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Sector Week 2012

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DHL Houston Energy Center

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DHL Houston Energy Center

DHL Houston Energy Center

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Opening Event

Opening Event Houston, 25th September 2012

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Welcome to DHL Energy Sector Week, where we put the spotlight on one of the key sectors we serve at DHL!

During the week of September 24-30, 2012, come along as we explore the exciting world of energy. We’ll take a look at the trends and supply chain requirements of the energy industry and its subsectors, and present DHL’s unique value proposition and capabilities to meet the needs of our customers across the sector.

Join us and experience how, together we "Empower Energy!".

Energy Week

Day 1

Managing Energy Trends today and tomorrow

Today's energy market is characterized by rising demand, ever-more difficult to access supplies, deregulation, and new sources, technologies and geographies. Thanks to new technologies, shale gas deposits are changing the energy supply mix, with gas expected to overtake coal as the second most important energy source after oil.

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CO2 emissions regulations and environmental concerns, meanwhile, are driving renewables – whose share is anticipated to keep rising. And energy efficiency and technological innovation are playing increasingly key roles in meeting demand for energy.

The energy industry, therefore, must keep searching for new and alternative sources, and new technologies and techniques, all of which raises costs. At the same time, safety, environmental and regulatory compliance remain top priorities across the industry. The energy industry, therefore, must keep searching for new and alternative sources, and new technologies and techniques, all of which raises costs. At the same time, safety, environmental and regulatory compliance remain top priorities across the industry.

Rising demand and costs and diversifying supplies pose new challenges

Today’s energy market is more dynamic than ever, as demand continues to rise and supplies get scarcer, while the resource mix becomes more diverse and competition keener. To meet these challenges, companies in the sector must invest in new technologies and geographies, while always looking for ways to balance risks and costs.

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Shale gas is changing business' nature, with untapped reserves becoming available and redirecting the focus of the international oil companies. The huge increase in gas production has improved global energy security, but downward price pressure is causing concern for the main producers.

Thanks to innovative technologies, renewable energies like solar and wind power are becoming more mainstream, and rapid progress in battery technology is transforming the prospects for electric vehicles.

At the same time, regulations are ever-more stringent, and safety, security and environmental (HSSE) and regulatory compliance are top priorities across the industry, creating yet more supply chain challenges and making logistics requirements that much more demanding.
Steve Harley
President Energy Sector, DHL Customer Solutions & Innovation

Day 2

Specialized Solutions and Competencies

The energy sector's activities tend to be in hard to access, remote areas, where logistics are a challenge – both in terms of the physical infrastructure, as well as compliance with strict environmental, health and safety regulations.

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Whether it's accessing previously unobtainable gas and oil deposits in North America or China, drilling thousands of meters below the seabed off of Brazil, or setting up a wind project in a remote area of South Africa – logistics in this sector is no doddle.

The specialized requirements may include moving an extremely heavy compressor unit across an ocean and up a river by barge to a remote location in Latin America, or moving massive drilling rigs in Oman. They may also include resupply of materials, inbound logistics, and maintenance, repair & operations (MRO) in difficult oil sands terrain in Canada or in far-off Papua New Guinea. And, they may include a network support system, along with the more traditional storage, handling and distribution responsibilities for downstream products, such as a petrochemicals producer in Aberdeen or Houston.

These companies also want their supply chain flows to be better managed worldwide, including in remote areas, using control tower and other state-of-the-art information management capabilities. The energy sector is looking to logistics suppliers specialized in the industry to gain access to technology and talent, and as a means of cutting costs and focusing more effectively on their core priorities. And don't even bother applying unless you already have robust safety programs and procedures in place.

The Big Picture of Integrated Supply Chain Competence

As energy resources become more difficult to exploit, requiring more complex technologies and extraction techniques, the logistics requirements of the sector are becoming more specialized, complex and costly.

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The industry is listening more intently, therefore, when it comes to smarter, more efficient supply chain solutions, through outsourcing to a trusted partner.
This is why we have just opened the DHL Energy Center in Houston, Texas. It brings together in one facility the full picture of our capabilities to understand and meet the challenges and requirements of the industry.

Our Energy Center showcases DHL's global reach and cross-divisional commitment to provide end-to-end supply chain solutions tailored to the needs of energy companies across the industry's subsectors, worldwide.

Today's energy sector is a whole new ballgame, with highly-complex logistics needs, and our customers know they can rely on us to meet these challenges. And, if you're in Houston, be sure to stop by the DHL Energy Center to learn more our value proposition!
Hans Toggweiler
CEO DHL Industrial Projects

Day 3

Making a tough Business easier

The energy sector’s operating conditions are often harsh and challenging, in remote, difficult to access areas. This, combined with strict environmental, health and safety regulations, makes its logistics requirements particularly demanding.

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Upstream oil & gas exploration and production in the deserts of the Middle East, the jungles of Africa or offshore of South America call for complex, expert logistical services. Energy mining in Australia or Papua New Guinea has similar challenges and specialized logistics needs.

Local content requirements from the oil producing countries mean multinationals need to open new production sites in the respective country where they explore the oil. Robust health, safety, security and environmental, as well as compliance procedures, are absolutely necessary in geographies where the infrastructure may be modest, to say the least. Planning, foresight and visibility are critical to get the job done safely, on budget and on time.
To address these challenges and successfully develop their business, energy companies are relying increasingly on partners with demonstrated industry competences and capabilities. The energy sector is looking to logistics suppliers specialized in the industry to gain access to technology and talent, and as a means of cutting costs and focusing more effectively on their core priorities.

The End of easy Oil

The need for energy is growing, nuclear power is being phased out in a number of countries, and the easy oil is gone. The industry is moving to unconventional oil and gas resources, ultra-deep-sea deposits, and R&D is key to developing new technologies.

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Health, safety, security and environmental standards and regulatory compliance dominate activity throughout the sector, anywhere in the world.

Our customers are active in geographies where the infrastructure might be poor and risks high, and anticorruption and trade compliance are critical to sustain their operations.

We work together as one team across our business units at DHL - Excellent customer service and flawless operations, backed up by our integrated capabilities and global network, are the best guarantee for our success, as we endeavor to be the provider of choice for the energy industry.
Joerg Rohrer
Global Business Development Oil and Energy, DHL Global Forwarding

Day 4

Meeting the Demands of Power & Utilities and Renewables

Whether building a new power station or supporting field engineers in transmission and distribution activities, complex supply chains are a reality in the power & utilities industry.

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While new capital projects and existing power, utilities, transmission and distribution facilities each have their own unique supply chain challenges, the need to get or keep equipment online is of paramount importance for all. Growing competition, complex regulations, and the drive for grid parity by renewables are all tightening profit margins in the industry.

Keeping that inbound supply chain of indirect materials running smoothly is vital to the safe and efficient operation of a plant. More efficient turnarounds mean increased plant reliability, which is hugely important to these organizations. Logistics and its associated costs have therefore become a focal point for many energy producers as they look for cost savings, greater efficiencies and new markets. And, more efficient transport and logistics solutions for the solar and wind power segment can make all the difference when it comes to the viability of green alternatives.

Renewable Capabilities

Our sector is not just focused on oil and gas and petroleum-based products. We’re heavily involved in the power & utilities and renewables subsector, too, where green energy is taking off.

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We do a considerable amount of work in the area of materials management for various UK utilities, as well as for utilities in Portugal and Brazil, enabling these gas and electricity providers to “keep the lights on” by ensuring the right parts get to their engineering teams who maintain these networks.
We understand what is involved in delivering delicate technology, like solar components. By partnering with a global logistics firm that has local expertise

in key wind, solar and other energy markets, and that provides logistics solutions with full transparency, flexibility and reliability, customers can make the most of green opportunities across the globe.
Mark L. Johnson
DHL Supply Chain

Day 5

Meeting tomorrow’s Energy Demands

Meeting tomorrow’s energy needs will require a combination of increased efficiency, innovative technologies, and a blend of diversified and alternative resources, including cleaner and renewable energies.

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Demand for solar, wind and other sustainable sources will keep rising briskly, with the share of renewable energy expected to be close to one-fifth of the mix by 2035. Solar energy holds particular promise, as technologies improve efficiency and prices for components and panels continue to plummet.

Not only is demand for renewables driven by the search for alternatives to finite carbon-based energy supplies, but environmental concerns and CO2 emissions policies are also playing an ever-more important role in this market shift towards cleaner energy and enhanced efficiency. Scores of countries and regions already have emissions trading schemes operating or under development, including the European Union, China, Japan, India and California.

The Future calls for Innovation, Integration and Collaboration

Our energy customers are increasingly willing to outsource portions of their supply chain. They want logistics partners who can bring innovation, integration and collaboration to their supply chains.

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Increasingly, as they enter even more difficult markets and remote places, they are seeing that they need specialist logistics support and the reliable infrastructure of a global company like DHL. Our strategy hits the right buttons by offering integrated solutions across all our divisions, supported by a strong health and safety approach and strict compliance.

As a trusted partner to the industry, it is important to anticipate customer needs and find ways to meet these requirements. It is very important for the energy industry to be able to track materials, since they keep high levels of inventory in warehouses, so that

operations managers can react fast to material requests.
A solution for material track and trace, combined with an international express service, could bring a customer a part they urgently needed straight away. That would reduce these inventory levels - and integrate DHL into our customers' supply chains. Through this kind of innovation, combined with our integrated approach and collaborative partnerships, we are building strategic relationships with our customers in the energy industry for a better future for all of us.
Carl Friedrich zu Knyphausen
DHL Express