Retails Fuel Premier XL Green XL E10 Retail Fuels is one of the core business segment of PSO, with its

finest quality brands Premier XL, Green XL and E-10. The retail team at PSO works relentlessly to fulfill the needs of the automotive sector. With more than 3,500 retail outlets nationwide; PSO serves approximately 2.8 million retail customers daily. PSO Retail department is spread across the nation with 14 division offices. All divisional offices and retail outlets across the country are linked to the head office through state-ofthe-art enterprise resource planning software SAP. Retail Department continuously strives to provide unmatched service and customer care at PSO forecourts round the clock. Gaseous Fuels CNG LPG Introduction of Gaseous Fuels: Since more than a decade, Pakistan has witnessed a remarkable shift of consumers from petroleum to gaseous energy sources. Over the years, Gas has become a preferred energy source for the consumers, mainly due to the price competitiveness. Resultantly, CNG/ LPG have become The Fuel for the automotive sector, which are slowly and gradually replacing conventional liquid fuels. In such market scenario, being a dynamic energy company, strategic and focused diversification has been inevitable for PSO, in order to maintain the market leadership position. Therefore, in order to focus this business segment with full trust and to ensure active participation in ventures related to CNG and LPG, a separate segment for Gaseous Fuels has been formed in 2006. This highly lucrative and potential energy segment looks after the existing business of CNG and LPG, vis a vis capitalize on business projects related to CNG and LPG.

Biodiesel Biodiesel is a renewable, environment friendly substitute for petro-diesel fuel. It is derived from Jatropha Curcas plant which is a hardy, wild oilseed perennial plant. Conditions for cultivation of this plant are favorable in Pakistan, and the biodiesel derived can reap benefits in the form of economic, environmental, mechanical and national security. PSOs focus is on using this plant as feedstock and utilizing countrys ample marginal land for cultivation. This initiative would create employment opportunities and contribute towards the development of the nation. Being a focal member of AEDB Biodiesel Advisory Committee which is working on the roadmap of National Biodiesel Program, PSO believes that biofuels will make a major contribution to road transportation and power generation fuels. This will also lead to reduction in carbon emissions in the years to come.

Cards We have been the pioneers in introducing a novel concept to reward customers for their loyalty and patronage through the PSO Loyalty Card. After the successful launch of PSO Loyalty Cards, PSO launched two kinds of fuel-based cards for the business entities - PSO Fleet and Corporate Cards. These are fuel based cards specifically designed for organizations/individuals who want to manage their fuel expenses systematically. This unique proposition was introduced in February 2003 in the fuel market for the first time by PSO. Both Fleet & Corporate Cards have pre-approved credit limit provided by company/fleet owners or individuals. These cards are well-established and have received an overwhelming response from the corporate world. In September 2003, PSO Prepaid Cards were launched with multiple denominations.

Lubricants Ever since its existence, Pakistan State Oil Co. Ltd. has been playing a leading role in the oil industry of the country. Round-the-clock, uninterrupted oil supplies, all the way from Karachi to Khyber, through an integrated network of oil terminals and storage depots has been PSO's hallmark. Besides selling Mogas, Furnace Oil, Diesel, Kerosene, Jet Fuels, etc, PSO is committed to serve the petrochemical needs of the local industry and is positioned among customers as a reliable, cost-effective and high-quality chemical supplier. The company markets imported and indigenous chemicals in bulk through tank lorries as well as in drums. To cater to all kinds of lubricants customers, including automotive, hi-street and industrial consumers by meeting the national demand through products of international standards, PSO has set up a state-of-the-art Lubricants Manufacturing Terminal (LMT) at Korangi Industrial Area in Karachi. The LMT facility features: Automatic Batch Blending System Entailing a single shift production capacity of 50,000 MT per annum, a highly sophisticated system comprising of Automatic Batch Blender for production in batches and Simultaneous Metering Blender for continuous & bulk blends imported from ABB Cellier (France). Automatic Can & Cap Manufacturing Machines Built on latest technology and imported from Techne (Italy) & Battenfeld (Austria) respectively. Automatic Can Filling & Capping Machines Built on latest technology and imported from Comaco (Italy). Automatic Drum Filling Machine By-weight filling machine imported from Velcon (USA). Tank Farm Having an oil storage capacity of around 6000 MT. State-of-the-art Warehousing Setup Employing drive-in & drive-through pallets racking system. Highly Efficient Fire Fighting System Employing the best combination of automation technology and manual controls. Central Air-conditioning System Over 300 Tons of central air-conditioning has been carried out for Can Manufacturing & Filling Sections. Chillers are highly energy efficient and can operate on Natural Gas, Diesel & different forms of Recovered Waste Heat. Self Power Generation System Two Natural Gas driven generators of capacity 1200 KVA & 900 KVA each and one stand-by Diesel driven generator of capacity 1200 KVA.

Our Range of Lubricants: PSO Automotive Oils PSO Industrial Oils PSO Fuel Oils The automotive oils category entails automotive greases, brake fluids, diesel engine oils, gear fluids, motor cycle and passenger car oils. The leading automotive brands of PSO are Carient and DEO. The fuel oils include High Speed and Light Diesel Oil (HDO and LDO), Furnace Oil (FO), Kerosene and High Octane Blending Element (HOBC). The industrial oils of PSO are the widest lubes category. This product line entails Asphaltic, Circulation, Cylinder, Gas Engine, Gears, Heat Transfer, Hydraulic, Marine Engine, Metal Working Fluids, Process, Refrigeration, Slide Way, Spindle, Transformer and Turbine Oils. Aviation & Marine The company realized from the outset that it needs to join hands with an internationallyaccredited company having wide research base to attain leadership role in aviation business. PSO signed an agreement with Air Total International France as their technical partners in order to share not only the know-how but also to benefit from their strong standing in the global aviation industry. In 1999, PSO took the lead by stepping forward and invested a significant amount by constructing state-of-the-art fuel farm facility at the newly-developed Allama Iqbal International Airport at Lahore. This was followed by constructing refueling facilities at another 8 airports of Pakistan. Our Aviation & Marine department and all its nine aviation stations are ISO 9001 2000 certified and maintain high safety standards. PSO has retained its market leadership in the Marine business as well. A special quality treatment unit - Precoat Unit - was installed in the year 1997 to cater to the special HSDO requirement of the entire Pakistan Naval fleet. To further facilitate supplies to Pakistan Navy, a pipeline has also been laid at OP-III. In line with the soon-to-be-introduced environment laws by International Maritime Organization (IMO), PSO is in the process of implementing MARPOL Annex VI (Marine Pollution) for bunker supplies to all vessels calling at Karachi and Bin Qasim ports. Companys corporate policy is to support at times of need and Aviation played its due role during the Tsunami crisis and the earthquake of October 8, 2005.

Into-Plane Re-Fueling Facility We have into-plane re-fueling facilities at 9 airports in Pakistan on round the clock basis: 1. Jinnah International Airport, Karachi 2. Allama Iqbal International Airport, Lahore 3. Islamabad International Airport 4. Peshawar International Airport 5. Multan International Airport 6. Faisalabad International Airport 7. Turbat International Airport 8. Pasni International Airport 9. Sialkot International Airport We are equipped with one of the most modern fleet for aircraft re-fuelling at our aviation locations. The entire PSO Aviation Department is ISO 9001:2000 certified including all 9 Aviation Stations. Aviation Customers With the aviation fueling facilities bench marked with the best in the world, we service some of the best airlines of the world, with most sophisticated equipments & facilities. We are proud to serve both national & international air carriers: Air Blue Air China cathay Pacific Defence Aviation Wings Emirates Airlines Etihad Airways Gulf Airways Indian Airlines Iran Air Kuwait Airways Pakistan International Airlines Qatar Airways Saudi Arabian Airlines Shaheen Air International Thai Airways and many other small carriers/charters etc In addition to the above, we also accept carnet of Air BP, WFS, AVCARD

Marine Products We supply 3 types of fuels to the marine sector: Bunker Fuel Oil (BFO) commonly known as Furnace Oil. Marine Gas Oil (MGO) commonly known as High Speed Diesel. Marine Diesel Oil (MDO) commonly known as Light Diesel Oil. Highly filtered High Speed Diesel Oil (HSDO) is supplied to Pakistan Navy which not only enhances the life of the marine engines & equipment but also helps in preserving a healthy pollution free environment. Marine Customers PSO caters to the fuel requirements of local & foreign marine customers including: Pakistan Navy, Maritime Security Agency, Karachi Port Trust, PNSC, Faisal Marine Oil Services (Pvt) Ltd. Non Fuel Retail Today, PSO symbolizes more than just fuel. Its corporate image extends to well beyond the realm of fuel, a thoroughly deserved recognition earned since its historic turnaround in a rather short span of just eight years PSO's 'Non Fuel Retail' initiatives include: ATMs Shop Stop Quick Service Restaurant

POL Effective Date: Apr-01-2012 Product Name E10 Gasoline HOBC Premium / PG HSD LDO SKO Retail Sale 103.18 126.87 105.68 108.16 93.29 101.69 Direct Sale 0.00 126.87 105.68 108.16 0.00 0.00

Strategy & Long Term Objectives Strategy Pakistan State Oil needs to adopt the combination of following Low-cost Leadership, Market and Product development strategies. Research and improve alternate energy products such as Bio-Diesel and E10 Research and develop new products as White Oil substitute Work out a formula and convince government to facilitate PSOs debtors to pay off their liabilities to PSO

Long Term Objectives Here are the long term objectives for Pakistan State Oil. To work with Government of Pakistan to reduce companys portion of circular debt by 60% by FY 2017. To increase profitability to at least 6% by end of FY 2015 To have at least 25% revenue in FY 2016 from the alternate fuel products To have revenue growth of at least 7% per annum till FY 2017 To enhance the E-10 blending facility at 60% storage facilities by FY 2013. To improve and launch Bio-Diesel as a substitute of White Oil by FY 2014. To train employees to adapt to technology advancements in alternate fuel by FY 2015.

Comparison of Long Term Objectives The existing strategic objectives of the company, given in section 2.3, are also related to the intensive strategies of Market Development, Market Penetration and Product Development. The proposed Long Term objectives back the strategies adopted by the company at the moment of increasing its market share by using Intensive strategies.

Strategy Implementation Recommendations Board of Management must purse with the Government of Pakistan on a formula to reduce the companys portion in the circular debt of the country. The Ministry of Petroleum, Ministry of Finance, the Finance Department of Pakistan State Oil and the related finance departments of the debtors and creditors of the PSO need to sit together to reach on an agreement to discharge their liabilities to each other. A 5-year plan must be devised in this regard before the end of FY2012 and the implementation of this plan need to start from FY 2013 till FY 2017. The decreased debts and receivables will help stabilize the company and the economy in general. This stability will translate into higher net profit margin. Increase the supply of alternate fuel, especially E-10 blended fuel, to all the retail outlets of the country by FY 2014. It can be achieved by installing Fuel Blending facility at 20 out of 30 storage facility of the country by the end of FY 2013. The E10 fuel can be carried in the existing modes of transport of fuel such as tank lorries, therefore its availability at all the retail outlets is possible. The increased availability of alternate fuel at the retail outlets will in turn increase its portion in the total revenues. The lower production cost will help in increasing the gross profit margin. Research, in collaboration with Singaporean and Malaysia OMCs, on Jatropha fruit (edible) oil to produce more cost-efficient, environment-friendly fuel as a substitute of White Oil and CNG. Pipri Marshall Yard is being used as the research facility at the moment. Plantation of Jatropha seed is recommended on large scale in order to produce sufficient BioDiesel for launching the product and maintain uninterrupted supplies. Arrange for trainings in Singapore and Malaysia for having the basic knowledge and innovative ways of extracting fuel-oil from the non-edible seeds. It will help to produce alternate fuels more efficiently.