December 15, 2010

NOTE OF ACKNOWLEDGEMENT

Dear Reader:

I would like to thank Almighty ALLAH, for finally making my efforts worthwhile. I would like to
thank then Ms Umme Hina Faiz, Course Instructor, Business Communication, for her amiable
support and guidance in completing this course and report. It is due to her that we had the
opportunity of learning Foundations of Business Communication and enhance related aspects
to it. This will help us in enhancing our communication skills in the practical scenario.

Sincerely,

Syed Asif Ali Kazmi

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December 15, 2010

Ms Umme Hina Faiz

Course Instructor
Business Communication

NOTE OF TRANSMITTAL

Dear Madam,

A brief report on BYCO is hereby submitted as a Project Report for the course of Business
Communication.
The Project Report is an effort to reflect all the elements being illustrated and conceptualized by you
during your instructions for this project.
During the course, our class was strongly motivated and enthusiastically supported by you.

Your insightful guidance throughout the course has been vital for the improvement and worthiness for
our efforts not only as enhanced professional but more importantly as an improved citizen of the society
and last but not the least an enhanced Patriotic of this motherland and this thanksgiving is not aimed at
any persuasion for good grades, but it is really meant to show our gratitude for all your sincerity with
your profession and your students.

We really thank you for all what you have been and we really look forward to your guidance in the times
to come.

Sincerely,

Syed Asif Ali Kazmi

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Table of contents:
Acknowledgement Page 1

Letter of Transmittal Page 2

Table of Contents Page 3

BYCO At a Glance Page 4

Brief History / Introduction Page 5

Mission Statement / Vision Page 7

Environment Health Safety & Security Policy Page 8
Human Resource Development Page 9
Products
Furnace Oil Page 10
High Speed Diesel Page 11
Motor Gasoline Page 12

Liquefied Petroleum Gas Page 13

Future Outlook Page 14
Oil Refining Business Page 15
Petroleum Marketing Business Page 15
Conclusion of the Visit Page 16

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 BYCO At a Glance
Name Byco Petroleum Pakistan Limited
Formerly Bosicor Pakistan Limited

Established January 1995

Registered Office The Harbour Front, 9th Floor Dolmen City

HC-3, Block 4, Marine Drive, Clifton
Karachi 75600, Pakistan.
UAN: (92 21) 111 222 081
Fax: (92 21) 111 888 081

Plant Address
Mouza Kund Plant, Sub Tehsil Gadani, Near Hub
Power Company Ltd. Power plant (HUBCO), District
Lasbela, Baluchistan.

Line of Business Oil Refining, i.e. producing & supplying petroleum

products such as Liquefied Petroleum Gas (LPG),
Naphtha, High Octane Blending Component
(HOBC), Motor Spirits, Kerosene, Aviation Fuels 1
& 4, High Speed Diesel & Furnace Oil.

Crude Refining Capacity 35,000 barrels per day

1.738 million metric tons per annum
Authorized Capital Pak Rs. 5,000,000,000
Issued, Subscribed & Paid up Capital Pak Rs. 3,921,043,960

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Brief History / Introduction:

Byco Petroleum Pakistan Limited (BPPL), previously known as Bosicor Pakistan Limited (BPL)
formed in 1995 started off as a Business to Business (B2B) market producing petrochemicals, oil
refining and supplying oil to PSO. BPPL was incorporated in Pakistan as a public limited company
on January 09, 1995 and was granted the certificate of commencement of business on March
13, 1995. The shares of the company are listed on the Karachi, Lahore and Islamabad Stock
Exchanges. The Company is engaged in the business of refining crude oil into various saleable
components including High Speed Diesel (HSD), Liquefied Petroleum Gas (LPG), Motor Spirits
(MS), High Octane Blending Components (HOBC), Kerosene (K-Oil), Jet Fuels, Furnace Oil and
Naphtha. Refining capacity was enhanced by 5,000 bbl/day during turnaround in June 2010,
hence making the total refining capacity to 1.738 (million metric tons per annum) or 35,000
(barrels per day).

Then about three years ago a major shift occurred. We all witnessed some heavy campaigning
and promotion done by Byco. This change came about with a change in strategic goals. The goal
was now to make Byco one of the top OMCs in Pakistan. Earlier oil marketing was a very small
part of the business and now the major focus was on it. The management identified that this
change was important as it already had a surplus production and a refining capacity of 30000
barrels The implementation of goals by all departments is primarily more evident with the hard
work of the marketing department. The value proposition of Byco became differentiation. The
change came about by first changing its name from Bosicor to Byco. The head of brand and
advertising explained that this was important to give a more modern and unique impression.
Byco was also an easier word in terms of pronunciation. The reason behind aggressive
campaigning was o familiarize customers with the name and establish Byco as an OMC implying
the Production concept Byco used. They are focusing to develop a network more accessible and
visible to consumers. By focusing on differentiation, Byco aims to transform the look of the
service stations, introduce multi-product dispensers, convenience stores and specialized
lubricant brands.

What Byco is doing is that its changing from a B2B market to a B2C market (Business to
Consumer) by opening up its own service station and competing with other OMCs.it has
become more consumer centric now. It now has 138 service stations across Pakistan. The
increase in service stations improves the competitive position of Byco from being a Nicher to a
Follower. It has gone from being the 10th largest to the 6th largest. Its strategic goal is to move
up to the 3rd or 4th place by 2011, improving their position further by becoming a follower.
Immense competition is seen from PSO- the leader, Shell, Chevron and Total. However, drawing

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consumers towards itself is not seen as a major problem by Byco as brand loyalty is not a
problem in the case of petroleum as petroleum is a generic product requiring Habitual Buying
Behaviour. Once people would use it they would realize its the same as other OMCs. Therefore,
Byco is confident of achieving success with a change in strategy to expand and differentiate.

Byco and its associated entities have interests in the oil refining, petroleum marketing and
chemical manufacturing in Pakistan:

1. Byco Petroleum Pakistan Limited (BPPL) Oil Refining & Petroleum Marketing
2. Byco Oil Pakistan Limited (BOPL) Oil Refining & Chemical Manufacturing

Oil Refinery is located at District Hub, Lasbela, Baluchistan. The Company started its commercial
production from July 1, 2004 and ramped up the capacity to 30,000 bpd from February 2008
after debottlenecking of the whole plant and its corporate office at Harbour Front, Clifton,
Karachi.

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 Mission Statement
Our Mission is to proactively invest to develop infrastructure in order to become a single source
chain for meeting the Economys Chemicals, Energy, Petroleum and Petrochemical
requirements, thereby provide the best possible returns to our stakeholders

Vision Statement
Our Vision is to develop our Company on ethical and professional basis in order to steadily grow
and become a valued contributor to the Economy and a respected Corporate Entity.

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Environment Health Safety & Security Policy

Byco remains on ethical and professional basis and is a responsible corporate entity with
respect to Environment Health & Safety.

Management Belief
Management Leadership, Participation and Accountability: Our leaders, from top management
to frontline supervisors, are responsible and accountable for Environment, Health and Safety, its
compliance and for managing such risks of their areas. Their active participation includes
collaborating across organizational lines to integrate risk management practices into our routine
business processes.

Management Role

Worker Protection and Wellbeing: To enable all employees to accept individual

responsibility for EHS, implement best practices, and work in partnership to create an
ethos of continuous improvement by providing appropriate training & information.
Contractor Safety: To work with and demand compliance from our contractors for
adhering to our EHS Policies and Procedures, thereby ensuring high standards for
protection of our environment, workers and assets.

Employee Responsibilities

Environmental Protection: Adopt best in class practices that protect the environment,
including reducing the quantity of emissions, developing opportunities for recycling,
pollution prevention, and efficient use recyclable materials.
Emergency Vigilance: Anticipate emergency situations and be ready to respond
appropriately to eliminate harm to the environment, people and property.

Continual Improvement: Strive to constantly improve our EHS performance and

management processes by measures, including the following:

o Benchmarking industry best practices to identify improvement opportunities;

and

o Conducting reviews and auditing our EHS management system and operations to
monitor progress and compliance.

o Incorporating newer generation technology and advance management systems.

o Learning from events - accidents, close calls and identified substandard

conditions.

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Human Resource Development

Our Staff are the most valuable asset.

In order to hire competent & quality resources, a pre-employment IQ test is mandatory which
screens participants after assessing them on three dimensions: Intelligence, Comprehension &
Analytical abilities.

The Company pays special attention on the training and development of its Employees. All new
employees go through a detailed Orientation Training Program. Existing Employees are provided
refresher training courses on a regular basis. Theoretical and practical training to fresh
engineering graduates is also imparted through Graduate Trainee Engineer program. This
familiarizes graduates to the industry practices.

The Company focuses on environment, health, safety and security while striving to achieve
operational excellence to energize economic growth.

Products

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FURNACE OIL

Furnace Oil ("FO") is a major source of fuel for power and industrial sectors with power
sector accounting for 72% of total consumption in FY 05.

Cement (5%) and other industries (23%) account for the remaining 28%. FO is a deficit
product and about 31% of domestic consumption was met through imports during FY 05.

FO was deregulated in July 2000 leading to stiff competition amount MOCs and oil
traders actively engaged in the marketing and import of FO.

FO sales experienced a decline of 15% in FY 03 and further 44% in FY 04 mainly due to

increase in availability of gas and water for the power sector and conversion of cement
plants to coal and gas fired systems.

FO sales bounced back in FY 05 with a growth rate of 23% due to shortage of water and
disruption of gas supplies

Demand Production

Sectoral Consumption of FO (000

Tons)

7000

6000

5000

4000 6113

5398
3000

2000
3319

1000 2493
1272
1544 1265 1230

0
FY 04
FY 02 FY 03 FY 05

Others Power Sector

HIGH SPEED DIESEL:

High Speed Diesel (HSD") in terms of volume is the most consumed POL product in

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 Pakistan. HSD is a deficit product and about 55% of domestic consumption was met
through imports during FY 05

Transport & agriculture sectors are the main consumers accounting for 90% of total
consumption.

The demand of HSD grew at a CAGR of 3.6% during FY 05

During the last two years the growth in HSD consumption has been contributed primarily
by a significant increase in freight movement and growth in agriculture sector

HSD is a partially deregulated product; OMCs are authorized to fix and notify HSD prices
individually on cost competition basis and as per parameters set by GOP but OMC
margin is capped at 3.5% and dealer margin at 4%

HSD Demand & Supply (000 Tons)

7734
8000
7334
7014
7000 6964

6000
5000
4000
3454
3000 3050
2721
2000 2517

1000

0
FY 04
FY 02 FY 03 FY 05

Demand Production

MOTOR GASOLINE:

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 Pakistan has been able to meet local requirement of Motor Gasoline ("Mogas") through
local production since PARCO came online in 2001

Local refineries produced 1.33 million tons of Mogas during FY 05

Transport sector is the main consumer accounting for 98% of total consumption

The demand for Mogas grew at a CAGR of 6.8% during FY 02-FY 05

Mogas consumption increased to 1,332 tons in FY 05 from 1,265 tons in FY 04 due to the
growth in the number of cars and motorcycles. However, there has been a decline in
Mogas consumption of 11% during 1H FY 06 when compared to same period last year
due to availability of cheaper fuels such as CNG and continuous increase in oil prices
Mogas is a regulated product and OMC margin is fixed at 3.5% and dealer margin at 4%

Sectoral Consumption of Mogas (000

Tons)
1500

1000

1332
1268

1102
1104

500

42
38 31
19

0
FY 04
FY 02 FY 03 FY 05

Transport & Agriculture Others

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LIQUEFIED PETROLEUM GAS:

Mainly used by domestic and commercial consumers

Consumption in the country has increased by a CAGR of 10.3% over the last 6 years due to increasing prices of
kerosene and other alternatives

LPG Demand & Supply (000 Tons)

500

450

400

350

300
452
415 412
250 373 380
357
355
348
200

150

100

50

0
FY 04
FY 02 FY 03 FY 05

Demand Production

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 FUTURE OUTLOOK OF PETROLEUM PRODUCTS

14000 13800

12000


10000

900

8000


6000

5100

4000 4014
4800
3600 1000 1000
3158 2300
2000 402
1400 760 1500
1180 1673 1800 550 1700 300 500 210
0 0

0%


Available Domestic
Supply Yr-05 Estd. Supply FY-12 Demand FY-12
Market

Diesel SK/J-I Gasoline Furnace Oil LPG Pet Coke

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Oil Refining Business

At present, the Company receives limited quantity of local crude oil and blends it with imported
crude oil while retaining product quality and yields. This has not only reduced the Refinerys
exposure on foreign currency rate fluctuations but also reduces the demand for foreign
exchange. The Company is seeking to increase its allocation of local crude oil and condensate.
Good Maintenance and Operations ensured 100% availability of the crude oil processing
capacity at the Oil Refining Business (ORB). Other improvements included lower fuel and water
usage, increased LPG recovery and further enhancement in the recovery of High Speed Diesel.
The Company is completing studies to increase the processing capacity above 35,000 bpd, to
implement as the trading scenario changes for the better.

Petroleum Marketing Business

Byco Petroleum Pakistan Limited, the only refinery in Pakistan which has acquired marketing
license from the start of its operation. During the year 2007, the Company has launched its fuel
marketing activities managed by the Petroleum Marketing Business (PMB) formerly known as
Oil Marketing Unit. The business has been re-launched with a new vision and has developed
progressively during this period and is now growing aggressively, so far approximately (till date
15th December, 2010) 180 retail outlets have been set-up, primarily focusing on retail segment
and PMB is now expanding the canvas by targeting to become a dominant player in the
industrial, international and retail segments. Going forward, PMB will be increasing its product
portfolio by adding LPG and lubricants as well.

Plans are also underway to make LPG available at the Filling Stations, as well as to market LPG
cylinders with the Companys Brand through a distribution network and launch branded
lubricants for the automotive and industrial sectors which will be available at the Filling Stations
as well as in the commercial markets.

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PMB is focusing and planning to cater to the international opportunities available in the region
where it can provide petroleum and lubricant products.

With ever-increasing competition in the market today, availability of product is a major

challenge for all Oil Marketing Companies (OMCs). Byco has a distinctive advantage through its
Refinery, to meet the product requirement in the south of the Country.

However, while we develop infrastructure that will assist in the delivery of product to the
consumers at their doorstep, to cater to the fast growing requirements of the business in other
parts of the Country, arrangements are being put in place to acquire products through other
sources, like the White Oil Pipeline, as well as purchases from other refineries and oil marketing
companies.

Conclusion of the Visit dated 11 December, 2010.

A Brief Overview of the Report

BYCO commenced the sale of petroleum products with the establishment of its first retail outlet in July
2007 and reached 100 retail outlets in the last fiscal year achieving the milestone in less than 3 years.
Now with 180 retail outlets in our portfolio, it expect to continue adding Outlets, which will enable to
consolidate market position and have representation within major geographical areas of the country
spread from Karachi to Kashmir.

BYCO is the only OMC to be growing at a staggering rate of 208% as compared to other competitors; with
a growth of 390% in retail sales and turnover growing by 303% in the last fiscal year. Though in its infancy
stages, the Marketing Business already has attained 5th ranking amongst the industry players in a very
short span of time. With a cumulative market share of 2.1% in liquid fuels, the Petroleum Marketing has
grown exponentially in terms of market share as compared to previous fiscal year. Following a
multipronged strategy entailing rapid expansion in our key segments of Retail, Consumer and
International Sales, your Company is making its mark in the industry. Apart from retail sales your
Company's ever increasing and diversified consumer portfolio is also on a fast track growth. Although it
has not been long, the marketing business has developed a strong customer base and is expanding every
day by acquiring major customers in bunkering and marine business, industrial consumer business,
captive power projects, cement, and consumer goods companies. Furthermore we have carved a niche
for ourself in the international market by supplying specialized diesel (Ultra Winterized Diesel) and fuel
oil (RMG 380) products in growing foreign markets and bunkering businesses. The Company has had the
privilege to be the first to introduce these products in Pakistan. Supply chain mechanism has been
strengthened with availability of storages at Keamari, Machike, Ghatti, Chaklala, Shikarpur, Tarujabba and

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Mehmoodkot in order to meet marketing requirements at various geographical locations. Moreover with
entry into the White Oil Pipeline the Company is supplying the refinery's product across the length and
breadth of the country more efficiently. For the first time in the oil industry's history in the country, our
petroleum marketing business has entered into an agreement for managing inventory for fuel oil at the
customer's doorstep. Moreover your Company has recently accomplished the milestone of importing its
first consignment of Diesel and Furnace Oil during the last financial year.

BYCO also endeavors to be a major part of the industry and is involved in molding its business activities
to the changing requirements of its customers and providing them with the best possible experience. An
essential step in this regard was the launch of the new

An unparalleled brand architecture exercise by international brand consultants has created a position for
Byco over and above its competition. This is the first time such an exercise has been undertaken in the
country's oil Industry. Through this exercise we aim to strengthen our corporate image by infusing
brandstrategy elements and aspects such as positioning and brand persona that allow us to not only
compete locally but also at a global level with international giants. As a result of the new identity, our
existing stations will be transformed into state-of-the-art, modern retail outlets across Pakistan providing
customers with Branchingout Growth 19 Improvement through the addition of quality human resource.

Social Corporate Responsibility

Timely and generous response to Flood victims of Baluchistan in particular and to other parts of
the Country in general.
Evacuation of local residents during Cyclone PHET,which hit parts of Baluchistan.
Pirkhus Road repair to facilitate daily commutation of residents of Moza Kund and adjoining
areas.
Industrial Visits of upcoming graduates from well reputed Universities.
Supply of Drinking Water to Local Residents.
Medical Relief Camps.
Arrangements of Sports and recreational activities for local residents.
Environment, Health, Safety and Security (EHSS);
During the period under review, significant achievements were made by your Company in EHHS.
A few major achievements have been listed below:
3 million safe man-hours achieved without a Lost Time Injury (LTI).
Total Recordable Incident Rate TRIR of 0.347 achieved against 0.8 target, the achieved TRIR is a
113.25% improvement compared to the set target of 0.8.
The Refinery achieved the milestone of Integrated Management System (IMS) Certification. IMS
includes certification of ISO 9001-2008, ISO 14001- 2004 and OHSAS 18001-2007 standards.
280 Standard Operating Procedures prepared and implemented through Integrated
Management System.
An outsourced training program in five areas include Incident Reporting, IMS Awareness, OHS
Risk Assessment, EMS Risk Assessment and Internal Auditing arranged by EHS Department for
Management and staff through Integrated Management system.

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