS TO THE FUTURE AT STOWEN, INCLUDING WORKING IN NUCLEAR Pg. 9

2 THE NORTH SEA AWASH WITH OPPORTUNITY FOR OVER FIFTY YEARS. There is a mood of optimism sweeping the industry as the first shoots of recovery in the oil price point to a longer-term improvement in the forecast price. Fifty years ago, the North Sea promised a new boom in energy production, revenues and opportunities for the supply chain. Fifty years on, the North Sea is one of the longest-producing hydrocarbon basins globally, recognised as a major contributor to world energy markets. That longevity and stability has been shaken up by high-profile company mergers and a falling oil price, forcing the supply chain to react. At Stowen, we think change brings opportunities - smarter ways of working, inventive solutions and a re-evaluation of time-honoured methods. Doing things one way because they ve been done like that for half a century no longer flies we see the supply chain becoming leaner, more agile and more resourceful in order to maximise profitability and efficiency. With many operators extending assets into late-life operations, simplification programmes and upgrades are underway in tandem with field developments. We think the North Sea Basin still has many years of productive life to offer! By increasing efficiency and adding value to existing assets, the North Sea is once again positioning itself for sustainable success that is attracting investment. The next fifty years of activity in the North Sea will also undoubtedly have renewable offshore wind at its core. This market continues to expand apace, supporting the UK s ambition to deliver a low-carbon, clean energy future. This is a market that is no longer emerging, but rather establishing itself at the heart of the UK s energy mix. These offshore projects have injected a vital sense of dynamism into the sector, bringing innovative, practical solutions that are ushering in another boom for the future of the North Sea. Whilst many companies are only now thinking about diversifying, Stowen have been doing this for years. We were quick to react, designing solutions to challenges across Oil and Gas, Clean Energy, Nuclear and other sectors whilst other were thinking should we be worried? INTRODUCTION FROM THE CEO GROWTH, DEVELOPMENT AND INVESTMENT It s great to be welcoming another new year as President and CEO of Stowen. Our plan in 2017 was to build a healthy order book, despite some of our end-markets remaining challenging. I am pleased to say we made great progress across the business given conditions in natural resources end-markets. Our year-end trading performance was robust, as we benefited from the diversity of our business - especially the record performance from our clean energy division. With a strong order book for Q1 & Q2 already in place, 2018 is set to be another exciting year for the Stowen team and shareholders. We continue to see some of the most significant and rapid changes to the energy market we have experienced for some years, however these changes offer great opportunities. On the demand side, the overall demand for energy looks set to continue to expand. The pace of growth is likely to slow as vehicles become more efficient and technological improvements such as electric vehicles, autonomous driving and car sharing herald a mobility revolution. The recent war on plastics will also likely impact the demand placed on oil in the long run. On the supply side, the impact on future supply due to significant cutbacks in investment spending on new energy projects over the past two years has not yet been fully felt. However, with oil inventories at a record-high and an abundance of oil resources (oil resources known today dwarf the world s likely consumption of oil out to 2050 and beyond) it s hard to predict a significant upswing in this sector any time soon. These supply and demand changes mean lowcost operators will be able to use their competitive advantage to increase market share. This presents a great opportunity for Stowen in supporting these operators as they continue to operate and produce from assets reaching end-of-life. Within Stowen, we continue to grow and have welcomed a large intake of new team members in Q Our commitment to training and developing young local people is stronger than ever. You can see more about our apprenticeship training on page 10. Thank you for taking the time to read and learn about Stowen, and I wish you a productive and prosperous MATHEW OWEN PRESIDENT - CEO 2 See our infographic on Pg. 6 for a history of Oil and Gas in the North Sea, and where we see the future going. 3

3 ONSHORE SERVICES IN THE New fabrication, inspection and testing facilities FRAME INSPECTION AND INTEGRITY - NOBEL DRILLING Stowen recently conducted a combined inspection program for Nobel Drilling. Like many companies, Nobel were looking for quality and governance and found just that with Stowen. The multi-skilled approach Stowen takes to delivering projects continues to prove an attractive model. Coupled with a deep understanding of drilling contractors and the sector as a whole, Stowen offered a unique and efficient approach to ensuring integrity and compliance with the Nobel Bob Douglas asset. The NBD sailed out of the Gulf of Mexico in September with a six-man Stowen team on board. The scope of the inspection covered: light and heavy lift-gear inspection, DROPS inspection, Derrick API 4g inspection and load-path inspection. On completion, Stowen compiled the reports and uploaded them to the online inspection portal for easy client access. Using Stowen s multi-skilled teams, Nobel received an efficient service that gave them fast access to their reports. The team were also able to carry out other ad hoc work at height that came up on the sail. To learn more about combined inspection and compliance programs contact: denise.hone@stowengroup.com 2017 saw Stowen launch their new onshore services division, based conveniently in south Lowestoft with easy access to the port, a natural gateway to the North Sea. The 600m 2 facility boasts a 10Te and 5Te overhead cranage, as well as a 300Te loading pad. The facility is set up for supplying fabrication to DNV and ABS standards, with a dedicated clean shop for Stainless, Aluminium and other exotic projects. This outstanding new facility was put to good use when we took delivery of a multi-million pound cyber drillers cabin for a client requiring modification. The drillers cabin required structural stainless-steel modifications, installation of two new Amphion cyber chairs, touchscreen drilling systems and new flooring. Thanks to the new facility and our multi-discipline team, we were able to complete the modifications on time and within budget. The Onshore Services division emulates that of the offshore division with multi-discipline and multi-skilled teams to ensure all works (structural, welding, electrical) were carried out by Stowen personnel. For fabrication enquiries please contact denise.hone@stowengroup.com We have already had a steady stream of projects, utilising the full services onsite. The week we opened the doors we took receipt of a multi-million pound cyber drillers cabin for modification and upgrade. Colin Stewart, Technical Director 4 5

4 IS THE FUTURE INNOVATIONS REDUCE RISK AND COST A project is launched to reduce manning levels on the Thames to reduce costs and risk. By 1995 the project is operated from a Great Yarmouth control room. The Weiland and Pickerill fields make Arco one of the first North Sea companies to operate remotely controlled unmanned facilities. 6 Oil Prices plummet to below 40 per barrel where they would largely remain for the next 15 years. Two of the key centres of the industry were Great Yarmouth /Lowestoft area for the Southern North Sea gas industry and Aberdeen, now regarded as the oil capital of Europe. ALL TIME FROM BOOM TO BUST By the early 1980s Britain had become a net exporter of oil, millions of barrels were being produced every day. An oil and gas bonanza had occurred. The Forties Field begins producing oil in September The Field peaked in 1979 at 500,000 barrels per day, equivalent to 25% of the UK s daily oil needs. Auk A is the first platform to sail out from SLP s Belvedere Road yard at Lowestoft. SLP becomes a leading player in the fabrication industry. Off shore production, in the North Sea, becomes more economical after the 1973 oil crisis which causes the world oil price to quadruple. PRODUCTION BEGINS FIRST LOCALLY MADE PLATFORM SAILS OUT WORLD OIL CRISIS THE OIL BONANZA HIGH WIND POWER EARLY 1980 s Piper Alpha was once Britain s biggest single oil and gas producing platform, bringing more than 300,000 barrels of crude a day (10% of the country s total) from below the seabed 125 miles north-east of Aberdeen. In the space of two hours, 167 men lost their lives. Amazingly 61 men survived - some by jumping 175ft (53m) from the rig s helicopter deck into the sea. It remains the world s worst offshore oil disaster. On 6 July 1988 The dangers of extracting oil at sea was underlined when a series of explosions ripped through the Piper Alpha platform in the North Sea. PIPER ALPHA DISASTER s BP DISCOVER LARGE NORTH SEA OIL FIELDS QUIET TIMES During the 1990s, the North Sea was vulnerable to the fluctuation of world oil prices. The oil company British Petroleum announces it has struck oil in the North Sea. The discovery follows other finds of natural gas as well as oil and suggests the North Sea could become one of the world s major sources of crude oil. The North Sea is divided into UK, German, Norwegian, Danish and Dutch sectors. The UK has the largest of these sectors. In June BP discovered another major field in the Norwegian section, Ekofisk, that is expected to supply 10% of Britain s oil needs. WIND POWER IS THE FUTURE Wind power is generated onshore at Blood Hill near West Somerton s 1970 FORTIES FIELD DISCOVERED 110 miles eastnortheast of Aberdeen in 350 feet of water. BP s semi-submersible drilling rig Sea Quest hit crude at 11,000 feet and marked the first and largest major oil field discovery in the United Kingdom sector of the North Sea. Named Forties Field. By the mid-1990s Britain had become a net exporter of gas. EXPORTING s 1969 FIRST OIL Petroleum engineer, Brendan McKeown, brought the first North Sea oil ashore in a pickle jar! Under a shroud of secrecy, he took the container to Amoco s Great Yarmouth office on South Denes in September 1969, where the sample was tested. It was only when it was poured into an ash tray, sniffed and set alight that his boss Mitch Watt knew they had struck oil. The Duke of Edinburgh returns to Bacton to open the 400 million Interconnector pipeline linking Norfolk with Zeebrugge in Belgium. GAS SUPERHIGHWAY LINKS NORFOLK WITH BELGIUM 1967 GAS FLOWS FROM LEMAN The first gas comes ashore from the Leman field. Discovered in 1966 and in production by 1968, it remained the biggest offshore gas field in the world for the next 20 years. The Buzzard Field is located in the Outer Moray Firth, central North Sea, 100km north-east of Aberdeen, UK, and 55km from the coast at Peterhead. NEW DISCOVERIES EARLY 1970 s DISCOVERIES ABOUND 1971, Shell Expro discovered the giant Brent Oilfield in the northern North Sea, east of Shetland in Scotland and the Petronord Group discovered the Frigg Gas Field. The Piper Oilfield was discovered in 1973 and the Statfjord Field and the Ninian Field in FIRST DISASTER On the 27th December, while making preparations to move the Sea Gem drilling rig, two of the eight legs collapsed. The rig began to tilt sideways and men were thrown into the icy waters of the North Sea. Thirteen lives were lost as a result of this disaster. An impact study reveals that the East of England s energy sector accounts for 20,000 jobs, 3.5% of GDP and 226m in capital investment, 14% of the region s total. ENERGY HAS IMPACT 1965 FIRST HYDRO CARBONS - WEST SOLE FIELD 42 miles off the Mouth of the River Humber, the 5600 ton Drilling Barge Sea Gem was the first rig ever to find hydrocarbons in the British North Sea sector. Drilling Completed at a depth of 10,000 ft. BOOM FORWARDS & BACKWARDS STOWEN ENERGY BEGINS ALL TIME HIGH MORE NEW DISCOVERIES January 2015, the North Sea was the world s most active offshore drilling region with 173 active rigs drilling. OR BUST CELEBRATING 50 YEARS IN THE ENERGY SECTOR RENEWABLES FUTURE FOR GY SCOTTISH POWER 1965 NORTH SEA OIL & GAS SCROBY SANDS, POWER OF WIND June 2008, oil prices rise to the highest level in recent history over 150 per barrel. An estimated 3 million barrels of oil were discovered at the Johan Sverdrup Field. Stowen Launches in November 2014 with the aim of servicing the maturing oil market and the rising renewable s market By May 2016, the North Sea oil & gas industry was financially stressed by the reduced oil prices, and called for government support. More than 350 companies in and around Great Yarmouth are involved in the off-shore industry, providing a crucial support role for the Southern North Sea gas fields. Renewables is to build East Anglia One off the Suffolk coast which will generate enough power for 500,000 homes. Scroby Sands starts supplying the national grid with power. TIME LINE GO FIFTY YEARS OF THE NORTH SEA We roll the dice and look back on the history of one of the world s longest-producing hydrocarbon basins. With decommissioning picking up pace, oil and gas will no longer monopolise the energy mix as the winds of change see offshore wind picking up the slack. Pass Go Since the first hydrocarbons were pumped by the drilling barge Sea Gem, 42 miles off the mouth of the River Humber, the North Sea has become a vital part of the UK and global energy economy. Following this early gas exploration, BP discovered large North Sea oil fields that led to an oil bonanza in the 1980 s. By the start of that decade, the UK became a net exporter of oil! This proliferation of assets extended to gas too, and by the 1990 s the UK also became a net exporter of gas. The North Sea continues to be a productive source of hydrocarbons, but this longevity means there are many assets now ready for decommissioning as they reach endof-life saw the first major decommissioning project completed, with the removal of the Brent Delta platform from its legs. The 24,000-tonne platform sat on a three-legged gravity-based structure in 140 metres of water, 115 miles north-east of Shetland. It was lifted onto a giant, purposebuilt ship and transported to England to be scrapped. Projects such as this represent a huge opportunity for the supply chain, and a further 100 platforms are expected to be completely or partially removed from the UK and Norwegian continental shelves by More than 1,800 wells are also scheduled to be plugged and abandoned, with 7,500km of pipeline decommissioned. Community Chest Over the next forty years, the bill for decommissioning in the North Sea is put at somewhere between 30bn and 50bn. Stowen is perfectly positioned in Great Yarmouth to access this burgeoning market, with access to skills, infrastructure and expertise to enhance our in-house teams. The winds of change are blowing in the North Sea again, and offshore wind is the new boom sector of the 21st century. Large-scale investment in wind projects off East Anglia represent lucrative opportunities for the supply chain. East Anglia ONE is currently being built 30 miles off the coast at Kessingland. This 714MW project is the first and smallest of four such projects. Lowestoft will be the operational base for the project, following a 25million deal struck between the Port and ScottishPower Renewables. For fifty years, the North Sea has provided a livelihood to operators and the supply chain, whist generating revenues for the Treasury. We welcome the next fifty years as we begin the process of decommissioning and the decarbonisation of energy production as we exploit renewable energy sources. 7

5 IN THE FRAME LOOKING FORWARD DENISE HONE DIRECTOR OF SALES & MARKETING Denise Hone joined Stowen as Director of Sales and Marketing in Coming from a business development background across the energy sector, she is excited to be bringing new skills and vision to Stowen as they enter new markets, including nuclear. CONSTRUCTION SERVICES New Fabrication, Inspection and Testing Facilities Stowen carried out repairs and upgrades to a jack-up rig in the Asry Ship Yard Bahrain. The works carried out included: Mud valve replacements 4130 welding Heat treatment Since Stowen first started operating, our aim has always been to bring a lean, efficient multi-skilled team to energy projects, and this model has worked well. As our Monopoly board shows (see page 6) the emphasis on oil and gas in the North Sea is shifting as renewable energy enters the mix as a vital component rather than a token gesture. One of Stowen s strengths is seeing which way the wind is blowing, and we always position ourselves to be proactively creating new markets rather than reacting to the energy landscape. In 2018 I m excited to see that continue, as we bring new skills to our in-house offering and start to work in new markets. With a strong background across the energy sectors in both onshore and offshore fabrication, I ve been able to bring new expertise that has assisted the launch of our new fabrication facility (see page 5). With multiple skills and facilities in-house, we remove the uncertainly of subcontracting to ensure each strand of the project is managed and delivered by Stowen. This model is one of the reasons our clients keep coming back to us. Our turnkey solutions keep project costs lower and improve delivery times whilst reducing project overruns. Time is money, and in these leaner times we need to pass savings onto the customer wherever we can. It s not just oil, gas and wind projects that benefit from the Stowen approach! 2018 sees us move into nuclear as we bring the same efficiencies and expertise to this heavily-regulated industry where there is no margin for error. In fact, we have had enquiries from many utility services looking to save money and remove risk with a single point of contact, without multiple vendors. Navigation light survey and replacement Installation of derrick escape platform Docking plug modifications Joining the board at Stowen I am struck by how this can-do ethos runs from the top to the bottom of the company. The whole team is committed to being lean, updating skills through training and delivering all aspects of a project. Trip tank modifications 8 Flare boom rectification

6 INSIDE STOWEN APPRENTICESHIP TRAINING WORK SOMEWHERE THAT TAPS INTO YOUR FULL POTENTIAL. DENISE HONE Stowen's continuing commitment to filling the skills gap in the technical services sector has been further galvanized this week. Working with Skills Training UK, two of Stowen's engineering apprentices began their journey into the everchanging landscape of testing and inspection. The 3-year training program results in the technicians gaining PCN qualifications in a multitude of NDT techniques. Already on the Stowen apprenticeship scheme as fabricator welders, the trainees will complete their robust apprenticeship as true multi-skilled technicians which gives further value to our clients. 10 The Board of Stowen Group announces the appointment of Denise Hone as Director of Sales and Marketing with effect from 8th January Denise has extensive experience and strength in the energy sector with a particular focus on business growth and strategy development and implementation for penetration into new markets. Commenting on the new appointment, Mathew Owen (Managing Director) said: "I am extremely pleased that Denise has accepted the Board's invitation to join Stowen. We believe that her long record of sales and marketing coupled with her experience in the East of England energy sectors will be a great benefit to the growth and strategy of the company." Denise can be contacted at: denise.hone@stowengroup.com QHSE STATISTICS Stowen completed 2017 with a cumulative total of over 163,700 man hours with no recorded incidents. Contact us to learn more about the values of Stowen Group. ACCREDITATIONS IRATA: Full Members During 2017, Stowen were successfully audited by IRATA to gain full member approval. With rope access being a core part of Stowen s services, we gained probationary membership from the start. Having successfully completed the probationary period and subsequent to an audit in October 2017, Stowen were then awarded full-member status. ISO During the December audits of our QHSE systems by DNV, Stowen successfully transitioned to the standard. The transition process received great feedback from the DNV auditor. During the audit process, the OHS and were also passed successfully. Engagement with our inspirational people remains a priority. We take pride in our inclusive culture that empowers everyone to be involved in our long-term vision. James Watt Close, Gapton Hall Ind Est, Great Yarmouth, Norfolk, United Kingdom NR31 0NX +44 (0) It is our policy to encourage the employment, training and development of people from all sectors of the community. If this sounds like something you would like to be a part of, contact careers@stowengroup.com or visit 1625 W. Grand Parkway N. Katy, Texas, U.S.A Warehouse Q4-11 Saif Zone, P.O.Box Sharjah, UAE +971 (0) Plot 6A Wole Olateju Lekki 1, Lagos Nigeria

7 We offer bespoke, turnkey solutions to our clients that cover a range of disciplines. Let us manage your project and provide our skilled OUR SERVICES workforce rather than dealing with multiple vendors and POs. If you can't see the service you require listed, contact us. enquires@stowengroup.com CONSTRUCTION AND FABRICATION INSPECTION AND INTEGRITY On and offshore fabrication and construction services. From minor modifications to commissioning through to decommissioning. Innovative inspection techniques developed to minimise downtime and disruption to client operation. ELECTRICAL AND INSTRUMENTATION SERVICES Installation, inspection and testing of electrical systems to the up, down and midstream energy sectors using multiskilled rope access technicians. PIPING AND MECHANICAL Full piping services from engineering, design and fabrication through to installation, inspection and maintenance. ENGINEERING, SURVEYING AND PROJECT MANAGEMENT In-house project and engineering teams work closely with our clients and our construction groups to ensure practical and efficient solutions are designed. FABRIC MAINTENANCE Complementing the full suite of services, the fabric maintenance teams offer a complete range of modern and innovative blasting and coating processes. DRILLING PACKAGE UPGRADE We undertake a complete turnkey service, from conceptual study to commissioning and closeout. One Vendor, One Contract! ACCESS SOLUTIONS All our multi-disciplined teams are IRATA and/or SPRAT accredited rope access technicians. This reduces or eliminates the need for scaffold and scaffolders. CRANE SERVICE AND MAINTENANCE Full crane inspection and compliance service for offshore and ship cranes as well as onshore plant cranes and mobile cranes. Stowen also supplies complete hydraulic, mechanical and electrical maintenance and repairs for crane pumps, motors, gearboxes and winches. ONSHORE AND INFRASTRUCTURE Our core operational services within the sector include: Fabrication services Marine support services Construction and inspection Plant and refinery services Access solutions Printed on 100% recycled paper