Six generations@workDeveloping.Growing.Performing

KMG International

Vienna, February 2nd 2017 1

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KMGI’s imports from Kazakhstan cover approx. 40% of Romania’s refinery intake.

The distribution of the products is carried out via the Midia port but also by road and rail.

KMG International owns the largest and most modern refinery in Romania and the Black Sea region – Petromidia Năvodari –which boasts a processing capacity of over 5 million tons annually.

Over 1,100 fuel distribution points under the “Rompetrol” brand and Dyneff brand (only in France and Spain)

Highest European fuel standards

Third largest taxpayer in Romania, itscontribution to the national budget ranging from 2.5% to 3% of the total Government revenues between 2013 and 2015.

Over 7.000 employees are currently working for KMGI worldwide

WHO WE AREKMG International. Economic Impact Overview

KMGI comprises 55 entities, headquartered in 16 countries on 3 continents

WHO WE AREKMG International. Integrated Global Business

7599 employees

in 2014

61% Romanian

employees

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WHO WE AREOur People

DIRECT JOBS4,772 INDUCED JOBS

1,483

INDIRECT JOBS9,245

One of the biggest employers in Romania supporting in a direct, indirect and induced manner an estimated

15,500 jobs

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One of the youngest managementteam in the

manufacturing industry.

55 entities

More than 200 distinct specializations

worldwide

16 countries

7000 employees worldwide

WHO WE AREPetromidia Refinery

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PetromidiaOperations & Economic overview

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approx. 1.4 bil. USD invested between 2007-2015 in the modernization of

Petromidia Refinery

Unique location on the Black Sea

shore in Navodari, 20 km North of

Port of Constanta.

One of the most modern refineries in

SE Europe and the largest refinery in

Romania

The Laboratory Division of KMGI, RQC, is one of the

top laboratoryanalysis companies

on the national market.

Petromidia operates its own logistics:

railway, access to the Danube-Black Sea

Channel,Port of Midia.

In 2009, KMGI put into operation MidiaMarine Terminal, in

the Black Sea offshore

Top contributor to the Romanian state budget in the past 9 years with over 12 billion USD.

Petromidia plays a significant economic role in Constanta County.

Rompetrol Rafinare is Romania’s largest exporter of oil products and the second national exporter.

Petromidia and Vega refineries cover more than 40% of Romania’s refining capacity.

PetromidiaThe “city” of an unique “population”

90 colleagues are working in PetromidiaRefinery for nearly 40

years

In 1978, before the construction of the Petromidia Refinery, Navodari, the citywhere the refinery is currently located hosted approx. 6.000 inhabitants.Following the launching of the Petromidia Refinery, the city’s populationexpanded up to 40.000 inhabitants (in 2016) as a result of the workplacescreated and the investments made by KMGI in the area. Petromidia is themain economical agent in Constanta county, comprising over 1,800 employeesand even more contractors.Petromidia Refinery is basically a city , with a spread of 480 hectares and 37km of railway (within the Refinery).

There are over 60 specializations on Petromidia

Platform from oil & gas professionals to divers, IT,

finance, HR

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Current employment issuesYouth unemployment. Skills shortage

90 million people in Europe aged 15-29

13.7mil.

WHO ARE NOT IN EMPLOYMENT,

EDUCATION OR TRAINING

8.7mil.

UNEMPLOYED

1/3 of Europeans aged 30-34

Have a TERTIARY DEGREE

82% of Europeans aged 20-24

Have completed UPPER SECONDARY EDUCATION

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Youth unemployment in Romania is at 24%, the highest rate in the

last 25 years

Economical causes

Educational and training causes

Economic recession and insufficient job creation

Uneven economic development

Mismatch between the skills and training needed by employers and the educational curricula

Lack of work experience and practical training

Petromidia5 Generations at work

Knowledge Transfer

More than 200 employees are expected to retire by

2020, risking the company to lose key knowledge, know-

how and unique skills

The youngest employee is 19

years old, while the

oldest is 76 years old.

5 Generations are working

side by side

Value authority

Expect deference to their opinions

Comfortable with authority

Respect must be earned

Digital natives

Fast decision makers

Highly connected

Technologically savvy

Goal & achievement oriented

Work as hard as necessary

Importance of work-life balance

WorkaholicsTop-down management

Hard working

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Over 200 employees are eligible for retirement by

2020

More than 150 key positions are going to remain vacant due to

employees’ retirement and lack of technical skills in the market

Our Challenge1. Retaining key knowledge inside

Risk of losing key knowledge and skills, due to lack of prepared workforce to take

over key positions

Prepare employees to take over key positions in a short period of time, gaining both practical and

theoretical knowledge through Knowledge Transfer

Develop a young team of professionals ready to take over responsibilities and tasks by attracting the young

generation and prepare it through Internship and Traineeship Programs

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WHAT TO DO

WHY

Our Challenge2. Building Capabilities for Today & Tomorrow

Accelerate development of employees’ skills and competences and increase employees flexibility and

readiness to switch to a new role through Cross-Training and Job Rotation

Enable continuous improvement and operational efficiency by encouraging innovation through a dedicated platform

Rapid pace of skills and capability development needs

Educational tools and methods, do not keep the pace with the latest innovations & technologies in the oil & gas field

Gap between the theoretical and practical skills requested by the employers and the skills a student can gain in school

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WHAT TO DO

WHY

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Want their actions to connect with the good of the

company

Need to see how their actions make

a difference

Need flexibility to get job done

on their schedule

Connect responsibility with

personal goals.Want to be discovered

Work for success.Connected to everyone and

everything Technology and social

media part of work

Our Challenge3. Motivating 5 Generations

A platform of Motivational Projects and

Initiatives was developed in order to

address the motivational needs of each

generation.

Knowledge Transfer

Seniority Recognition

Top Expert Award

Mentoring Program

Shift Competition

Top Expert Award

Pay for Performance

Employee of the Month

Cross-Training

Retention Program

Career Development

Knowledge Transfer

Innovation Program

Succession Mngm

Young Leaders Club

Social Platform

Mentoring Program

Internship & Traineeship

Internship & Traineeship

Performance & Career

Management

OUR PLAN

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Our Plan. Step 1Setting Partnerships with Educational Institutions

Set long-term partnerships with universities and

high schools in the oil & gas field

Support students build a strong

academic foundation, that provides all

needed theoretical knowledge to be put

into practice

Recognize and support potential and hard work of high school and

university students

Encourage high school students to

achieve high academic results and

continue their education with

university studies

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Understand students’

development needs and develop an action plan to address them

Our Plan. Step 1Challenges of the educational system in preparing

students for actual careers

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Outdated educational tools and methods, that do not

keep the pace with the latest innovations &

technologies in the oil & gas field

Lack of technology and properly equipped laboratories where

students to gain practical skills

Decreasing rate of students graduating the

BAC exam

Reduced availability to work during the

university year, due to the busy university

schedule

Low students’ awareness of job opportunities and

Internship/ Training programs available to

gain practical knowledge

As of 2002, KMGI opened its doorsfor over 1000 students, graduates of mid and high education and rewarded their performance and

potential through sponsoring educational events.

KMGI developed long-term partnerships with technical and economic Universities in

Constanța, Ploiesti, Timisoara and Bucharest.

Provide the students with the opportunity to gain practical

skills – student practice programs

“Student Development Action Plan”

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Our Plan. Step 2Building the Leaders of Tomorrow

A higher involvement of the company in the educational system – by

providing instructors (Rompetrol professionals) to share their job

experience and updates regarding the innovations and technologies/

installations available in a refinery;

Support students in developing their soft skills and preparing them for employment –workshops within the universities and high schools, hosted by HR Specialists

Inform students about the opportunities the company offers to them - Open Day events, where students were able to see how a refinery looks like and meet the management team of the companies operating on Petromidia and Vega Platform

Ensure knowledge transfer from the experts and future retirees to the young generation

Our Plan. Step 2The Internship Program - bringing together young

energy with experienced leaders

Develop top students into future employees by helping them gain technical skills and practical experience through the Practice and Internship programs

Get a fresh perspective and improve existing business processes; support innovations

Recognize and support potential and hard work of high school and university students

WHY

Prepare a pipeline of future employees who can take over the responsibilities of future retirees

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Mentor’s role

Provides support to the student during the entire program by; answering industry/work related questions, providing information on topics studied in university;

Prepares the intern’s development plan;

Provides guidance and career advice based on the student’s expectations, skills, strengths and specialty;

Periodically meets the intern to offer feedback regarding his/her activity and development; makes recommendations for improving identified weaknesses and develop existing skills and potential.

Evaluates the student’s progress throughout the entire program and evaluates his/her hiring potential

Our Plan. Step 2Mentoring the next generation

As of 2002, KMGI opened its doors for over 1000 interns, graduates of mid and high education , out of which the outstanding ones were offered permanent jobs.

Annually, upon completing the programs, more than 50% of the interns have entered the Traineeship Program and have been hired within KMG International’s member companies, in

different areas of activity.

• taking into account the future business needs, future open positions, retiring personnel

ANNUAL INTERNSHIP

PLAN

• 1 month of Practice, in order for the students to get acknowledged with the Refinery and its operations

PRACTICE

• 2 MONTHS of INTERNSHIP (during which the Interns are rotated through all Production units)

INTERNSHIP

• One mentor assigned to the student throughout the roll-out of the Internship

MENTOR

• Elaborated for each Intern and monitored throughout the program

DEVELOPMENT PLAN

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Our Plan. Step 3Generation Exchange

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Facilitate the knowledge and technical skills transfer from our highly experienced employees to the new generation, in order to prepare them for taking the

business further.

OUTCOMES

Keep key information within the organization (especially for the cases where the information is not captured within

Procedures, Instructions, or any other documents)

Renew the company’s workforce

Accelerate development of employees’ skills and competences and increase employees flexibility and readiness to switch to a

new role

HOW

➔ Knowledge Transfer Project;

➔ Cross Training Project;

➔ Succession Plan for future retirees;

Our Plan. Step 3Generation Exchange through Knowledge Transfer

and customized Cross-Training Programs

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Knowledge Transfer

Cross-Training

➔ Identified key positions and matched mentors and

disciples for Knowledge Transfer Program;

➔ Develop Competency Matrix for each key position;

➔ Elaborate & implement Knowledge Transfer Plan &

Action Plan for each pair of mentors and disciples;

➔ In 2016, 18 young employees were involved into

the Knowledge Transfer Program and have already

took over new roles and responsibilities;

➔ The project continues in 2017, with more

employees planned to take over new roles and

develop their professional careers

➔ Continuous development and improvement trainings

aiming to develop the technical skills of employees with

operational roles.

➔ Prepares employees to take on new task and

responsibilities within complementary areas;

➔ Increases employees flexibility and readiness to switch to

a new role;

➔ The trainings consist in: Classroom training; Practical

workshops (job shadowing); Evaluation of trained

employees

➔ In 2016, 57 employees participated to Cross-Trainings;

➔ Employees were prepared to take on new roles & responsibilities

after the Cross-Training

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OutcomesThe new generation is taking over

Thank you!

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