ROAD TRANSPORT HSE MANAGEMENT STANDARD

Standard Overview

Mandatory

Road Transport HSE Management

Purpose To manage the Risk of driving and transportation of people and goods on Company Business. The nature of activities undertaken by Sakhalin Energy generates a requirement for extensive road transport operations throughout Sakhalin Island. The combination of road and environmental conditions, remote locations and driving standards make the risks associated with road transport significant. For these reasons, it is essential that all personnel operating road transport activities apply the mandatory controls identified in this Standard. Adequate steps should be taken by both staff and contractors to reduce the risks associated with road transport operations to a level that is as low as reasonably practicable (ALARP), and to ensure the health and safety of personnel using road transport in the course of their duties. Broader objectives of Road Transport HSE Management are to: Define and manage gaps between the existing road safety situation and Company standards; Where possible, make substantial improvements in attitudes and performance in road safety, both within the Company and by its contractors, and within affected communities on the Island; Contribute to a public/private partnership for road safety that addresses road safety throughout Sakhalin Island. Who is this for?

1

Managers; Supervisors; Contract Holders; Drivers; Professional Drivers.

Road Safety is championed by the Sakhalin Energy Chief Executive Officer (CEO) and performance is overseen by the Road Safety Steering Committee, chaired by the CEO. What situations are covered? This document applies to all Sakhalin Energy Assets, Facilities, Operations, Projects and Activities, including activities undertaken by contractors on behalf of the Company, including: All Company Vehicles or Drivers on Company Business; and Contracts exceeding three months, which cover Vehicles, Drivers, or Common Carriers used exclusively by the Company. This document does not apply to: Commuting; Bicycles and non-motorised Vehicles; Construction and Industrial Equipment and Tracked Vehicles; Contract transport where the Sakhalin Energy load is carried with loads from other customers; Customer collection of goods; Private use of job-allocated Company Vehicles.

Italicized terms in this document are included in the Sakhalin Energy HSE Glossary. UNCLASSIFIED Document 0000-S-90-04-O-0005-00-E Appendix 1, Revision 05 Custodian: Valid from 31.05.2010 to 31.05.2015 Printed copy uncontrolled p1 of 4 Document History Authorisor:

ROAD TRANSPORT HSE MANAGEMENT STANDARD

Standard Overview

Mandatory

Requirements 1. Manage Land Transport in compliance with: 2 a. Russian Federation law (overview is provided in Legal Requirements for Road Transport ), and b. Lender and Shareholder requirements defined in International Requirements for Road Transport. Requirements 2 to 6 shall be established and maintained in accordance with requirement 1. Implement roles and responsibilities as defined in Road Transport Roles and Responsibilities and ensure that staff involved in land transport activities are suitably trained and equipped. Implement requirements in accordance with the following rules and specifications: Sakhalin Energy Life Saving Rules Drivers and Driving Land Transport Vehicles In-Vehicle Monitoring Systems Safe Journey Management Procedure Loads Transported by Road Transport Operating Procedure. Roads and Environment a. For Sakhalin Energy Company owned and maintained roads: Road Risk Assessments should be done at regular intervals at a frequency to be determined by usage, local climatic conditions, and risk exposure levels. Maintenance proposals shall be approved by a Competent Highway Civil Engineer. A road condition feedback and corrective action system shall be in place. Drivers shall report problems with road condition, layout and signage. b. Known high-risk locations for Sakhalin Energy, including public and third party roads, shall be mapped geographically in order that these locations can be considered under the Sakhalin Energy Procedure Safe Journey Management. Journey Management a. Utilization of road transport in Sakhalin Energy shall be subject to the Safe Journey Management Procedure, the key objectives being to: Challenge the business need for every journey made; Select the most appropriate mode of transport for each journey; Combine journeys with others travelling the same route to minimize kilometres travelled; Ensure drivers stay fit to operate a vehicle whilst on the road; Provide for active monitoring of journeys in progress to ensure safe completion, and to enable effective assistance in the case of incidents or overdue vehicles. b. Road transport journeys shall not be undertaken without the required Journey Authorisation in accordance with the Safe Journey Management Procedure. c. Contract Holders shall require Contractors to adopt the Company procedures, or alternatively to implement their own journey management system provided that it conforms to and satisfies the above objectives. Driving During the Hours of Darkness a. Driving shall not be permitted in Company vehicles Contractors, or subcontractors vehicles during the hours of darkness (defined as 30 minutes after sunset to 30 minutes before sunrise) outside of the site area to which the vehicle is assigned, unless there is a clearly demonstrable business need, or for emergency response purposes, and shall be specified by the Journey Plan. b. Authorization for night driving shall be given on a case-by-case basis, and shall be the responsibility of the Journey Authorizer. For Contractor and subcontractor activities permission for night driving shall be given by relevant Contract Holder. c. Crew changes by bus, and journeys within well lit City Limits, shall be exempt from this requirement.

2. 3.

4.

5.

6.

Underlined items in this document refer to Sakhalin Energy Controlled Documents. UNCLASSIFIED Document 0000-S-90-04-O-0005-00-E Appendix 1, Revision 05 Custodian: Valid from 31.05.2010 to 31.05.2015 Printed copy uncontrolled p2 of 4 Document History Authorisor:

ROAD TRANSPORT HSE MANAGEMENT STANDARD

Standard Overview 7.

Mandatory

Emergency Response in Journey Planning a. Transport Managers shall ensure that they have suitable arrangements in place to identify, and respond to, vehicle related emergency situations. Journey Plans shall identify how these arrangements apply for individual journeys. b. The emergency response arrangements shall include: Definition of the method of identifying a need for response (e.g. emergency communications, overdue arrival etc.) and the actions to be taken on the basis of the specific situation; Providing appropriate breakdown and medical assistance at an incident site; Arrangements for rescue of stranded personnel and vehicle recovery; Recovering loads fallen from vehicles in an accident and; Provision of initial response to any loss of containment that may have an environmental effect. Off Road Driving a. Off road driving in Company vehicles shall be permitted only where it can be justified for a demonstrable business need. The term off road driving means operating a motor vehicle across ground that has not been prepared as a road, either by grading or by the provision of a prepared road surface. b. Additional HSE control measures to compensate for the risks associated with off road driving shall be specified by the Journey Plan. c. HSE requirements for vehicles used for off-road purposes are applicable as specified in the Land Transport Vehicles Standard 0000-S-90-04-O-0260-00-E. Vehicle Specifications a. Vehicles shall comply with the requirements of the Land Transport Vehicles Specification. b. Sakhalin Energy shall ensure that a vehicle-by-vehicle comparison against the standards is regularly undertaken and that vehicle condition, vehicle speed and driver behaviour are monitored. c. All vehicles shall carry appropriate insurance complying with RF legislative requirements for the type of operations for which it is used (refer Legal Requirements for Road Transport).

8.

9.

10. In Vehicle Monitoring Systems (IVMS) a. Vehicles shall be fitted with IVMS as per the requirements of the Land Transport Vehicles Standard. b. IVMS shall be used to provide data for feedback to supervisors of drivers for counselling and continuous improvement of their driving behaviour, and to provide the basis of a driver recognition and reward program. 11. Road Safety Teams a. During the construction phase, and where considered applicable during operations phase, Sakhalin Energy and its contractors and subcontractors may establish Road Safety Teams responsible for assessing compliance with road transport standards and procedures. Where established, Road Safety Teams will carry out roadside checks to ensure that Sakhalin Energy road transport requirements are being met. This will include checks on vehicle suitability and condition, loading and load securing, vehicle and driver documentation, vehicle speed and driver behaviour. Feedback on the results of these checks, both positive and negative, will be given to drivers and their employers. 12. Transport Control Room a. The Head of Transport Operations is Accountable for operation of the Sakhalin Energy Transport Control Room as described in the Transport Operating Procedure 0000-S-90-01-P-0117-00-E. 13. Community Road Safety a. Support and participate in the Sakhalin Road Safety Partnership (which is part of the Global Road Safety Partnership), a combined initiative with the Sakhalin Oblast Administration, to work towards identifying and implementing specific road safety projects. b. Sakhalin Energy makes available Company buses to transport permanent staff to and from work free of charge, with drop-offs at key points in Yuzhno town centre, the main Sakhalin Energy office buildings, Zima housing complex, and Prigorodnoye locations. c. The Project shall not cause significant and material adverse impact to roads. In such cases, Sakhalin Energy will remedy the situation.

UNCLASSIFIED

Document 0000-S-90-04-O-0005-00-E Appendix 1, Revision 05 Custodian:

Valid from 31.05.2010 to 31.05.2015 Printed copy uncontrolled p3 of 4

Document History Authorisor:

ROAD TRANSPORT HSE MANAGEMENT STANDARD

Standard Overview

Mandatory

14. Improvement Planning a. Road Safety Steering Committee shall update the Sakhalin Energy Road Safety Plan on an annual basis and ensure that key actions, key performance indicators (KPIs), and targets are included in the annual Corporate HSE Plan, and track implementation. KPIs and related monitoring outcomes shall be included in performance reports to Lenders. 15. Verification and Review a. Implement required monitoring activities including IVMS, Driver Management, and vehicle monitoring. b. Undertake regular site inspections/audits, inclusive of gatekeeper reviews, c. Report performance against targets included in the Road Safety Plan and annual Corporate HSE Plan, in accordance with the HSE Monitoring and Reporting Standard. d. Consider outcomes of road transport HSE management during Management Reviews.

UNCLASSIFIED

Document 0000-S-90-04-O-0005-00-E Appendix 1, Revision 05 Custodian:

Valid from 31.05.2010 to 31.05.2015 Printed copy uncontrolled p4 of 4

Document History Authorisor: