Business Report 2005 / 2006 · Business Report EBV 05/06 neu 30.10.2006 14:13 Uhr Seite 2 Probedruck C M Y CM MY CY CMY K 01. April 2005 - 31. March 2006 ERDÖLBEVORRATUNGSVERBAND

Business Report EBV 05/06 neu 30.10.2006 14:13 Uhr Seite 1

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C M Y CM MY CY CMY K

Business Report2005 / 2006

ERDÖLBEVORRATUNGSVERBANDKÖRPERSCHAFT DES ÖFFENTLICHEN RECHTS


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01. April 2005 - 31. March 2006


Report on the Financial Year2005 / 2006



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2ERDÖLBEVORRATUNGSVERBANDKÖRPERSCHAFT DES ÖFFENTLICHEN RECHTS

Table of Contents

Report of the Board of DirectorsIntroduction

Membership, Bodies, Committees

Stockpiling and warehouses

Cavern operations

Financing

Fees

Explanatory notes on the Annual Accounts

Outlook

Report of the Supervisory Board

AppendicesSupervisory Board / Board of Directors

Committees

Budget Account

Breakdown of Income and Expenditure in the Budget Account

into Loan and Fee Financing

Proof of Assets and Liabilities

Auditor’s certificate

Tables / Overviews / GraphicsMembership and allocation of voting rights

Development of Stockpiling Obligation and Coverage

Stockpiling Obligation and Coverage on 31.03.2006

Stockpiling Obligation and Coverage on 01.04.2006

Regional Distribution of EBV Stockpiling on 31.03.2006

Interest binding periods on 31.03.2006

Development of volumes requiring fees

Development of Fees

Development of Fee Surplus

Change in Loans compared to previous year

Composition of Surplus from

Proof of Assets and Liabilities

Page

4

4

6

8

13

14

16

18

25

26

Appendix

1

2

3

4

5

6

Page

6

9

10

10

11

14

16

17

21

22

24


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List of Abbreviations

AAA-Rating

ACOMES

BAFA

CFPP

DGMK

DIN

DK

EBV

ECB

EN

EQPS

ErdölBevG

EU

HEL

IEA

ISPG

NWKG

OK

Long-term issuer rating of the rating agency, Standard& Poor’s: ‘A debtor with the rating ‘AAA’ has anoutstanding ability to fulfil his financial obligations.‘AAA’ is the highest issuer rating allocated byStandard & Poor’s

Annual Coordination Meeting of Entities for Stock-holding

German Federal Authority for Economics andExport Control

Cold Filter Plugging Point

German Scientific Society for Mineral Oil, NaturalGas and Coal, e.V., Hamburg

German Industrial Norm

Diesel fuel

Erdölbevorratungsverband

European Central Bank

European Norm

EBV Quality Prediction System

Law on the stockpiling of Mineral Oil and MineralOil products (Erdölbevorratungsgesetz)

European Union

Extra light heating oil

International Energy Agency

International Sludge Prediction Group

Nord-West Kavernengesellschaft mbH, Wilhelmshaven(100 % subsidiary of the Mineral Oil Stockpiling Asso-ciation)

Motor gasoline


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Introduction

Report of the Board of Directors


After the completion of the exchange of its OK stockpiling on accountof the reduction of the maximum aromatic content, the issuesconcerning biogenous mixed fuels and the exchange of HEL stockpilingof about 4 million tons on account of the sulphur reduction in heatingoil were of top priority for the EBV. The financial year 2005 / 2006included intensive, frequent meetings on these issues as well aspreparatory work with regard to the exchange of heating oil. Inaddition to this, after the emptying of the motor gasoline caverns inSottorf, the return supply of the corresponding crude oil volumebegan. After the emptying of a gasoil cavern in Bremen-Lesum, thiswas refilled with DK.

During the entire year under review and at the end of the financialyear (31.03.2006), the stockpiling obligation was fulfilled in all productgroups. In product groups 1 and 2 the EBV fulfilled its stockpilingobligation at 31.03.2006 to approx. 103 % for each group. Thestockpiling for product group 3 exceeded the stockpiling obligationby approx. 151 %, caused by the allowable yield from heavy heatingoil from crude oil stocks.

As in previous years the warehouse and delegation contracts due fortermination as of 31.03.2006 were ended in the financial year 2005 /2006, and the tenders were invited for requirements calculated for01.04.2006. The terminated volume amounted to approx. 3.2 millionm3. New contracts were concluded for a volume of 2.6 million m3. Thedifference can mainly be explained by the reduction of delegationvolume in connection with the declining stockpiling obligation.

In the year under review EBV mostly financed itself by means of loansand loans against borrowers’ notes, which were exclusively appropriatedby the capital market. The instrument of registered debenture isespecially popular on account of the long term periods. In November2005 the Standard & Poor’s rating was updated with an AAA-ratingwith stable perspectives.

On 31.03.2006, outside funds amounted to 3.4 billion C. In the yearunder review, borrowing amounted to 220 million C, with 63 % ofthis being loans.


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The financing of stockpiling was again mostly agreed via long-terminterest binding. The average rate reduced from 5.45 % p.a. to5.22 % p.a..

The accumulated budget surplus (133.5 million C) was not utilizeddespite a planned withdrawal of 16.8 million C due to fee surplus inthe year under review of 35.4 million C.

Traditionally good contacts to stockpiling organisations in othercountries and the International Energy Agency, IEA, were continuedand developed. Several candidates for joining the EU as well ascountries in the Asian regions were informed of the German systemof mineral oil crisis provision.

The EBV would like to thank all members, warehousing companies,banks, insurances and all other companies and organisations for thegood cooperation which has contributed to the successful fulfilmentof tasks. Our thanks also go to staff who have made an immensecontribution on account of their commitment.


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6

Membership, Bodies, Committees

Personnel changesin Supervisory Board

Annual Members’Meeting, 22.11.2005

Membership and allocation of voting rights


Voting right allocation

31.03.2005 31.03.2006

Number of memberseach with

more than

total memberswith votes

12 - 56 - 1010

93747

111397

85747

103390

votevotesvotesvotes

In the year under review 16 companies left the association, 8 becamenew members or rejoined the association.

At the 28. Members’ Meeting on 22.11.2005, 33 members (30 % ofthe membership) took part with 315 votes (79 % of the total votes).After accepting the annual accounts, the Board of Directors andSupervisory Board were unanimously approved.

Due to the expiry of the official period of service, re-elections wereheld for the six electable Supervisory Board Members and theirrepresentatives. Mr. Hanns, Mr. Schäfer, Dr. Seifried and Mr. Weissserwere re-elected as ordinary Supervisory Board Members and Ms.Breitkreutz, Messrs. Dikty, Karstedt, Kollmann, Roth and Dr. Viragwere re-elected as representative Supervisory Board Members. Newordinary members were also elected, namely Dr. Abbenseth and Mr.Deisenhofer, in place of Dr. Kalkoffen and Mr. Beckmann who left theSupervisory Board.

With effect of 01. July 2005 the German Federal Ministry for Economicsand Technology appointed Mr. Bonaldo (government director) in placeof Mr. Johanssen (ministerial councillor) as representative member tothe Supervisory Board. With effect of 01.11.2005 the Federal Ministryof Finance appointed Mr. Schwarzer (ministerial director) to theSupervisory Board in place of Dr. Plachetka (ministerial director). Asof 01.01.2006, Mr. Schwarzer was replaced by Dr. Kühne (ministerialdirector).

The Federal Council (Upper House) appointed Mr. Wolf (ministerialcouncillor) as an ordinary member (up to now representative member)after an Upper Council resolution from 25.11.2005. He replaced Mr.Dehlinger (mini-sterial councillor) who left after expiry of service. Mr.Glatz (government director) was appointed as his representative.


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Supervisory Boardconvened threetimes


Messrs. Beckmann, Dehlinger, Johanssen, Dr. Kalkoffen, Dr. Plachetkaand Mr. Schwarzer, all of whom left the Supervisory Board in the yearunder review, were thanked by the Mineral Oil Stockpiling Associationfor their many years of service.Special thanks were expressed to Mr. Johanssen who played a significantrole in the setting up and development of mineral oil stockpilingunder public law.

The Supervisory Board convened three times in the year under review.It discussed the financial and fee issues, the auditors report, issues ofstock-keeping (i.a. stockpiling obligation and coverage, conversion ofOK to 35 % aromatic content and HEL to 1000 ppm sulphur, theexchange of products stored in caverns for crude oil, the storage offuels with biogenous share, the increase of the JET A-1 stocks of EBV,offers to tender), the improvement of the release process existing forprovision crises, and financial and insurance issues (i.a. replacing theexisting insurance of goods with self-insurance).

On 23.09.2005 the Supervisory Board decided to extend the period ofoffice of Mr. Pott as Board Director of EBV by 5 years.

Resolutions of the Supervisory Board were normally prepared byrecommendations from the respective committees.


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Stockpiling and Warehouses

Maintenance ofStockpile

Development ofStockpiling Obligation

The stockpiling obligation for the financial year 2005 / 2006 whichapplied as of 01.04.2005 amounted to 21.2 million t and was therefor0.9 million t below the previous year’s level. The change in stockpilingobligation is split across the product groups 1, 2 and 3 with minus297,000 t, minus 558,000 t and minus 32,000 t respectively.

The calculation of stockpiling obligation on 01.04.2006 (90 days) wasmade pursuant to § 3 Par. 1 of ErdölBevG. The volumes to be stockedagreed with the BAFA result from fee reports from members. Pursuantto the legal regulation, the averages from the years 2003 - 2005formed the basis for the product groups 1, 2 and 3.

The level of allowable stockpiling amounted to 22.7 million t at thebeginning of the financial year under consideration of the crude oilyield code valid as of 01.04.2005. As a result, in the change of thefinancial year 2004 / 2005 to 2005 / 2006 the stockpiling obligationwas over-fulfilled by 7.4 %.

Specifications for OK in effect as of 01.01.2005 provided for a maximumaromatic content of 35 vol. %. In accordance with the respectiveregulations, and after consultation with the Stockpiling Committeeand the resolutions of the Supervisory Board, the Mineral Oil StockpilingAssociation ended its exchange of OK stockpiling in the year underreview.

In accordance with the Study 2010 advised by the Stockpiling Committeeand passed by the Supervisory Board, it is intended to improve thestatutory 60 / 40 % ratio of crude oil to product stockpiling by reducingsurplus stockpiling of underground stored product volumes of individualproduct groups, and to replace these with corresponding volumes ofcrude oil. In the financial year 2005 / 2006 the remaining gasoil andheating oil heavy stockpiling at the cavern warehouse in Rüstringenwere exchanged for crude oil. A physical exchange was not possiblesince these product stocks are located together with crude oil inindividual caverns. Now only crude oil is stored in the cavern plantsat Rüstringen. The discharging of the benzine ‘RON 90’ stored in theunderground cavern plant at Sottorf was completed in the year underreview. Since the caverns have to be completely emptied before re-filling with crude oil, the return deliveries of crude oil will be completedin the financial year 2006 / 2007. The exchange of gasoil of a firstcavern for the return of DK at the Lesum plant was completed in theyear under review, and discharging of a second gasoil cavern wasstarted.

In total approx. 248,000 t benzine ‘RON 90’ and approx. 350,000 tgasoil were exchanged for crude oil and 95,000 t gasoil for DK in thefinancial year 2005 / 2006.


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9

Pan-EU offer totender of tank spaceand delegation

Stockpiling Obligation and Coverage


2003

2004

2005

Year

0

50

1.000

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2.000

3.000

4.000

5.000

6.000

7.000

8.000

9.000

10.000

11.000

12.000

13.000

14.000

15.000

16.000

17.000

1.000 t

Stockpiling Obligation

Coverage

Product group 2

Product group 1

Product group 3

2006

As a result of a Supervisory Board resolution to terminate all time-limited warehouse and delegation contracts to the end of the respectivefinancial year and to conduct a competitive tender to offer, thecontracts limited to 31.03.2006 were terminated in 2005, and a newtender to offer was issued.

The terminated volume totalled 3.2 million m3 warehouse space anddelegations; 3.4 million m3 warehouse space and delegations wereoffered. A total of 2.6 million m3 warehouse space was re-contracted.

The development of the stockpiling obligation and coverage sincethe setting up of the Mineral Oil Stockpiling Association is displayedin the following graph:


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10

Stockpiling Obligation and CoverageStatus: 31.03.2006

Stockpiling Obligation and CoverageStatus: 01.04.2006


The following changes in stockpiling obligation and coverageresulted in the transition from the financial year 2005 / 2006 to thefinancial year 2006 / 2007.

ProductGroup 2t

ProductGroup 1t

ProductGroup 3t

Total

tEBV own volumes––– products––– crude oil (13,709,995 t)

delegated volumes––– products––– crude oil (0 t)

Totallegal stockpiling obligation(basis 100 %)

Surplus/DeficitCoverage in %

3,167,1172,865,3896,032,506

318,5810

318,581

6,351,087

6,160,000

191,0873.10

8,157,8206,398,454

14,556,274

367,3750

367,375

14,923,649

14,490,000

433,6492.99

58,1941,253,0941,311,288

000

1,311,288

523,000

788,288150.72

11,383,13110,516,93721,900,068

685,9560

685,956

22,586,024

21,173,000

1,413,0246.67

ProductGroup 2t

ProductGroup 1t

ProductGroup 3t

Total

tEBV own volumes––– products––– crude oil (13,709,995 t)

delegated volumes––– products––– crude oil (0 t)

Totallegal stockpiling obligation(basis 100 %)

Surplus/DeficitCoverage in %

3,160,6962,864,0186,024,714

110,6660

110,666

6,135,380

5,950,000

185,3803.12

8,132,0596,528,699

14,660,758

216,4090

216,409

14,877,167

14,723,000

154,1671.05

58,1941,161,2371,219,431

000

1,219,431

473,000

746,431157.81

11,350,94910,553,95421,904,903

327,0750

327,075

22,231,978

21,146,000

1,085,9785.14


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11

Regional Distribution of EBV Stockpilingon 31.03.2006

The association continues to place emphasis on a regionally balancedstorage of the stocks.

Quality Assurance


ProductGroup 21,000 t



Crude oil

1,000 t

Lower SaxonyNorth Rhine-WestfaliaBavariaBaden-WuerttembergSchleswig-HolsteinBremenHamburgRhineland-PalatinateBerlinHesseBrandenburgThuringiaMecklenburg-Western PomeraniaSaxonySaxony-AnhaltSaarland

Foreign stockpilingTotal

Stockpiling total: 25,799,000 t

(The stockpiling allocated to the actual warehouse locations, without considering logistic connections)

91370852234811724

1251941064487

1791490150

3.4860

3.486

8481.3531.1151.034

4241.061

69852954834487

19286

11124

8.43689

8.525

11.657989

98185678

00000

10300000

13.7100

13.710

58000000000000000

580

58

Changes in product specifications continue to be introduced at evershorter intervals due to environmental protection requirements. Assuch, the forecast for the development of specifications is influencedby uncertainties.

- Standardization work for the requirement of DIN 51603-1 for HEL, EN 228 for OK and EN 590 for DK- The issue of biofuels (further tests 2005 / 2006 to ensure long-term storage)- The Additivation of HEL (CFPP improvement)- Exchange of product stockpiling in caverns for crude oil- The development and management of software for evaluation of crude oil stockpiling storage in EBV caverns- The development of a new test in microbiology (colony figure in mineral oil products)- The development of a ‘Technical Instruction’ for discharging of crude oil from caverns- Discussion of experience gained in long-term storage in international organisations such as ACOMES and IEA


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12

Control of Fulfilmentof Contract

Inventory as per31.12.2005

Tank WarehouseInquiry


provide new tasks for the EBV to ensure quality.

Ever greater significance is being attached to quality assurance,supported by our Quality Prediction System (EQPS). By using EQPS theassociation was able to extend the storage times. The EBV participatesin DGMK specialist committees for fuels in the development of a newtest process to improve the forecasting of thermal stability andwarehouse consistency.

In addition, EBV participates in the prediction and minimizing of crudeoil sludge in overground tanks and salt caverns in an internationalstudy group, ISPG (International Sludge Prediction Group), to researchmechanisms which lead to the generating of sludge.

In the year under review the associations inspected all 166 contractualtank warehouses with regard to the fulfilment of contractualobligations. In the course of this work, 827 current and expiredwarehouse and delegation contracts were inspected. Complaints wereraised in 11 cases, which led to warnings and, in some cases, to thecall for a contractual penalty.

The processing of the inventory including evaluation and preparationof invoices and credit notes was completed without complication. Wewere able to clarify any differences in figures with our contractualpartners.

The EBV conducted an updating inquiry of all tank warehouses,refineries and cavern capacities for BAFA as per 31.12.2005. A veryslight reduction in tank volume was established.


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13

Cavern Operations

Handling Activities


The cavern plants owned by EBV in Bremen-Lesum, Heide, Sottorfnear Hamburg and Wilhelmshaven-Rüstringen, in which approx. 10million m3 stocks are stored are operated by NWKG in accordancewith an operations contract. In the period under review priority wasto ensure the readiness for service of the four plants and to improvethem, and to carry out measures for the protection of the environment,where useful and necessary.

In the period under review, extensive volumes of crude oil and productvolumes in the cavern warehouses were handled on account of qualityadjustments or conversions of storage to crude oil. In the warehouseof Rüstringen, approx. 248,000 t of crude oil were stored, in Sottorfapprox. 248,000 t of OK was discharged and in Bremen-Lesum approx.94,800 t high-sulphur heating oil light was discharged and approx.242,400 t DK stored.


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14

Financing

Interest binding periods


Year

50

100

150

200

250

300

350

400

450

Mio C

0

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2021

2024

2028

2029

2030

2032

2034

2020

2022

2023

2031

2033

2035

2036

2025

2026

2027

The long-term debt of the association resulting from the financing ofstockpiling, warehouses and caverns was reduced in the year underreview by 220 million C, from 3.48 billion to approx. 3.26 billion C.Further details are included in the Explanatory Notes on Proof ofAssets and Liabilities.

This year, again, new loans have been taken out almost solely in long-term periods. The favourable interest situation led to a furtherreduction of average interest burden at the end of the year underreview from 5.45 % p.a. to 5.22 % p.a..

The following graph shows the interest binding periods of the EBVat the end of the year under review:


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15

AAA-Ratingconfirmed

FinancingInstruments


The credit portfolio of the association has a mainly long-term interestbinding structure on account of long-term assets. Essentially thefinancing of the association was made via the instruments of loansagainst borrowers’ notes, and loans.

The Medium Term Note Program, under which public loans (Eurobonds)and private placements could be concluded, has not been updateddue to the simple structure of the financing of the EBV (only EUROfixed rate business). This saves annual updating costs, and dependencyon legal changes for fields which do not affect the instruments of theEBV is reduced.

In future the issuing of loans will be made at our own documentations.

The internationally recognized AAA-rating from Standard & Poor’shas again been confirmed with a stable forecast. Loans issued by EBVstill have the opportunity in future of being given an explicit rating.


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16

Fees

Fee rates unchanged

Developement of volumes requiring fees

The fee rates for the financial year 2005 / 2006 have remainedunchanged:

Product group 1 C 6.13 / tProduct group 2 C 4.62 / tProduct group 3 C 4.10 / t

Income from fees amounted to 437 million C. As such, these wereabout 8 million C (2 %) below the budget plan.


Year

1.000

2.000

3.000

4.000

5.000

6.000

0

Product group 2

Product group 1

Product group 3

2004

2005

2006

1996

1997

1998

1999

2000

2001

2002

2003

1.000 t

7.000


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17

Development of Fees

(not including VAT and considering reimbursement to non-members – the mean monthly fee perquarter is given)

Member companies mostly fulfilled their reporting and feeobligations. However, inspection of import volumes led to subsequentsubmissions in 52 cases totalling approx. 0.6 million E and reimburse-ments of approx. 0.5 million E. Inspections of manufacturing and re-duction figures resulted in 106 cases to fees totalling approx.4.4 million E (balance from 5.1 million E contribution subsequentpayments and 0.7 million E fee reimbursements).

For the reimbursement of non-members totalling approx. 8 million Ethere were 75 inspections, as a result of which on balance 14 TE havehad to be paid back to the EBV.

For late payments the association took in interest totalling 292 TE.There were no failures of fee in the year under review.


Year

1996

1997

1998

2003

2004

2005

1999

2000

2001

2002

2006

Mio C

20

25

30

35

40

45

50

55


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18

Income

Budget Account

Explanatory Notes on the Annual Accounts

Explanatory Notes on the Loan Section (Appendix 4)

Expenditure


The financial plan for the financial year 2005 / 2006 established bythe Supervisory Board and approved by the Federal Ministry forEconomics and Technology together with the Federal Ministry forFinance, provided income and expenditure respectively totalling476,071,000 E.

The Mineral Oil Stockpiling Association finances all acquisition ofstockpiling and warehouse facilities as well as business equipment bytaking out loans, in accordance with legal and statutory regulations.All other expenditure including interest for such loans is covered bymembership fees. All income and expenditure flow into the budgetaccount (appendix 3). Since this accounting schedule does not displaywhich amounts can be allocated to which type of financing, we haveenclosed a detailed schedule of the budget account displaying loanand fee financing with this report (appendix 4), as in previous years.The following pages contain explanations of each of the two budgetsections. Finally, the development of fee surplus is shown in an overview.

Other income results mainly from the volume change in stockpilingfrom the incomplete change and rolling processes on the balancesheet date, which on the key date record an income surplus of 72.1million E.

Income from loans (1.3 million E) includes expenditure to be financedfor the procurement of compulsory stocks amounting to 0.5 millionE, and additions to assets of 0.8 million E.

Income from surplus of the previous year (6.5 million E) is explainedat the end of the summarized display of fee surplus.

Expenditure for the procurement of compulsory stocks (0.5 million E)result from additions to stockpiling in the course of the inventory. Inaccordance with the regulations of the Mineral Oil Stockpiling Act,this expenditure was financed via loans.

In addition to the amount of 72.1 million E explained under Otherincome, repayments for loans for the financing of stockpiling (88.7million E) were used from fee surplus (total: 160.8 million E).


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19

Income

Expenditure


Administration income (4.2 million E) essentially includes income fromcontractual penalties (2.6 million E) and the discharge of change androlling partners from their contractual duty to maintain spare provisions(1.3 million E). The EBV charged its partners with the cessation oftheir delegation obligations, and covered the fulfilling of legalstockpiling obligation from its own stockpiling. In addition, defermentand default interest is also included.

The other income (3.9 million E) includes interest income from theinvestment of cash bonds (2.4 million E) and income from rent (1.5million E).

With regard to income from membership fees we refer to the expla-natory notes in the section ‘Fees’ (p. 16).

Expenditure for administration (4.3 million E) is made up of personnelcosts totalling 3.0 million E, administration expenditure of 1.0 millionE and expenditure for investments (mainly data processing units) of0.3 million E.

In addition to the two board members, on 31.03.2006 25 staff wereemployed (partly part-time staff) at the offices of the Mineral OilStockpiling Association.

The expenditure for insurances for stockpiling of goods (0.9 millionE) includes premium payments for fire and goods transport insuranceof the mineral oil not stored in caverns, and the fire insurance of ourown tank warehouses and caverns. Insurance protection also coverstheft and damage to property resulting from intentional damage(sabotage), domestic unrest, strikes and blockades.

Expenditure for tank warehouses and caverns and for delegationpayments for mineral oil products (203.1 million E) mainly comprised151.8 million E for warehouse keeping payments, 24.2 million E forcosts for re-storing and discharging and the quality maintenance ofstockpiling, 10.5 million E for management of our own tank warehousesand caverns by NWKG, 9.7 million E for the maintenance of rentedand own property with buildings, and 6.6 million E for delegationpayments.

Explanatory Notes on the Loan Section (Appendix 4)


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20

Fee surplus andtheir application

Summarized Report of Fee Surplus


Interest and similar expenses amounted to 196.5 million E. Of this,189.7 million E were for loans and loans against borrowers’ noteswith fixed periods. 6.8 million E were spent on interest on call moneyand current accounts and for cash bonds with interest. The interestexpenditure from investments made with cash bonds received (1.7million E) is balanced by the same amount of interest income. Thisexpenditure also includes interest swap transactions (balanced withincome) and the maintenance of the rating.

Repayment expenditure for loans for the financing of warehousefacilities (0.6 million E): On account of the regulations of § 20 par. 5ErdölBevG the Mineral Oil Stockpiling Association has financed theacquisition of warehouses by taking out loans. The financing conceptstipulates that credit repayments made on depreciations on assetsand retirement of fixed assets are made at the expense of fees.

Repayment expenditure for loans for the financing of stockpiling(4.1 million E) are mainly based on stock losses in product groups 1and 2.

In so far as fee income in previous years was not required to coverappropriate expenditure, its budget inclusion to accumulated budgetsurplus was provided. The footnote to appendix 4 specifies in whichfinancial year respective fees were added or with-drawn. Additionalresultant income surplus were carried forward to the followingyear as ‘income from surplus of the previous year’.

The surplus was used to replace loans or settle due loans in accordancewith the financial plan. This led to off-setting between the fee sectionand the loan section of the entire budget. In the case of an increasein surplus – as in the year under review – loans were repaid to anappropriate amount.


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21

Assets

Development of Fee Surplus

Proof of Assets and Liabilities (Appendix 5)

Surplus of budget accounton 31.03.2005Accumulated budget surpluson 31.03.2005

Status on 31.03.2005

Changes in year under review

Withdrawl from accumulated budget surplus

Increase in fee surplus

Change in surplus of total budget account

Status on 31.03.2006

Recorded as

Accumulated budget surplus

Amount c/f to 2006 / 2007

-

133.5

133.5

-

35.4

168.9

133.5

35.4

168.9

6.5

-133.5

-127.0

-

-88.7

-215,7

-133.5

-82.2

-215.7

6.5

-

6.5

-

-53.3

-46.8

-

-46.8

-46.8

used forFee surplus

(Fee section)

Million €

StockpilingFinancing

(Loan section)Million €

Turnover taxFinancing/Liquid assets(Total budget)Million €


The following schedule shows the development of fee surplus includingthe amounts placed into accumulated budget surplus and theirapplication in the year under review.

The value of fixed assets and intangible assets did not changesignificantly in the year under review. Additions of 1.2 million E wererecorded, and depreciations of 1.0 million E. Fixed assets and intangibleassets record 6.2 million E on 31.03.2006. This essentially comprisesthe value of our own properties.

Compulsory stocks of mineral oil and mineral oil products remain atacquisition costs in the proof of assets and liabilities. The value ofstockpiling increased compared to the previous year, especially dueto early returns of crude oil volume and conversion of gasoil andheavy heating oil to crude oil, by 103.9 million E to approx. 3.8 billionE. The market value of stockpiling on 31.03.2006 at 11.2 billion Ewas approx. 7.4 billion E above acquisition costs.


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22

Liabilities

Change in Loans

Borrowing

for acquisition of compulsory stocks

for investments

Repayments

due to depreciation of products

due to volume loss

due to depreciation on fixed assets

of credits paid from fee surplus

Reduction in loans

0.5

0.8

72.1

4.2

0.6

88.7

1.3

165.6

164.3

Million €Million €


Liquid assets consist essentially of time deposit balances of cash bondsreceived (16.7 million E) which were made available within the scopeof rolling agreements.

Receivables from membership fees of 82.3 million E mostly involvefees at the end of the year under review not yet due, for the monthsof February and March 2006.

Trade accounts receivable of 233.6 million E involve receivables fromaccounts of counter-delivery agreements.

Loans and loans from banks, insurances and assignment creditorsinclude loans for financing stockpiling and non-depreciated sectionsof our own warehouses (properties), since these are not subject tovalue reduction.

The reduction of loans in the financial year 2005 / 2006 by 164.3million E is made up as follows:

Liabilities from interest to be paid on loans reduced by 10.3 million E.At the end of the year under review this figure was 88.2 million E.


Probedruck



Liabilities from cash bonds (16.7 million C) relate to securities madein connection with rolling agreements, which are balanced to the sameamount by time deposit balances at banks.

Liabilities to NWKG (8.9 million C) result from operating managementof the cavern plants.

Liabilities for turnover tax account (21.0 million C) result from turnovertax burden figures for the months of February and March 2006.

Liabilities from membership fees to be repaid (3.3 million C) are feereimbursement obligations due to reduction facts pursuant to § 3 par.4 numbers 1-4 ErdölBevG, mostly for the months of February andMarch 2006.

Adjustment items from open exchange and rolling contracts Returndelivery claims and counter-delivery obligations from exchange androlling agreements not yet completed on 31.03.2006 amounted to208.8 million C.

ReservesThe EBV records obligations for pension commitments of 4.0 millionC in newly created Reserves for old-age provision. This involvesfour current pensions, two expectancies of board members officiatingon 31.03.2006, and an expectancy of a board member who retired in2001.

Reserves for closure of caverns (8.5 million C) involve the annual riskprovision considered necessary by the EBV in order to be able to fulfilexisting obligations from the closure of caverns pursuant to federallaw, after an operating period of 30 years.

Reserves for equivalent payments pursuant to § 23 VBLS involveessentially future redevelopment fees to the VBL, which amountedto 4.7 million C.

Reserves for insurance of compulsory stocks of mineral oil and mineraloil products was allocated at the level which corresponds to thepossible risk of a loss in value in a medium size tank terminal (190,0million C).


Probedruck


Transition of Surplus

24

Composition of Surplus from Proof of Assets andLiabilities


Deficit from budget account

Plus

Fee surplus used for temporary stockpiling financingincluding accumulated budget surplus

Proceeds which have not yet led to income (mostlymembership fees receivable)

Less

Expenses which have not yet led to expenditure(mostly interst payables)

Surplus from proof of assets and liabilities

215.7

67.7

101.3

-46.8

182.1

135.3

Million € Million €

Reserves due to sales of stocks and sales of warehouse facilities weremainly contributed to in the year under review, pursuant to § 7ErdölBevG, on account of the sale of diesel and motor fuels withinthe scope of release, and the sale of premium fuel from a warehousein Belgium totalling 47.1 million C. In accordance with a SupervisoryBoard resolution, an amount of 203.2 million C was withdrawn forthe aforementioned reserves, and 4 million C from the hithertopension reserves were converted to reserves for old-age provisions.On the key date this amounted to 42.1 million C.

The surplus from proof of assets and liabilities is made up as follows:


Probedruck


25

Outlook


Stockpiling obligation reduced slightly on 01.04.2006 by 27,000 t to21.1 million t. This is a reduction of 0.13 % compared to the previousyear.

In the financial year 2006 / 2007 the EBV will begin with the exchangeof heating oil extra light stocks due to sulphur reduction, and continuethe exchange of gasoil stored in the cavern plant Sottorf, for crudeoil. The exchange of higher sulphated gasoil for diesel fuel in thecavern plant at Lesum will be continued.

The reduction of stockpiling obligation and the resultant necessity ofstockpiling adjustment will be further monitored and maintained bythe EBV. Existing surplus stockpiling will be decreased and the objectiveof 60 % share of crude oil in total stockpiling for reasons of increasedflexibility will be further improved.

Fee rates will remain unchanged in the year 2006.

Hamburg, 22. September 2006

Stephan Bockmühl Eberhard Pott


Probedruck


26

and statement of the Supervisory Board on the audited accounts ofthe Mineral Oil Stockpiling Association – corporation under publiclaw – Hamburg, for the financial year 2005 / 2006 (01.04.2005 to31.03.2006)

During the year under review the Supervisory Board has been regularlyinformed orally and in writing on the activities of the Mineral OilStockpiling Association and has monitored activities of the Board ofDirectors. In addition to this, the Chairman of the Supervisory Boardwas informed of essential business issues in between meetings.

The auditors appointed by the Annual Members’ Meeting on22. November 2005,

Pricewaterhouse CoopersAktiengesellschaft

Wirtschaftsprüfungsgesellschaft

have audited the annual accounts of the financial year 2005 / 2006 ofthe Mineral Oil Stockpiling Association. According to the prescribedaudit, the budget account and the proof of assets and liabilities complywith § 21 par. 1 of the Law on Stockpiling of Mineral Oil and MineralOil Products, § 109 of the Federal Budget regulations and supplementaryregulations of the statutes.

The Board of Directors presented the accounts to the SupervisoryBoard for comment. After inspection, the Supervisory Board approvesthe results established by the auditors.

The Supervisory Board would like to thank the Board of Directors andall staff for their work and commitment, and proposes to the AnnualMembers’ Meeting that the Board of Directors be approved.

Hamburg, 22. September 2006

The Supervisory Board

Dr. Peter Seifried- Chairman -

Report of the Supervisory Board



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Dr. Peter Seifried, Hamburg, ChairmanDr. Alois Virag, Burghausen, representative

Hellmuth Weisser, Hamburg, deputy ChairmanBernd Karstedt, Bremen, representative

Uwe Beckmann, Osnabrück (up to 22.11.2005)Gerd Deisenhofer, Kempten (as of 22.11.2005)Dieter Roth, Gießen, representative

Rüdiger Hanss, Zug (CH)Jürgen Kollmann, Hamburg, representative

Heinerich Schäfer, HamburgPetra Breitkreuz, Berlin, representative

Dr. Gernot Kalkoffen, Hamburg (up to 22.11.2005)Dr. Rainer Abbenseth, Hamburg (as of 22.11.2205)Rüdiger Dikty, Hamburg, representative

- by the Federal Ministry of Economics and Technology

Ministerial governor, Hartmut Schneider, BerlinMinisterial councillor, Klaus Johansen, Berlin, representative(up to 30.06.2005)Government director, Frank Bonaldo, Berlin, representative(as of 01.07.2005)

- by the Federal Ministry of Finance

Ministerial director, Dr. Uwe Plachetka, Berlin (up to 31.10.2005)Ministerial director, Joachim Schwarzer, Berlin (as of 01.11.2005 to 31.12.2005)Ministerial director, Dr. Gabriel Kühne, Berlin (as of 01.01.2006)Ministerial councillor, Hans-Borchard Kahmann, Berlin, representative

- by the Federal Council (Upper House)

Ministerial councillor, Johannes Dehlinger, Dresden (up to 25.11.2005)Ministerial councillor, Albert Wolf, Munich (as of 25.11.2005,hitherto representative)Government director, Uwe Glatz, Hamburg, representative(as of 25.11.2005)

Stephan Bockmühl, HamburgEberhard Pott, Hamburg

Appendix 1

Supervisory Board

elected

appointed

Board of Directors



Probedruck


Sven Thiessen (Chairman)Rotterdam

Hans Sperling (deputy Chairman)Hamburg

Andreas BodenmüllerMünchen

Gerhard FischerIngolstadt

Jörg KnaakHamburg

Karl-Heinz KopischkeBerlin

Hans-Bernhard KruseGelsenkirchen

Peter WallnyBremen

Norbert Krupp (Chairman)Hamburg

Gerd Hamer (deputy Chairman)Hamburg

Sven BürknerOsnabrück

Peter GarrnHamburg

Christine HeinBerlin

Norbert MikullaBremen

Michael TielBochum

Committees

StockpilingCommittee

Budget andFee Committee

Appendix 2, page 1ERDÖLBEVORRATUNGSVERBANDKÖRPERSCHAFT DES ÖFFENTLICHEN RECHTS


Probedruck


Dr. Claus-Georg Nette (Chairman)Hamburg

Christian von Steinkeller (deputy Chairman)Hamburg

Gudrun BackhausBerlin

Gerd HamerHenstedt-Ulzburg

Michael RadeloffBochum

Reiner SütterlinBremen

Dr. Dagmar Müller-Collin (Chairwoman)Hamburg

Reinke Aukamp (deputy Chairman)Hamburg

Kurt AndingHamburg

Dr. Christoph BuchholzHamburg

Dr. Annette Flormann-PfaffHamburg

Werner HollsteinBerlin

Hanno KrauseBurghausen

Nicole LauteHamburg

Loan Committee

Legal Committee


Appendix 2, page 2


Probedruck


Budget Accountfor the period from01. April 2005 to 31. March 2006

Appendix 3

1. Income (chapter 01) a. Administration income b. Other income c. Membership fees Product group 1 Product group 2 Product group 3

d. Income from loans e. Income from surplus of previous year

2. Expenditure a. Expenditure for administration (chapter 02) Personnel expenditure Real administrative costs Investment expenditure

b. Expenditure for mineral oil stockpiling (chapter 03) Procurement of compulsory stocks Insurance of stocks of goods Expenditure for tank warehouses and caverns, and delegation payments for mineral oil products Interests and similar expenditure Repayments for loans for financing warehouse facilities Repayments for loans for financing stocks Expenditure for investments for oil stockpiling

3. Surplus / Deficit (-) Surplus / Deficit (-) of financial year 2005 / 2006 (2004 / 2005)

Hamburg, 24. May 2006

Title Actual vs. estimateMore (+) Less (-)

Financial year2004 / 2005

Actual comparison

113 01 - 121 01124 01 - 162 02

218 01218 02218 03

325 01360 01

425 01 - 452 01511 01 - 539 99811 01 - 812 02

551 01556 01

557 01 - 558 71572 01 - 577 01

591 01591 04820 01

Estimate Actual

C C C C

S. Bockmühl E. Pott



+4,202,624.87+73,514,021.59

-8,553,289.92+538,243.73-379,759.47

-8,394,814.66-26,979,150.17+6,495,047.50

+48,837,729.13

-113,572.39-243,183.94-200,023.57-556,779.90

-8,445,827.47+120,819.63

-55,252,791.48+3,474,633.95-1,860,353.01

+159,939,667.88+1,733,322.70

+96,242,826.80+95,686,046.90

+46,848,317.77

3,116,048.49101,565,449.89

149,231,407.24275,106,824.38

9,222,071.82433,560,303.4430,500,479.574,977,429.06

573,719,710.45

2,919,828.86992,225.0617,520.10

3,929,574.02

0.00314,433.89

235,329,689.53211,207,605.23

827,455.36114,334,280.75

1,281,624.17563,295,088.93567,224,662.95

6,495,047.50

33,000.002,512,000.00

152,024,000.00284,592,000.00

8,610,000.00445,226,000.0028,300,000.00

0.00476,071,000.00

3,104,000.001,247,000.00

530,000.004,881,000.00

9,000,000.00800,000.00

258,390,000.00193,000,000.00

2,500,000.005,000,000.002,500,000.00

471,190,000.00476,071,000.00

0.00

4,235,624.8776,026,021.59

143,470,701.08285,130,243.73

8,230,240.53436,831,185.34

1,320,849.836,495,047.50

524,908,729.13

2,990,427.611,003,816.06

329,976.434,324,220.10

554,172.53920,819.63

203,137,208.52196,474,633.95

639,646.99164,939,667.88

766,677.30567,432,826.80571,757,046.90

-46,848,317.77


Probedruck


Brakedown of Income and Expenditurein the Budget Account 2005 / 2006into Loan and Fee Financing

Appendix 4

I. Income (chapter 01) a. Administration income b. Other income c. Membership fees d. Income from loans e. Income from accumulated budget surplus f. Income from surplus of previous year

II. Expenditure a. Expenditure for administration (chapter 02) Personnel expenditure Real administration costs Investment expenditure

b. Expenditure for mineral oil stockpiling (chapter 03) Procurement of compulsory stocks Insurance of stocks of goods Expenditure for tank warehouses and caverns, and delegation payments for mineral oil products Interests and similar expenditure Repayments for loans for financing warehouse facilities Repayments for loans for financing stocks Expenditure for investments for oil stockpiling

c. Payment to accumulated budget surplus (chapter 04)

III. Surplus / Deficit (-)IV. Accumulated budget surplus1)

V. Surplus / Deficit (-) including accumulated budget surplus

113 01 - 121 01124 01 - 162 02218 01 - 218 03

325 01351 01360 01

425 01 - 452 01511 01 - 539 99811 01 - 812 02

551 01556 01

557 01 - 558 71572 01 - 577 01

591 01591 04820 01

911 01

Title

Estimate Actual Estimate Actual Actual

Fee sectionLoan section Total

1)Development of accumulated budget surplus

Accumulated budget surplus allocated in 1985 / 86 Accumulated budget surplus allocated in 1991 / 92 Accumulated budget surplus allocated in 1992 / 93 Accumulated budget surplus allocated in 1993 / 94 Accumulated budget surplus allocated in 1997 / 98 Accumulated budget surplus allocated in 1998 / 99 Total additions Withdrawals 1994 / 95 Withdrawals 1995 / 96 Withdrawals 2003 / 04 Withdrawals 2004 / 05 Status on 31.03.2006

C C C C C

C


0.001,000,000.00

0.0028,300,000.00

-16,800,000.000.00

12,500,000.00

0.000.000.000.00

9,000,000.000.000.000.000.00

1,000,000.002,500,000.00

12,500,000.000.00

12,500,000.000.000.000.00

0.0072,071,875.63

0.001,320,849.83

0.006,495,047.50

79,887,772.96

0.000.000.000.00

554,172.530.000.000.000.00

160,792,212.71766,677.30

162,113,062,.540.00

162,113,062.54-82,225,289.58

-133,477,365.39-215,702,654.97

33,000.001,512,000.00

445,226,000.000.00

16,800,000.000.00

463,571,000.00

3,104,000.001,247,000.00

530,000.004,881,000.00

0.00800,000.00

258,390,000.00193,000,000.00

2,500,000.004,000,000.00

0.00458,690,000.00

0.00463,571,000.00

0.000.000.00

4,235,624.873,954,145.96

436,831,185.340.000.000.00

445,020,956.17

2,990,427.611,003,816.06

329,976.434,324,220.10

0.00920,819.63

203,137,208.52196,474,633.95

639,646.994,147,455.17

0.00405,319,764.26

0.00409,643,984.3635,376,971.81

133,477,365.39168,854,337.20

4,235,624.8776,026,021.59

436,831,185.341,320,849.83

0.006,495,047.50

524,908,729.13

2,990,427.611,003,816.06

329,976.434,324,220.10

554,172.53920,819.63

203,137,208.52196,474,633.95

639,646.99164,939,667.88

766,677.30567,432,826.80

0.00571,757,046.90-46,848,317.77

0.00-46,848,317.77

39,587,285.1961,137,215.4028,778,063.5323,125,220.4944,404,677.3068,502,886.24

265,535,348.1518,662,153.6672,603,447.1328,917,672.0311,874,709.94

133,477,365.39


Probedruck


Proof of Assets and Liabilitieson 31. March 2006

Appendix 5

Assets Liabilities

Hamburg, 24. May 2006


Fixed assetsand intangible assets

Real property and equivalent rights with business, operating and other buildings Business equipment Plants in fee

Financial assets Participations

Compulsory stocks of mineral oil and mineral oil products(assessment at acquisition costs) Product group 1 Product group 2 Product group 3 Crude oil

Liquid assets Cash in hand Bank balances

Receivables From membership fees Trade receivables From turnover tax account Others



1) Statutes of the Versorgungsanstalt des Bundes und der Länder (Pensions office of the federal and local governments)

6,008,473.701.00

209,704.756,218,179.45

25,564.596,243,744.04

772,538,918.701.397,425,819.46

5,746,230.351,650,181,243.063,825,892,211.57

3,133.2017,349,760.7817,352,893.98

82,245,898.29233,605,652.47

0.0012,191.29

315,863,742.05

4,165,352,591.64

Status on31.03.2005

Status on31.03 2006

Change

6,008(C 1.00)

296,037

266,063

807,2711,345,728

12,8741,556,1353,722,008

3160,600160,603

88,015387,84225,979

696502,532

4,391,206

00

181181

0181

-34,73251,698-7,12894,046

103,884

0-143,250-143,250

-5,769-154,236-25,979

-684-186,668

-225,853

C TC TC

Loans Bearer debentures Registered debentures

Loan obligations to banks, insurance companiesand assignment creditors

Other liabilities From interest to be paid From cash bonds To the Nord-West Kavernengesellschaft mbH Trade accounts payable From turnover tax account From fees payable to members

Pension reserves

Adjustment items from incomplete changeand rolling contracts

Reserves For old-age provision For closure of caverns For counter-value payments purs. to § 23 VBLS1)

For insurance of compulsory stocks of mineral oil and mineral oil products Due to inventory sales and sales of warehouse facilities

Net assets of the association

Surplus from proof of assets andliabilities Deficit from budget account for period from 01. April 2005 to 31. March 2006 Adjustment items from adjustment of budget account to proof of assets and liabilities

Status on31.03.2006

Status on31.03.2005

Change

635,000,000.00190,000,000.00

2,607,878,995.523,432,878,995.52

88,176,842.7716,700,000.00

8,946,539.33924,775.00

21,000,666.683,288,781.37

139,037,605.15

0.00

208,836,910.06

3,963,419.008,500,000.004,733,700.00

190,000,000.00

42,148,731.84249,345,850.84

1.00

-46,848,317.77

182,101,546.84135,253,229.07

4,165,352,591.64

685,00050,000

2,862,1383,597,138

98,448160,600

8,957210

03,095

271,310

3,877

226,867

000

0

198,321198,321

(C 1.00)

6,495

87,19993,694

4,391,206

-50,000140,000

-254,259-164,259

-10,271-143,900

-10715

21,001194

-132,271

-3,877

-18,030

3,9638,5004,734

190,000

-156,17251,025

0

-53,343

94,90341,560

-225,853

C TC TC


ERDÖLBEVORRATUNGSVERBANDKÖRPERSCHAFT DES ÖFFENTLICHEN RECHTS Note

Liabilities from a release from liability to theNord-West Kavernengesellschaft mbH

1.00 1.00

C C


Probedruck


Appendix 6

Certification


of the auditors, PricewaterhouseCoopers Aktiengesellschaft Wirt-schaftsprüfungsgesellschaft on the audit of the accounting for thefinancial year 2005 / 2006

We have audited the budget account and the proof of assets andliabilities including respective accounting of the Mineral Oil StockpilingAssociation, corporation under public law, Hamburg for the financialyear from 1. April 2005 to 31. March 2006. Accounting and schedulingof the budget account as well as the proof of assets and liabilitiespursuant to § 21 par. 1 of the Law on Stockpiling of Mineral Oil andMineral Oil products, § 109 of the Federal Budget regulations andsupplementary regulations is the responsibility of the Board of Directorsof the Mineral Oil Stockpiling Association. It is our task to provide anassessment of the budget account and the proof of assets and liabilitiesbased on our audit.

We have conducted our audit of the budget account in accordancewith the German principles of accounting established by the Instituteof Accountants and Auditors (IDW). According to such principles, theaudit is to be planned and executed so that inaccuracies and violationscan be recognized with substantial security, which affect the displayof the budget account and the proof of assets and liabilities inaccordance with the German Principles of Accounting. On definingauditing practice, knowledge on the business activities and theeconomic and legal environment of the Mineral Oil StockpilingAssociation and the expectation of possible errors is considered. Withinthe scope of the audit, the effectiveness of the internal control systemrelated to invoices and evidence of bookkeeping, budget account andproof of assets and liabilities is mostly assessed on the basis of randomsamples. The audit comprises the assessment of the balance sheetprinciples applied and the essential estimates of the Board of Directors,and appreciation of the overall standard of the budget account andproof of assets and liabilities. We are of the opinion that our auditprovides a secure basis for our assessment.

Our audit did not result in any objections.

Hamburg, 22. June 2006

PricewaterCoopersAktiengesellschaftWirtschaftsprüfungsgesellschaft


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Addresses

ErdölbevorratungsverbandKörperschaft des öffentlichen Rechts

Jungfernstieg 38D-20354 Hamburg

Phone: +49 (0)40 / 35 00 12 - 0Fax: +49 (0)40 / 35 00 12 - 149

Email: [email protected]


Documents

Business Report 2005 / 2006 · Business Report EBV 05/06 neu 30.10.2006 14:13 Uhr Seite 2 Probedruck C M Y CM MY CY CMY K 01. April 2005 - 31. March 2006 ERDÖLBEVORRATUNGSVERBAND