Overall Equipment Effectiveness Definition

ETHYLENE MALAYSIA SDN BHD POLYETHYLENE MALAYSIA SDN BHD TOOLS DOWN: OVERALL EQUIPMENT EFFECTIVENESS (OEE) What is Tools Down? An activity where certain tools or knowledge is shared with a person or group of people with the intent to upskill those people in the usage of the tool or develop deep understanding of how the tool is utilized ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD 2 OVERALL EQUIPMENT EFFECTIVENESS (OEE) ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD 3 Definition OEE is used to measure plant performance against its limit and identify sources of loss within the plant.

It measures how well we use the equipments when they are available. ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD 4 To understand OEE better is to understand OEE waterfall chart… y External factors Category 3* -i. e. , lack of demand, lack of feed, lack of storage and other external downtime Slowdown S2 – Slowdown (external upstream) S3 – Slowdown (external downstream) S4 – Slowdown (Others/ force majoure) Not Normal Plant Operations 2a* – Debottle necking 2b* – Revamp/ Rejuvenation Formula:

This model is based on the latest OEE concept approved and endorsed during 36 th OPI Working Group Meeting and 61st Plant Managers Meeting. * As per the IPWE classification of downtime ** As per the OPI definition for OEE calculation *** In cases where the MSR is lower than Nameplate Capacity, Nameplate Capacity will be used instead of MSR ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD Maximum Sustainable Rate*** OEE Turnaround (DOSH requirements) Net Production (x) Adjusted Capacity (y) Adjusted Capacity** Normal Plant Operations 1a* – Scheduled downtime (excluding Turnaround)

Available Capacity** Normal Plant Operations 1b* – Unscheduled downtime 1c – Consequential downtime Slowdown S1 – Slowdown (internal) x Net Production** Quality (Reject or off spec. ) Gross Production** Indirect losses Availability losses Productivity losses Quality losses 5 5 What is Maximum Sustainable Rate (MSR)? Maximum Sustainable Rate (MSR): OPU specifies its respective MSR for a period based on the highest daily throughput or production rate sustained over 30 consecutive days. In cases where the MSR is lower than Nameplate Capacity, Nameplate Capacity will be used instead of MSR.

ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD 6 External factors – Indirect losses ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD Maximum Sustainable Rate Category Not Normal Plant Operations Category 2* Downtime Definition Debottlenecking Revamp/Rejuvenation Lack of economic feedstock Economics Lack of storage Others Slowdown (external upstream) Slowdown (external downstream) Slowdown (Other/Force Majeure) 2a 2b 3a External Factors Category 3* – Downtime Category S* – Slowdown 3b 3c 3d S2 S3 S4 7 Internal factors – Downtime (Availability losses)

Turnaround Category Turnaround Normal Plant Operations Category 1b & 1c Normal Plant Operations Category 1a Definition ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD Adjusted Capacity 1a 1b 1c Planned downtime Unplanned downtime Consequential downtime 8 Internal factors – Slowdown (Productivity losses) ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD Available Capacity Category Category S1 Definition Slowdown (Internal) S1 9 Internal factors – Slowdown (Quality losses) ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD

Gross Production Net Production Category Quality loss Definition Quality Reject, offspec, flaring (Not applicable to EPEMSB) Official production as recorded by Production Planner 10 Recap… y External factors: Downtime 3a – Lack of economic feedstock 3b – Economics 3c – Lack of storage 3d – Others Slowdown S2 – Slowdown (external upstream) S3 – Slowdown (external downstream) S4 – Slowdown (Others/ force majoure) Not Normal Plant Operations 2a – Debottle necking 2b – Revamp/ Rejuvenation Formula: OEE Turnaround Net Production (x) Adjusted Capacity (y)

ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD Maximum Sustainable Rate Normal Plant Operations 1a – Scheduled Normal Plant downtime Operations (excluding Turnaround) 1b Unscheduled downtime 1c – Consequential downtime Adjusted Capacity Available Capacity Slowdown S1 – Slowdown (internal) x Net Production Quality (Reject , off spec. or flaring) Gross Production Indirect losses Availability losses Productivity losses Quality losses 11 11 OTHER PERFORMANCE KPIs ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD 12 Other performance KPIs

Besides OEE, there are FIVE other KPIs that EPEMSB track, monitor and analyze: ? Production volume (net production) ? Utilization ? Reliability ? Operational Availability ? Mechanical Availability ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD 13 Production Volume Production volume is without doubt the most important KPI to be tracked and reported at various levels of management Typically reported in metric ton (MT) or kilometric ton (kMT) Official production volume is reported by planners Official production volume is taken from 1st to 1st of every month

ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD 14 Utilization z Utilization External factors: Downtime 3a – Lack of economic feedstock 3b – Economics 3c – Lack of storage 3d – Others Slowdown S2 – Slowdown (external upstream) S3 – Slowdown (external downstream) S4 – Slowdown (Others/ force majoure) Not Normal Plant Operations 2a – Debottle necking 2b – Revamp/ Rejuvenation Formula: Net Production (x) Maximum Sustainabl e Rate (z) ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD Maximum Sustainable Rate Turnaround

Normal Plant Operations 1a – Scheduled Normal Plant downtime Operations (excluding Turnaround) 1b Unscheduled downtime 1c – Consequential downtime Adjusted Capacity Available Capacity Slowdown S1 – Slowdown (internal) x Net Production Quality (Reject , off spec. or flaring) Gross Production Indirect losses Availability losses Productivity losses Quality losses 15 15 Reliability Reliability is used to determine the impact of unscheduled downtime over mission time*. Formula: Re liability 1 UnscheduledDowntime(Category b) 1 TotalTime ScheduledD owntime(Category a) 1 r simply R = 1– ( TT – P ) U Mission Time = Total Time – Scheduled Downtime Total time = Total number of calendar days ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD 16 Operational Availability Operational Availability is used to determine the impact of all downtime (excluding slowdown). Formula: Operationa lAvailability 1 Downtime(Categories ,2,3) 1 TotalTime or simply OA = 1 – ( E+U+P TT ) Total time = Total number of calendar days ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD 17 Mechanical Availability

Mechanical Availability is used to determine the impact of scheduled and unscheduled downtime. Formula: MechanicalAvailability 1 Downtime(Category a &1b) 1 TotalTime or simply OA = 1 – ( U+P TT ) Total time = Total number of calendar days ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD 18 Volume-based vs. Time-based Take note that: Volume, OEE & Utilization – Volume-based Reliability, Operational Availability & Mechanical Availability – Time-based ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD 19 END OF PRESENTATION ETHYLENE MALAYSIA SDN BHD & POLYETHYLENE MALAYSIA SDN BHD 20