Annual Report 2022

Custodian of the Two Holy Mosques

Kingdom of Saudi Arabia

The King of the Kingdom of Bahrain

Amir of the State of Kuwait

His Majesty King Hamad bin Isa Al Khalifa

His Majesty King Salman bin Abdulaziz Al Saud

His Highness Sheikh Nawaf Al-Ahmad Al-Jaber Al-Sabah

THE Chairman’s Message

in March 2022, after being postponed from its initial target date due to the COVID-19 pandemic. The deferral caused an accumulation of new tasks in addition to those on the maintenance schedule; further increase in manpower to a workforce of approximately 3,000; and the need for additional precautionary measures to ensure the health and safety of larger than expected increase in turnaround personnel.

GPIC’s record achievements during the year were attained across all levels, underpinned by robust operational resilience, efficient plants’ production, and adherence to the highest environmental and health and safety standards. Indeed, cumulative safe working without lost time accidents amounted to 38 million man-hours for the company’s employees and contractors. This was accomplished in spite of the major maintenance turnaround that commenced

GPIC’s outstanding performance and continuous achievements would not have been possible without the outstanding support and guidance of the Kingdom of Bahrain’s wise leadership, we would like to take this opportunity to convey out sincere thanks and appreciation to His Majesty King Hamad bin Isa Al Khalifa, may God protect him; and HRH Prince Salman bin Hamad Al Khalifa, Crown Prince, Deputy Supreme Commander and Prime Minister, may God protect him and His Highness Shaikh Nasser bin Hamad Al Khalifa, His Majesty’s Representative for Humanitarian Works and Youth Affairs, National Security Advisor and Commander of the Royal Guard, is nogaholding Chairman and whose progressive vision and policies have formed the bedrock upon which companies

HE. Mr. Kamal bin Ahmed Mohammed Chairman

like GPIC have been able to thrive. We are all very grateful for this and proud to contribute to the national success and prosperity.

2022 was a year of exceptional global volatility and uncertainty. Despite the many challenges that this posed for our industry, while also being a year of a major maintenance turnaround in the first quarter of the year 2022, thanks to God Almighty and the company’s commitment to the successful implementation of its strategic plans.

These achievements are credited to various dignitaries who deserve our utmost respect and appreciation, our previous Chairman, Dr. Ahmed Al Sharyan, and the Board of Directors during their tenure that concluded in July 2022. Their policy decisions and oversight successfully steered GPIC through the turbulence, enabling it to adapt and prosper.

GPIC has also remained steadfast in its commitment to continue investing in human capital. During 2022, effective remote training sessions and courses were structured and rolled out, while the return of in-person training further benefitted the employees towards ensuring the continued cultivation of GPIC’s future leaders.

We are proud to recognize the diligence of GPIC’s management team and the employees to streamline internal processes and enhance cost optimization towards driving the superior financial results. This performance is also further

testimony of the positive influence of an exemplary corporate culture that has continually cultivated a motivated mindset and determination to succeed, while embracing and embedding sustainability and corporate social responsibility.

Our deepest appreciation is also extended to all the government institutions in the Kingdom of Bahrain and our honorable shareholders – the National Oil and Gas Holding Authority in Bahrain (nogaholding), SABIC Agri-Nutrients Investment Co and the Petrochemical Industries Company (PIC) of Kuwait for their continuous support and encouragement.

I would also like to acknowledge sincere appreciation to my fellow members of the Board of Directors for their wisdom, informed guidance, inspired opinions and high levels of professionalism that have had a significant impact on the company›s success and prosperity.

Finally, I would like to extend my deep gratitude the Chief Executive Officer of GPIC, members of the Executive Management, GPIC’s Labour Union and all our employees for their loyalty, dedication, and determination to navigate through the many challenges and headwinds. These are the ingredients that have turned GPIC’s ambitions into a reality, with the company poised for much more success in the years to come.

Chief Executive Officer`s Message

GPIC is Continually Exerting Tremendous Efforts to Transform Its Energy Applications and Usage Towards Reducing Our Carbon Emissions.

Mr. Yasser A.Rahim Alabbasi

The extraordinary health, economic, and geopolitical challenges of the last few years have come in quick succession, with many more complexities still ahead. We have been very fortunate at GPIC to have navigated the disruptions from unpredictable and extreme uncertainties, and this has only been possible because of our incredible team. As I complete my first year as chief executive officer, I am proud to present GPIC’s Annual Report 2022, highlighting an outstanding operational and financial performance. This is reflective of our resilient, skilled, and committed workforce that collectively and individually aspires towards the company’s success.

Since its inception, GPIC’s success has been firmly rooted in a deep commitment to value creation for our shareholders, employees, and the society at large. The 2022 financial performance is further testimony to this as we report a net profit of over US$303 million, the highest in the company’s history. Netbacks earned during the first half of year resulting from oil prices at multiyear highs were supplemented by optimized efficiencies and higher production in the second half of the year, following a successful maintenance turnaround. The exceptional performance was further attributed to a sharp focus on cost discipline without jeopardizing operational reliability and the safety of our plant and people.

After four years of continuous plant operations, the maintenance turnaround commenced

in March 2022 following repeated postponements due to the pandemic outbreak. The undertaking of the project after such an extended deferral was an extremely challenging feat, as Covid-19 continued to cause disruptions and obstruct the deployment of necessary resources. The late commencement vastly increased the number of turnaround tasks, and this, in turn, led to a surge in manpower to approximately 3,000 contracted staff, while also multiplying the required roll outs of precautionary measures critical for protecting all those involved from infections. I am delighted that in spite of the multifaceted challenges we faced, GPIC capably concluded the plant maintenance turnaround safely and without any delays. The unwavering dedication of our employees is at the heart of the project’s success, under the leadership of our capable executive management that used transformative and creative ways to persevere and complete the tasks in record time. The professionalism was displayed at every level as the tasks involved demanded far greater commitment both in time and effort, than we have ever experienced. This helped mitigate the hurdles that were being encountered, and enabled us to complete the turnaround project safely, successfully, within time and below budget. In the aftermath, we have been able to run our plants more efficiently and at higher production levels towards delivering a solid financial performance.

During the year we also conducted a comprehensive review of GPIC’s management systems and recertified our Quality, Environmental, Occupational

Health & Safety, Responsible Care, Energy, Business Continuity, and IT Security Management Systems with reputable assessors to ensure our processes and activities are running in-line with international standards requirements and best practices.

GPIC also received many prestigious awards and accolades during 2022, including those in the field of corporate social responsibility (CSR), as we continued to strengthen our mission to serve Bahraini society. Our CSR strategy features specific goals, notably community service and the development of the community as our key priorities. During the year we won the first edition of the Al-Bilad Newspaper Shield for CSR among more than 70 local companies.

The company was also awarded the Dubai Chamber of Commerce accolade for CSR, the Mohammed bin Rashid Al Maktoum Business Award, the Arab CSR Award, in addition to winning a gold medal in the field of industrial excellence from the International Fertiliser Association. Moreover, in the field of occupational safety, the company has succeeded in achieving two awards from the Royal Society for the Prevention of Accidents (RoSPA) in the United Kingdom, and the Certificate of Excellence in Maintenance, in addition to the Procurement Risk Management Award.

While the global economy experienced a broad-based slowdown last year as supply chain disruptions, multi-decade high inflation, unprecedented tightening

in interest rates, the Russia-Ukraine war and increased geopolitical tensions all weighed on growth prospects, the greater awareness to health, social equality and sustainability brought about by the pandemic continues to gain momentum. As humankind continues to emerge stronger, more resilient, and increasingly capable of adapting to the many challenges we have faced from recent disruptions, this is encouraging us towards building a post-pandemic recovery that is both inclusive and sustainable.

At GPIC, our commitment to integrating environmental, social and governance (ESG) considerations into our operations and business development strategies, are resolute and steadfast. As a responsible member of the petrochemicals and agrinutrients industries, we are consistently striving to improve energy efficiency and reduce the company’s carbon footprint in the journey to a resilient net zero and lowcarbon energy world. In this regard, GPIC is continually exerting tremendous efforts to transform its energy applications and usage towards reducing our carbon emissions.

Beyond our focus on enhancing the sustainability of our operations, the proactive and agile approach adopted since the onset of the pandemic has ensured safe and continuous plant operations and production, with comprehensive safety, security and work policies being continuously refined. Our priority is and always will be on the health and well-being of our employees and the community at large.

I look forward with expectation and hope to lead GPIC in new and exciting directions, anticipated by the continued economic recovery and the many opportunities gathering momentum as the world moves into the post-pandemic phase. These

strategic aspirations are underpinned by an uncompromising vision to seek sustainabilitydriven growth, embed ESG initiatives and programmes in all that we do, deliver strong operational safety and excellence, and continue to invest in our people to prepare the future leaders.

The company has recently embarked on journey to explore future growth opportunities as part of long-term expansion plan to build on the legacy of success and further add value to the shareholders. Under the guidance of the GPIC Board of Directors, the company has engaged world-renowned consultant to develop a new corporate strategy incorporating the identification of new growth and business opportunities across products, processes, and markets, in addition to the existing business lines. Embedding sustainability and ESG considerations will be at the core of all future strategic opportunities that we seek, including compliance with the Kingdom of Bahrain’s vision of carbon neutrality by 2060, other relevant sovereign and regulatory requirements and transition to a circular economy.

I am confident that under the guidance and support of our shareholders and Board of Directors, we will collectively navigate GPIC into a new era, allowing the company to be well positioned to further build and expand on its illustrious four decades of continuous success.

We ask Almighty God to guide and enable us towards the organization’s continued growth, prosperity and progress. We are also deeply grateful and thankful to the Kingdom of Bahrain and the wise Leadership, under which GPIC has thrived over the last four decades and much more success still ahead.

The Board Of Directors

Chairman (From July 2022) Chairman (up to July 2022)

Deputy Chairman (From May 2022) Managing Director

Board Member

Board Member

Board Member Board Member

Board Member (From May 2022)

Board Member (From July 2022)

The Future of Sustainable Growth

Managing Director (Up to May 2022)

Board Member (Up to May 2022)

Mr. Kamal bin Ahmed Mohammed Dr. Ahmed Ali AlSharyan

Mr. Ahmed M. Alumar

Mr. Ali M. Shafiee

Mr. Abdulrahman Ahmed Shamsaddin

Mr. Shafi Taleb Alajmi

Mr. Hamad Dekheel Alsubaie

Mr. Salem Ali Alazmi

Shaikh Fahad Bin Salman Al Khalifa

Dr. Samir A. Al-Abdrabbuh

Mr. Ali Ahmed Alghamdi

Mr. Fahad M. Al Battar

Executive Management

Mr. Yasser A.Rahim Alabbasi Chief Executive Officer (CEO)

Mr. Bader Mohammed Almansoori

Mr. Jassim Ahmed Darwish

Mrs. Najat Mohamed Sharif

Mr. Khalid Yusuf Al Bin Ali

Technical Services Manager (TSM) Maintenance Manager Human Resources & Corporate Communications

Plants Operation Manager (POM)

Mr. Adnan A.Razaq ALMahmood

Mr. Fadhel Malalla Alansari Executive Advisor

Mr. Jehad Ali Khalfan

Mr. Jamal Ali Alshawoosh

Finance & Marketing Manager Safety, Security, Health & Environment Manager (SSHEM)

Dr. Omar Naser Al Bastaki

Chief Internal Auditor & Secretary to the Board (SB)

Mr. Ahmed Al Arabi Procurement & Warehousing Manager (PWM) (Up to November 2022)

Deputy Chief Executive Officer - Support

Vision

To be a world-class petrochemical and fertilizer company of choice, recognized for excellence.

Mission

To produce high quality petrochemical and fertilizer products. To grow through successful partnerships and joint ventures. To optimize the business in a safe, sustainable and cost effective manner.

To embrace knowledge, harness innovation and utilize best applicable technologies and practices. To boost Stakeholders share value.

To train and develop the Human Capital to realize their full potential.

Report to Shareholders

GPIC Board of Directors congratulates its Shareholders, the company’s President, members of the Executive Management and all employees for their remarkable role during 2022, an exceptional year, with all the difficulties, challenges and complexities it brought about.

However, due to the co-operation of all GPIC stakeholders and thanks to God Almighty, we were able to overcome all challenges and difficulties to achieve records at all levels despite of all indications and expectations pointing to negative effects and losses.

The year 2022, thanks to God Almighty, showcased various successes at the local and global levels. Among them was GPIC achieving a new record of 38 million hours without a lost time accident for its employees

and contractors, and maintaining a clean record of no accidents since October 2012. This achievement was in spite of the major Turnaround that took place during March 2022, which included a vast increase in the number of necessary Turnaround tasks caused by the initial postponement of the Turnaround due to the COVID-19 pandemic. The increase in Turnaround tasks also led to a large increase in manpower to a worlforce of approximately 3,000, as well as additional precautionary measures to ensure the health and safety of all those involved. GPIC was still able to complete the Turnaround safely and without any delays.

In documenting this successful journey, the Board of Directors is pleased to present to the Shareholders its Annual Report for the year 2022, including achievements it made as well as activities related to occupational safety, health and the environment, in addition to financial, technical, administrative and marketing activities. The company’s Board of Directors expresses its sincere thanks and gratitude to His Majesty the King, Hamad bin Isa Al Khalifa, may God protect him, and His Royal Highness Prince Salman bin Hamad Al Khalifa, Crown Prince, Deputy Supreme Commander and Prime Minister, May God protect him, for all their support and assistance.

Their Excellencies the Board of Directors also extends its sincere thanks and gratitude to the shareholders – National Oil and Gas Authority, Saudi-based SABIC Agri-Nutrients Investment Company and Kuwaitbased Petrochemical Industries Company, for their close cooperation, high professionalism, and unlimited eagerness to secure GPIC’s continuous success in operational and marketing operations.

Their Excellencies the Board of Directors also commends the sincere efforts of the company’s President, members of the Executive Management and all employees who worked as a team and in the one-family spirit to preserve its status and gains.

Performance Highlights

47.03 MILLION Metric Tonnes

tonnes of combined production of ammonia, methanol and urea since 1985.

44,373 Students

from 584 schools have attended environmental awareness lectures given by GPIC employees since 2001.

US$5.931 BILLION

Invested into Bahrain’s economy since inception.

38 MILLION Man-hours

without LTA as of 31 December 2022.

US$10.5 MILLION

saved through in-house spare part manufacturing since 2001.

US$2.605 BILLION

paid to shareholders as dividend.

+1 MILLION FISH

Released to Bahrain’s territorial waters from GPIC’s managed fishfarm since 1996.

2,598 Cargo ships

loaded and exported around the world since 1985.

Achievements and Awards

RoSPA’s Award, from the Royal Society for the Prevention of Accidents. Arabian Corporate Social Responsibility Award - Major Businesses Category

Arabian Corporate Social Responsibility Award - Community Partnership and Cooperation Categories.

AL Bilad first CSR Shield 2022.

Conducted major TA 2022 successfully. Maintaining business continuity, uninterrupted operations and exports amidst the COVID-19 pandemic.

Our proactive digitalization strategy and implementation enabled virtual business including work from home, external audits, meetings, training and factory acceptance tests.

Continued to build on our success and received recognition for the relentless and driven attitude to sustainability, corporate social responsibility and beyond excellence results.

Challenges

Continuity of market uncertainty, instability and unpredictability, financial crunch and escalating energy costs.

Corporate Governance

GPIC’s Corporate Governance system is based on three fundamental components namely; Principles, Code of Ethics and Policies. The system is based on our shareholders aspirations to conduct the company’s business within the acceptable international and local guidelines and standards to ensure full protection of the interest of the shareholders and various other stakeholders. The company’s Corporate Governance principles have been developed primarily from the company’s Memorandum and Articles of Association, the Bahrain Commercial Companies Law and Bahrain’s Code of Corporate Governance. These Corporate Governance Principles are responsible for providing a basis and a system of principled goal-setting, effective decision making and ethical actions, with the objectives of establishing a fundamental corporate entity that - on a long term basis - drives value creation to the company’s shareholders and promotes sustainable business conduct in line with the principles outlined in the company’s Articles of Association.

Composition of the Board of Directors

The Board of Directors represents the owners› interest in perpetuating a successful business. The Board is responsible for determining that the company is managed in such a way as to ensure this result. The Board of Directors is composed of nine members. The Directors are nominated by The Oil and Gas Holding Company (Nogaholding), SABIC Agri-Nutrients Investments Company and Petrochemical Industries Company (PIC), representing the three shareholders. The current Board of Directors includes four independent members including the Chairman of the Board. The Board of Directors held five meetings during 2022, and the regular General Assembly Meeting was held in March 2023.

Board Committees’ Composition

The Corporate Governance Policy of Gulf Petrochemical Industries Company and Bahrain’s Corporate Governance Code resulted in the formation of three high level committees: the Audit, Finance and Risk Committee, the Remuneration, Nomination and Governance Committee and the Strategic Growth Committee. These three committees are created to assist the Board of Directors in the effective performance of their governance and oversight responsibilities

The Remuneration, Nomination and Governance Committee

The Remuneration, Nomination and Governance Committee consists of three Board members. The Committee is responsible for overseeing the overall remuneration and nomination process, as well as ensuring the strength of the organization’s governance. The Committee’s main task is to ensure compliance with the Kingdom of Bahrain’s Corporate Governance Code regulations and mandates. The committee held four meetings during 2022.

The Audit, Finance and Risk Committee

The Audit, Finance and Risk Committee consists of three Board members, one of which is an independent director. The purpose of the Committee is to assist the Board of Directors in independently ensuring and maintaining an overview of Gulf Petrochemical Industries Co. (“GPIC”) processes. The Committee is tasked with overseeing such responsibilities such as the integrity of the company’s financial statements and financial reporting, internal control and risk management process, internal audit function, independence and performance of the external auditors, compliance with ethics policies and legal and regulatory requirements, governance and other matters as enumerated in the Audit, Finance and Risk Committee Charter.

The Audit, Finance and Risk Committee held four meetings during 2022, where they discussed the Internal Audit Section activities, the External Audit Reports, and the Company’s Enterprise Risk Register during the meetings.

The Strategic Growth Committee

The Strategic Growth Committee consists of members from the Board of Directors along with GPIC’s CEO. Two committee meetings were held during 2022.

The role of the committee is to develop and implement a growth strategy for the Company appropriate with the nature of its business, activities and risks, and present suitable recommendations to the Board. The strategy aims to enable the Company to sustain its competitiveness, maintain its position as an important economic asset that benefits its shareholders and ensures the Company’s sustainability and growth in line with local, regional and global economic changes.

Internal Audit Function

GPIC’s Internal Audit team is an independent, objective, assurance and consulting activity designed to add value and improve GPIC’s operations. The internal audit function helps the company accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, internal controls and governance processes. It contributes to a sound control environment through monitoring the prescribed control procedures. An effective internal audit function can assist all members of Management in effectively discharging their responsibilities by providing them with analysis, appraisals, recommendations and pertinent comments concerning the activities reviewed. In addition, it can provide constructive suggestions for improving systems.

The internal audit function can play a prominent role in enhancing the overall control environment within the Company. When an organization, such as GPIC, reaches a certain size or complexity, it becomes a challenge for Senior Management to ensure that all the sections within the business are being effectively managed to achieve the Company’s objectives and are performing economically, efficiently and effectively. The Internal Audit Section, effectively established and resourced, provides reasonable assurance to the Board of Directors and Management of GPIC on whether the controls to manage key risk areas are designed and operating effectively or identify important improvement opportunities where Management actions are necessary. The GPIC Internal Audit team reports directly to the Board’s Audit, Finance and Risk Committee. For logistical reasons, the Internal Auditor reports to the CEO for matters relating to time and attendance, leave, travel and other administrative requirements.

External Auditors

The External Auditors are appointed by the Shareholders at the annual ordinary meeting to audit the Company in accordance with the accepted local and international accounting standards. Appointing an independent External Auditor is one of the requirements of Bahrain’s Corporate Governance Code. The External Auditor is responsible for verifying the Company’s financial statements and audit the Company’s accounts. The External Auditors also examines the administrative and financial systems of the company and express their opinion regarding their effectiveness.

Production

2022 was another successful year, all Plants operated in a safe, reliable and efficient manner whilst maintaining specified standards in terms of quality for all products. All plants registered excellent records in regards to performance factors (On stream factor, Capacity Utilization and Utilization Factor).

Year 2022 Main Highlights

Urea plant achieved 2133 tonnes the highest production ever on 5th of December.

The total cumulative combined production since 1985 achieved 47.03 million tonnes.

The total cumulative combined exported since 1985 achieved 38.1 million tonnes.

As a part of GPIC’s commitment towards encouraging and supporting Bahrain’s economy, GPIC continued sustainable supply of Methanol to local markets with 1,292 tonnes of Methanol sold in 2022.

GPIC also continued sustainable supply of Urea to local market with 1,306 tonnes of Urea sold in 2022.

Production Figures

The table below gives summary of the various budgets versusactual production figures.

0.9%

The combined products was 0.9% higher than the budgeted figure.

15.8 MILLION TONNES

Since 1985, cumulative total of 15.8 million tonnes of Ammonia and 15.5 million tonnes of Methanol production were achieved by end of December 2022.

15.7 MILLION TONNES

Since 1998, 15.7 million tonnes of Granular Urea production was achieved by end of December 2022.

PRODUCTION PERFORMANCE 2022

Plants Performance Indicators

On Stream Factor %

Utilisation Factor %

The Future of Sustainable Growth

Maintenance

In 2022 Maintenance Team continued its consistent efforts to enhance safety and reliability throughout the complex, placing special emphasis on the process plants. Accordingly, the Objectives and Key Performance Indicators were set and monitored closely on quarterly basis, resulting in the achievement of all set objectives.

The Turnaround commenced on the 1st of March 2022. On this day, the Turnaround preparatory phase entered the execution phase, culminating the preparation activities for the turnaround that had started directly after the completion of the last Turnaround Project which was conducted in April 2018 (47 months interval). The completion of the 2022 Turnaround was achieved safely and with great outcomes, completing around 1.1 million man-hours without lost-time Accidents.

Routine Maintenance Orders [Completed]

Process Performance Effectiveness

94% of CMRT Completed [Including Priority: 1, 2, 3].

98% of PMRT & INRT Completed [Including BOPA].

100% Execution of Emergency Orders.

100% Execution of Urgent Orders.

Maintenance Index [PM/CM ratio] achieved: [Target: 70/30] - 89/11

76.2% Maintenance.

Orders completed during year 2022 (Order Type: PMRT/CMRT/INRT/EPRT/ ANRT/GSRT/MDRT/CPRT/WKRT/RWRT):

- Received : 9,731

- Completed : 7,413

- PM Records Reviewed – 2,065

- Rework: Maintenance Orders – 5

- Slippage to Scheduled jobs – 38 Orders

- Production Orders completed – 60

Major Jobs Executed during 2022

Completion of all Turnaround Project Activities

Maintenance of Desalination Plant I & II activities are completed.

All PM maintenance activities are completed as per Winter Schedule.

Upgrade of GPIC Security Management System [Completed].

Replacement of Ammonia Refrigeration Compressor [K-7101C].

Installing of CCTV at several LCRs at Complex .

Replace Mobile Air Quality Monitoring Station .

Upgrade of plate heat exchangers [E-3202] A/B/C/D.

Material Status

Stock Items (Spares) Consumed – 4603 items [BD 1,308,501].

Direct Use Material procured - 14 PRs [BD. 93,473].

No of Items (Spares) Withdrawn – 5187 items [BD 1,942,562] .

No of Items (Spares) Returned - 584 items [BD 634,061].

Sales and Export

Global markets in 2022 showed a price spike in the first quarter due to some political issues, however prices started to correct downward and then stabilize as European gas prices eased in the following quarters of the year.

After a year of unprecedented high prices during 2021 in the urea market; 2022 started by prices correcting downwards. The market was impacted by political issues between Russia and Ukraine and high natural gas prices in Europe, subsequently prices increased to US$ 860 PMT during March/April. Lack of demand and uncertainty in the market led the year to end with softer prices; yet still in the US$500s PMT range.

Similarly, the ammonia markets were impacted by the issues in Russia and Ukraine during the first quarter of the year only, which led to some capacity cuts and firm demand causing prices to move upwards. The drop in European gas prices returned the ammonia prices back to previous levels, starting and ending the year in the US$ 800s PMT range.

As far as the petrochemical sector is concerned, methanol prices started the year 2022 with a bullish sentiment and prices increased further by the end of the first quarter on the back of the political issues as has been the case with both ammonia and urea markets. Throughout the rest of the year the market saw gradual softening prices. Low Rhine water level, natural gas production cuts, issues at derivative units and demand destructions all contributed to the bearish sentiment in the market.

The company’s sales of ammonia, urea and methanol reached a total of 1,126,748 metric tonnes. A total of 43,815 metric tonnes of ammonia was sold, and a total of 425,599 metric tonnes of methanol was sold, an increase of 3.7 per cent over what was planned for the year. As far as urea is concerned, GPIC sold 657,334 metric tonnes, an increase of 0.7 per cent over what had been planned for the same year. All of the company’s exports were shipped over 55 vessels.

In addition, the local market in Bahrain was supplied with 1,293 metric tonnes of methanol and 871 metric tonnes of bagged urea.

The Indian market, which is known for its strategic importance to urea producers, had the largest share of the company’s exports, for the second year in a row, at 35 per cent. India also was the largest export for the company’s methanol product with 43 per cent of all methanol exports. As for ammonia, Korea had the biggest share of the company’s exports at 83 per cent. It is evident that the Asian markets are strategic target markets for the company’s exports of ammonia, urea and methanol with all Asia exports holding a 67 percent share among other international markets.

Since the start of production in 1985, the company’s total exports of ammonia have reached 7.0 million metric tonnes and methanol exports have reached 15.5 million metric tonnes. The total exports of urea have reached 15.6 million metric tonnes since operations began in 1998. The combined three products exports totaled approximately 38.1 million metric tonnes by the end of 2022.

The company’s production and export operations continued unhindered through the commitment of its employees, the reliable marketing plans and goals, and the flexible strategies put in place by the Board of Directors for 2022. In addition, the efforts of the Petrochemical Industry Company of Kuwait, the marketer of ammonia and urea, and the Saudi Basic Industries Corporation (SABIC), the marketers of methanol, and their unlimited cooperation, also played a major role in GPIC’s success.

Safety, Security, Health and Environment

During 2022, managing major turnaround in GPIC amidst the COVID-19 pandemic was one of the major challenges. GPIC managed to execute its major Turnaround without being compromising on health, safety and well-being of our workforce.

Directives from Executive Management and strong commitment of workforce was the key to successfully accomplishing turnaround activities without Lost Time Accident, No Environment Incident and No Security Breach.

GPIC considers the safety of its employees and the neighboring communities as one of its top priorities and responsibilities. “Zero Harm” continues to be our vision.

As we move forward, our resolve to achieve our goals has intensified. “Zero Harm” is not restricted to rates, statistics, numbers or metrics, It is about our people, and keeping our people, facilities, environment and communities safe.

These continual improvement efforts culminated in achieving a record +38 million working hours for its workforce and contractors without any lost time accident, exceeding 11,000 days of safe work. Additionally, we did not have any Tier 1 and Tier 2 process safety incidents, zero reportable environmental incidents and zero security breaches and incidents, keeping all in mind this was a Turnaround year as well.

The following is a list of significant Safety, Health and Environment (SHE) achievements during 2022:

+ 38 million-man hours without lost time accidents.

One Million safe manhour during TA alone with not LTA

Zero reportable environmental incidents and Zero Tier 1 and Tier 2 process safety incidents and there were no security incidents or breaches.

Environment projects kick started such as AQMS - Air quality monitoring system unit, CEM – Continuous Emission Monitoring project.

12 Fire & Safety and 10 Security Mock Drills were carried out as part of emergency response training and part of emergency plans prepared for high risk scenarios

Major complex Evacuation exercise conducted

Major security Emergency Exercise with Bahrain National Guards and Local Government Authorities conducted.

Joint Environment emergency drill was conducted with OSRL

Security Management System enhancement project was completed successfully.

Radiation License for the use of X-ray machines and radioactive sources obtained.

GPIC, being a pioneer in environmental protection, has planted 4,660 mangrove trees during 2022 within the complex bird sanctuary at the shoreline.

Energy efficient LEDs replacement project continued and in 2022 we installed 1627 LEDs with an annual energy savings of 168 MWh and a yearly GHG reduction of 82 Tons CO2.

Technical Services

During 2022, laboratory collected approximately 47,683 routine samples from various plants of the complex and analyzed for 160,542 parameters during the year. In addition to the routine samples, approximately 4,188 special/request samples were also analyzed for 10,110 parameters, thereby fulfilling the total analytical requirement of the plant. The break-up of the samples and the parameters analyzed during the year has been shown in the graphs attached.

The quality of all final products was checked before being shipped/loaded in the trucks/tankers. Approximately, 200 Quality Certificates related to three products were issued by the laboratory during the year.

Protecting the Environment is our ultimate aim, therefore monitoring of gaseous emissions and liquid effluents is being carried out every quarter as per requirement of the “Supreme Council for Environment”. All the parameters monitored were well within the specifications laid down by Supreme Council for Environment.

Our laboratory is an ISO 17025:2017 accredited laboratory with the best quality management system. To fulfill the requirement of ISO 17025 Standard, laboratory participated in number of “Proficiency Tests” conducted by world renowned agencies i.e. M/s Laboratory Quality System International-USA (LQSi) for Urea product and M/s Institute for Inter-laboratory Studies, Netherland (IIS) for Methanol product during the year. The laboratory performed very well in all the tests conducted by the above-mentioned agencies.

Inspection

GPIC’s Inspection Section continued with its proactive approach toward reliability excellence through enhancing the mechanical integrity of its assets. The inspection regime built to fulfil the requirements of the latest revisions of codes and standards, legislative requirements and industry best practices.

The inspection programme further enhanced by the introduction of RBI (Risk Based Inspection) approach, ISO 17020:2012 Management System and PSM (Process Safety Management), these enhancements improved the focus of the inspection and added confidence in the equipment reliability.

In 2022, the Inspection Section successfully completed the inspection of 449 plant items, 88 of them were statutory during Turnaround 2022, in addition the Inspection Section issued 180 routine inspection reports.

In line with GPIC’s policy on enhancing and updating the skills of employees, two of the Inspection Engineers attended API exam preparation course and 4 engineers were recertified for 8 individual certificates through the American Petroleum Institute (API) certification programme. In line with the Inspection Section’s strategy to update its equipment and instruments, the Inspection Section has acquired 2 latest models of thermal cameras & 1 UFD Machine as upgrade of inspection instruments.

In addition to its regular activities, GPIC Inspection Section presented one technical paper in “Middle East Maintenance and Reliability Conference Maintcon-2022”.

Engineering

The year 2022 was another challenging year for Engineering Section, as it was a shutdown year where all approved Capex Projects and modifications have to be processed to meet the target date for the scheduled Turnaround 2022. In 2022, 10 Capital Projects were approved.

Some of the critical Capex Projects that were under detailed engineering study are listed below:

Replacement of two Process Gas Coolers (PGC) [E-0301 & E-1201].

Replacement of obsolete Fans for the Fin Fan Coolers. Procurement of Operator Training Simulator for Ammonia, Methanol, Urea & Utilities plants.

During Turnaround 2022, the following capital projects were implemented:

Refurbishment of Burners of Ammonia & Methanol Reformers [B-0301 & B-1201]

Replacement of Steam Superheater [EB-0302-1B].

Enhancement of Ammonia DCS controller capacity by installing a new Honeywell C300 controller.

Replacement of Methanol Reformer Tubes.

Replacement of Steam Generator Coil [EB-1202-5] with New One.

Replacement of Outer HP Casing, Exhaust Casing & Two Bearing Housing of [MT-1401].

Replacement of Existing Samifi Compressors [K-7101C] with its Auxiliaries.

Upgrade MarkVIe control system for [MT/MG-6401] along with AVR Panel.

In addition to the above, Engineering spearheaded the energy optimization drive in the complex and the following actions / modifications were studied and implemented in the year 2022:

Increasing Urea production by bypassing the De-Hydro Reactor.

Replacement of Six (6) Internal Sieve Trays (9th to 14th) with Supercup Trays from Bottom of [R-8201].

SIL evaluation and SIL verification study has been conducted along with consultant for Methanol plant.

Capital Expenditure (in USD)

ERM and Business Excellence

Lockdown restrictions and safety measures put in place to contain the spread of COVID-19 posed unprecedented challenges. Therefore, it was necessary for the industries related to oil and gas sector and all other industries to work hard and with extra effort to adopt new and different innovative processes and methodologies in order to maintain safe and sustainable operations.

In this regard, GPIC took number of steps to develop and improve alternative plans to achieve the corporate objectives and optimise cost and in the shortest possible time. GPIC Business Resilience Committee, in coordination with the Executive Management Team, played a prominent role in managing the crisis pandemic since the Coronavirus outbreak at the beginning of 2020 to the present day.

The committee had carried out a thorough analysis of the pandemic outbreak risk caused by the COVID-19 in the early stages and identified the consequence of the risk and mitigation controls to prevent/reduce the impacts of the pandemic. Business continuity plans were prepared to ensure safe continuity of the business. This was in conjunction with closely following up and coordinating with the appropriate authorities. This included following all government guidelines and laws and to ensure GPIC’s conformity with the current COVID-19 situation. All the corporate enterprise risks have been reviewed it ensured

its controls and mitigation plans are sound and effective to confirm the safe continual operation activities.

Over the years, GPIC have adopted and embraced number of international management system standards and accreditations which helped us in engaging and aligning all our stakeholders to continually improve the company’s processes, products, and culture. This is in order to achieve the long-term success that stems from customer satisfaction in a very systematic and consistent manner through optimum utilization of our resources and adaptation of a risk and opportunity approach in our activities. In spite of the challenges brought on by the pandemic, GPIC was able to realise a new and distinguished

achievement by obtaining an acknowledgment certificate from the external auditor that it had successfully implemented the guidelines for ISO 31000:2018 Risk Management System. This certificate confirms that GPIC had applied the Risk Management System in a systematic, transparent and credible manner within the scope and context described in the framework of Enterprise Risk Management (ERM) established in the company. The External Auditors praised the GPIC Executive Management’s commitment in implementing the standard requirements and the ongoing improvement of the Management System standards despite the crisis and the effect it had on the various systems and applications used.

GPIC’s Executive Management held remote and periodic Management meetings to regularly review and follow up on the performance and efficiency of its Integrated Management Systems PAS 99. This includes ISO 9001 Quality Management System, ISO 14001 Environment Management System, ISO 45001 Occupational Health and Safety Management System, RC 14001 Responsible Care Management System, ISO 27001 Information Security Management System, ISO 22301 Business Continuity Management System, and ISO 50001 Energy Management System. As a result, GPIC created a roadmap to further improve and continuously develop management systems, as well as ensuring there is a robust schedule to complete all internal reviews and external audits. Although 2021 was challenging, it had positive effects on internal and external auditing systems. This was because the remote work methodology proved to be very effective and feasible. Four different external auditing processes, covering all of the company’s Management systems, were held –

each over a working week – and all internal audits were completed. GPIC’s internal audit team was successfully able to complete all internal audits. The reviewing processes are among the most important tools the company uses to continue the process of improvement and development. All audits, external and internal, have concluded and it has emerged the GPIC is fully committed to implementing all specifications and Management systems requirements.

Certification

ISO 9001 Quality Management System Certificate

ISO 50001 Energy Management System Certificate

ISO 17025 Calibration Management System Certificate.

Methanol Halal Certificate

ISO 14001 Environment Management System Certificate

ISO 45001 Occupational Health & Safety Management System Certificate

ISO 27001 Information Security Management System Certificate

RC 14001 Responsible Care Management System Certificate

ISO 17025 Testing laboratories Management System Certificate.

ISO 31000 Risk Management

ISO 22301 Business Continuity Management System Certificate

ISO 22301 Business Continuity Management System Certificate

IFA Protect & Sustain Product Stewardship Certificate

ISO 17020 Inspection Management System Certificate

IFA Protect & Sustain Product Stewardship Certificate

Procurement and Warehousing

During 2022, GPIC received materials/equipment/ services to support the maintenance activities to ensure the reliability of plants’ operation. Approximately, 1,185 Purchase Orders for materials/services were issued in 2022. The Warehouse service levels continued to remain at more than 99% throughout the year, indicating the ready availability of materials when required by the plants. This reflects the close and effective coordination with suppliers and contractors, both local and foreign to expedite procurement requests.

Whilst keeping within the Company’s cost optimisation Strategy for 2022 and ensuring the reliability and safety of the Plants, emphasis was given to stronger commercial negotiation with vendors. This has led to a 12% saving of the total purchases negotiated value. Efforts were also made in consultation with the end users, to procure only essential spares.

In addition, the Procurement & Warehousing team has finalized orders based on competitive offers from International Traders along with authorized local representatives for some OEM spares, which has resulted in further savings.

In order to mitigate the effects of the economic situation on the company›s business, all suppliers and contractors’ annual contracts have been renegotiated and extended for the next two years (2023-2024) in order to stabilize prices, and terms & conditions. Thanks to the excellent partnership existing with all suppliers and contractors, everyone cooperated in reviewing and fixing prices, so that additional savings were achieved.

In coordination with the Maintenance, Technical Services and Procurement & Warehousing Departments, all materials and equipment were successfully received on time and the necessary Maintenance Services for Plants Turnaround TA2022 were arranged earlier prior to March 2022 despite the challenging global shipping schedules and COVID-19 impacts. This was accomplished through careful and continuous followup and communication with suppliers, which led to the receipt of 100% of imported materials and the completion of the necessary services.

During the month of April 2022, the customs audit process was completed by an integrated team representing the Risk Department in the Customs Administration to obtain the Authorized Economic Operator Certificate, as the Procurement & Warehousing qualifies to obtain this prestigious certificate.

Human Resources and Development

The training and development of Bahraini employees is a major priority for GPIC’s management and 2022 marks 43 years of this commitment as the Academy of Leadership and Learning, previously the Training Centre, celebrated its 36th anniversary. The Company’s training policy supports the full development of Bahraini employees, both new and existing, as its ultimate objective. To achieve this goal, employees undergo training courses arranged and designed by the Academy of Leadership and Learning as a part of their continuous training and development through in-house, local and overseas training events.

The Academy of Leadership and Learning supports and encourages employee participation in relevant petrochemical industry workshops, forums and conferences in order to achieve the Company’s sustainable development objectives. The Academy of Leadership and Learning utilises Competency-Based Training (CBT) in its approach to the training and development of staff. This methodology is considered

a qualitative step in the development of training with a view to enhancing staff skills, boosting their capabilities, achieving equal training opportunities, improving productivity and developing skills to bridge any competency gaps. Apart from the training of new graduates, the Academy conducted a number of training and development courses to meet the requirements of both the Company and its employees. Due to the COVID-19 pandemic, the Academy utilized online and virtual training. There were many online courses offered during the pandemic at which employees attended as an alternative to the physical classroom training. This process involved the organisation of 33 virtual training courses attended by 178 employees, 111 training courses held in the Academy and GPIC Club, attended by a total of 1,136 employees. This is in addition to 37 training courses and conferences held in Bahrain with 188 employees in attendance and a total of 57 training courses outside Bahrain attended by 200 employees. This is in addition to specialized courses in the field of safety, health and environment. These courses represented a total of 310 courses attended by 1,940 employees and trainees. In 2022, GPIC trained 54 students from various local and overseas universities, institutes and schools in various departments of the Company under the supervision of qualified employees. This came as part of the management’s keenness to play its role towards the community and provide training opportunities for upgrading the technical, leadership, communication, planning and team work skills of young people engaged in their academic studies. This is a part of GPIC’s commitment to the community and the development of a generation of young people who have enhanced skills and abilities to contribute to the country’s growth and development.

The eLearning Centre provides support to the training and development plans in GPIC as it offers more than 800 training programmes in a wide range of topics such as technical skills, soft skills safety, health and the environment and cyber security. The eLearning facility was active during the pandemic and 165 employees attended the e-learning courses during 2022.

Sustainability

GPIC’s sustainability strategy is built on the foundation of the United Nations pillars of sustainable development; People, Planet Prosperity, Partnerships and Peace. We measure, monitor and mange our impact in relation to social responsibility, climate action and inclusive prosperity on an ongoing basis. We also understand that this can only be achieved through sustainable partnerships in a peaceful environment.

GPIC is a proud supporter of the global goals and has contributed in all phases, right from the participatory process of My World to setting up meaningful indicators, sharing best practices on SDG aligned projects and programmes through the UN Global Compact. Aligning corporate goals both short term and long term with the relevant SDGs. Mainstreaming SDGs in business functions. Linking SDGs with our Capex projects and modifications through our MOC system is one of our initiatives. Sharing our sustainability performance publicly through GRI sustainability reports and encouraging others to do the same. In 2022, GPIC issued 2020-2021 sustainability report in accordance to GRI standards-comprehensive.

We continue to contribute towards all the 17 SDGs - our operations are directly linked to SDG 12: Responsible consumption and production. We ensure responsible consumption and production through resource efficiency, energy conservation and energy efficiency; high on-stream factor resulting in less process venting and flaring; maintaining air and water quality; continuously decreasing our waste to landfill through reuse and recycle. In 2022, being a turnaround year

GPIC contributes across all 17 Sustainable Development Goals (SDGs)

GPIC still managed to achieve zero hazardous waste to landfill. At GPIC in line with our business principles of sustainability, coupled with responsible care and corporate social responsibility ethics, our strategy of environmental management goes beyond our facilities. Our responsible operations strategy ensures that we do not have an adverse impact on our neighboring communities.The key goal is to manage our business processes to produce overall positive impact to society.

GPIC firmly believes that the SDGs can only be realized with strong partnerships and effective cooperation which addresses SDG 17, Partnerships for the goals. We engage with several international and regional organizations such as UN Global Compact; National Safety Council (NSC-USA), Royal Society for the Prevention of Accidents (RoSPA-UK), International Fertilizer Association (IFA), Arab Fertilizer Association (AFA), Gulf Petrochemical and Chemicals Association (GPCA), Global Reporting Initiative (GRI). This also provides GPIC workforce the opportunity to work with and interact with international expertise.

GPIC is committed to climate change action in relation to COP 21 and has been reporting our GHG emissions since 2014. GPIC contributions towards COP 26 climate targets through increasing mangrove plantation and afforestation within the complex; currently working on ESG reporting to set targets to reduce our GHG emissions to support the Kingdom of Bahrain in achieving 30% reduction in GHG emissions by 2035 compared to 2015 baseline and Net zero emissions by 2060. In addition, GPIC is also studying to introduce renewable energy within the complex to support Bahrain commitments towards doubling renewable energy targets. GPIC engineers were part of Bahrain delegation at COP 27 Sharm el Sheikh.