Petronet LNG Ltd

FORMING PART OF DIRECTORS' REPORT

A Brief Statement on Company's Philosophy on Code of Corporate Governance

The Philosophy of the Company in relation to Corporate Governance is to ensure transparent disclosures and reporting that conforms fully to laws, regulations and guidelines, and to promote ethical conduct throughout the organization with the primary objective of enhancing shareholders' value while being a responsible corporate citizen. The Company firmly believes that any meaningful policy on Corporate Governance must provide empowerment to the executive management of the Company, and simultaneously create a mechanism of checks and balances which ensures that the decision-making power vested in the executive management is used with care and responsibility to meet shareholders' and stakeholders' aspirations. The Company is committed to attain the highest standards of Corporate Governance.

Board of Directors

The total strength of the Board as on 31st March, 2013, was thirteen Directors as detailed herein below:

S No	Name	Designation	Category (Whole-time / Non-executive / Independent)
1	Shri Vivek Rae	Chairman, Secretary, Govt. of India, (MOP&NG)	Independent
2	Dr. A. K. Balyan	Managing Director & CEO	Whole-time
3	Shri R. K. Garg	Director (Finance)	Whole-time
4	Shri Rajender Singh	Director (Technical)	Whole-time
5	Shri B. C. Tripathi	Director, Nominee of GAIL	Non-executive
6	Shri R. K. Singh	Director, Nominee of BPCL	Non-executive
7	Shri Sudhir Vasudeva	Director, Nominee of ONGC	Non-executive
8	Shri A. M. K. Sinha	Director, Nominee of IOCL	Non-executive
9	Mr. Dominique PELLOUX-PRAYER	Director, Nominee of GDF International	Non-executive
10	Shri Tapan Ray	Director, Nominee of GMB/GOG	Independent
11	Shri B. C. Bora	Director	Independent
12	Shri Ashok Sinha	Director	Independent
13	Shri R. Ram Mohan	Director, Lender's Nominee	Independent

Board Meetings

During the year 2012-13, four Board Meetings were held on 24th April, 31st July, 19th October, 2012, and 13th January, 2013. The attendance of each Director in the Board Meetings and the last Annual General Meeting is detailed herein below:

Name of Directors	Designation	Number of Board Meetings held during the year 2012-13	Number of Board Meetings attended during the year 2012-13	Attendance at last Annual General Meeting held on 4th July, 2012
Executive Directors
Dr. A. K. Balyan	Managing Director & CEO	4	4	yes
Shri R. K. Garg	Director (Finance)	4	4	yes
Shri C. S. Mani (upto 19th October, 2012)	Director (Technical)	4	3	yes
Shri Rajender Singh ( w.e.f. 14th November, 2012)			1	NA
Non-executive Directors
Shri B. C. Tripathi	Nominee Director of GAIL	4	2	No
Shri R. K. Singh	Nominee Director of BPCL	4	2	No
Shri Sudhir Vasudeva	Nominee Director of ONGC	4	3	No
Shri A. M. K. Sinha	Nominee Director of IOCL	4	3	No
Mr. Dominique PELLOux-PRAYER *(Two Board meetings attended by Mr. Eric Ebelin as an Alternate Director)	Nominee Director of GDF International	4	4	No
Non-executive Independent Directors
Shri G. C. Chaturvedi (upto 31st January, 2013)	Chairman	4	3	yes
Shri Vivek Rae (w.e.f. 21st February, 2013)			NIL	NA
Shri Tapan Ray	Independent Director	4	2	No
Shri B. C. Bora	Independent Director	4	4	yes
Shri Ashok Sinha	Independent Director	4	4	yes
Shri R. Ram Mohan (w.e.f. 19th October, 2012)	Independent Director	4	1	NA

Detail of Directorship / Membership / Chairmanship on the Board / Committees of the other Companies and Shareholding in the Company as on 31.03.2013

Name	No. of other Companies in which Directorship / Chairmanship is held		No. of Membership / Chairmanship held in Committees of Board of other Companies		No. of Shares held in the Company
	Directorship	Chairmanship	Membership	Chairmanship
Shri Vivek Rae	NIL	1	NIL	NIL	NIL
Dr. A. K. Balyan	2	NIL	NIL	NIL	400
Shri R. K. Garg	2	NIL	NIL	NIL	5300
Shri Rajender Singh	NIL	NIL	NIL	NIL	NIL
Shri B. C. Tripathi	NIL	4	1	NIL	NIL
Shri R. K. Singh	1	5	NIL	1	400
Shri Sudhir Vasudeva	NIL	7	NIL	NIL	800
Shri A. M. K. Sinha	1	1	NIL	NIL	600
Mr. Dominique PELLOlix-PRAYER	1	NIL	NIL	NIL	NIL
Shri Tapan Ray	11	1	3	2	NIL
Shri B. C. Bora	1	NIL	NIL	NIL	NIL
Shri Ashok Sinha	2	NIL	2	Nil	NIL
Shri R. Ram Mohan	NIL	NIL	NIL	NIL	NIL

Note: -

As per Clause 49, the above details are required to be disclosed only for the following three committees:

1 Audit Committee

2 Shareholders/Investors Grievance Committee

3 Remuneration Committee

Remuneration paid to Whole-time Directors and to Non-executive Directors during the year ended 31st March, 2013

The remuneration to Whole-time Directors is being paid as per terms of their appointment. The Company pays remuneration by way of salary, perquisites, allowances and commission to Whole-time Directors. The commission is calculated with reference to profits of the Company in a particular year and is determined by the Board and Shareholders, subject to overall ceiling as prescribed in the Companies Act, 1956.

The details of remuneration paid to the Whole-time Directors during the year are stated herein below:

(In Rupees)

S. No.	Name	Designation	Salaries & Allowances	Contribution to PF & Gratuity Fund	Other Benefits & Perks	Commission payable on Profit for the year 2012-13	Total
1	Dr. A. K. Balyan	Managing Director & CEO	50,82,552	2,89,548	6,22,429	20,00,000	79,94,529
2	Shri C. S. Mani	Director (Technical) (upto 19th October, 2012)	30,18,243	7,04,091	15,34,806	11,06,849	63,63,989
3	Shri R. K. Garg	Director (Finance)	38,51,363	2,01,701	7,03,904	20,00,000	67,56,968
4	Shri Rajender Singh	Director (Technical) (w.e.f. 14th November, 2012)	12,58,444	69,048	2,18,992	7,56,164	23,02,648

The details of the sitting fees paid to Non-executive Directors or their nominated Organization / Company during the year ended 31st March, 2013, is as detailed below:

S. No.	Name	Sitting Fees paid during 2012-13 (Rs.)
1	Mr. Dominique Pelloux - Prayer/ Mr. Eric Ebelin	1,00,000
2	Government of India	80,000
3	Bharat Petroleum Corporation Ltd.	80,000
4	Oil & Natural Gas Corporation Ltd.	1,20,000
5	Indian Oil Corporation Ltd.	1,80,000
6	GAIL (India) Ltd.	60,000
7	Gujarat Maritime Board	40,000
8	Shri B. C. Bora	2,00,000
9	Shri Ashok Sinha	2,20,000
10	Shri R. Ram Mohan (w.e.f. 19th October, 2012)	20,000

*Alternate Director to Mr. Dominique Pelloux-Prayer

In addition to the above, Commission on Profits is also payable to the following Independent Directors:

S. No.	Name	Commission payable on Profit for the year 2012-13 (Rs.)
1	Shri B. C. Bora	7,50,000
2	Shri Ashok Sinha	7,50,000

Terms of appointment of Whole-time Directors

The Company has the following Whole-time Directors as on 31st March, 2013:

1. Dr. A. K. Balyan, Managing Director & CEO

2. Shri R. K. Garg, Director (Finance)

3. Shri Rajender Singh, Director (Technical)

The initial tenure of Whole-time Director(s) is for a period of five years w.e.f. their respective date of appointment. However, the tenure of Whole-time Directors may further be extended by re-appointing them, subject to approval by Members in the Annual General Meeting.

The appointment of Whole-time Directors is subject to termination by a three-month notice in writing by either party.

Audit Committee

The Audit Committee comprises the following Directors as on 31st March, 2013:

1 Shri Ashok Sinha, Chairman

2 Shri B. C. Bora, Member

3 Shri A. M. K. Sinha, Member

4 Shri R. Ram Mohan, Member

All the Members of Audit Committee are Non-executive Directors and three out of four Members are Independent Directors, namely Shri Ashok Sinha, Shri B. C. Bora and Shri R. Ram Mohan. The quorum of the Audit Committee is two Members.

The Chairman of the Audit Committee also attended the last Annual General Meeting of the Company held on 4th July, 2012.

The Company Secretary is the Secretary of the Audit Committee.

Detail of Meetings of Audit Committee held during the year

Member	No. of Meetings Held	No. of Meeting Attended
Shri Ashok Sinha	4	4
Shri B. C. Bora	4	4
Shri A. M. K. Sinha	4	3
Shri R. Ram Mohan, Independent Director (Appointed as member w.e.f. 13th January, 2013)	4	Nil

Terms of Reference of Audit Committee

The primary function of the Audit Committee is to assist the Board of Directors in fulfilling its oversight responsibilities by reviewing the financial reports and other financial information provided by the Company to any Government Body or to the investors or the public; the company's system of internal controls regarding finance, accounting and legal compliances that the Management and the Board have established.

The terms of reference of Audit Committee include inter-alia the following:

• Oversee the Company's financial reporting process and disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible.

• Recommending the appointment and removal of statutory and internal auditors (wherever required), fixation of audit fee and also approval for payment for any other services.

• Reviewing with the Management the quarterly, half-yearly and the annual financial statements before submission to the Board, focusing primarily on:

- Any changes in accounting policies and practices.

- Major accounting entries based on exercise of judgment by the Management.

- The going-concern assumption.

- Compliance with accounting standards.

- Compliance with Stock Exchange(s) and Legal requirements concerning financial statements.

- Any related party transactions, i.e. transactions of the Company of material nature, with Promoters or the Management, or relatives etc. that may have potential conflict with the interest of the Company at large.

• Reviewing with the Management, statutory and internal auditors, the adequacy and compliance of internal control systems.

• Reviewing the adequacy of internal audit function, reporting structure coverage and frequency of internal audit.

• Discussion with internal auditors about any significant findings and follow-up thereon.

• Reviewing the findings of any internal investigations by the internal auditors into matters where they are suspected of any fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the Board.

• Discussion with statutory auditors about the scope of audit as well as have post-audit discussion to ascertain any area of concern.

• Reviewing the company's financial and risk-management policies.

Shareholders' / Investors' Grievance Committee

As on 31st March, 2013, the Shareholders'/Investors' Grievance Committee comprises the following Directors:

1 Shri Ashok Sinha, Chairman

2 Shri A. M. K. Sinha, Member

3 Shri R. K. Garg, Member

4 Shri Rajender Singh*, Member

The Company Secretary is the Compliance Officer of the Company.

One Meeting of the Shareholders'/Investors' Grievance Committee was held on 13th January, 2013 which was attended by all the memebers of the committee.

* (Appointed as member w.e.f. 13th January,2013)

Details of Complaints received and redressed during the year ended 31st March, 2013

2 complaints were pending as on 1st April, 2012. 1,206 complaints were received and 1,203 complaints were resolved during the year. Only 5 complaints were pending as on 31st March, 2013.

Share Transfer Committee

The Share Transfer Committee was constituted to deal with the cases like re-materialization of shares, transfer, transposition and splitting of shares in physical mode. The Share Transfer Committee comprises Whole-time Directors, namely,

1 Dr. A. K. Balyan, Managing Director & CEO

2 Shri R. K. Garg, Director (Finance)

3 Shri Rajender Singh, Director (Technical)

Dr. A. K. Balyan, Managing Director & CEO, is the Chairman of the Committee.

Remuneration Committee

The Remuneration Committee was constituted by the Board to determine the Remuneration Package for Executive Directors. The following Directors are the Members of the Remuneration Committee as on 31st March, 2013:

1. Shri Ashok Sinha, Chairman

2. Shri B. C. Bora, Member

3. Shri Sudhir Vasudeva, Member

One meeting of the Remuneration Committee was held on 24th April, 2012.

Risk Assessment & Minimisation Procedure

The Company has laid down procedures to inform the Members of the Board about the risk assessment and minimization procedure. A Risk Management Committee consisting of Whole-time Directors periodically reviews the procedures to ensure that Executive Management controls risk through properly defined framework. The risk assessment framework encompassed, inter-alia, methodology for assessing risks on ongoing basis, risk prioritization, risk mitigation, monitoring plan and comprehensive reporting system.

Legal Compliance Reporting

As required under Clause 49 of the Listing Agreement, the Board periodically reviews compliances of various laws applicable to the Company.

Annual General Meetings (AGMs)

The details of last three Annual General Meetings are as mentioned below:

Year	2009-10	2010-11	2011-12
Date & Time	24th June, 2010 at 10:00 AM.	30th June, 2011 at 10:00 AM.	4th July, 2012 at 10:00 AM
Venue	Air Force Auditorium, Subroto Park, Dhaula Kuan, New Delhi-110010	Air Force Auditorium, Subroto Park, Dhaula Kuan, New Delhi-110010	Air Force Auditorium, Subroto Park, Dhaula Kuan, New Delhi-110010
Details of Special Resolutions	1) Appointment of Statutory Auditors	1) Appointment of Statutory Auditors	1) Appointment of Statutory Auditors
	2) Amendment of Articles of Association	2) Approval for payment of Commission on profit to Directors	2) Approval for Employee Stock Option Scheme
Resolutions passed through Postal Ballot	Nil	Nil	Nil

Extraordinary General Meeting(s) (EGMs)

During the year 2012-13, no Extraordinary General Meeting of the Members of the Company was held.

Disclosure

During the year 2012-13, no material transactions with the Directors or the Management, their subsidiaries or relatives etc. have taken place, which have potential conflict with the interest of the Company.

Compliance

There has been no non-compliance of the provisions/requirements of Stock Exchanges/SEBI. No penalties/strictures have been imposed on the Company by the Stock Exchanges or SEBI or any other statutory authority on any matter relating to the Capital Market.

Means of Communication

The Company's website (www.petronetlng.com) has updated details about the Company, its project status, Shareholding pattern on quarterly basis, etc. The financial results are being posted on the Company's website. The Company also has an exclusive e-mail ID (investors@petronetlng.com) for investors to contact the Company in case of any information and grievances. The financial results were also published in National Daily Newspapers in terms of Listing Agreement.

General Shareholders Information Annual General Meeting (AGM)

Day & Date	4th July, 2013
Time	10:00 AM
Venue	Air Force Auditorium, Subroto Park, Dhaula Kuan, New Delhi-110010
Date of Book Closure	24th June, 2013, to 4th July, 2013 (Both days inclusive)

Dividend Payment Date

The dividend, if approved by the Members of the Company, will be paid on or after 16th July, 2013.

Financial Calendar

Petronet LNG Ltd. follows the financial year from April to March. The Un-audited Financial Results for the first three quarters and the Audited Financial Results for the year ended 31st March, 2013, were taken on record and approved by the Board in its meeting(s) held on the following dates:

Quarter Ended	Date of Board Meeting
April - June, 2012	31st July, 2012
July - September, 2012	19th October, 2012
October-December, 2012	13th January, 2013
Year Ended
31st March, 2013	30th April, 2013

Listing on Stock Exchange(s)

Name of Stock Exchanges	Stock Code
The Stock Exchange, Mumbai (BSE)	532522
The National Stock Exchange of India Limited (NSE)	PETRONET

Market Price Data: High and Low during each month in the last financial year

Month	BSE (in Rs.)		NSE (in Rs.)
	High	Low	High	Low
April, 2012	175.00	135.20	174.90	135.00
May, 2012	145.25	122.25	145.35	122.00
June, 2012	149.50	125.40	149.80	125.30
July, 2012	150.65	139.55	150.80	139.25
August, 2012	155.45	144.60	155.40	144.55
September, 2012	172.95	152.20	172.65	150.65
October, 2012	171.20	157.50	180.00	157.25
November, 2012	175.15	153.90	175.35	153.65
December, 2012	165.70	153.55	165.70	157.00
January, 2013	168.80	150.90	168.70	150.55
February, 2013	156.20	140.00	156.30	139.60
March, 2013	150.80	127.15	150.75	126.75

Distribution Schedule as on 31st March, 2013

Category (Amount)	No. of Cases	% of Cases	Total Shares	Amount in Rs.	% of Amount
Up to - 5000	3,26,964	89.51	5,06,24,071	50,62,40,710	6.75
5001 - 10,000	24,974	6.84	1,95,93,154	19,59,31,540	2.61
10,001 - 20,000	8,381	2.29	1,23,04,032	12,30,40,320	1.64
20,001 - 30,000	1,923	0.53	49,29,379	4,92,93,790	0.66
30,001 - 40,000	821	0.22	29,30,880	2,93,08,800	0.39
40,001 - 50,000	602	0.16	28,47,433	2,84,74,330	0.38
50,001 - 1,00,000	813	0.22	58,97,181	5,89,71,810	0.79
1,00,001 & Above	838	0.23	65,08,73,914	6,50,87,39,140	86.78
TOTAL	3,65,316	100.00	75,00,00,044	7,50,00,00,440	100.00

Shareholding Pattern of the Company as on 31st March, 2013

Category	No. of Shares Held	% of Shareholding
A Promoter's holding
1 Promoters
• Indian Promoters	37,50,00,000	50.00
• Foreign Promoters	Nil	Nil
Sub- Total (A)	37,50,00,000	50.00
B Non- Promoters holding
1 Institutional Investors
a Mutual Funds and IITI	6,72,80,381	8.97
b Banks, Financial Institutions	1,50,953	0.02
c Insurance Companies / Central / State Govt. Institutions / Non-government Institutions / Venture Capital Funds	1,40,000	0.02
d FII's (Including ADB holding)	10,26,46,886	13.69
Sub-Total (B1)	17,02,18,220	22.70
2 Others
a Private Corporate Bodies	1,78,19,673	2.38
b Indian Public including HUF and Foreign Nationals	10,63,62,860	14.18
c NRI's / OCB's (Including GDFI)	7,89,29,492	10.52
d Any other (Clearing Members & Trusts)	16,69,799	0.22
Sub-Total (B2)	20,47,81,824	27.30
GRAND TOTAL (A+B1+B2)	75,00,00,044	100.00

List of Shareholders Holding More than 1% of Equity Capital as on 31st March, 2013

Name	No. of Shares Held	% of Shareholding
Promoter's Holding
Bharat Petroleum Corporation Ltd.	9,37,50,000	12.50
GAIL (India) Ltd.	9,37,50,000	12.50
Indian Oil Corporation Ltd.	9,37,50,000	12.50
Oil & Natural Gas Corporation Ltd.	9,37,50,000	12.50
Non-promoters Holding
GDF International	7,50,00,000	10.00
Asian Development Bank	3,90,00,000	5.20

Detail of Unclaimed Shares as on 31.03.2013 issued pursuant to Initial Public Offer (IPO)

S. No.	Particulars	Cases	No. of shares
1	Aggregate Number of shareholders and the outstanding shares in the suspense account (i.e. KCL ESCROW ACCOuNT PETRONET LNG IPO-OFFER) lying at the beginning of the year i.e. 1st April, 2012.	649	1,32,700
2	Number of shareholders who approached for transfer of shares from suspense account during the year.	2	300
3	Number of shareholders to whom shares were transferred from suspense account during the year.	1	200
4	Aggregate number of shareholders and outstanding shares in the suspense account at the end of year, i.e. 31st March, 2013.	648	1,32,500

Code of Conduct for Board Members & Senior Management Personal

The Board of Directors of the Company approved Code of Conduct for Board Members & Senior Management Personnel and the same was made effective from 1st April, 2006. A copy of the same has also been hosted on the website of the Company. All the Board Members and Senior Management Personnel have affirmed compliance with the said Code for the year ended 31st March, 2013.

CEO/CFO Certification

A certificate from the Managing Director & CEO and Director (Finance) on the financial Statements of the Company in terms of Clause 49 of Listing Agreement was placed before the Board, who took the same on record.

Related Party Transactions

The details of all significant transactions with related parties are periodically placed before Audit Committee.

Reconciliation of Share Capital Audit

A qualified practicing Company Secretary carried out a Reconciliation of Share Capital Audit on quarterly basis to reconcile the total Share Capital with National Securities Depository Limited (NSDL), Central Depository Services Limited (CDSL) and the total issued and listed capital. The audit confirms that the total issued/paid-up capital is in agreement with total number of shares in physical forms and total number of dematerialized shares held with NSDL and CDSL.

Status of Corporate Governance Voluntary Guidelines 2009

The voluntary guidelines issued by Ministry of Corporate Affairs in December 2009, pertaining to Corporate Governance are complied with to the extent found feasible.

Major Plant / Unit Location(s)
Dahej LNG Terminal	Kochi LNG Project Site
GIDC Industrial Estate,	Survey No. 347,
Plot No 7/A, Dahej,	Puthuvypu (Puthuypeeen SEZ),
Taluka: Vagra, Distt. Bharuch,	P.O. 682508, Kochi,
Gujarat - 392130	Kerala
Tel : 02641-253182/257004-257007	Tel: 0484-2502259
Fax: 02641-253179/300310	Fax : 0484-2502264
Address for Correspondence
Registered & Corporate Office	Registrar & Share Transfer Agent
Petronet LNG Limited	M/s Karvy Computershare Pvt. Limited
World Trade Centre, First Floor,	Plot No. 17 to 24,
Babar Road, Barakhamba Lane,	Vittal Rao Nagar,
New Delhi - 110 001	Madhapur, Hyderabad - 500081
Tel: 011- 23472525, 23411411	Tele: 040-23312454,23320751/52
Fax: 011- 23472550	Fax: 040-23311968,23323049
Email: investors@petronetlng.com

Auditors' Certificate on Compliance with the conditions of Corporate Governance under clause 49 of the Listing Agreements

To the Shareholders of Petronet LNG Limited

1. We have examined the compliance of conditions of Corporate Governance by Petronet LNG Limited ("the Company") for the year ended March 31st, 2013 as stipulated in clause 49 of the Listing Agreements of the said company with Stock Exchanges in India.

2. The compliance of conditions of Corporate Governance is the responsibility of the Company's management. Our examination was limited to the review of procedures and implementation thereof, adopted by the Company or ensuring the compliance of the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.

3. In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement.

4. We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company.

	For T.R. Chadha & Co.
	Chartered Accountants
	(Firm Registration No. 006711N)
	Sd/-
	Neena Goel
Place : New Delhi	Partner
Date : 29th May, 2013	M.N.057986

BUSINESS RESPONSIBILITY REPORT

Section 1: About our Company
1. Corporate Identity Number (CIN) of the Company	: L74899DL1998PLC093073
2. Name of the Company	: Petronet LNG Ltd.(PLL)
3. Registered address	: World Trade Centre, First Floor, Babar Road, Barakhamba Lane, New Delhi - 110 001
4. Website	: http://www.petronetlng.com
5. E-mail id	: investors@petronetlng.com
6. Financial Year reported	: April 2012 - March 2013
7. Sector that the Company is engaged in	: Oil & Gas
8. Product provided by the Company	: Regasified Liquefied Natural Gas (LNG)
9. Total number of locations where business activity is undertaken by the Company:
a. International Locations	: Qatar (primarily) and various other countries of the world (for sourcing of LNG)
b. National Locations	: Dahej in Gujarat, Kochi in Kerala and New Delhi.
10. Markets served by the Company	: Pan-India
Section 2: Our financial details
1. Paid up capital (INR)	: 750 crores
2. Total turnover (INR)	: 31,649 crores
3. Total profit after taxes (INR)	: 1,149 crores
4. Total spending on Corporate Social Responsibility (CSR) as percentage of profit after tax (%)	: 0.32%
5. Activities in which CSR expenditure has been incurred
• Community Development	• Healthcare
• Education	• Water Management
• Disaster relief	• Sports and Culture
• Fostering Entrepreneurship
Section 3: Other details
Subsidiary companies	: The Company does not have any subsidiary Company.

Section 4: BR information

1. Details of Director/Directors responsible for Business Responsibility

a. Details of the Director/Directors responsible for implementation of the BR policy/policies

i. DIN Number	: 00793181
ii. Name	: Dr. A. K. Balyan
iii. Designation	: MD & CEO

b. Details of the BR head

S.No.	Particulars	Details
1.	DIN Number	00793181
2.	Name	Dr. A. K. Balyan
3.	Designation	MD & CEO
4.	Telephone number	011 - 23472503 / 04
5.	e-mail id	md.ceo@petronetlng.com

Governance related to Business Responsibility

In our Company, compliance is the Board's responsibility and the members take it very seriously, thus ensuring regular evaluation of the Company's sustainability performance. We have a Risk Management Committee to identify and mitigate all types of risks pertaining to the business of the Company. The Committee meets regularly to discuss various risks and mitigating factors for the same. The Board reviews and approves the annual business plans. The decisions on all strategic matters related to capital expenditure, revenue, etc. are taken with the approval of the Board. It also discusses and deliberates on issues pertaining to risk management, safety performance, and monitors compliance to applicable statutes and norms.

Our detailed sustainability performance will be published in our first Sustainability Report - Partners of Clean Energy. This report will be available on our website from July, 2013, onwards.

Nine Business Responsibility Principles

Principle 1: Businesses should conduct and govern themselves with Ethics, Transparency and Accountability

As part of our Company's endeavor to set high standards of conduct for its employees, a Code of Business Conduct and Ethics has been laid down for all Board Members and Senior Management personnel. The Code, which was approved by the Board in 2006, encompasses general moral imperatives, specific professional responsibilities, and additional duties / imperatives for the Board Members and Senior Management personnel. From 1st April, 2006, strict adherence to the Code has been mandatory for all. The Code reflects our thorough belief in maintaining the highest standards of business ethics, which takes into account our business performance and its impact on society. All members have affirmed compliance to the Code in the reporting period. Besides being available on our website, copies of the Code are circulated to all the individuals concerned.

Anti-corruption

Corruption is one of the world's greatest challenges. It is a major hindrance to sustainable development and corrodes the very fabric of the society. Petronet LNG Ltd. (PLL) strongly believes in maintaining integrity and work ethics to protect not just the reputation of the Company but also the interests of its shareholders.

We have identified that the major potential source of corruption could be contracts awarded for construction of various facilities in an LNG Terminal. In order to mitigate the risk, the EPC Sub-Committee of the Board, which is responsible for evaluating and recommending large EPC contracts for Board approval, has an Independent Director as a Member. In addition to this, we also have safeguards in place in the tender documents which discourage bidders from indulging in any corrupt practice. In case of any such act of misconduct, it is within our rights to reject the bid or contract, as the case may be.

Further, to strengthen our commitment to anti-corruption practices and principles, we have been a member of Global Compact Network (GCN) since the last three years. We have committed to the principles and practices of the Global Compact that includes the ten principles pertaining to human rights, labour standards, environment and anti-corruption. PLL has submitted its first Communication on Progress (CoP) for 2011-12 that details our willingness to actively support the efforts made by GCN.

As part of our mission statement, we believe in maintaining highest standard of business ethics and values.

Principle 2: Businesses should provide goods and services that are safe and contribute to sustainability throughout their life cycle

At present, PLL deals primarily in one business segment: the import, storage and re-gasification of Liquefied Natural Gas (LNG). The product composition is dominated by methane, with varying portions of ethane, propane and butane. Natural Gas is cooled to minus 160C to liquefy, which facilitates transportation. LNG is transported in cryogenic tankers across seas to our terminal, where it is re-gasified and then distributed.

PLL has branded its product as" Taral3" -the new-age eco-friendly fuel. It is proposed to be delivered to customers not connected with pipeline near our Terminals.

Three LNG ships - 'Disha', 'Raahi' and 'Aseem', bring LNG from RasGas, Qatar, to Dahej, transporting the contracted quantity of 7.5 MMTPA of LNG. Further, 1.44 MMTPA will be imported from Australia.

Product responsibility forms the very basis of the existence of our Company. Our product itself being clean energy, there are no sustainability challenges arising from the impact of our product. Having said that, there have been no instances of complacency and PLL is committed to diligence when it comes to taking responsibility for our product, including its provision, transportation and use. We are entirely compliant with all existing regulations and during the reporting period, have not paid any fine for non-compliance.

While we ensure that there is minimal environmental impact from transporting LNG across India, sourcing from local suppliers is not a valid option, given the nature of the product. Further, the product doesn't produce any waste. Hence, recycling is also not applicable.

Principle 3: Businesses should promote the wellbeing of all employees

We believe a Company is as good as its people. Given our constant drive for success, our employees form the most important part of our DNA. As on 31st March 2013, our total employee strength stands at 397. The detailed break-up of our workforce will be available in our Sustainability Report.

We engage the services of contractors at our facilities. In FY 2012-13, 477 contractual workers (annual average) were operating in our Dahej facility. Additionally, for the construction project of our second jetty at Dahej, we engaged the services of a contractor who employed approximately 950 (annual average) personnel at the project site.

We look at collective bargaining as an employee's right and do not object to it in any way. However, the culture of an organized employee union or association does not exist in our Company.

Child and forced labour

To eliminate any instance of child labour, we ensure strict adherence to the minimum age provisions of National Labour Laws and Regulations. Being a part of the hydrocarbon industry, we have stringent rules for hiring. Forced labour too, holds similar stances on our part, culminating in a clearly defined exit policy and a zero-tolerance approach to this violation of human rights.

Enhancing potential

Attracting, motivating, and retaining talented employees today, given the competitive market, is a major challenge we must give adequate importance to.

Through our training programs, we would like to benchmark and enhance competencies which will address workforce issues on which the Company could capture value and make a tangible positive impact of a learning organization.

The number of hours spent on training for our employees in the reporting period (in man-hours) is as follows:

Employee category	FY 2012-13
	Male	Female
Senior Management	136	NA
Mid Management	2483	82
Junior Management	5192	377
GETs / PGETs	592	131
Staff	4223	409

Further, PLL has a robust Quality, Health, Safety and Environment Policy which is circulated and emphasized to all our employees to help inculcate a culture of safety on our premises.

Principle 4: Businesses should respect the interests of, and be responsive, towards all stakeholders, especially those who are disadvantaged, vulnerable and marginalized.

We, at PLL, believe that stakeholder engagement plays a vital role in improving sustainability performance. It enables a better understanding of the reasonable expectations and interests of stakeholders, allowing the Company to better manage and respond to their concerns. Interacting with stakeholders and responding to stakeholders' expectations and feedback on the organization's performance confer many benefits on those that undertake genuine stakeholder engagement. Engagement is not only a trust-building exercise, but can also give us a first-mover advantage in opportunities with relation to the stakeholder groups consulted.

Stakeholder identification

Stakeholder identification is about defining the different groups of individuals or institutions that affect, or are affected by PLL's business operations in some capacity. We have identified our stakeholders on the basis of the parameters of responsibility, influence, proximity, dependency and representation.

The Government, our shareholders, employees, suppliers, contractors, customers and communities are key stakeholders, amongst others.

Though not disadvantaged or vulnerable, communities operating in and around our Dahej Terminal need some assistance for faster development and we, at PLL, have provided support to facilitate the same.

In this context, we would like to mention an initiative in Luwara village situated near our Dahej Terminal. We have contributed significantly to the overall development of the village, specifically focusing on primary healthcare. Our contribution in other schemes, like improving drinking water facilities, installing solar street lights, development of school infrastructure, etc., has also been significant.

Principle 5: Businesses should respect and promote human rights

Our policies related to human rights are all-encompassing and thorough. We expect all our contractors and suppliers to also follow them. Some of the policies are as follows:

• It is the policy of the Company to provide employment opportunity, regardless of race, color, gender, religion, age, sexual orientation, national or ethnic origin, disability, marital status, veteran status, or any other occupationally irrelevant condition.

• The above policy applies to recruitment, hiring and job assignment, promotion, demotion and transfer, layoff or termination, rates of pay and benefits, selection for training and the provision of any other human resources service.

• The continuing progress and vitality of the Company requires that we utilize all available human resources to the fullest. The continuing need for well-qualified personnel dictates that individuals with talent must be recognized and encouraged to progress.

• The Company treats its employees with fairness and is deeply interested in their growth and development. The Company expects its employees to adhere to the established standards of conduct and performance to enable all to work together to achieve the objectives of the Company.

There have been no complaints regarding breach of human rights in the reporting year.

Principle 6: Business should respect, protect, and make efforts to restore the environment

Our Quality, Health, Safety, and Environment (QHSE) Policy is displayed at prominent locations within our Dahej Terminal. We expect our employees, contractors and suppliers to adhere to the principles outlined in the policy.

At PLL, not only do we import cleaner fuel and propel India towards low carbon growth, we also ensure energy efficiency, water conservation and other environment friendly activities in our operations. We take our role in contributing to a better environment seriously and assess all potential environmental risks of our operations.

Energy and emissions

Our primary energy sources are Natural Gas and Diesel. In 2012-13, 2.48 million GJ of primary energy was consumed in our operations. Natural Gas is the main fuel constituting nearly 95% of the energy consumed. Captive power generation using Natural Gas contributes 92.39 % of the total carbon dioxide emissions from our operations.

As our processes are already environmentally clean, we do not have any Clean Development Mechanism (CDM) projects.

Water management

Our operations do not necessitate consumption of large quantities of water. Yet, we have undertaken certain innovative measures to reduce water consumption in our operations.

Waste management

We, at PLL, have robust waste management systems in place. All hazardous waste generated in our facility is responsibly disposed through authorized waste recyclers.

Biodiversity management

The Company has undertaken measures towards protecting the marine ecology in the area of its operations.

All our emissions/waste, etc. are well within regulatory limits.

Details of our environmental performance will be available in our Sustainability Report.

Principle 7: Businesses, when engaged in influencing public and regulatory policy, should do so in a responsible manner

For the past three years, we have been a part of the Global Compact Network. Our Company is also a member of the Standing Conference of Public Enterprises (SCOPE) and the International Group of Liquefied Natural Gas Importers (GIIGNL). Our Senior Management represents the Company in various industry forums. We understand our responsibility as an influential part of the economy and do not engage in influencing public policy with vested interests.

Principle 8: Businesses should support inclusive growth and equitable development

As a responsible corporate citizen of the country, PLL has dedicated itself wholly to the betterment of India, through business, by providing clean energy, and through constant community engagement. Socio-economic development programmes are undertaken by our Company in order to meet the priority needs of the community we operate in, envisioning self-sustaining communities in the near future. We have designated CSR roles and responsibilities to ensure thorough implementation of our plans. Spearheading it at the Board level is our MD & CEO who is responsible for the overall CSR planning and implementation.

At the Corporate level, the Head HR, in consultation with Executive Committee (EC), is responsible for the formulation of plans and strategies, annual fund allocation, periodic monitoring and evaluation of activities to be taken up by terminals, documentation, brand enhancement and active CSR involvement at the Corporate office.

Similarly at the Dahej Terminal, CSR is undertaken by the Plant Head, who is responsible for identification of appropriate schemes, in consultation with concerned executives in the field, examination and consolidation of proposals, maintenance of data records, etc.

Further, we constantly motivate our employees to engage in the CSR schemes as a voluntary philanthropic contribution to the society we live in.

Our community initiatives

At the Corporate level, emphasis is laid on providing support for disaster relief management, water management, education, healthcare, promotion of sports, art and culture, entrepreneurship, environment, etc. Similarly, at the LNG terminals priority is given to education, healthcare including drinking water, environment and entrepreneurship schemes.

Investments

Each development project at PLL has a CSR component as a part of the project cost now. Since FY 2012-13, we have been allocating a certain part of our profit for CSR activities. We work closely with the local Gram Panchayat and District administration. A couple of major schemes, such as sweet drinking water facilities for Bharuch and mangrove plantations for environmental development near Dahej, are under implementation in collaboration with the State Governments in which PLL has made substantial contribution.

Principle 9: Businesses should engage with and provide value to their customers and consumers in a responsible manner

We, at PLL, follow the highest standards of business ethics while dealing with our customers. Adherence to all laws pertaining to product labeling, branding and distribution is of utmost priority to us and we are fully compliant with each one of them. As of now, there are no instances of customer dissatisfaction.