Petrofac Limited
2021 Annual report and accounts
A platform
for growth

A platform
for growth
We are a leading energy services company that
helps our clients meet the world’s evolving energy
needs. We use our engineering know-how and our
consultancy expertise to design, build, and operate
world-class energy facilities that are engineered for
safety, optimal efficiency, and low emissions.
We operate in a range of markets and work
across the entire asset life cycle – from design to
decommissioning. These competencies, supported
by flexible commercial models, differentiated local
delivery, and a technology neutral approach, set
us apart. Core to our offering is our distinctive,
delivery-focused culture.
Find out more at:
www.petrofac.com
Front cover image:
Seagreen Wind Energy Ltd

Highlights
Contents
Strategic report
02 Petrofac at a glance
04 Chairman’s statement
06 Group Chief Executive’s review
08 Our strategy at a glance
11 Our executive team
13 Market outlook
16 Our business model
18 Key achievements of 2021:
Local delivery
20 Key performance indicators
22 Stakeholder engagement
26 Key achievements of 2021:
Newenergies
30 Environmental, Social and
Governance
60 Risk management
62 Principal risks and uncertainties
70 Viability statement
72 Key achievements of 2021:
Best-in-class delivery
76 Segmental overview
82 Financial review
Governance
88 Chairman’s introduction
92 Board of Directors
94 Corporate Governance report
103 Nominations Committee report
106 Audit Committee report
114 Compliance and Ethics
Committee report
116 Directors’ remuneration report
128 Directors’ statements
Financial statements
129 Group financial statements
130 Independent auditor’s report
141 Consolidated income statement
142 Consolidated statement of other
comprehensive income
143 Consolidated balance sheet
144 Consolidated statement of
cash flows
145 Consolidated statement of
changes inequity
146 Notes to the consolidated
financial statements
203 Appendices
209 Company financial statements
210 Company income statement
210 Company statement of
comprehensive income
211 Company balance sheet
212 Company statement of cashflows
213 Company statement of changes
in equity
214 Notes to the Company financial
statements
227 Glossary
229 Shareholder information
1 Business performance before separately disclosed items.
This measures underlying business performance.
2 Earnings before interest, tax, depreciation and
amortisation (EBITDA) is calculated as operating
profit, including the share of net profit of associates
and joint ventures, adjusted to add back charges for
depreciation and amortisation (see A3 in Appendix A of
theconsolidated financial statements).
3 Attributable to Petrofac Limited shareholders, as reported
in the consolidated income statement.
4 The prior year numbers are restated in relation to the
adoption of the IFRIC decision on cloud configuration and
customisation costs, in April 2021 (see note 2.9 of the
consolidated financial statements).
5 Free cash flow is defined as net cash flows from operating
activities, plus net cash flows from investing activities,
less net interest on borrowing and interest on finance
leases, repayment of finance lease principal plus amounts
received from/paid to from non-controlling interests (see
A7 in Appendix A of the consolidated financial statements).
6 Return on capital employed (ROCE) is calculated as EBITA
(earnings before interest, tax and amortisation, calculated
as EBITDA less depreciation) divided by average
adjusted capital employed (see A9 in Appendix A of the
consolidated financial statements).
7 Backlog consists of: the estimated revenue attributable to the
uncompleted portion of Engineering & Construction operating
segment contracts; and, for Asset Solutions, the estimated
revenue attributable to the lesser of the remaining term of the
contract and five years. The Group uses this key performance
indicator as a measure of the visibility of future revenue.
8 % spend on local goods and services, excludes JV projects
9 Employees with line management responsibility
Revenue
US$3,057 million
2020: US$4,081 million
EBITDA
1,2
US$104 million
2020: US$211 million
Business performance net profit
1,3
US$35 million
2020 (restated)
4
: US$50 million
Reported net loss
3
US$(195) million
2020 (restated)
4
: US$(192) million
Full year dividend per share
nil cents
2020: nil cents
Diluted earnings per share
1,3
9.7 cents
2020 (restated)
4
: 14.8 cents
Free cash flow
5
US$(281) million
2020 (restated)
4
: US$(123) million
Return on capital employed
1,6
3.7%
2020 (restated)
4
: 7.1%
Backlog
7
US$4.0 billion
2020: US$5.0 billion
CDP rating
B
2020: B
In-country value spend
8
54%
2020: 53%
Employee completion of mandatory Code of Conduct
e-learning
9
97.2%
2020: 99.3%
Strategic report Governance Financial statements
01Petrofac Limited 2021 Annual report and accounts

200+
Our experience is built on more than
200 major projects across the world
40+
We have more than 40 years of
experience in design, engineering,
procurement, and construction
We are Petrofac...
Our purpose is to enable our
clients to meet the world’s
evolving energy needs.
Wherever our clients are on their
energy journey, Petrofac has
the expertise, capabilities and
experience to support them.
02 Petrofac Limited 2021 Annual report and accounts
Petrofac at a glance

1 The division was formerly known as Energy Production Services.
2 The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs, in April 2021 (see note 2.9 of the consolidated
financialstatements).
Engineering &
Construction
Revenue US$1,971m
2020: US$3,090m
EBITDA US$10m
2020 restated
2
: US$114m
Business performance
net profit US$8m
2020 restated
2
: US$63m
Employees 3,350
(as at 31 December 2021)
% of revenue 64%
The Engineering & Construction
(E&C) division delivers onshore and
offshore engineering, procurement,
construction, installation and
commissioning services. Lump-sum
turnkey is the predominant commercial
model used, but we also offer our
clients the flexibility of other models.
The division has more than 40 years’
track record in designing and building
major energy infrastructure projects.
—Read more page 77
Asset Solutions
1
Revenue US$1,111m
2020: US$933m
EBITDA US$84m
2020 restated
2
: US$60m
Business performance
net profit US$86m
2020 restated
2
: US$40m
Employees 4,350
(as at 31 December 2021)
% of revenue 34%
The Asset Solutions (AS) division
manages and maintains client
operations, both onshore and offshore,
delivers small to medium scale EPC
projects and provides concept,
feasibility and front-end engineering
design (FEED) services. The division
is also home to market-leading well
engineering, decommissioning and
training capabilities. The majority of AS’
services are executed on a reimbursable
basis, but we are responsive to clients’
preferred commercial models to deliver
ourexpertise.
—Read more page 79
Integrated
Energy Services
Revenue US$50m
2020: US$110m
EBITDA US$21m
2020: US$39m
Business performance
net loss US$(5)m
2020: US$(18)m
Employees 250
(as at 31 December 2021)
% of revenue 2%
Integrated Energy Services (IES)
is Petrofac’s upstream oil and gas
business, providing an integrated
service for clients under flexible
commercial models that are aligned
with their requirements.
Following the completion of the sale of
our 51% interest in our Mexico operations
in November 2020, our interest in the
Production Sharing Contract (PSC)
for Block for Block PM304 Malaysia’s
offshore Cendor field is our sole remaining
material IES asset.
—Read more page 81
A sustainable mindset
At Petrofac, we believe that how
wedo business is just as important
as what we do.
We have a clear purpose: to enable our
clients to meet the world’s evolving energy
needs. We also have four clear values that
underpin our purpose and govern how
weoperate: driven, agile, respectful and
open. These core values are superseded
onlybyour unyielding commitment to
safety and ethical behaviour.
Environment
Social
Governance
Find out more at
www.petrofac.com
Environment – ensuring that Petrofac
is able to minimise its own environmental
impact, while supporting our clients in
achieving their lower carbon ambitions.
Social – promoting safe local delivery
of our projects and services, drawing on
ethical supply chains to create in-country
value, address local skills gaps, and build
a diverse and inclusive workforce.
Governance – underpinning everything
we do with clear, consistent standards
of ethical behaviour, bound by rigorous
compliance and governance.
03Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Core to the Petrofac
offering is the Group’s
distinctive, delivery-
focused culture.”
2021 was another challenging year for
Petrofac, yet there are some real positives
to draw:
– A refreshed executive team made
strong progress in reshaping and
rebalancing the business
– The conclusion of the Serious Fraud
Office (SFO) investigation drew a line
under four years of uncertainty
– As well as demonstrating investor
confidence, the successful capital
raiseand refinancing programme
secured a long-term capital structure
– With the energy transition gathering
pace, we are well positioned to
benefit – with continued growth in
new energies, and a strong position
in many of the world’s most resilient
hydrocarbon markets
– Although the pandemic-related
headwinds continue to have an
impact, we see signs that investment
is returning to our core markets, and
we have a strong platform for medium-
term growth
Strategic report
Chairman’s statement
04 Petrofac Limited 2021 Annual report and accounts

I do not wish to underplay the challenges
of 2021.
The pandemic continued to exert a deep
impact on our core markets, resulting in
additional costs and delays to projects,
whilst clients continued to adopt rigid
commercial positions. Once again, the
severity of the situation was reflected in
our financial results as well as our new
order intake.
I would, however, like to emphasise
the progress we made, the underlying
strength in the business, and the
prospects for the future.
The conclusion of the SFO investigation
was welcome, putting an end to
the uncertainty of recent years.
The subsequent capital raise and
refinancing showed that,with this
regrettable period behind us, we retain the
confidence of the investment community.
Strategically, we were reassured that the
energy transition represents an opportunity
for Petrofac. Alongside the growth in new
energies, we are helping clients reduce the
carbon intensity of their existing operations,
while the onus on fulfilling the world’s
ongoing oil and gas demand is likely
tofallto our core MENA markets.
Operationally, there was also much to
celebrate: as part of the reshaping and
rebalancing of the business, we continued to
deliver on our ESG agenda and our progress
was recognised in the external rankings by
ESG ratings agencies; we demonstrated our
ability to deliver prestigious projects under
difficult conditions; a strong Asset Solutions
performance brought a more balanced
portfolio; our new order intake improved
in the second half; and the future bidding
pipeline looks encouraging.
While further challenges in 2022 are
inevitable, we clearly have a strong
platform for medium-term growth.
Embedding a strong, refreshed
executive team
Group Chief Executive Sami Iskander and
his refreshed executive team made excellent
progress in rebalancing and reshaping the
business. Although leadership successions
are often difficult, this one was well executed
and delivered an immediate impact.
We consider ourselves very fortunate
to have secured someone with Sami’s
credentials. As well as having a deep
understanding of our markets and client
landscape, and a proven track record
inbusiness transformation, his energy
andenthusiasm are clearly valued across
the business.
Meanwhile, Afonso Reis e Sousa marked
his internal appointment as Chief Financial
Officer with the delivery of a significant
and successful refinancing programme
(asset out below).
The refreshed leadership extends to our
in-country operations. The appointment
offive new country heads, all of whom are
local nationals, demonstrates our aspiration
for all teams to be representative of the
societies in whichthey work.
Bolstering our capital structure
A clear priority for the year was to protect
our financial strength.
With this in mind, we trimmed further costs
taking the total reduction to US$250 million
compared with pre-pandemic levels.
We also took the difficult decision to
suspend the dividend for a further year.
Then, when the SFO investigation was
concluded and the financial penalties
confirmed, a key achievement was our
refinancing programme, comprising a
capital raise, a bond issue, and a new
two-year revolving credit facility. We were
gratified by the extent of the support from
across the investment community. To me,
this demonstrates that existing shareholders
and new investors alike believe in Petrofac,
our fundamental strengths, and our
medium-term prospects.
We therefore enter 2022 with a long-term
capital structure, enabling us to navigate
this period of uncertainty and return to
growth as the market recovers.
Extending the ESG agenda
Importantly, our business model and our
ESG agenda are completely aligned: we
see the energy transition as a strategic
opportunity; the creation of in-country
value is central to our local delivery
model; and our best-in-class delivery
is characterised by uncompromising
commitments to ethical behaviour,
safety, employee wellbeing, diversity,
andinclusion.
In 2021, more granularity was brought
toour Net Zero plans and more ambition
to our diversity targets (see pages 35 and
49 for more information).
Although our safety record is among
thestrongest in the sector, we did see
some isolated incidents, including a tragic
fatality at our project site in Thailand.
In 2021, we strengthened our safety
leadership to ensure we apply the same
high standards everywhere.
Ethical behaviour remains a core priority.
We continued to embed a comprehensive
compliance and governance regime
that meets or exceeds international best
practice. Both the SFO and the Court
acknowledged the extent and integrity
ofour reforms, and we are confident that
the past behaviour uncovered in the SFO
investigation would not be possible today.
Maintaining a strong, well-informed
dialogue
With so much happening, the Board met
on more than 40 occasions during 2021.
I therefore thank my fellow Directors for
their commitment, for making themselves
so available, often at short notice, and
for their determination to deliver on their
fiduciary responsibilities.
Although the pandemic prevented us
from meeting face-to-face or from visiting
any Petrofac sites, I believe we were still
able to maintain a good understanding
of the inner workings of the business.
Through our bi-annual meetings with
the Petrofac Workforce Forum, we were
able to converse directly with employees
representing different levels, functions and
geographies. I am constantly impressed
by the quality of the dialogue, and I know
the entire Board values the insights
itbrings.
Looking ahead to 2022 and beyond
We expect 2022 to be another challenging
year. The new order intake outlook is
beginning to improve, as is the scale of
the 2022 bidding pipeline. While much
of this business is scheduled for award
in the second half of the year, it all adds
to prospects for medium-term growth.
A priority for the Board will therefore be
to give Sami and his team the support
they need in navigating the intervening
uncertainties and rebuilding the
orderbacklog.
For the Board itself, it will be necessary
tomake some measured changes.
In 2021we took the view that it was
important to maintain continuity, such
that my term as Chairman was extended
for another year. A priority for 2022 will
be to plan and manage my succession
and ensure that, going forward, the
size and structure of the Board remains
commensurate with the scale of the
Company and the geographies in which
itoperates (see the Nominations Committee
report on page 103).
For now, I would like to thank the entire
Petrofac team for their commitment to
the Company, their exceptional response
to the ongoing challenges, and their
contribution to the achievements of the
past year. I would also like to thank our
shareholders for their patience and loyalty,
and for the confidence shown through
2021’s refinancing.
René Médori
Chairman
23 March 2022
05Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Sami Iskander
Group Chief Executive
Establishing aplatform
for medium-term growth.”
Strategic report
Group Chief Executive’s review
06 Petrofac Limited 2021 Annual report and accounts

Overview
– Today’s Petrofac is a better company
– we have emerged from legacy
issues with strong controls, consistent
processes, and an unwavering
approach to ethical conduct
– Our capital raise was significantly
oversubscribed – showing that
investorssupport our strategy,
understand our differentiation,
andbelieve in our growth prospects
– We made progress in reshaping and
rebalancing Petrofac – and, byarresting
the decline in our backlog, are well
positioned to rebuild the business
– For 2022, the emphasis is to regainthe
confidence of clients, including a return
to bidding in markets from which we
have been temporarily excluded
– Over the medium term, I expect
Petrofac to deliver US$4-5 billion,
including US$1 billion of annual
revenues from NewEnergy Services
Although 2021 was another challenging
year, we made progress on several
fronts. The business was rebalanced and
reshaped, the decline in our order backlog
was halted, the Serious Fraud Office (SFO)
investigation was finally put behind us, and
the investment community signalled its
confidence in the Company, enabling us
tosecure a long-term capital structure.
Although the pandemic still exerts its
influence, 2022 is set to mark the beginning
of the rebuilding of our backlog. The bidding
environment is improving, and we see a
clear path to growth. In the medium term,
we expect Petrofac to be a US$4-5 billion
revenue business, with sector-leading
margins and more than 20% of our
revenuescoming from New Energies.
Acknowledging the continuing
impact of the pandemic
Once again, the year was overshadowed by
the pandemic. The biggest consequence
was project delays and additional costs.
Customers were also under pressure, so
commercial conditions remained tight.
In response, we continued to reduce our
costs, removing US$250 million from our
overhead and project support costs relative
to pre-pandemic levels, while being sure to
protect our delivery capability.
In the medium term,
weexpect Petrofac
to be a US$4-5 billion
revenue business, with
sector-leading margins
and more than 20% of
our revenues coming
from New Energies.”
With the increase in oil prices, the market
showed some signs of improvement
towards the end of the year, and the
bidding environment further into 2022
looks promising. However, this crisis
has always been characterised by
unpredictability, and we have prudently
braced the Group for continued
headwinds through 2022.
Emerging from the SFO investigation
A key milestone was the resolution
oftheSFO investigation. Casting its
shadow over the past four years, this
hasbeen a painful learning experience.
The commercial and reputational impact
was significant. Our teams felt badly let
down by the actions of former colleagues.
However, we have made sweeping changes
in recent years, and I am pleased that the
SFO and the Court commented publicly
on the extent and integrity of our reforms.
Consequently, we emerge a better Group,
with a world-class compliance regime,
more codified behaviours and values, a
more consistent approach to everything
we do, and a determination to regain the
confidence of all clients. I believe that
the industry is coming to recognise the
progress made, and we were pleased
to announce in March 2022 that we had
been reinstated to ADNOC’s bidding list
inthe UAE, which represents a major
market for us going forward.
Meanwhile, the subsequent refinancing
programme had two key outcomes: it
secured a long-term capital structure;
andit confirmed that the markets
have realconfidence in our Group, its
positioning, and our ability to deliver.
07Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Our strategy
at a glance
Strategic priority 1
Best-in-class delivery
– Simplify the organisation
– Global capability, local execution
– Digitally enabled
– Strategic partnerships/technology neutral
We will build relentlessly on our traditional strengths,
introducing new efficiencies and bringing greater consistency
to the way we operate the business – with a single technical
services organisation (1tec) providing support and assurance
and enabling us to operate with optimal efficiency.
A Petrofac differentiator is our local delivery model, helping us
bid on challenging projects, keep costs to a minimum, reduce
risk, and build stronger relationships with local stakeholders.
To build on this, we ensure that our local teams reflect the
clients they serve and deliver the highest levels of in-country
value (ICV) in our industry.
We invest in digitalisation and in our technical expertise to
maximise productivity and provide optimal solutions to our
clients. Being technology neutral ensures we specify the best
solution for each client. We develop strategic partnerships to
help us achieve the best outcome for our clients.
2021 achievements
– New operating model introduced with the creation of 1tec,
a single technical services organisation
– Local country managers appointed in India, Indonesia
Libya, Mozambique and Oman and a formal ICV
programme approved, including key targets and strategies
agreed for every country
– Digital solutions, such as Petrolytics, brought tangible
benefits to more clients, including costs savings, emissions
reductions, and optimised uptime
– Several new partnerships agreed including, in New
Energies, Protium, CO
2
Capsol, Storegga, Boya Energy,
andCranfield University
2022 priorities
– Leverage our new operating model to drive our excellence
agenda
– Preserve our cost-competitiveness by maintaining an
optimal cost structure
– Further strengthen our ICV proposition in each of our core
markets
– Continue to digitalise the business with a strong focus on
value creation
Rebalancing, reshaping, and rebuilding
The focus for my first full year in charge at Petrofac
was what I call the ‘Three Rs’, namely the rebalancing,
reshaping, and rebuilding of the business, and the
way this enables us to deliver on our strategy.
Across all three dimensions, progress was made –
not in abstractions, but in tangible developments.
As part of the rebalancing, the SFO investigation was
concluded, the refinancing was secured, overheads
were reduced, and the business was rightsized.
In terms of reshaping, we established a new
operating model. A key component is 1tec, a single
technical services organisation, providing support
and assurance, enabling us to operate with optimal
efficiency, with common systems and procedures,
backed by transparent checks and balances.
The rebuilding element remains a work in progress.
However, we did halt the decline in our order backlog,
we won business in new geographies such as the
Mažeikiai Refinery development in Lithuania, and added
considerable momentum to our New Energies business.
These Three Rs relate directly back to each of our
strategic priorities – by enabling best in-class delivery,
equipping us for a return to growth, and calibrating
the business for superior returns.
08 Petrofac Limited 2021 Annual report and accounts
Strategic report
Group Chief Executive’s review
continued

Strategic report Governance Financial statements
Strategic priority 2
Return to growth
– Rebuild backlog
– Selective growth in new geographies
– Leverage capabilities in New Energies
– Customer centric approach
As the oil and gas sector emerges from the COVID-19
pandemic with a strong macro backdrop, our core MENA
markets are expected to be the first to recover and provide
asustained period of growth.
Our clear priority in E&C is to capitalise on this recovery in our core
markets, whilst also targeting growth in selective new geographies.
In New Energies, we are focusing on four clearly defined segments
of the market where we have a strong track record and/or relevant
experience, namely offshore wind, carbon capture utilisation and
storage (CCUS), hydrogen and waste-to-value, and are achieving
strong growth. Meanwhile, Asset Solutions continues to deliver
significant revenue growth, and is expected to continue this
trajectory in 2022, supported by stronger order intake in 2021
anda healthy pipeline of opportunities.
As a services business, our clients sit at the heart of
everything we do – and our operating model creates a
customer centric approach, enabling the support of client
relationships across the Group.
2021 achievements
– The decline in our order backlog was halted, and the
bidding environment showed signs of recovery
– We successfully continued our push into new territories, with
the award of the Mažeikiai Refinery development in Lithuania
– With the SFO investigation resolved, we began the process
of re-engaging with clients in those markets from which we
had been temporarily excluded
– Strong progress in New Energies, with 16 contracts in
execution in 2021 compared with two in 2020
2022 priorities
– Rebuild the order backlog from a diverse pipeline of
opportunities in available core markets and targeted
growthin selective new markets
– Regain the confidence of clients, including a return to bidding
in markets from which we have been temporarily excluded
– Accelerate New Energies with a clear focus on early
worksthat have the potential to convert into EPC contracts
– Focus on the integration of our life-of-asset service
offerings to create pull-through, for example, from FEED to
brownfield modifications, emissions reductions, operations,
to full EPC and decommissioning
Strategic priority 3
Superior returns
– Integrated ESG delivery
– Enhanced risk management framework
– Deliver premium margins, consistently
– Capital light business model
– Maintain strong balance sheet
Petrofac has traditionally had a strong reputation for
operatingwith financial efficiency and generating sector-
leading margins. The headwinds of recent years, compounded
by the SFO investigation, dented our operational and financial
performance. We now have a clear pathway back to future
growth and the delivery of superior returns.
Our best-in-class delivery and our local market model enable
us to keep costs down, whereas the new operating model
provides a strong risk management and an independent
assurance function. Our ESG commitment brings additional
rigour to the way we manage the business, unlocks new
growth opportunities, and helps us meet client expectations.
We are confident that we will deliver our medium-term
ambition of US$4-5 billion revenue (more than 20% of which
from New Energies), with EBIT margins of 6% to 8% and a
strong balance sheet with net cash.
2021 achievements
– With the successful refinancing, we strengthened the
balance sheet, and secured a long-term capital structure
– We removed additional overhead and project support costs
– We continued to make progress on the ESG agenda –
enhancing our ICV ratio with 54% local procurement, and
strengthening our comprehensive compliance regime
– As part of our new operating model, we introduced enhanced
risk management and independent assurance capability
2022 priorities
– Maintain strict bidding discipline
– Fully embed the new operating model with enhanced risk
management processes to ensure consistent delivery and
differentiated margins
– Continue to collect and conserve cash and maintain
financial discipline
– Deliver on our ESG targets through emissions reductions,
greater diversity, strong ICV proposition, and maintaining
the highest standards of business ethics
09Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Helping clients meet the world’s
evolving energy needs
Another 2021 highlight was the
progress we made in New Energies.
We have a clear focus on four areas
wherewe already have a strong track
record or demonstrable experience –
namely offshore wind, CCUS, hydrogen,
and waste-to-value – and we made
progress against each of them.
Clearly, the most mature opportunity is
offshore wind. With more than a decade
of experience, we have delivered several
of Europe’s largest and most prestigious
projects and are currently executing three
EPC projects for offshore transmission
systems. We achieved a number of significant
milestones in the year, including installation of
the topside High-Voltage Alternating Current
(HVAC) units for both the Hollandse Kust
Alpha project in the Netherlands and for
theSeagreen project in the UK.
Most other New Energy projects are at
amore conceptual stage. Many are looking
to create first-of-a-kind projects, or to scale-
up pilot schemes. They want a partner who
can help them achieve project sanction,
secure investment, select technologies,
mitigate technical and execution risks,
andachieve certainty of cost and schedule,
all of which play to our strengths.
Looking ahead to 2022, approximately
US$7 billion of the Group bidding
opportunities are in New Energies,
whichspeaks to the current strength
aswell as the future opportunities of
thisrapidly growing part of our business.
Achieving global consistency
with local delivery
A differentiator of the Petrofac
modelis local delivery, and excellent
progress was made.
We want our local teams to reflect the
clients they serve and deliver the highest
levels of ICV in our industry. In 2021, we
formalised our ICV strategy, with key
targets and strategies for every country,
and strengthened our in-country teams.
Ultimately, we aim to be – and to be seen
as – an Omani business in Oman, an
Algerian business in Algeria, a Kuwaiti
business in Kuwait, and so on. As well
as being the right thing to do, this is a
source of competitive advantage, helping
us bid on challenging projects, rely on
local supply chains, keep costs down,
and build stronger relationships with
localstakeholders.
Delivering on the ESG agenda
How we do business is just as
important to me as what we do.
With a significant proportion of their
incentives tied directly tothe ESG
agenda, this has the attention of the
entire executive team, and more progress
was made in 2021. On the environment,
we provided details of how we would
meet our NetZero commitments,
eradicated the useofsingle-use plastics
at our major offices,andimproved our
emissions performance. On social, we
were somewhat preoccupied by the
impact of COVID-19 on our people and
their communities, including the support
ofvaccination programmes in Algeria,
India, and Iraq, but nonetheless made
progress on diversity and invested
in an already strong safety culture.
On governance, ethical behaviour is
paramount: compliance is a constant
focus, and we are working hard to
continue to build amore transparent
andopen culture.
10 Petrofac Limited 2021 Annual report and accounts
Strategic report
Group Chief Executive’s review
continued


For full biographies go to:
www.petrofac.com
A strengthened executive team
Afonso Reis e Sousa
Chief Financial Officer
Elie Lahoud
Chief Operating Officer,
Engineering & Construction
Nick Shorten
Chief Operating Officer,
Asset Solutions
John Pearson
Chief Operating Officer,
NewEnergy Services
Matthew Barton
Group General Counsel
Alison Flynn
Group Director of
Communications & Sustainability
Jim Andrews
Group Head of Health, Safety
and Environment
Des Thurlby
Group Director of
HumanResources
Leading the Petrofac
teambackto growth
2021 was another challenging year,
particularly for those working on our
operational sites, compounded by a
painful rightsizing process. Through it
all, our people showed resilience and
professionalism, and I would like to offer
my profound thanks to everyone for their
ongoing commitment to the Group.
Ultimately, this is a people business.
It isour employees who set us apart.
I am determined that Petrofac should be
a place where people feel proud to work,
without reservation, as well as a place
where they feel safe and cared for.
I am therefore looking to a refreshed
executive team to nurture their respective
organisations and ensure that we maintain
consistent standards everywhere we
operate. Four of my eight direct reports
are new to their role. We have also been
strengthening our in-country teams with
new local managers, and all of us share
real enthusiasm for the future of Petrofac
and the delivery of our strategy.
Skills and experience
International experience
8
Leadership
8
Engineering
4
Digital
6
Operational/strategic
management
8
HSE
5
Regulatory and governance
5
Oil and gas experience
6
Finance
2
11Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

and executing our strategy, we will
recoverand deliver sustainable value
forallour stakeholders.
Sami Iskander
Group Chief Executive
23 March 2022
Establishing aplatform
formedium-term growth
Although the coming year may be
characterised by uncertainty, we do
seeaclear pathway to strong growth
overthemedium term.
Irrespective of the speed of the global
energy transition, oil and gas will remain
an important part of the mix for the
foreseeable future. Given the current
investment climate, we expect the onus
for fulfilling this demand to fall largely on
National Oil Companies in the MENA
region, where Petrofac has a strong
trackrecord and a leading position.
At the same time, we expect a rapid
acceleration of investment in renewables,
considerable pressure on energy
companies to reduce their existing
emissions, and a shift in emphasis
tothose fossil fuels with lower carbon
intensities. We have shown that we are
well positioned to help clients tonavigate
these changes.
Helped by a recovery in oil and gas
prices, we successfully halted the
decline in our 2021 backlog, and have
a Group pipeline of US$37 billion that is
scheduled to be awarded to the industry
by the end of 2022. While the majority of
opportunities in E&C are scheduled for
award in the second half of the year, we
expect this to mark the beginning of a
multi-year upcycle, with more sustained
growth anticipated from 2023. Our recent
reinstatement to ADNOC’s bidding list
supports our confidence and will add
at least US$10 billion of opportunities
in 2023. This strong outlook and a
commitment to strict bidding discipline
in pursuit of quality backlog supports
our ambition to become a US$4-5 billion
revenue company, with at least 20% of
our revenues coming from New Energies,
sector-leading EBIT margins of 6% to 8%,
and a net cash position. I am therefore
confident that, by following through on
thechanges implemented in 2021,
Positioned for recovery
and sustained growth.”
12 Petrofac Limited 2021 Annual report and accounts
Strategic report
Group Chief Executive’s review
continued

2020
27%
29%
24%
4%
12%
5%
141.8
187.9
162.2
16%
27%
24%
2%
6%
26%
12%
22%
20%
3%
37%
7%
3%
8%
11%
67%
11%
STEPS 2050
1
APS 2050
2
NZE 2050
3
Coal Oil
Renewables Other
Source: International Energy Agency, World Energy Outlook 2021
(1) STEPS Stated Policies Scenario
(2) APS Announced Pledges Scenario
(3) NZE Net Zero Emissions by 2050
Natural gas Traditional use of bio mass
2020
381
62
104
547
423
70
121
614
468
81
126
675
476
85
105
666
493
91
109
693
509
97
84
690
2022 20232021 2024 2025
Upstream
Source: Rystad, GlobalData and Petrofac analysis
Refinery Petchem
2020
Offshore wind
GW installed
capacity in Europe
Waste-to-value
SAF demand kbpd
Carbon Capture & Storage
Million tonnes
captured per annum
Hydrogen
Global production Mtpa
20502030
2020
Source: Wind Europe
Source: Carbonomics, Goldman Sachs
Source: Carbonomics, Goldman Sachs
Source: Carbonomics, Goldman Sachs
25
110
400
40
1,000
7,000
100
1,000
11,000
7
125
516
20502030
2020 20502030
2020 20502030
Market
outlook
As the world emerges
from the pressures
of the COVID-19
pandemic, and the
energy transitionbuilds
momentum, Petrofac
is well positioned
for long-term growth.
In the long term
The long-term fundamentals are strong.
In all plausible scenarios, absolute
energy demand is expected to remain
robust, andoil and gas will continue to
be a significant proportion of the global
energymix, even as far as 2050.
Whatever the pace of the energy transition,
all forms of energy will be required for
several decades (see chart 1).
We are active in the most robust
hydrocarbon markets within the upstream,
refinery, and petrochemical sectors,
and expect to see sustained spending,
particularly in the MENA region, driven
byambitious OPEC production targets
(seechart 2).
At the same time, there will be an
acceleration of investment in new energies,
including strong growth in offshore wind,
CCUS, hydrogen and waste-to-value
(W2V) projects. In each of these, Petrofac
has strong credentials and a rapidly
developing track record, and expects
tosee exponential growth (see chart 3).
Under pledges made at COP26 in Glasgow,
reducing emissions will be a key priority
in all markets. There will therefore be
considerable pressure on energy companies
to reduce the carbon intensity of their
existing operations and to shift their focus
to lower intensity fuels, such as natural gas.
At Petrofac, we are committed to reducing
our own emissions (with a 2030 Net Zero
commitment) and are well equipped to
assist clients in reducing theirs.
Chart 3. New energy capex forecasts
Exponential growth across our focus sectors
Chart 2. Oil and gas investments $bn
Chart 1. Total primary energy supply by fuel and scenario
13Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

2020
310
62
19.9
352
71
20.3
126
356
80
22.4
105
378
85
22.4
391
91
23.2
2023 20242022 2025
Global (excl. MENA)
Source: Rystad
MENA MENA % of total
100 200 300 400 500
Onshore Middle East
Oil sands
RoW onshore
Source: Rystad Energy UCube
Numbers shown represent the average breakeven price
Deepwater NA tight liquids
Shelf Extra heavy oil Russia onshore
0
0
10
20
30
40
50
Brent breakeven price ($/bbl)
Total recoverable liquid resources (billion bbl)
60
70
80
90
100
•
32
•
37
•
42
•
40
•
54
•
45
•
55
•
36
In the short to medium term
To satisfy immediate demand and
compensate for several years of under-
investment, as clients prioritised cash
preservation over new investments,
considerable spend is forecast in
production infrastructure, particularly
inPetrofac’s core MENA markets.
The investment case is made stronger by
the return to higher oil prices, which are
expected to remain elevated due to the
supply shortages and growing demand
as global economies recover from the
pandemic. With many of the International
Oil Companies maintaining capital
discipline, focusing on decarbonising,
and allocating an increasing proportion of
investments to new energies, much of the
supply gap is expected to be met by the
National Oil Companies, which are set for
a sustained period of production growth.
By virtue of our geographic focus,
Petrofac is well positioned to benefit.
Regardless of one’s view on the pace
of the energy transition, the MENA
geographies are where the last barrels
ofoil will be produced due to their low
costs of production (see charts 4 and 5).
Petrofac has an extensive track record
and a leading position in MENA, where
investment is expected to grow at a
10% CAGR between 2021 and 2025.
Our leading position in these markets has
been established through our local delivery
model, which enhances our understanding
of local markets, de-risks delivery, and
generates sector-leading margins.
Chart 4. Global upstream capex forecasts $bn
MENA region to grow at 10% CAGR 2021-2025
Chart 5. Global liquid cost curve
Whatever the pace of the
energytransition, all forms
of energy will be required
forseveral decades.”
14 Petrofac Limited 2021 Annual report and accounts
Strategic report
Group Chief Executive’s review
continued

2020 2021
CCUS
Hydrogen
Offshore windWaste-to-value
Meanwhile, as the energy transition gathers
pace, we have built on our existing new
energy credentials, largely in offshore
wind, and have secured a series of
contracts across CCUS, hydrogen and
waste-to-value, significantly enhancing our
experience. We have also created alliances
with several technology providers and
developers to best position the Group
togrow in these sectors.
In the near term, offshore wind continues
to represent the most material opportunity
in new energies, and we expect to be
competitive on several EPC opportunities
in 2022. The medium-term outlook is
further enhanced by ScotWind’s recent
award of 25GW of offshore wind seabed
leases, which is more than twice the UK’s
existing installed capacity.
By 2025, the addressable market
for Petrofac is expected to exceed
US$105 billion per annum, comprising
US$70 billion in upstream oil and gas,
refining and petrochemicals, US$20 billion
in new energies, and US$15 billion in
operating expenditure.
Of course, uncertainty regarding the future
impact of the pandemic remains in focus
as well as the pace of recovery in client
spending. However, with a Group pipeline
of US$37 billion scheduled to be awarded
to the industry by the end of the year,
we are well positioned for recovery, and
expect to deliver sustained growth over
the medium term.
New Energies’ pipeline in 2022Growth in new energy projects
Number of contracts in execution in
the year
US$6.8
billion
Offshore wind 26%
CCUS
22%
Waste-to-value 22%
Hydrogen
30%
15Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Driven Agile Respectful Open
Strategic report
Our business model
What we do
Strategic report
Our business model
Our purpose
We enable our clients to meet
the world’s evolving energy needs.
Our vision
To be the preferred services
partner to the energy industry.
Our values
Our resources
The right people and culture
As a service business, it is our people, their capabilities and
skills that set us apart from our competitors. Our values and
behaviours underpin our ways of working. We are committed
to developing our people, identifying and nurturing future
leaders, and enabling everyone within the business to perform
to their true potential and make a real difference.
Strong and trusted relationships
Our deep understanding of our sector allows us to develop
and deliver solutions that solve our clients’ problems.
Our knowledge and skills
We develop deep knowledge of the many businesses in
our supply chain; we know when and how to call on their
respective strengths to deliver for our clients.
Asset light
Low capex, highly cash flow generative business model,
witha long-term capital structure in place.
Making a positive contribution
We aim to make a positive contribution to the societies in
which we operate. We are committed to ethical conduct, put
an emphasis on safety, care deeply about creating in-country
value and, to minimise our environmental impact, have set a
Net Zero target for carbon emissions.
Design
Engineering expertise is at
the heart of everything we
do. We provide a full suite
ofengineering services from
conceptual and feasibility
studies and Front-End
Engineering and Design
(FEED) to detailed design.
Build
We build some of the
world’s largest energy
facilities, leveraging our
differentiated engineering,
procurement, construction
and commissioning skills
to safely deliver projects on
time and on budget. We offer
clients a range of flexible
commercial delivery models,
from lump-sum turnkey
tofullyreimbursable.
Our services
Oil and gas
processing facilities
Storage and
pipelines
1.
Best-in-class
delivery
2.
Commitment to
bidding discipline,
and prioritising
differentiating
margins
3.
Trusted partner
with long-
standing client
relationships
Find out more at:
www.petrofac.com
How we do it
differently
16 Petrofac Limited 2021 Annual report and accounts

Find out more at:
www.petrofac.com
Operate
We safely operate and maintain
energy facilities on behalf of
our clients through a variety
of services, from the provision
of labour to fully managed
solutions. The deployment
of digital technologies is
atthe heart of our offering
as we focus on maximising
productivity and efficiency.
Train
We develop local workforces
through a range of services,
from assessing capability
needs and creating tailored
training courses to designing,
building and managing state
of the art training facilities.
Our unique offering is
supported by industry-
leading software solutions.
Decommission
We decommission energy
assets at the end of their life,
delivering an integrated services
offering to extend production,
while minimising operating and
abandonment expenditure.
Client value
Benefiting from certainty
ofcost and delivery, utilising
commercial models that
meet their needs.
In-country value
Developing local skills
andcapabilities, benefiting
local development and
stimulating productivity
inlocal economies.
Social performance
54%
on local goods and services
(2021)
Tax spend
$157m
Employee value
84%
Employee engagement
score
8,200
employees (13% decrease)
Emissions reduction
Emission reductions and
low-carbon offering on
tenders, enabling clients to
meet their targets.
Value
created
in 2021
Refining and
petrochemicals
Offshore production Offshore wind
4.
Local delivery model:
employ local people,
build local supply
chains, and develop
local capabilities
and talent
5.
Engineering
expertise, expertly
delivered across the
life cycle of energy
assets
6.
A problem-
solving culture
that harnesses
innovation and digital
technology to find
new ways to add
value
7.
A focus on
maintaining a
strong balance
sheet
17Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Working with local
supply chains
Wherever in the world we operate, we
always prefer to work with local vendors
and support local supply chains.
A hallmark of our approach is the way we
nurture local supply chains, helping them
develop their competencies, capabilities,
and quality standards. A good example is
Oman, and the way we have delivered the
OQ-LPG project in the region of Salalah,
where we engaged with more than 300
locally-based businesses. At the outset,
we hosted a roadshow for more than 100
companies, to gain an understanding of
their respective credentials, specialisms,
and appetite for growth. We then ensured
they were included on the relevant
invitations to tender – not just for direct
contracts, but also those issued by our
main subcontractors.
When we identify a vendor with the
appetite for growth, we offer practical
support. For example, we advised
Dhofar Structures and Iron Industries,
a Salalah-based steel fabricator, on
thebest equipment to invest in, helped
it to embed a strong safety culture, and
introduced it to potential customers across
Oman. Since we first started working
together, the company has increased
itsmanufacturing capacity three-fold.
Global
reach, local
delivery
Strategic report
Key achievements of 2021
18 Petrofac Limited 2021 Annual report and accounts

Appointing more
local country managers
While Petrofac has always benefited
from an ethnically diverse workforce,
comprising more than 60 nationalities,
we do want all our teams to become
more representative of the societies in
which they work – especially at senior
management levels.
To this end, we made a series of significant
hires in 2021, including the appointment
of local nationals as country managers
inIndia, Indonesia, Libya, Mozambique
and Oman.
For example, in August 2021, Dr Khalid
Al Jahwari joined us as Country Manager
for Oman, bringing more than 20 years’
experience in the energy industry,
with a varied background in technical,
commercial and management roles
from across the Middle East, Africa and
Europe. Most recently, he was Shell’s
Creating value
in Algeria
We have been creating value in Algeria
for 25 years, and have contributed to
many of the country’s most significant
energy assets.
A support office in Algiers is supplemented
by a busy operations hub in Hassi
Messaoud, plus project sites in Tinrhert
and Ain Tsila. Depending on the nature and
stage of our projects, we typically employ
more than 800 people in Algeria, more
than half of whom are Algerian nationals.
Through sub-contractors, several thousand
more people are generally employed on
Petrofac-led projects and, in 2021, more
than 85% were Algerian nationals.
We also nurture local supply chains.
In thepast five years, 5,300 purchase
orders were placed with Algerian vendors
and service providers, with an in-country
spend of US$642 million, while some
60% of goods and services are typically
sourced from locally-based suppliers and
subcontractors.
We continue to invest heavily in training
and development. We designed, built
and operate the Hassi Messaoud
Construction Skills Training Centre,
with the capacity to deliver skills-based
training to 400 delegates annually.
A five-year development plan is set to
deliver additional modules, third-party
certification, and management training
for supervisors.
Strategic report Governance Financial statements
General Manager for Operations in Egypt
and, prior to that, Global Production
Excellence Leader for Shell based in the
Netherlands. He also spent 15 years with
Petroleum Development Oman with key
roles in areassuch as operations, well
engineering, and strategy.
At Petrofac, he has a mandate to develop
Oman into one of our major operational
hubs, to match those currently located in
the UAE, India, and the United Kingdom,
and has big ambitions to grow the order
backlog and, with it, the size of the in-
country team. To match Oman’s oil and
gas heritage, he also sees considerable
opportunity for the Sultanate to become
aglobal leader in new energies. “With
along coastline, intense sun, strong
winds, and an energy mindset, Oman
isperfectly positioned to be a global
leader in newenergies.”
Oman is perfectly
positioned to be a global
leader in new energies.”
19Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Measuring our progress
Petrofac sets key performance (KPI) targets
and assesses performance against these
benchmarks on a regular basis.
Part of the 2021 Executive Directors’ Remuneration
Revenue -25%
Description
Measures the level of revenue of the business.
Measurement
Revenue for the year as reported in the consolidated
income statement.
2019
2020
202 1
US$5,530m
US$4,081m
US$3,057m
EBITDA
1
-51%
Description
EBITDA means earnings before interest, tax, depreciation
and amortisation and provides a measure of the operating
profitability of the business.
Measurement
EBITDA is calculated as operating profit, including the share
of profit from associates and joint ventures, adjusted to add
back charges for depreciation and amortisation (see A3 in
Appendix A ofthe consolidated financial statements).
2019 US$559m
2020 US$211m
202 1 US$104m
Reported net profit/(loss)
2,3
-2%
Description
Measures the reported net profitability of the business.
Measurement
Reported net profit/(loss) attributable to Petrofac Limited
shareholders per the consolidated income statement.
2019 US$73m
2020 US$(192)m
202 1 US$(195)m
Business performance net
profit
1,2,3
-30%
Description
Provides a measure of the net profitability of the business.
Measurement
Business performance net profit attributable to Petrofac
Limited shareholders, as reported in the consolidated
income statement.
2019 US$276m
2020 US$50m
202 1 US$35m
Return on capital employed
(ROCE)
1,3
3.7%
Description
ROCE is a measure of the efficiency with which the Group is
generating operating profits from its capital.
Measurement
Return on capital employed (ROCE) is calculated as EBITA
(earnings before interest, tax and amortisation, calculated
as EBITDA less depreciation) divided by average capital
employed (see A9 in Appendix A of theconsolidated
financial statements).
2019
2020
202 1
23.3%
7.1%
3.7%
20 Petrofac Limited 2021 Annual report and accounts
Strategic report
Key performance indicators

Business performance diluted
earnings per share (EPS)
1,2,3
-34%
Description
EPS provides a measure of net profitability of the Group
taking into account changes in the capital structure, for
example, the issuance of additional share capital.
Measurement
Business performance diluted EPS attributable to Petrofac
Limited shareholders, as reported in the consolidated
income statement and calculated in accordance with note 9
of the consolidated financial statements.
2019
2020
202 1
80.4¢/s
14.8¢/s
9.7¢/s
Free cash flow
4
Description
These KPIs measure both the absolute amount of cash
generated from operations and the conversion of EBITDA
to cash.
Measurement
Free cash flow, as per appendix A7 of the consolidated
financial statements. Cash conversion is calculated as
cash generated from operations divided by business
performance EBITDA.
2019 US$138m
2020 US$(123)m
202 1 US$(281)m
Cash conversion
3
2019 71%
2020 36%
202 1 0%
Backlog -20%
Description
Provides a measure of the visibility of future revenues.
Measurement
Backlog consists of: the estimated revenue attributable to the
uncompleted portion of Engineering & Construction operating
segment contracts; and, with regard to Asset Solutions, the
estimated revenue attributable to the lesser of the remaining
term of the contract and five years.
2019
2020
202 1
US$7.4bn
US$5.0bn
US$4.0bn
Employee numbers -13%
Description
Provides an indication of the Group’s service capacity.
Measurement
For the purposes of the Annual Report, employee
numbers include contract staff and the Group’s share of
joint venture employees.
2019
2020
202 1
11,500
9,400
8,200
Lost time injury
Description
Provides measures of the safety performance of the Group,
including partners and subcontractors.
Measurement
Lost time injury (LTI) and recordable injury (RI) frequency
rates are measured on the basis of reported LTI and RI
statistics for all Petrofac companies, subcontractors and
partners, expressed as a frequency rate per 200,000 work
hours. We aim continually to improve our safety record, but
our target for these measures is zero.
2019 0.013
2020 0.013
202 1 0.018
Recordable injury frequency rates
2019 0.060
2020 0.065
202 1 0.091
1 Business performance before separately disclosed items. This measurement is shown by Petrofac as a means of measuring underlying business performance.
2 Attributable to Petrofac Limited shareholders, as reported in the consolidated income statement.
3 The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9 of the consolidated financial statements.
4 Definition amended to include repayment of lease liabilities. 2019 and 2020 figures have been restated accordingly.
21Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Shareholders
Delivering an attractive return to our shareholders is
acore priority for the Board. Their views are considered
during strategy discussions to enable the Board to provide
information that will drive informed investment decisions.
Our vision
To be the preferred
services partner to
the energy industry
Shareholders
Petrofac is focused on driving long-term sustainable performance
for the benefit of all stakeholders, and this can be best supported
through proactive and effective engagement. We believe that by
taking into account what matters to our stakeholders, we can
secure long-term success for the business.
The Board has engaged proactively with key stakeholder groups
during the year. We have been able to better understand their
concerns and issues, which has been of particular importance
inlight of the challenges faced in recent years.
Stakeholder engagement below Board level is also important.
The requirements identified are considered in business
decisionstaken across the Group, to ensure effective and
continued engagement.
Further details on Board stakeholder engagement can be found
in our Governance report on page 101.
Key interests
– Financial performance and returns
– Conclusion of the SFO investigation
– Application of the business model
– Implementation of our strategy
– Governance matters, including Board effectiveness,
succession and remuneration
– Sustainability and ESG performance
– Strong leadership
– Reputation
How we engage
– Regular meetings and roadshows held with key investors
todiscuss strategy, operational and financial performance
– Management presentations provided to institutional investors
following publication of our results, which are streamed live via
a webcast and are available on our website
– The Chairman and the Remuneration Committee Chair
engage with investors on matters relating to governance,
succession and remuneration
– Shareholders have the opportunity to ask questions at general
meetings
– Regular updates provided to the Board on investor sentiment
Outcome of engagement
– The Board reflected on the ongoing external impacts on the
Group and consequently no dividend was recommended
– Extensive engagement was undertaken upon conclusion of
the SFO investigation in relation to the refinancing project.
During the year, approximately 120 meetings with key
shareholders, investors and analysts were held
Further links
Financial review, pages 83 to 87
22 Petrofac Limited 2021 Annual report and accounts
Strategic report
Stakeholder engagement

Key interests
– Implementation of the strategic agenda
– Business model application
– Ethical credentials
– Transparent tendering process
How we engage
– Attendance at industry events, such as EIC Connect Oil, Gas
& Beyond
– Engagement between supply chain partners and our
Compliance function to ensure understanding and compliance
with our Code of Conduct
– We work with our extended supply chain to uphold and
advance human rights throughout our operations to ensure
everyone who works with and for us are treated with respect,
fairness and dignity
Outcome of engagement
– Our supplier portal is a key tool that enables each supplier’s
offering to be understood, allowing improved collaboration
through the procurement cycle
– As part of our sustainability strategy, we are committed to
working with our supply chain to assist in setting their own
emissions targets to support their lower carbon ambitions
– Performed annual assessment of our operations for human
rights issues
– Petrofac remains a member of the UK Prompt Payment Code
Further links
Global reach, local delivery case studies pages 18 and 19
ESG, pages 35, 40 and 56
Suppliers
Strong supplier relationships ensure sustainable,
high-quality delivery for the benefit of all stakeholders.
So, wherever the Group operates, we are committed
toemploying local people, working with local suppliers
and developing local capabilities.
Key interests
– Career and development opportunities
– Diversity and inclusion matters
– Health, safety and wellbeing
– Fair pay and reward
– Implementation of the strategic agenda and the impact
ofdigitalisation
– The energy transition agenda
How we engage
– Regular interaction between the Board and management
during and after Board meetings, focusing on performance
and strategy
– Talent management and succession plan discussions
– Direct engagement via the Employee Workforce Forum
– Senior management attendance at townhalls
– Annual employee surveys
– Internal engagement campaigns to reinforce important topics
such as health & safety, compliance, diversity & inclusion,
mental health awareness and Net Zero initiatives
Outcome of engagement
– Extensive internal communications on COVID-19 impact,
including mental health awareness programmes
– Mentoring programmes introduced
– Diversity and inclusion employee network groups created
– Board endorsement of new diversity targets
– PetroVoices survey issued
– The opportunity for employee shareholders to take part in
theOpen Offer
– Engagement in relation to the rightsizing of the business
Further links
ESG, pages 49 to 51
Employees
We are fundamentally a people business, and our
employees are the driving force behind our Group.
Their capabilities and skills set us apart from our
competitors and we are committed to ensuring
wehavesafe and effective working environments,
whichenable everyone to perform to their true potential.
Employees
Suppliers
23Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Key interests
– Investments in local supply chains
– Supporting infrastructure improvement programmes
– Human rights matters
– Local employment opportunities
– The impact of activities on the wider community
– STEM education initiatives
How we engage
– Ad hoc face-to-face meetings with local communities
– Vocational development programmes with our local partners
– Public consultations
– Our ICV programmes are continually reviewed and extended
to grow sustainable economies and create value for the Group
as well as local communities
Outcome of engagement
– Several social programmes are in place which are focused
onbuilding capacity with the local supply chain, creating local
jobs, and supporting vocational training and apprenticeships
and scholarship programmes
– A team in India worked in collaboration with Samhita’s
Collective Good Foundation and Vaccine on Wheels, to offer
support and help to deliver COVID-19 vaccines to vulnerable
people in the community with limited access to healthcare
Further links
ESG, pages 52 to 55
Communities
We actively support local communities to address
local issues responsibly and manage the social and
environmental impacts of our business, which we believe
will bring long-term sustainability to the communities
where we work.
Key interests
– Operational delivery
– Implementation of the strategic agenda
– Ethical credentials
– Consideration and development of an ESG strategy
How we engage
– Meetings with key clients, involving Executive Directors
and members of senior management
– At industry events
– Via our website
– At trade shows and conferences
– Online materiality review surveys
Outcome of engagement
– Close collaboration with clients was of paramount importance
throughout the year to ensure operations and projects could
continue, despite the ongoing restrictions caused as a
result of the COVID-19 pandemic
– Following the conclusion of the SFO investigation, engagement
with clients to outline our robust compliance framework
– Greater deployment of new digital technologies enabled us
toovercome many of the challenges presented by COVID-19
and conduct virtual site audits, perform equipment inspections
and safely mobilise our people in offshore locations
Further links
Best-in-class delivery case studies, pages 72 to 74
Clients
The better we understand the needs and
concernsofour clients, the better we can serve
them. Ongoing engagement ensures these matters
are considered, while gaining relevant feedback and
views,inthe identification of growth opportunities.
Clients
Communities
24 Petrofac Limited 2021 Annual report and accounts
Strategic report
Stakeholder engagement
continued

Key interests
– Health and safety matters
– Performance against regulatory targets
– Governance and compliance matters
– The Energy Transition agenda
– Taxation
– The UN Climate Change Conference (COP26)
How we engage
– Through the UK regulator Oil and Gas Authority (OGA)
– Through our representation with trade bodies, such as Oil &
Gas UK, the EIC, CBI and Renewable UK
– Participation in round table and industry consultations on
issues that are relevant to our business, e.g. Carbon capture,
utilisation and storage (CCUS) business models
– Responding to consultations on issues affecting the industry
Outcome of engagement
– Our New Energies team met with a local MP to discuss the
importance of hydrogen to the UK economy and the role we
can play in hydrogen projects both in the UK and overseas
– In Oman, we hosted UK Government representatives at our
Duqm site
– We attended the World Future Energy Summit in Abu Dhabi,
where the theme was on the transition to low carbon energy
Further links
ESG, pages 41 and 42
We are subject to the laws and regulations of many
governments and regulators across the world. As a result,
we are committed to engaging constructively on a range
of issues, as local and central government policy and
regulation can have implications for our business.
Governments,
regulators and
industry bodies
Capital raise and refinancing
The Board considered several factors when looking at
launching a capital raise during the year, including the
best interests of shareholders, investors and employees.
Providing financial certainty was felt to be important for
employees, many of whom are also shareholders.
The Board and its advisors consulted with many shareholders
shortly before and during the proposed project. Based on
the engagement and the strong investor appetite, the Board
decided to launch the capital raise at US$275 million.
The Board was mindful that the quantum of the offer capital
raise would require significant investment by shareholders.
However, it also considered that the trading environment
remained uncertain and, having reviewed the Group’s long-term
capital and liquidity needs, raising their amount of equity was
prudent given downside risks and supported management’s
ability to deliver long-term value for shareholders.
Rightsizing the business
During the year, management continued its actions to
control costs, protect the Group’s balance sheet and maintain
liquidity, taking into account the constraints placed on the
Group’s ability to generate revenue. Although the Group took
advantage of Government support initiatives and financing
facilities, redeployed staff where possible and implemented a
package of other mitigations, a number of redundancies were
unfortunately inevitable due to the economic environment in
which the Group was operating and continues to operate.
The Board has given its full support to management with
respect to the package of measures that has been employed
to rightsize the business, taking into account the impact on
the Group’s employees.
Through updates received from management, the Board is
satisfied that actions taken to date are in line with the Group’s
culture and values: importantly that redundancies were made
with respect and sensitivity, with the aim of mitigating the
impact on those employees affected. In its support of the
rightsizing actions, the Board had regard to the interests of
employees and to the needs of the Group’s other stakeholders.
The Board’s decision to support management was based on
the Board’s responsibility for safeguarding the future success
of the Company.
We believe that open
engagement is central
to how we do business
to ensure the effective
delivery of our strategy.”
Examples where the Board actively
considered stakeholders when
making key decisions
25Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Infinite Blue Energy
Arrowsmith Hydrogen
Project, Australia
The Arrowsmith Hydrogen Project is a
proposed green hydrogen project being
developed by Infinite Blue Energy near
Dongara in Western Australia, 320 kilometres
north of Perth. It will have a production
capacity of 25 tonnes of green hydrogen per
day, derived from renewable energy sources.
To produce this volume of hydrogen, the
plant includes around 100 MW of solar
power, supplemented by 114 MW of wind
generation capacity, both generated onsite.
The scope of work covered every element
of the project and its operations, from the
power that generates the electricity to
electrolyse the water, to the roads, cables,
substations, piping integration, nitrogen,
and buildings for people to shelter and
work in. To successfully deliver the front-
end engineering and design (FEED) for the
project, we brought together our expertise
across renewable energy, low carbon
engineering, and gas processing.
One of the requirements was a hydrogen
storage facility, with the capacity for 2 to 4
days’ production capacity. We came up with
an ingenious solution, in which the volume of
hydrogen is kept to a minimum by storing it
as a high-pressure gas in several kilometres
of large diameter steel piping arranged in a
line packing approach (like a busy airport
security queue).
Meanwhile, our safety management
framework identified and modelled all major
accident hazards and identified prevention
measures, with specific engineering
safeguards built into the design.
New
energies
Strategic report
Key achievements of 2021
26 Petrofac Limited 2021 Annual report and accounts

Stockholm Exergi,
Sweden
Stockholm Exergi, the energy company
that provides heating, cooling, electricity,
and waste management services across
the Stockholm region, awarded us a FEED
contract for a planned CO
2
capture facility at
one of its combined heat and power plants.
This will support Stockholm Exergi’s goal
of reducing carbon emissions while also
meeting the energy needs of the city and
the surrounding area. Our scope of work
covers a plant capable of capturing more
than 800,000 tonnes of CO
2
every year,
along with CO
2
compression, dehydration,
liquefaction, onsite storage, and an outward
shipment terminal, from where the CO
2
will
be transported to its final storage site.
As well as extending our carbon capture
credentials, the project takes us into the
Swedish energy market for the first time.
Protium and Quorn, UK
Through our strategic partnership with
green hydrogen specialists Protium, we
have been contributing to several intriguing
and innovative hydrogen projects. We are
exploring the deployment of green hydrogen
technology to enable Quorn, the meat-free
manufacturer, to accelerate its ambitious
decarbonisation plans.
Drawing on our process engineering skills,
we are assessing how the introduction of
dual-fuel boilers (combusting both hydrogen
and natural gas blend) could meet Quorn’s
expanding production capacity. We are also
working with Protium to explore the feasibility
of supplying green hydrogen via a pipeline as
part of its green hydrogen project in Teesside.
The project could serve as a blueprint for
other manufacturing companies looking
to decarbonise their manufacturing
processes, not only in the vegan protein
space but across the broader food and
beverage manufacturing sector – which,
collectively, accounts for 35% of the UK’s
total CO
2
output.
Our scope of work
covers a plant capable
of capturing more than
800,000 tonnes of CO
2
every year.”
Strategic report Governance Financial statements
27Petrofac Limited 2021 Annual report and accounts

28 Petrofac Limited 2021 Annual report and accounts
Strategic report
Key achievements of 2021
continued

Offshore wind plays
a crucial role in the
energy transition.”
Over the past four years, we have
been working towards the delivery
of two 700-megawatt transformer
substations for the Hollandse Kust Zuid
(HKZ) windfarm zone in the North Sea.
Located 20 kilometres off the Dutch
coast, and stretching for more than
235square kilometres, it comprises
four350 MW offshore windfarms – and
our involvement adds to our decade-long
experience in offshore wind.
With a combined value of US$200 million,
the contract, awarded by the Dutch-
German transmission grid operator
TenneT, covers the engineering,
procurement, construction and
offshoreinstallation of the HKZ
platformsAlpha and Beta.
Both the jackets and the first of the
topsides have now been installed in
the North Sea. The installation of the
second topside, together with the final
completion and commissioning work,
arescheduled for 2022.
At 50 metres long, 34 metres wide and
44 metres high, the jackets are anchored
to the seabed by six piles, each weighing
162.5 tonnes, while each of the topsides
weigh in at 3,800 tonnes.
As ever, safety has been a priority.
The fabrication of the first of the top
sides involved 2.57 million work hours.
Yet the entire process was completed
without a single lost-time incident (LTI).
Our involvement
adds to our decade-
long experience in
offshorewind.”
HKZ, The Netherlands
29Petrofac Limited 2021 Annual report and accounts
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“How we do business
is as important to me
as what we do.”
Complete alignment
between our business
model and our
ESGagenda
Our business model and our ESG
agendaare completely aligned.
We see the energy transition as a strategic
opportunity, the creation of in-country value
is central to our local delivery model, and
our best-in-class delivery is characterised
by uncompromising commitments to ethical
behaviour, safety, employee wellbeing,
diversity and inclusion.
Ultimately, our role is to help clients to meet
the world’s evolving energy needs – and this
means our purpose is intrinsically linked with
overcoming one of the biggest challenges
currently facing humanity, namely the
decarbonisation of the global energy sector.
A stronger, better company
In recent years, it was difficult to talk
candidly about Petrofac’s ESG agenda
without also referencing the Serious Fraud
Office (SFO) investigation. The commercial
and reputational impact was significant,
and obscured much of the good work
we were doing in areas such as the
30 Petrofac Limited 2021 Annual report and accounts
Strategic report
Environmental, Social and Governance

environment, human rights, in-country
value, and employee engagement.
Itmade us reflect even more deeply on
theimportance of how we do business.
With this regrettable episode very much
in the past, I know that we are now a
stronger, better Company. We have a
deep commitment to ethical conduct,
backed by a world-class compliance
regime, more codified behaviours and
values, and a determination to regain
theconfidence of all clients – and this
exists within the context of a broader
ESGagenda, which encapsulates our
approach to how we do business.
Clear commitments
andsolidprogress
ESGhas the full attention of the Executive
team, and we are making demonstrable
progress on many fronts.
In 2021, for example, we gave details
of how we would meet our Net Zero
commitments, eradicated the use of
single-use plastics at all our permanent
offices, andimproved our emissions
performance. We also made progress
on diversity andinclusion, introducing
several relatedinitiatives, and setting
moreambitious targets.
Meanwhile, an already strong safety
culture was bolstered with new senior-
levelappointments.
Putting our people first
We also remain acutely aware of the
impact of COVID-19 on our people
andtheir wellbeing.
2021 brought another difficult rightsizing
programme: the pandemic created
continuing disruption, especially for onsite
teams, and morale was inevitably impacted.
We have therefore been increasing our
focus on employee engagement.
I should stress that this is just a snapshot.
As I hope this report demonstrates, these
few highlights exist within a Petrofac
approach to ESG which is holistic as
wellas authentic.
Sami Iskander
Group Chief Executive
Defining our
materialissues
Understanding what matters most
to our stakeholders
To understand what matters to
them most, we formally engage with
representatives from various stakeholder
groups (including clients, suppliers,
investors, NGOs, policymakers,
employees, and our supply chain)
and align our Environment, Social
andGovernance (ESG) priorities to
thematerial issues identified.
In 2021, we undertook a limited materiality
review, updating our previous survey with
a programme of more focused one-on-
one discussions with key stakeholders.
We also consulted employees from
across the business through various
webinars and engagement events
tolistento their views and better
understand their priorities.
Based on this engagement, we maintain
amateriality matrix, which is used to
inform our sustainability strategy and
guide our ESG programmes.
1. Define internal and external
stakeholders Broad selection
taken from key stakeholder groups
andgeographies.
2. Stakeholder information gathered
Via survey questionnaires,
stakeholderroadshows, and
variousengagement events.
3. Follow-up engagement sessions
One-to-one sessions with key
stakeholders to ‘deep dive’ on
specifictopics and emerging issues.
4. Materiality reviews Collate and
evaluate data, review accompanying
commentary and rank issues.
5. Finalise materiality matrix
Material issues presented to the
Sustainability Steering Committee
and executive management to inform
strategy and disclosure.
Environmental aspects
1. Tackling climate change
2. Environmental accidents
3. Plastic pollution
4. Biodiversity
Social aspects
5. Diversity and inclusion
6. Worker welfare
7. Human rights
8. In-country value
9. Process safety
10. Emergency preparedness
11. Safety systems
12. Worker safety
Governance aspects
13. Whistleblowing
14. Responsible governance
15. Anti-bribery and corruption
16. Ethical conduct
Material issues
The ESG issues that
matter mosttoour
stakeholders
Importance to external stakeholders
High materialityMaterialSomewhat material
Somewhat material Material High materiality
Importance to Petrofac
1
4
2
3
5
8
9
10
11
12
13
14
15
16
6
7
31Petrofac Limited 2021 Annual report and accounts
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An ESG framework focused
onshared value
Aligning with the sustainable development goals
Our sustainability strategy is aligned with the seven UN
Sustainable Development Goals that we believe are most
relevant to Petrofac’s business.
Embedding our sustainability strategy
A priority for 2021 was to embed our newly-launched
sustainability strategy, introducing the ESG goals to our people
andstakeholders, and showing how our purpose is aligned
tooursustainability ambitions.
The strategy is structured around the three ESG pillars:
– Environment – ensuring that Petrofac minimises its own
environmental impact, while supporting our clients in achieving
their lower carbon ambitions
– Social – promoting safe local delivery of our projects and
services, drawing on ethical supply chains, building a diverse
workforce, and helping to address the skills gaps that will
support a just transition
– Governance – underpinning everything we do with clear,
consistent standards of ethical behaviour, bound by rigorous
compliance and governance
Our material issues Our targets Progress in 2021 Further information
Addressing climate risk Net Zero by 2030
(Asset Solutions by
2025)
Scope 1 & 2 emissions were reduced by 22% and we started reporting against
Scope 3 emissions
See page 35
Spill prevention
and response
Zero pollution
We made progress in preventing and reducing spills, though unfortunately
had one recordable spill, with a volume of two barrels
See page 35
Promoting a
circular economy
Circular economy
adopted by all sites
We launched our No, Less, Better plastic reduction strategy and eliminated
single-use plastics in our main offices
See page 36
Sector leading
health and safety
Zero harm
Tragically, we saw one fatality on a third-party contractor manual excavation
activity on a project in Thailand. We have taken far-reaching actions to address
the underlying causes and remain determined to achieve our zero-harm target
See page 45
Enhancing diversity
and inclusion
30% women in
leadership roles
by 2030
We increased the proportion of women in senior management to 25% and
adjusted our target of 30% by 2030 bringing it forward by five years to 2025
See page 49
Respecting
human rights
All third parties
screened for
human rights
We screened 100% of third parties for human rights violations, and no incidents
of modern slavery were reported. However, at lower tiers of our supply chain, we
did undercover labour rights violations (late salary payment)
See page 56
Optimising
in-country value
Sector leading
local delivery
The proportion of locally-sourced goods and services increased to 54%,
reflecting our continued investment in our local delivery capability
See page 53
Embedding ethical
values and behaviours
No regulatory
non-compliance
We worked with the Serious Fraud Office to bring to conclusion the investigation
into seven historic offences of failing to prevent former employees from offering
or making payments to agents in relation to project awards between 2012
and 2015. We have taken responsibility, reformed, and learnt from these past
mistakes, as acknowledged by the SFO and the Court.
See page 58
Enhancing transparency,
governance and
disclosure
Full compliance
with TCFD
We successfully completed our first climate response report, which achieved
full compliance with the TCFD recommendations and was recognised by the UN
Global Compact as good industry practice
See page 37
Environmental
Minimise our
environmental impact
Social
Inform, educate
and engage
Governance
Embed integrity,
transparency
and trust
We are also a signatory of the UN Global Compact, and
thisreport serves as our Communication on Progress on the
implementation of its 10 Principles. The report is also prepared in
accordance with the Global Reporting Initiative, the Sustainability
Accounting Standards Board, and the recommendations of the
Task Force on Climate-related Financial Disclosures (TCFD).
Our strategic goals
On target Progressing Target not achieved
32 Petrofac Limited 2021 Annual report and accounts
Strategic report
Environmental, Social and Governance
continued

Why this is important to our
business model and strategy
As an energy services company that
designs, develops and operates large scale
facilities, Petrofac’s business is inextricably
linked to environmental considerations.
This includes energy and climate change
concerns and the risk of environmental
incidents, as well as the environmental
performance of our own operations. It also
includes the requirement from clients to help
reduce the carbon intensity of their facilities
and operations, and incorporates Petrofac’s
role in the global energy transition.
Environmental
Our performance
4
Scope 1 emissions
(direct from owned or controlled sources)
Tonnes of carbon emissions (000 tCO
2
e)
Scope 2 emissions
(indirect from purchased energy)
Tonnes of carbon emissions (000 tCO
2
e)
Number of spills above one barrel
(0 from vandalism)
2019
2020
2021
231
250
188
2019
2020
2021
12
10
8
2019
2020
2021
17
1
1
GHG intensity IES
(000 tCO
2
e per million boe production)
GHG intensity E&C/AS
(000 tCO
2
e per million man-hours worked)
Hydrocarbon spilled volume in barrels
(0 from vandalism)
2019
2020
2021
97
116
256
2019
2020
2021
0.23
0.27
0.30
2019
2020
2021
558
2
2
1 Net Zero: no net increase in GHG emissions to the atmosphere as a result of GHG emissions associated with Petrofac’s activities, where residual emissions will be offset by carbon credits.
2 Scope 1 (direct emissions e.g., production processes) and Scope 2 (indirect emissions e.g. energy purchased).
3 Gas flaring reduced by 5MM SCF/d from November; equivalent to 1/3 of the average gas flaring per day in 2021
4 Greenhouse Gas Protocol Standard Corporate Accounting and Reporting (equity share approach) followed for Scope 1 and 2 emissions (market based), utilising SANGEA Energy and
Emissions Estimating System and UK Government greenhouse gas (GHG) conversion factors.
We phased out single-use plastics
across our permanent offices
We are committed to reaching
Net Zero¹ in Scope 1 & 2²
emissions by 2030
Gas abatement plans
implemented on PM304
reduce gas flaring by a third
3
Our UK offices switched
over90% of supplied energy
contracts to renewable energy
33Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

SCOPE 3
Value chain
(upstream)
3,650kt (total Scope 3)
Carbon
Management
Planning
Energy efficiency Renewable energy
Value chain
(downstream)
Construction
(8%)
Carbon footprint 17kt
Operations
(88%)
Carbon footprint 171kt
(EPS 3kt, PM304 164kt)
Administration
(4%)
Carbon footprint 8kt
SCOPE 1 SCOPE 2 SCOPE 3
Action on Scope 3
Transport electrification
Emissions reduction
Action on Scope 3
PETROFAC’S ACTIVITIES
Low carbon construction sites
A technical specification for low carbon construction sites
was developed that combines greater energy efficiencies and
use of renewable power (including solar-diesel hybrid power
generation). Implementation on suitable future projects.
Supply chain
To assess the carbon intensive
parts of our supply chain and
promote decarbonisation,
a programme began and
a standard GHG protocol
evaluation tool used to
complete our first Scope 3
emissions inventory report.
Production operations
To reduce our flaring and fugitive emissions, gas
management plans were implemented, focusing on:
– Gas shut-off – improvements to reservoir
management through working over production wells
and inserting downhole sleeves to isolate the gassier
parts of the reservoir and reduce the gas going to flare.
– Action on methane – enhancing our infrared
surveys and leak detection programmes to reduce
fugitive methane emissions.
Digitalisation
Work on an established emission
and energy management tool was
advanced. The tool uses predictive
data analytics to enhance the
visibility of the carbon impacts
of engineering and operational
decisions, better enabling those
within our value chain to make low
carbon choices.
Low carbon offices
Office Net Zero action plans were put in place for all our main
offices, focusing on switching energy supply to renewable
energy (where available), advancing initiatives to promote
more efficient use of energy and water, and introducing EV
charging points. Our UK offices switched more than 90% of
supplied energy contracts to renewable energy.
Engagement
A Net Zero community of practice (Environmental Sustainability Network) was launched to facilitate employee collaboration and idea
sharing on low carbon and circular economy initiatives.
34 Petrofac Limited 2021 Annual report and accounts
Strategic report
Environmental, Social and Governance
continued

SCOPE 3
Value chain
(upstream)
3,650kt (total Scope 3)
Carbon
Management
Planning
Energy efficiency Renewable energy
Value chain
(downstream)
Construction
(8%)
Carbon footprint 17kt
Operations
(88%)
Carbon footprint 171kt
(EPS 3kt, PM304 164kt)
Administration
(4%)
Carbon footprint 8kt
SCOPE 1 SCOPE 2 SCOPE 3
Action on Scope 3
Transport electrification
Emissions reduction
Action on Scope 3
PETROFAC’S ACTIVITIES
Moving from ambition to action
on Net Zero
In 2020 we committed to transition to
a lower carbon business. To this end,
we aim to reach Net Zero
1
in our Scope
1 and 2 emissions
2
by 2030 and are
promoting decarbonisation across our
supply chain. Our targets support the
principles of the Paris Climate Agreement
and the increased ambition from the
COP26 Climate Conference in Glasgow.
They are also aligned with our clients’
own ambitions as the wider sector
moves towards decarbonisation.
In 2021 we developed a Net Zero
roadmap outlining the approach being
taken by each area of the business.
Broadly, the path to Net Zero emissions
involves two steps:
– First, to decarbonise to organically
lower emissions
– Then to offset residual emissions with
carbon credits
Our main decarbonisation levers are:
– Switching our energy supply to
renewable power
– Improving our energy efficiencies
– Reducing flaring, venting and
fugitiveemissions
– Electrifying our transport
We also support the lower carbon
ambitions within our supply chain,
andbegan a programme to address
Scope 3 emissions
2
and define related
reduction targets.
Another 2021 achievement was
to set upCarbon Management
Teams in each ofour business units.
Each of these teams is led by a senior
management sponsor, includes broad
representation from operational teams,
and has responsibility for identifying
and coordinating the local initiatives that
will achieve our overall decarbonisation
targets. Workstreams were also
established to cover: engagement,
supply chain, low carbon construction
sites, production operations, low carbon
offices, and digitalisation.
1
Net Zero: no net increase in GHG emissions to the
atmosphere as a result of GHG emissions associated
with Petrofac’s activities, where residual emissions will
be offset by carbon credits.
2
Scope 1 (direct emissions e.g. production processes),
Scope 2 (indirect emissions e.g. energy purchased),
Scope 3 (value chain emissions).
How we manage our
environmentalperformance
Our goal is to manage the environmental
risks of our projects and operations
effectively, optimise our use of resources,
and minimise our environmental impacts.
In terms of emissions, to support our
2030 Net Zero target, we are committed
to an interim target of a 3% year-on-
year reduction in greenhouse gas (GHG)
emission intensity from 2021 to 2023.
Each year, we participate in the Carbon
Disclosure Project (CDP), and in 2021 we
continued to enhance our climate change
programme and again achieved a CDP rating
of ‘B’. This is within the upper band of CDP
rating for managing and taking coordinated
action on climate-related issues, and above
the average of ‘C’ for our sector.
We calculate our carbon footprint and
energy consumption in accordance with
thenew UK Streamlined Energy and Carbon
Reporting (SECR) regulations, and our data
is assured and verified by an independent
AA1000 licensed assurance provider.
Our Waste Management Standard governs
our waste practices, with duty of care
as a basic principle. We aim to reduce
the amount of waste we generate and to
maximise reuse and recycling. In 2021,
we reviewed existing waste management
practices across the Group, and developed
a new digital tool to bring more consistency
and rigour to our reporting.
Reflecting on our 2021 performance
In 2021 our absolute emissions reduced
by 24%.
In our E&C business, a reduction of 22%
was achieved. Several measures in our Net
Zero plan contributed to this performance,
including enhanced energy efficiency
in our offices, reduced travel, and lower
fuel consumption, at construction sites.
We switched to renewable energy across
our UK offices and are exploring similar
opportunities in other regions.
At our offshore asset in Malaysia, we
completed a programme of optimisation.
A production issue led to lower than
anticipated levels of flaring and fuel
consumption and lower production.
In combination, this resulted in a 27%
reduction in absolute emissions.
We are on target to meet our long-term
commitment of a 20% reduction in GHG
intensity. However, with lower production
in IES and less activity in our E&C projects,
these business units saw an increase in
emissions intensity for 2021. The emission
intensity in Asset Solutions has increased
due to the inclusion of data from W&W
Energy Services, a company acquired by
Petrofac that operates a fleet of specialised
well services’ trucks and vehicles.
Overall, our energy use decreased by
20% to 333 GWh (Scope 1: 311 GWh,
Scope 2: 22 GWh). This decrease was
driven largely by lower levels of natural gas
consumption at our Malaysian operations
and reduced fuel consumption on our
construction projects.
In terms of spill performance, we
experienced one recordable spill, with
avolume of two barrels. Our spill risks
have significantly reduced since divesting
our Mexican assets, which had historically
been prone to vandalism.
Addressing our Scope 3 emissions
We recognise that the emissions from
our value chain are a material part of
our carbon footprint and, in 2021, we
initiated a Scope 3 programme to better
understand the related decarbonisation
challenges and opportunities.
The Quantis Scope 3 evaluator
tooldeveloped by the GHG Protocol
was customised for in-house carbon
accounting. To improve its accuracy,
the tool’s proxy carbon emissions data
was augmented with data from our
keyvendors, plus direct measurement
of some emissions data. This first cut
analysis assessed our emissions across all
the material Scope 3 categories (excluding
use of sold products) as 3,650kt CO
2
e.
A programme was also commenced to
engage with the most carbon intensive parts
of our supply chain. Our Net Zero supply chain
team conducted surveys with more than 300
suppliers and vendors, initiating dialogue
and identifying opportunities to support their
respective decarbonisation programmes.
Going forward, we will incorporate carbon
data into our supply chain and vendor
management systems to assist with the
selection of low carbon goods and services.
We are on target to
meet our long-term
commitment of a 20%
reduction in GHG
intensity.”
35Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements
Petrofac Limited 2021 Annual report and accounts

Although in its early stages, this Scope
3 programme is making progress and
has revealed that many suppliers and
vendors have begun to decarbonise.
Early successes include the identification
of several carbon neutral service providers
for oilfield equipment, warehousing, and
logistics, as well as sources of low carbon
steel and other bulk materials.
We also partnered with the UK Net
Zero Technology Centre to support
solutions that aim to accelerate
theenergytransitionthrough the
deployment of new technologies.
Our Scope 3 programme and engagement
of low carbon suppliers and technology
providers is also being incorporated into our
low carbon service offering as we support
our clients decarbonisation programmes.
Encouraging Net Zero behaviours
Our Net Zero engagement team consulted
with environmental advisors from across
the Group to identify and agree on the
type of individual behaviours that will
support our decarbonisation agenda.
We then developed a Net Zero Rules
promotional campaign, following the
same widely recognised format as the
International Association of Oil and
GasProducers (IOGP) Life-Saving
Rules,ready for roll-out during 2022.
Phasing out single-use plastics
We are reducing our reliance on plastic and
phasing out single-use plastic across the
Group. Our approach to plastics focuses on:
– No plastic: eliminating the main
single-use items
– Less plastic: reducing the amount
ofessential plastic we use or receive
– Better plastic: ensuring that as much
of this essential plastic as possible
has a higher recycled content and
isrecyclable
Across our permanent offices, single-use
plastics were set to be eliminated from the
start of 2022, and we are looking at how to
reduce them from all our operational sites.
Protecting biodiversity
As an energy services company operating
across many geographies, we are often
faced with biodiversity challenges, and
work with clients and other stakeholders
to develop effective solutions to protect
the natural environment.
To support the theme of this year’s World
Environment Day, ‘Reimagine, Recreate,
Restore’, several of our project teams
partnered with local community groups
to support restoration and conservation
projects. In Thailand, we worked with
the local marine department and Ban Ao
Udom fishery group to restore local marine
conservation areas and, in Oman, our
Duqm project teams worked to clean up
plastic waste pollution from local beaches
– an initiative that was recognised through
an outstanding achievement award by our
client OQ8.
Our Net Zero supply
chain team conducted
surveys with more
than 300 suppliers
and vendors,
initiating dialogue
and identifying
opportunities
to support
their respective
decarbonisation
programmes.”
36 Petrofac Limited 2021 Annual report and accounts
Strategic report
Environmental, Social and Governance
continued

We are committed to supporting
the recommendations of the Task
Force on Climate-related Financial
Disclosures (TCFD) and, in 2021,
issued our first climate response
report covering the initial work
undertaken in 2020. We also built
on this programme of climate risk
management and opportunity
capture, and began to integrate
itintoour existing risk and
governance processes.
Governance
Climate change is a material governance
and strategic issue that is regularly
addressed by our Board and Executive
team through strategy and investment
discussions, Enterprise Risk Management,
and performance review against
ourcommitments.
In 2021, the Sustainability Steering
Committee that reports to the Board
and Executive team was strengthened
and transitioned to the Net Zero Steering
Group. It provides support, guidance,
and oversight of progress on our Net
Zero programme. The Steering Group
is supported by a TCFD Working
Group that monitors and evaluates
climate-related risks and opportunities
and tracks management actions.
Performance is reported periodically
toExecutive management and the
Boardthrough bimonthly KPI metrics
and presentation of regular technical
andstrategic papers.
Informing our strategy
Our strategic risk and opportunity reviews
continue to be informed by a range of
sector analyses, including the full range
of future scenarios developed by the
International Energy Agency
1
. The scenarios
are used to aid our understanding of how
the pace and nature of the energy transition
may affect our strategy, and the actions
we can take to build resilience and pursue
related opportunities.
We actively manage climate-related
physical and transition risks, ranging from
the increased potential for extremeweather
events to disrupt our operations, to the
evolving policy landscape that may impact
the Group,such as carbon taxation or
more restrictive emissions legislation.
In 2021 we regularly engaged with policy
makers, contributing to their public
consultation programmes, offering our
expertise, and encouraging all industry
stakeholders to support a ‘justtransition’.
The transition to a lower carbon economy
also presents climate-related risks and
opportunities to our business. As well as
taking action to meet our Net Zero carbon
commitments, we are rapidly developing
our capabilities to unlock value for our
clients – for example by helping them
todecarbonise their existing operations,
and by helping them to plan, build and
manage new assets in the offshore wind,
hydrogen, CCUS, and waste-to-value
market segments. See pages 26 to 29 for
detail on the short- and long-term market
outlook and how our strategy addresses
future risks and opportunities.
Climate risk management
Climate-related risks are classified
according to the TCFD’s risk management
framework. This addresses transition
and physical risks, such as the evolving
policy landscape, the shift to a low
carbon economy, changing stakeholder
perceptions and preferences, and risks
that are event-driven, such as the increased
severity of extreme weather, as well as
longer-term shifts in climate patterns.
Issues such as changing energy usage
and the shift to a low carbon economy
are also assessed for the opportunities
they create as we look toexpand our
new energies business. Assessments are
undertaken over three- year and 10-year
time frames to align to business planning
and long-term strategic time horizons.
Climate-related risks and opportunities
arising out of the energy transition are
fed into the Enterprise Risk Management
programme and consolidated into our
principal and emerging risks, which are
reviewed by the Group Risk Committee,
endorsed by the Audit Committee,
andapproved by the Board (see pages
60and 61).
Further detail of the identified climate-
related issues and how they have affected
Task Force on Climate-related
Financial Disclosures
the business, its strategy and financial
planning is set out in our full response
tothe eleven TCFD recommendations
(seepages 38 to 43).
Metrics and targets
Petrofac is committed to becoming a
Net Zero company by 2030, with our
Asset Solutions business unit achieving
Net Zero by 2025. We have also set
decarbonisation targets that support
the principles of the Paris Climate
Agreement, the UK Government’s Net
Zero goal, and are aligned with our clients’
respective ambitions as the energy sector
progressively decarbonises.
In 2021 we began to develop a carbon
intensity ranking for each of our projects
and operations. The objective is to
benchmark each part of the business,
identify examples of good practice,
pinpoint areas that require additional work,
and hold line managers accountable for
meeting local decarbonisation targets.
Meanwhile, we continue to encourage
theadoption of emissions reduction
targets among key suppliers. We also
completed an assessment of our Scope
3 emissions, in preparation for setting
supply chain engagement targets in
2022with a focus on the most carbon-
intensive goods and services.
Finally, accountability for climate change
leadership and decarbonisation continues to
be embedded into executive performance
measures and remuneration. This means
that we are actively incentivising our
leadership to accelerate our transition
toalow carbon business.
Read the full TCFD report at
www.petrofac.com
1 Climate Scenarios: (i) Low Carbon Future at under 1.5°C
(based on IEA Sustainable Development Scenario), (ii) High
Carbon Future at more than 3°C (based on IEA Stated
Policies Scenario)
37Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

In compliance with Listing Rule 9.8.6(8), our climate-related financial disclosures, which are partially consistent with TCFD Recommendations
and Recommended Disclosures published in June 2017, are summarised here. Where our disclosures are not consistent with TCFD
Recommendations and Recommended Disclosures, the reasons and steps we are taking are set out in our ESG Report
* For further detail refer to our TCFD Climate response report 2021 at petrofac.com
Recommendation Response Disclosure location
GOVERNANCE
a) Describe the Board’s oversight of climate-related risks and opportunities
Process and role
ofCommittees
Climate change is a material governance and strategic issue that is regularly
addressed by our Board and Executive team through strategy and investment
discussions, enterprise risk management, and performance reviews against
ourcommitments.
The Board is responsible for oversight of the overall conduct of the Group’s
business, which extends to setting our climate response strategy and approach
to the energy transition. The Board is assisted by four Board committees that
have climate-related responsibilities covering – Audit, Compliance and Ethics,
Nominations and Remuneration.
The Audit Committee has been delegated the responsibility of monitoring and
reviewing the integrity and effectiveness of the Group’s overall risk management
and internal control systems, and exercises oversight of energy transition and
climate risks.
The Board and its committees typically meet every 2-3 months. Climate and
energy transition issues are discussed at each meeting.
Pages 60-61
Page 95
Pages 6-7 Climate
response report*
Examples of the Board
and relevant Board
committees taking
climate into account
In 2021 the Board progressed key actions defined by the Chairman from the
annual effectiveness review, including continued development of the sustainability
strategy and the ESG roadmap, clearly defining the Group’s direction on energy
transition and climate response.
Performance is reported periodically (typically bimonthly) to Executive management
and the Board through KPI metrics that include:
– GHG intensity reduction across each business unit
– Progress on emissions reduction initiatives
– % of purchased electricity switched to renewable sources, and
– Progress incorporating low carbon services into bids and tenders
(newKPIfrom2022)
In addition to KPI metrics, in 2021 a number of technical and strategic papers and
progress updates were presented (quarterly to six-monthly) on our Net Zero and
New Energies strategies and plans.
Pages 3-5
Pages 30-36
Page 100
b) Describe management’s role in assessing climate-related risks and opportunities
Who manages climate-
related risks and
opportunities
The assessment and management of climate-related risk and opportunity is
integrated into Executive Management’s area of responsibility as climate-related
objectives. Associated targets and key performance indicators are cascaded
downthrough line management and incorporated into staff scorecards.
Page 10
Pages 7-8 Climate
response report*
How management
reports to the Board
The Board and its Committees are updated on climate-related issues by the
company secretary’s office, which works closely with the Group Executive team
to develop materials that assist the Board and its Committees to discharge
theirresponsibilities.
In addition to these Board committees, there are a number of executive management
committees in place, which meet more frequently (biweekly-monthly), and are
involved in assessing the materiality of climate-related and energy transition risks
and opportunities and consider matters for recommendation to the Board and
itsCommittees.
The Group Director of Communications & Sustainability and Group Head of Health,
Safety and Environment are the principal points of contact with the Board and
Group Executive for ESG matters.
Page 11
38 Petrofac Limited 2021 Annual report and accounts
Strategic report
Task Force on Climate-related Financial Disclosures
continued

Recommendation Response Disclosure location
Processes used to
inform management
In 2021, the Sustainability Steering Committee that reports to the Board and
Executive team was strengthened and transitioned to the Net Zero Steering
Group. It provides support, guidance, and oversight of progress on our Net Zero
programme. The Steering Group is supported by a TCFD Working Group that
monitors and evaluates climate related issues and tracks actions.
Carbon Management Teams (CMT) established within each business unit take local
ownership for delivering decarbonisation. Each CMT has a senior management
sponsor who oversees the programme and keeps Executive Management
informed on progress
Climate-related matters and progress on our Net Zero and New Energies strategies
were discussed at each of the business unit leadership global town hall meetings
in 2021. In addition, a regular status report (typically quarterly) was provided to
management on decarbonisation progress through the Net Zero Steering Group’s
meeting minutes.
Page 35
Page 7 Climate
response report*
STRATEGY
a) Describe the climate-related risks and opportunities the organisation has identified over the short, medium and
long term
Processes used to
determine material
risks and opportunities
Our strategic risk and opportunity reviews continue to be informed by a range
of sector analyses, including the full range of future scenarios developed by the
International Energy Agency. The scenarios are used to aid our understanding of
how the pace and nature of the energy transition may affect our strategy, and the
actions we can take to build resilience and pursue related opportunities.
The climate risk and opportunity analysis undertaken in 2021 continued to be
based on the following low and high climate scenarios:
– Low Carbon Future at under 1.5 °C (based on IEA Sustainable Development
Scenario) – characterised by industry alignment with the Paris Agreement, rapid
acceleration to a low-carbon economy, green technology breakthroughs and
global policy coordination on carbon tax and emissions that materially reduces
fossil fuel use.
– High Carbon Future at more than 3 °C (based on IEA Stated Policies
Scenario) – characterised by current policy intentions and targets. Energy demand
rising by 1% per year to 2040, with low-carbon sources, led by solar PV, supplying
more than half of this growth, though the momentum behind clean energy
technologies insufficient to offset the effects of an expanding global economy
and growing population. The rise in emissions slows but, with no peak before
2040 and the world falls short of the Paris climate goals.
Pages 13-14
Pages 60-61
Page 10 Climate
response report*
Relevant time horizons In reviewing our strategy, we consider a wide range of opportunities and risks
across two discrete time horizons:
– Short term (0-3 years): defined by detailed business and financial plans, which
are performance managed in delivery of our business plan targets.
– Medium – Long term (4 – 10+ years): given the rapid pace of external change
and the wide range of uncertainties, this time horizon enables us to consider
longer term scenarios and possible energy transition pathways
Pages 60-61
Page 20 Climate
response report*
Transition or physical
climate-related risks
identified
The transition to a lower carbon economy presents both risks and significant
business opportunities for Petrofac. Climate-related physical and transition risks
are managed and reported as part of the Group’s risk management framework.
We actively manage climate-related physical and transition risks, ranging from the
increased potential for extreme weather events to disrupt our operations, to the
evolving policy landscape that may impact the Group, such as carbon taxation or
more restrictive emissions legislation.
Pages 60-61
Page 150
Page 23 Climate
response report*
Transition or physical
climate-related
opportunities identified
Climate-related risks and opportunities associated with the energy transition, such
as changing energy usage and the shift to a low carbon economy were taken into
consideration alongside other inputs in developing our New Energies strategy.
Page 10
Pages 26-29
39Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Recommendation Response Disclosure location
b) Describe the impact of climate-related risks and opportunities on the organisation’s businesses, strategy, and
financial planning
Impact on strategy,
business, and financial
planning
The potential implications of climate change and the energy transition building
momentum are described in the Market Outlook and New Energies sections of our
Strategic report.
We have reviewed the renewables and low carbon sectors in depth to identify where
our technical expertise and delivery experience would be the most valuable to
clients. And, are aligning our experience in high voltage systems, offshore platforms,
gas processing, clean fuels and grey hydrogen to where clients need our ability to
integrate and manage risk around large complex capital project delivery. As a result,
we are focusing our New Energies strategy on Offshore Wind, Carbon Capture
Utilization and Storage (CCUS), Hydrogen, Waste-to-Value and Emissions Reduction.
In addition to advancing New Energies, The Group’s ambition is to become a
Net Zero company by 2030 (scope 1 & 2 emissions). The Group’s current climate
change strategy focuses on reducing GHG emissions, investing in low emission
technologies, supporting emission reductions in the value chain and promoting
product stewardship, managing climate-related risk and opportunity, and working
with others to enhance the global policy and market response.
Petrofac is also progressing a scope 3 emissions programme, engaging our value
chain on decarbonisation strategies to enable their low carbon ambitions.
We have started to consider the impact of climate-related issues on our financial
planning, for example de-risking financial assumptions and contract renewal terms
against possible carbon taxation for our producing assets in Malaysia. We aim to
further enhance our processes and assurance as we mature our understanding
of the risks, opportunities and interdependencies of climate-related issues on
thebusiness.
Pages 13-15
Pages 26-29
Pages 33-36
Page 66
Pages 16-17 Climate
response report*
Impact on products
and services
To achieve our Net Zero ambition, we recognise that much of our workforce will
need to have additional skills and capabilities. For example, In the UK in 2021 we
set up an internal Taskforce to create the right climate across our workforce, to
ensure it has the right skills and capabilities.
One of the programmes under implementation is a competency mapping exercise,
to understand what transferable skills we already have and what skills will be
required to support the Transition and ensure alignment with Government and
Industry initiatives and client requirements.
Pages 52-53
Pages 16 and 18
Climate response
report*
Impact on our
supply chain
A programme was commenced targeting the most carbon intensive parts of our
supply chain (eg. steel, cement, copper, logistics). Our Net Zero supply chain
workstream conducted surveys with more than 300 suppliers and encouraging
them to make their own GHG emission reduction targets and decarbonisation
plans. Climate-related risks are also built into our supply chain due diligence.
We are also reducing our reliance on international supply chains, matching local
suppliers with project opportunities, and improving our logistics efficiencies,
carbon footprint and supply chain resilience.
Page 18
Page 23
Pages 34-36
Pages 53-54
Page 18 Climate
response report*
Impact on our offices Purchased energy emissions comprise 4% of our total carbon footprint. Our target
is to progressively transition to 20% renewable energy by 2030 and we are
pursuing opportunities to switch to renewable energy across the Group.
Most of our UK offices and facilities switched to renewable power in 2021 and
we have put in place transition plans for our other permanent offices globally.
We have also developed a green building standard to enhance our building
selection process and promote more sustainable offices. Our UK offices have
also undertaken Energy Savings Opportunity Scheme assessments, and have
improvement plans in place.
Pages 33-36
Page 16 Climate
response report*
40 Petrofac Limited 2021 Annual report and accounts
Strategic report
Task Force on Climate-related Financial Disclosures
continued

Recommendation Response Disclosure location
Impact on operations Our production operations account for 88% of our total carbon footprint, largely
due to flaring, venting, fugitive emissions and fuel gas. Our aim is to deliver a 25%
reduction in emissions by 2030 through operational improvements, gas shut-
off and power generation changes. We are also targeting a 30% reduction in
emissions intensity by 2030 from our construction operations through savings from
energy efficiency and hybrid power generation initiatives.
In 2021 we commenced a programme to review the operation of our site facilities
and offices to identify opportunities to decarbonise. For example, we completed
development of a low carbon specification for our construction camps, developed
low carbon construction execution methods, and commenced changes to our
supply chain systems to promote the use of low carbon intensity goods and services.
Pages 33-36
Pages 16-17 Climate
response report*
c) Describe the resilience of the organisation’s strategy, taking into consideration different climate-related scenarios,
including a 2°C or lower scenario
Embedding climate
into scenario analysis
We believe our strategy is resilient to the range of energy transition pathways and
scenarios including the pledges made at COP26 in Glasgow and the targets support
the principles of the Paris Climate Agreement, see Strategic report: Market outlook.
Pages 13-15
Pages 16-17 Climate
response report*
How we factor in
evolving government
policy
We regularly engage with policy makers, contributing to their public consultation
programmes, offering our expertise, and incorporating evolving developments into
our strategy and scenario planning. For example, we engage on a regular basis
with UK and Scottish Government departments. The Department of Business,
Energy, and Industrial Strategy (BEIS) and the Department of International Trade
(DIT) are key interlocutors.
2021 was a year the UK Government issued a raft of policies in support of the
Energy Transition including the Hydrogen Strategy, the Net Zero Review, the
Industrial Decarbonisation Strategy, and the Biomass Strategy. Petrofac engaged
with Government at various levels across all these developments.
We seconded an employee one day a week for 3 months to a BEIS Working
Group set up by the Energy Minister, to develop and maximise the carbon
capture utilisation and storage (CCUS) supply chain in the UK and support the
Government’s consultations on low carbon business models.
The Group are also represented on a number of Working Groups with Government
and stakeholder organisations ie BEIS Technical Expert Group for CCUS business
models and the Sustainable Aviation Fuel Delivery Group.
Pages 22-25
Page 10 Climate
response report*
How we collaborate
with industry to build
resilience
We believe substantive input from Industry and other stakeholder organisations
leads to better outcomes on evolving policy, practice, and standards.
In 2021 we undertook and supported a variety of collaborative initiatives as
members of various industry trade bodies such as Oil and Gas UK, Renewable UK
and the EIC and organisations specific to the new low carbon technologies such as
Global CCUS, Wind Europe, NECCUS and the Hydrogen Fuel Cell Association and
Hydrogen Strategy Now campaign.
Examples of our engagement included:
– Participating as a Board member on the Energy and Climate Change Board
at the CBI, which sets the agenda on climate and energy issues and works to
influence Government policy on moving urgently towards a low carbon future.
– Participation on the UK-UAE Business Council Climate Change and Energy
Board to stimulate bilateral trade between the two countries.
Pages 22-25
Page 14 Climate
response report*
Ensuring continued
relevance of our
strategies
The Group continues to develop its assessment of the potential impacts of climate
change and the transition to a low carbon economy. Evolving changes to global
climate change strategy or decarbonisation milestones are continuously monitored
by the Net Zero Steering Group and the TCFD Working Group.
As part of our governance processes our strategy is validated annually by the
Board to ensure it remains relevant and resilient. As our approach matures, we will
look to begin incorporating greater financial quantification and internal assurance
into our climate risk analysis.
Page 150
Pages 66-67
41Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Recommendation Response Disclosure location
RISK MANAGEMENT
a) Describe the organisation’s processes for identifying and assessing climate-related risks
Process Our risk management framework provides us with a consistent approach to identify,
manage and oversee the risks that may impact our business. Effective risk analysis
and response underpin our ability to achieve our objectives and assess opportunities
as our business evolves.
In 2021, risk and opportunity meetings were held with key functions to identify
climate-related risks, update and revalidate the existing assessments, review
progress closing out actions and review resilience, agreeing any further
actionsrequired.
We are integrating climate risk into the supporting policies, processes, and controls
for our key climate risks, and we will continue to update these as our climate risk
management capabilities mature over time.
Pages 60-62
Page 66
Pages 20-24 Climate
response report*
b) Describe the organisation’s processes for managing climate-related risks
Process Our risk management framework provides us with a consistent approach to
identify, manage, and oversee climate-related risks that may impact our business
and is designed to underpin the Group’s longer-term sustainability. For further
detail see Strategic report: Risk management.
As part of our business planning process, we review the Group’s principal risks and
uncertainties quarterly. The Energy Transition emerging risk was identified in 2019
and embedded as a sub-risk under the principal risk ‘Failure to deliver strategic
initiatives’ in 2020. This risk was reclassified as a standalone emerging risk in 2021
and reworded as ‘Failure to deliver New Energy Services (NES) strategy’ reflecting
the establishment of NES. This covers various aspects of how risks associated with
the energy transition could manifest. Similarly, physical climate-related risks such as
extreme weather are covered in our principal risks related to HSSE incidents.
Identified risks are prioritised in terms of their materiality, enabling decisions on the
adequacy of our controls and the most appropriate and cost-effective response
calibrated to the risk appetite of the Group.
Pages 60-62
Pages 66-67
Pages 20-24 Climate
response report*
c) Describe how processes for identifying, assessing, and managing climate-related risks are integrated into the
organisation’s overall risk management framework
Implemented risk
management
Transition and physical climate-related risks are identified, assessed, and managed
across the Group, addressing issues such as evolving policy, threat of legal action,
market changes, reputational issues, and extreme weather.
Examples of how risks are integrated into overall risk management include:
– Policy risks – Government consultation and advocacy strategy that supports
appropriate climate action while providing stability for business. In 2021 we
closely monitored the policy landscape in core geographies to ensure business
preparedness, including de-risking asset financial assumptions against potential
policy shifts.
– Market risks – A New Energy Services (NES) business line was created in
2021 to build capability to advance the company’s position within the energy
transition and target a greater market share of non-O&G projects.
– Production risks – to reduce our flaring and fugitive emissions, gas management
plans were implemented in 2021, focusing on: gas shut-off improvements to
reservoir management reduce the gas going to flare and action on methane to
detect and reduce fugitive emissions.
– Fines or other regulatory penalties – whilst difficult to predict how these might
crystalise, the base case cost contingencies and downside adjustments aim
to capture any exposure here as well as other legal / regulatory risks on other
aspects of the business. We undertake a periodic review of the voluntary carbon
offset market to have visibility of future offset costs and on current assessment.
– Extreme weather – in the base case, the business’ budgets are built up with
the industry knowledge of operating in extreme weather conditions (North Sea,
Malaysian monsoons, deserts, etc) and contingencies are included accordingly,
whether by way of cost or scheduling contingencies or both. In the downside
scenario, the business has captured the risk of further downside within
the scheduling delays and cost overruns in E&C, margin reduction in Asset
Solutions and production downside in IES.
Pages 34-36
Page 66
Page 150
Page 23 Climate
response report*
42 Petrofac Limited 2021 Annual report and accounts
Strategic report
Task Force on Climate-related Financial Disclosures
continued

Recommendation Response Disclosure location
METRICS AND TARGETS
a) Disclose the metrics used by the organisation to assess climate-related risk and opportunities in line with its
strategy and risk management process
Our business
performance
Petrofac sets key performance (KPI) targets for business performance and delivery of
our strategy and assesses progress against these benchmarks on a regular basis.
Pages 20-21
Page 76
Price assumptions A range of probable price scenarios have been selected for carbon offset calculations
and the voluntary offset market monitored to inform our future offset strategy.
The BloombergNEF Long-Term Carbon Offset Outlook will be utilised as a primary
indicator of the evolving prices of offsets input into future offset price assumptions
to account for the cost of achieving Net Zero.
Sustainability,
water and
biodiversitymetrics
A priority for 2021 was to embed our newly launched sustainability strategy,
introducing the ESG goals to our people and stakeholders. Performance in
delivering this strategy is gauged by a range of metrics aligned to our sustainability
ambitions and material issues.
Each year, we also produce an ESG datasheet that aims to provide a consolidated
overview of Petrofac’s non-financial performance. Metrics included in this
datasheet cover our activities during the period 1 January to 31 December for
theyears indicated.
Pages 32-36
Pages 3-4 ESG
Datasheet
Board or senior
management
incentives
Line management ownership of carbon was promoted in 2021 through embedding
a range of KPIs into senior management goal plans such as GHG intensity
reduction, CDP rating score and TCFD recommendations compliance.
Development of a broader range of KPIs was completed in 2021 for 2022
implementation, covering delivery of our Net Zero programme. Metrics include
supply chain decarbonisation, targets for incorporating low carbon services into
bids/tenders, and proportion of energy purchased from renewable sources.
Page 10
Page s 116-127
b) Disclose scope 1, scope 2 and, if appropriate, scope 3 greenhouse gas emissions and the related risks
Our own operations We report scope 1 and 2 greenhouse gas emissions resulting from our operations
and each year submit to the Carbon Disclosure Project (CDP). We also calculate
our carbon footprint and energy consumption in accordance with the new UK
Streamlined Energy and Carbon Reporting (SECR) regulations, and our data is
assured and verified by an independent AA1000 licensed assurance provider.
Pages 32-33
Pages 3-4 ESG
Datasheet
Our value chain We recognise that the emissions from our value chain are a material part
ofourcarbon footprint and, in 2021, we initiated a Scope 3 programme to
betterunderstand the related decarbonisation challenges and opportunities.
This first cut analysis assessed our emissions across all but one of the
materialScope 3 categories (Category: Use of sold products, will be
includedinthe2022 assessment).
Pages 35-36
Pages 3-4 ESG
Datasheet
c) Describe the targets used by the organisation to manage climate-related risks and opportunities and performance
against targets
Sustainability
Net Zero targets
In 2020 we committed to transition to a lower carbon business. To this end, we
aim to reach Net Zero1 in our Scope 1 and 2 emissions by 2030 and are promoting
decarbonisation across our supply chain. Targets cover our main decarbonisation
levers and include:
– Energy supply changes – progressively transition to 20% renewable energy
by2023, and 50% by 2030.
– Energy efficiencies – 30% energy consumption saving by 2030.
– Emissions reduction – Our aim is to deliver a 25% reduction in emissions
by2030.
– Transport – we are targeting a 30% reduction in transport emissions by 2030.
Pages 32-36
Page 150
Pages 16-17 Climate
response report*
Pages 3-4 ESG
Datasheet
43Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Our GC-32 project in Kuwait
received three ASSP HSE
Golden Awards
Accredited Living Wage
employee in the UK
16 years without an LTI on the
North Sea Kittiwake platform
We have set a target of 30% of
women in senior management
roles by 2025
US$60m of orders placed
with Omani vendors
Provided 7,200 COVID-19 vaccines
for marginalised people in India
Social
Why this is important to our
business model and strategy
As a service business, it is our people,
their attitude and skills who set us apart
from our competitors. We are therefore
committed to building a diverse workforce,
which is representative of the communities
in which we operate, while developing
all our people, keeping them safe, and
looking out for their wellbeing.
Wherever the Company operates, we are
committed to creating shared value, by
engaging with local communities, investing
in local supply chains, employing local
people, and stimulating local economies.
As well as being the right thing to
do, we see the creation of in-country
value (ICV) as a source of competitive
advantage, helping us to build strong
client relationships and bid on challenging
projects, while benefiting from the
economies of delivering locally.
Because we operate in challenging
environments, where the rights and welfare
of workers can sometimes be at risk, we
are committed to protecting human rights
throughout our business operations and
extended supply chain, ensuring that
everyone who works with and for us is
treated with respect, fairness, and dignity.
Gender profile of our people (%)
Employees
Age profile of our people (%) Grade profile of our people (%)
M
F
86
14
M
Leadership
F
74
26
<30
30-39
40 -49
50-59
>60
11
31
33
21
4
Executive
Management
Supervisory
Professional
Suppor t
1
10
25
46
18
Lost time injury frequency rate Recordable incident frequency rate % Spend on local goods and services
*
(%)
2019
2020
2021
0.013
0.013
0.018
2019
2020
2021
0.06
0.065
0.091
2019
2020
2021
41
53
54
* Non-JV projects
44 Petrofac Limited 2021 Annual report and accounts
Strategic report
Environmental, Social and Governance
continued

Health, safety
and security
Whatever their role and wherever they
work, we want everyone involved with
Petrofac to feel safe, valued, and cared
for. Ultimately, our aim is for zero safety
incidents, as reflected in the name of our
Horizon Zero global safety campaign –
which we see as an entirely realistic goal.
Although our overall safety record is
among the strongest in the industry, our
performance during 2020 and the start
of 2021 had seen a slight deterioration,
primarily due to the operational challenges
the COVID-19 pandemic placed on the
business. The emphasis for 2021 was to
bring more consistency, so that the same
uncompromising safety culture exists
across the entire Group, and the same
impeccable standards are applied on
every site.
Health and safety
From a safety management perspective,
2021 was another challenging year.
Once again, our health and safety teams
were focused on how best to continue our
operations, while protecting our people
and partners from the virus. This included
compliance with local requirements and
international guidelines, the restrictions
on travel, the enforcement of social
distancing, and the acceleration of
vaccination programmes.
The situation was exacerbated by the
fact that many of our people had to work
extended rotations on sites and were
kept apart from family and friends for
long periods of time. Inevitably, this had
an impact on their engagement levels,
situational awareness, and overall health
and wellbeing.
Tragically, we reported one fatality.
In Thailand, on the Sriracha Refinery
project, a woman employed by one
ofour contractors died when she was
digging around three piles and one of the
pile heads collapsed. The incident was
investigated in detail and reviewed by
senior management and, separately, by
the Board. The lessons learnt were fed
back into our ongoing safety programmes.
Despite our precautions, we tragically
lost a further 11 colleagues to COVID-19,
demonstrating how dangerous the virus
can be.
In terms of broader indicators:
– Lost time injury (LTI) frequency rate
– increased to 0.018 per 200,000
workhours, compared to anindustry
average of 0.044 (International
Association of Oil andGas
Producers2020)
– Recordable incident frequency rate
– increased to 0.091 per 200,000
workhours, compared to anindustry
average of 0.14 (International
Association of Oil andGas
Producers2020)
While these rates did increase, the
numberof incidents remained low,
and their prevalence was comparable
with 2020. Also, with most of the LTIs
taking place during the first six months
of 2021 (seven out of a total of nine),
our performance showed signs of
improvement during the second half of
the year. With a refreshed HSE leadership
and strategy in place, we are optimistic
that these improvements will continue
into2022.
Some of the more significant
achievements in the year include:
– 16 years without an LTI on the Kittiwake
platform in the North Sea
– 13 years without an LTI on the Jasmine
FPF003 FPSO offshore Thailand
– The team delivering the Visakh Refinery
in Andhra Pradesh, India, surpassed
10 million work hours without an LTI
– The Ithaca Integrated Services
Contract team on the Alba, Captain
and Erskine platforms in the North Sea
went 365 days LTI-free
– Our GC-32 project in Kuwait received
Golden Awards in three categories
(HSE Excellence, Environmental
Excellence, and Management of Driving
Safety) from the American Society of
Safety Professionals in the ASSP HSE
Excellence Awards 2021
Whatever their role
andwherever they
work, we want everyone
involved with Petrofac
to feel safe, valued,
andcared for.”
Strong new leadership
An important development for 2021
wasthe appointment of Jim Andrews
as Group Head of Health, Safety and
Environment (HSE).
His aim is to build on Petrofac’s already
strong safety record with the launch of
a refreshed HSE strategy – including
the deployment of more digital tools,
enhanced employee engagement, and
an increased use of data and analytics
to understand and address safety risks
before they materialise.
45Petrofac Limited 2021 Annual report and accounts
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Making better use of digital platforms
An important theme for the year was to
get more value from digital technologies
and analytical techniques, to help us
understand our vulnerabilities, predict
emerging issues, and inform our
decisionmaking.
Examples include a new data
collectionand reporting tool
andtheintroduction ofa Group-wide
digital safety dashboard, which gives
allemployees real-time visibility of our
safety performance. Several of the
initiatives from 2020 also became more
deeply embedded during 2021, including:
– HSE Deep Dives – regular sessions
with senior leaders to identify and
address any potential barriers to
safeand healthy working
– Life Saving Rules e-learning
– amandatory course for
all employees,partners and
subcontractors, incorporating videos
inEnglish, Hindi, Russian, and Arabic
– Behavioural-based training –
anumber of training programmes,
including our HSE Bootcamp for
supervisors and mental health
awareness modules
– Virtual site audits – more formal use
of virtual tools to conduct HSE audits
and Petrofac Assurance Index audits
Stepping up our health and
wellbeingprogrammes
Given that most site-based employees
had to contend with extended rotations,
and most office-based staff worked
remotely for most of the year, mental
health and wellbeing continued to
be a major focus. To supplement
our awareness programmes and
ourEmployeeAssistance programme,
newinitiatives for 2021 included:
– Virtual social breaks – online
sessions for employees and leaders
totalk and socialise, with the one rule,
no discussion could be work-related
– Mental health webinars – to raise
awareness of key challenges, and
discuss potential solutions
– Self-care challenges – to promote
the use of simple self-care actions that
can be fitted into everyday working
schedules, such as yoga, healthy
eating, sleep, and stress reduction
Catching up virtually
With so many of our employees working
from home, we wanted to replicate some
of those casual office chats, when we
catch up informally with colleagues.
Meanwhile, our senior leaders were
looking for new ways to engage with their
teams and keep in touch with the mood
of the organisation. So, we ran a series of
virtual social breaks, hosted by our senior
leaders, who had just one rule to follow –
no discussions could be work-related.
The Virtual Social Breaks were full of
laughter and inspiration, as people shared
their personal stories, goals, hobbies,
passions and more, giving everyone the
chance to get to know each other better.
Protecting our people from COVID
One of the ways we protected our people
from the threat of COVID-19 was to
work with public and private healthcare
providers to orchestrate and accelerate
vaccination programmes.
A good example was at one of our
projects where, in the second quarter
of 2021, we were challenged by a major
outbreak involving nearly 300 positive
cases. Over a two-month period, we
brought this under control by fast-tracking
the vaccination programme, thereby
protecting our people, and avoiding
furtheroperational disruption.
Setting out our 2022 priorities
During 2021, under our new HSE
leadership, we developed and agreed
a new HSE strategy, which will be
implemented in 2022. This is based
around five pillars:
1. Leadership – the shadow you cast
2. Employee engagement – greater
engagement, fewer incidents
3. Contractor management –
consistencyand performance driven
4. Training – formalise, simplify
and standardise, with a refreshed
learner experience
5. Compliance – do it right, first time
Kittiwake: 16 years
without a single lost
time incident
Petrofac has been Duty Holder on
theKittiwake platform in the North
Seasince 2003 and, in 2021, we
secured another one-year contract
extension from EnQuest the asset
owner.One of the characteristics
of the team has always been its
uncompromising attitude to safety,
andthe latest safety milestone is 16
years without a single lost time incident.
“A truly remarkable
credit to everyone
who has spent time
here. Whether it
was a flying visit for
acouple of days or
being part of the team
for all of the 16 years,
everyone has played
a part. It is everyone’s
responsibility to
look after ourselves
and each other.
Kittiwake isbig on
team spirit. It always
has been, and long
may that continue.”
Stuart Fraser
Offshore Installation Manager
46 Petrofac Limited 2021 Annual report and accounts
Strategic report
Environmental, Social and Governance
continued

Taking better care
of ourselves
We wanted to encourage all our
people to take some time out of their
working days to focus on their health
and wellbeing. So, we launched a
10-day programme of simple self-
care challenges. Around 500 people
enrolled and each day they received
an email, offering tips and techniques
to take better care of themselves, and
suggesting simple activities to fit into
their everyday working lives, like healthy
eating, breathing exercises, and more.
This programme was extremely well
received – 99%ofparticipants rated
the daily emailsas good or excellent,
95% saidthe programme helped
them improve their approach to self-
care, and78% completed most of the
practicalchallenges.
The major themes of the strategy, which
will feed into 2022 activities, include:
– Data-2-Decisions – using data and
analytics from key leading and lagging
indicators to define areas of focus and
reduce incidents
– Technology enabled – extensive
use of mobile technology to increase
situational awareness
– Engagement and communication
– engaging, insightful, focused and
evenfun
– Proactive vs. reactive –
observationsand interventions
beforean incident occurs
– Accountability – the joint ownership
of HSE performance by line
management and the HSE function
Asset integrity
Our aim is to design, build and operate
energy assets that are safe, reliable, and
meet or exceed their operational purpose.
We generally work with high-hazard
facilities, maintaining the right mindset,
backed up by disciplined processes and
controls, is critical to our success – as well
as the safety of our people and our clients.
In 2021, the Group was responsible for
managing and ensuring the integrity
of 14 operating assets. This work also
informs our wider operations, including
our approach to designing, building,
commissioning, and completing projects.
With a renewed demand among clients
for integrated service offerings, ourasset
integrity expertise positions Petrofac to
provide more managed integrity services.
Reflecting on our 2021 performance
In evaluating our asset integrity
performance, our main area of focus
is managing process safety hazards,
reducing high-potential incidents (HiPos)
and those incidents that involve process
safety procedures.
In 2021, we did not experience any asset
integrity-related HiPos (compared with six
HiPos across all operations and projects
in 2020). However, we did conduct a
small number of serious investigations
into incidents that did have asset integrity
implications, and may therefore have been
indicative of a failure to follow our asset
integrity procedures.
Getting value from a new suite
ofdigital tools
As with other areas of the business, we
deployed more digital tools during 2021.
These included:
– Asset integrity dashboard – we
continued to gain experience of the
new asset integrity KPI dashboard,
refine the way we use it, and increase
the value it creates. We reviewed
not just the number of indicators but
the interplay between them. As the
enhancements take effect, we expect
to get a better understanding of
cumulative asset integrity risks.
– Remote asset integrity reviews –
we refined and improved our ability
tomeaningfully conduct remote asset
integrity reviews using a variety of
mobile and digital tools, which should
increase our efficiency and accuracy
ofreviews going forward.
The use of digital tools will continue to
be prioritised in 2022. This will help us
tomaintain our leadership commitment
toasset integrity, engage more of our
people with the value created, refine
andsimplify our asset integrity KPIs,
andextend the learnings from our regular
programme of investigations and our
audits. Going forward, and enabled by
meaningful real-time data, our assurance
activities can be targeted more efficiently,
based on an accurate and up-to-date
understanding of the true condition
ofeach asset.
95% said the
programme helped
them improve their
approach to self-care.”
47Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Security and crisis management
Remaining responsive to a fast-
changing security environment
Petrofac works in challenging
environments with fast-changing
security issues. Our aim is to protect
ouremployees and assets in a responsible
manner, and to prevent any security-
related disruption.
Our security and crisis management
teams are closely integrated into the
widerHSE community. Our Security Policy
sets out the responsibilities of our senior
management team and our business units
and, with regard to crisis management,
weaim to operate to the same standard
as ISO 22301:2019.
Refreshing and renewing
In the wake of the COVID-19 pandemic,
the Security and Crisis Management
function began the process of reviewing
approaches in our existing projects and
incorporating the lessons learnt around
digital and remote working technologies.
Meanwhile, our traditional three-tier crisis
management system is being incorporated
into a digital platform to bring new
efficiencies, and reduce the burden on
anyteams working in a crisis situation.
Looking ahead to 2022
In many countries, the recovery from
the COVID-19 pandemic is likely to be
slow and bumpy. The Petrofac security
team will therefore review allplans
and procedures as sites return to
normal working routines, and ensure
they respond to any changes in the
securityenvironment.
We envisage disruption to the global
travel system will continue into at least
thefirst quarter of 2022, which adds to
thepressure on our teams. As this eases,
the focus can return to project delivery.
Cyber-security and
dataprotection
Remaining cyber-resilient and
continuing to improve our cyber-
security readiness
In response to rapidly evolving cyber-
security risks, and to support Petrofac’s
wider digitalisation initiatives, cyber-
security and data protection continued
tobe an area of focus.
During 2021, we stepped up the focus
on our own supply chain risks, engaging
with key vendors, subcontractors and
suppliers to ensure that cyber-security
risks are mitigated across the supply
chain. Meanwhile, we continue to align our
information security management practice
with the ISO27001 standard and other
best practices.
Petrofac works
in challenging
environments with
fast-changing security
issues.”
Related initiatives included:
– Continuing to enhance our threat
detection and threat-hunting
capabilities, with a greater focus on
artificial intelligence and machine
learning-based detection systems
– Continuing to test and improve cyber
incident response and resilience planning
– Enhancing our awareness programmes
for vendors, sub-contractors and
suppliers to further mitigate third-
party cyber-security risks and create
aculture of cyber risk awareness
across our supply chain
– Continuing our phishing simulation
tests and enhancing our awareness
programme with more ‘snackable
content’ (such as micro-videos) to
ensure our employees remain aware
ofthe latest phishing techniques
and tocreate a strong and dynamic
cyber-security culture
– Continuing the assessment of cyber-
security risks with regular vulnerability
assessments, penetration tests and
Red Team exercises
Meanwhile, cyber-security remained a key
priority in all our digitalisation initiatives,
and we ensure that effective cyber-
security architecture is embedded from
the initial ideation and conceptual phases.
48 Petrofac Limited 2021 Annual report and accounts
Strategic report
Environmental, Social and Governance
continued

People
Given the continuing impact of the
COVID-19 pandemic, 2021 was another
challenging year for Petrofac from the
people perspective.
It was necessary to further reduce our
labour costs and put extra resources into
protecting the mental and physical wellbeing
of our people. We wereable to make some
encouraging progress with several of our
planned HRinitiatives – including the launch
of ournew values and behaviours, several
new training and development initiatives,
and continued progress with our diversity
and inclusion programme.
Addressing the challenges of2021
Given the market conditions, our project-
based E&C business was hit hard, and
we had to bring a significant reduction
toour related headcount. By comparison,
our Asset Solutions business fared well,
enabling modest growth to the size of our
UK-based teams.
Overall, temporary and permanent
employment reduced by 1,207 in 2021,
down to 8,219 people, representing a
13% decrease on 2020.
Making progress on diversity
andinclusion
In 2021, we further increased our focus
ondiversity and inclusion, building on past
achievements, introducing new initiatives,
and setting more ambitious targets.
Although we have a long way to go,
we are committed to being a more diverse
company, which embraces differing
perspectives, is representative of the
communities in which we operate,
and provides equal opportunities to
all employees and job applicants.
Key developments and achievements
include:
Achieving a better gender balance
Given the nature of our business and
the location of many of our operations,
achieving a better gender balance is
achallenge.
One focus is our senior management
positions. In 2021, women accounted for
25% of oursenior managers, up from 6%
in 2018. Given this progress, we brought
our target of 30% of women in senior
management roles forward by five years
–from 2030 to 2025.
As well as building diversity from within, we
have mandated that at least one woman
is included on the final interview shortlist
for all external recruitment into middle and
senior management roles. Since 2020, the
proportion of women recruited externally
into senior management roles has
increased from 6% to 26%.
– More ambitious targets: 30% of
women in senior management by
2025 moved forward by five years
– A four-fold increase: Up from 6% to
26% externally hired women appointed
into senior management positions
– Parity in our graduates: 46% women
in the 2020 graduate engineering intake
Representing the communities
inwhichwe operate
Comprising more than 60 nationalities,
oneof Petrofac’s strengths has always been
its ethnic diversity. However, we do want
our workforce to be more representative
of the communities in which we operate,
especially at senior management levels.
During 2021, we made a series of significant
hires, including the appointment of five local
nationals as country managers in India,
Indonesia, Libya, Mozambique, and Oman.
Giving voice to diverse viewpoints
To ensure that the Company hears
and engages with a wider spectrum of
viewpoints, we established two new global
employee network groups – a Women’s
Group and a Pride Group.
Getting a more granular understanding
of our performance
Across our UK operations, we invited all
employees to add ethnic origin information
to their HR records. Based on best practice,
this was a voluntary exercise, and the
information will only ever be used to analyse
trends, not identify individuals. This data will
enable us to better monitor and minimise the
risks of any bias in our recruitment, training,
development, reward, and other processes.
Adding to a solid foundation
The 2021 initiatives supplement a pre-
existing programme. In 2020, for example,
we appointed our first Global Head of
Diversity and Inclusion, as well as two
Diversity Champions in the leadership
team. We also have a mandatory diversity
and inclusion e-learning programme, and
each member of the Group Executive
Committee mentored two high potential
femaleemployees.
Championing the
views of employees
from across the Group
One of the ways we engage with and
hold conversations with our workforce
isour Petrofac Workforce Forum.
Established in 2019, the Petrofac
Workforce Forum builds on the framework
set out in the UK Corporate Governance
Code, and the approach we took is
relatively progressive. Meeting with the
Board andthe Executive team twicea
year, the Workforce Forum comprises
12employee representatives from
acrossthe Group.
The Workforce Forum enables the Board
and the Executive team to understand
the mood of the workforce, better
understand their ideas, concerns,
andperspective, plus ascertain what
it is about Petrofac that motivates and
engages them. It has also played an
important role in helping us navigate
the recent challenges arising from the
COVID-19 pandemic – for example,
by giving us deeper insights into the
everyday realities of those people who
have had to work on extended rotations
in remote areas.
2022 marks the end of the three-year
term of the first Workforce Forum
representatives. Nominations and
elections will be held early in 2022 for
the second term. Given the success of
theinitiative and its high profile within the
Group, we expect this to have many new
nominations and a lively election process.
René Médori has stated: “I am constantly
impressed by the quality of the dialogue,
and I know the entire Board values the
insights it brings”.
49Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Investing in training and
development
We continued to evolve our training and
professional development programmes,
including our early career education
initiatives, our Leadership Excellence
Programme and our Petrofac Academy
online distance learning programmes.
Highlights of the year included:
Welcoming back our first cohort
ofMaster’s graduates
Back in 2020, one of the ways we
responded to the COVID-19 pandemic
wasto work with the American University of
Beirut to sponsor a first-of-its-kind Master’s
programme in Engineering Management.
As an alternative to redundancy,
weoffered talented young engineers
theopportunity to join the programme,
with Petrofac paying tuition fees and
covering subsistence costs. The first
cohort of 46 students graduated in 2021,
41 of whom rejoined the Company.
The second cohort of morethan 30
people is due to graduatein 2022.
Extending our successful
apprenticeship programmes
In the UK, one of the ways that we
attract and develop the next generation
of our workforce is through our Offshore
Apprenticeship programme. In 2021, we
welcomed six new apprentices, taking the
total number recruited since 2016 to more
than 60.
This four-year programme equips young
people for a career in the energy industry
in either mechanical maintenance,
electrical maintenance, or instrumentation
and control maintenance. Each apprentice
initially spend two years at college before
spending a further two years offshore.
Helping people improve their
everyday effectiveness
Meetings are an essential part of howwe
operate at Petrofac, helping us to share
information, solve problems, collaborate and
build camaraderie. So, any improvement in
the way we manage meetings helps us to
generate better ideas, make better decisions
and produce better work.
To this end, we introduced a new remote
training module on meeting etiquette and
effectiveness. Completed by more than
500 people, this received exceptionally
high ratings from almost all participants.
Focusing on employee
engagement
We have a number of mechanisms and
programmes to support and monitor
employee engagement, build on strengths
and address concerns. For example:
Maintaining an open, two-way
conversation – the Petrofac Workforce
Forum is an important route for the Board
and the leadership team to get deeper
insights into the opinions of our people
(see page 49).
Keeping track of attitudes and
opinions – each year we ask all
employees to participate in PetroVoices,
our confidential employee engagement
survey, run by an independent third
party (Willis Towers Watson). In 2021,
the participation rate increased to 65%,
up from 59% in 2020. The results were
strong, with most metrics scoring at more
than 80%, but we did see an across-the-
board drop of a few percentage points.
We believe this is in part due to the
difficult market conditions, the ongoing
ramifications of the COVID-19 pandemic,
and the impact on Petrofac. However, we
are charging all senior leaders to produce
action plans for the top three topics in
their respective areas. These plans will
be reviewed by the leadership team with
a view to implementing improvements
throughout 2022.
Developing a performance culture
As part of the rebalancing and reshaping
of Petrofac, a new set of behaviours
were defined, aligned with our new
values. These were integrated into our
performance management systems and
professional development programmes
in2021. The five behaviours are:
– Collaborating with purpose –
we bring people together to share
knowledge, co-create solutions
anddeliver the best business
outcomefor everyone
– Taking ownership – we lead work
to completion, take responsibility for
decisions, represent the organisation
and do not tolerate unethical behaviour
– Building relationships with
integrity – we have respectful
relationships, we build a climate of
trust, and foster an environment where
we can constructively challenge and
resolve conflict
– Coaching, developing and
empowering – we encourage our
people to grow, acquire the confidence
and skills to make accountable
decisions, and provide opportunities
to progress
– Driving positive change – we
embrace change, encourage constant
improvement and, where appropriate,
challenge the status quo
The behaviours have been incorporated
into our employee goal plans, which
means that they are now factored into
mid-year reviews and year-end appraisals.
To continue the process, and fully embed
the new values and behaviours, we intend
to make better use of our digital HR tools,
and enable more of a coaching culture
among our managers.
50 Petrofac Limited 2021 Annual report and accounts
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Environmental, Social and Governance
continued

Recognising and rewarding
ourpeople
It is important to Petrofac that all our
people are appropriately rewarded.
In 2021, we made several changes, including:
– Becoming a real Living Wage
employer – in the UK, we committed
to paying at least the real Living Wage
to all employees.
– Introducing a new recognition
scheme – we launched an additional
Groupwide recognition scheme.
This enables line managers to instantly
reward colleagues who are exceptional
role models and live our values with
acash award of US$100 to US$250
or a spot bonus, equivalent to one
month’s salary. In the first month alone,
242 of these awards were made.
– Reducing working hours in the
UAE – for employees based in our
Sharjah office, to coincide with the
national shift to a Saturday-Sunday
weekend, we decided to reduce our
own working week from 45 hours to 40
hours with no loss of pay, with effect
from 1 January 2022
– Introducing Total Reward
Statements – we issued Total Reward
Statements, which clearly itemise the
full range and value of the benefits and
remuneration our employees receive
– Bringing parity to all UK-based
employees – again in the UK, we
eliminated legacy differences in some
employees’ terms and conditions.
For the vast majority of employees,
this meant that the standard holiday
entitlement increased from 25 to 28
days, and that maternity and paternity
benefits also improved.
Paying the real Living
Wage
In 2021, Petrofac committed to being a
real Living Wage employer, and in early
2022 we made our application to the
Living Wage Foundation.
Wherever we operate, we want to
be seen as a good employer offering
competitive rates and conditions. And,
irrespective of their role, location, or
seniority, we want all our people to
enjoy dignified working conditions
andadecent standard of living.
By applying to become a real Living Wage
Employer, we will be accredited by the
real Living Wage Foundation which, each
year, calculates the hourly wage that a
UK family needs to live on, based on the
cost of a basket of household goods and
services. This wage is considerably higher
than statutory requirements.
Importantly, the commitment will extend
to all UK-based employees. It will
also cover indirect employees, such
as temporary or agency staff, as well
asanyinterns or placements.
51Petrofac Limited 2021 Annual report and accounts
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Community
engagement
Making a positive contribution
toour local communities
Our local delivery model is a key
differentiator for Petrofac and, wherever
we work, we want local communities to
benefit from our presence. We therefore
engage with local stakeholders to better
understand and manage the social
impacts of our business, address any
concerns they may have about our
work,and maximise the benefits we
areable to bring to their communities.
The Petrofac Social Performance
Framework governs the way we approach
community engagement. It consists of
our Social Performance Standard and a
set of guidelines that enable us to meet
the commitments set out in the Petrofac
Ethical, Social and Regulatory Risk Policy.
Enhancing our approach
tosocialinvestment
In 2021, we updated our social investment
guidelines to ensure that our activities
create value for both Petrofac and the
recipients, are conducted in compliance
with our Code of Conduct, and are subject
to rigour and transparency.
These guidelines explain that our social
investment initiatives should be consistent
with three strategic priorities:
1. Promote STEM (science, technology,
engineering and mathematics)
education, and improve educational
access and employability
2. Contribute to community improvement,
capacity building and disaster relief
3. Support a just transition as the
energysector evolves and reduces
itscarbon intensity
We also provided more clarity on the
types of initiatives that are eligible for
support and tightened our due diligence
processes. Across the Group, training
onthe new guidelines was delivered
to allcorporate social responsibility
representatives and will be extended to
country managers and project managers
in 2022.
Extending our support of
COVID-19 response initiatives
During 2021, we continued to support
several COVID-19 response initiatives,
including:
– Algeria – we donated 220 oxygen
concentrators for the Ministry
of Health,with 40 of the units
dedicatedfor use in Illizi province
tosupport the communities local
toourTinrhert project
– India – our Mumbai operations
hubworked with a local charity,
Samhita’s Collective Good Foundation,
to support a community vaccination
programme, providing vaccines for
7,200 people from marginalised and
underprivileged communities
– Thailand – we supplied COVID-19
support bags to nearby villages to
help those within the local community
who needed to self-isolate and
homequarantine
Algeria – supporting our
localcommunities
Our Ain Tsila project teams assisted the
nearby village of Tin Fouy. They donated
medical equipment for itsclinic, bought
and installed air conditioning and heating
systems for theelementary school, and a
new soundsystem for its mosque.
India – supporting women’s
educationand employability
There is a regulatory requirement for us
to spend at least 2% of our revenues in
India on social investments, equating to an
investment of approximately US$200,000
per annum. In 2021 the focus of our
community engagement programmes
continued to be the provisionof training
and employability skills for disadvantaged
people, with afocus on young women.
From Mumbai, through the PanIIT Alumni
Reach for India Foundation (PARFI),
we supported a one-year commis chef
training programme for young women
from disadvantaged communities,
and successfully placed 61 of them
in full-time hospitality jobs. As part
of an empowerment programme for
young women, our staff supported the
Wavaloli Ashram school, contributing to
educational resources and tuition fees.
Meanwhile, from Chennai, we
financed the installation of a new hall
at the Sri Ramakrishna Math school
for underprivileged girls, extended
oursponsorship of the Women’s
Organisation for Rural Development,
and supported several projects run
bySevalaya, a local charity that
providesskills and employability
educationin rural communities.
52 Petrofac Limited 2021 Annual report and accounts
Strategic report
Environmental, Social and Governance
continued

Oman – helping to recover
fromCyclone Shaheen
In Oman, a focus of our community
engagement activity was to assist
the reliefoperation following Cyclone
Shaheen, which swept through
the Sultanate in October 2021.
Through a fundraising appeal our
employees, assisted with a Petrofac
company donation, raised around
US$130,000 and partnered with the
Oman Charitable Organization (OCO) to
deliver relief, including the repair of vital
infrastructure and delivery of emergency
supplies. Our teams also helped on the
frontline, supporting the local community
by clearing storm-damaged properties.
Other social investments in Oman include
initiatives from our Duqm project team,
such as the construction of a sports
ground, the provision of benches and
shelters at a popular beach, and the
donation of IT equipment to local schools.
Thailand – becoming an active
member of the local community
In the Ban Thung and Ban Ao-Udom
communities, adjacent to our Thai Oil
refinery project, several community
relations and youth development
projectswere sponsored. We supported
weekly ‘Big Cleaning’ events, partnering
with the community representatives
to clean up neglected areas. We also
supported several road safety campaigns
to raise awareness of hazards and promote
safe behaviours, with volunteers routinely
supporting safe traffic management
during rush hour. Meanwhile, our youth
development activities included the
sponsorship of anEnglish language camp
programme over seven months for 24
students aged 13 to 18 years.
UAE – supporting STEM education
and research
We continued to support STEM education
at the American University of Sharjah.
The university’s Renewable Energy
Research Center (RERC), established in
2017, is backed by Petrofac, and supports
12 faculty members and research staff
assistants working on new energies
initiatives. We also sponsor a Research
Chair in Renewable Energy and support
several university events such as its open
day, careers fair, and an environmental day.
To encourage breakthroughs in green
energy, we also collaborated with the
Middle East and Africa Innovation Hub,
by supporting and helping to judge
a three-day hackathon for university
students. Meanwhile in Abu Dhabi,
we worked with the UAE Ministry of
the Interior and the Saaed Association
to support marginalised communities
duringRamadan.
UK – partnering for a just transition
In support of a just transition to a lower
carbon energy industry, we established
a partnership with the East of England
Energy Group (EEEGR) an industry-led
membership organisation. EEEGR builds
skills and capability for the hydrogen,
carbon capture, offshore wind, and
waste-to-value sectors. Our support
covers several EEEGR core programmes,
including Skills for Energy and Clean
Energy technologies.
We also signalled our support of the UK
armed forces community, signing the
Armed Forces Covenant, which seeks to
ensure those who serve, or have served,
in the armed forces are treated with
fairness and respect.
In-country value
% Spend on local goods and
services* (%)
54% (US$158m)
2019
2020
2021
41%
53%
54%
*Non-JV projects
Key project jobs (’000)
2019
2020
2021
57.0
41.0
33.0
Generating economic value
in-country
Wherever Petrofac operates, we are
committed to creating shared value by
employing local people, supporting local
supply chains, developing local capabilities,
and stimulating local economies.
As well as being the right thing to
do, wesee the creation of in-country
value (ICV) as a source of competitive
advantage. It enables our local delivery
model, helping us to bid on challenging
projects, keep costs down, improve the
quality and capability of local vendors
and supply chains, and build stronger
relationships with local stakeholders.
Alongside shareholder and client value,
weregard ICV as one of the most
important outcomes of our business
model. We therefore aim to make a
positive and measurable contribution
tothe economies in which we operate.
53Petrofac Limited 2021 Annual report and accounts
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Formalising our ICV
deliverystrategy
The creation of ICV has always
been ahallmark of our approach.
In 2021, weenhanced and extended
ourcommitment with a formal ICV
strategybased on four levers:
– Employing and developing a
world-class national workforce –
strengthening our local teams,
making them more representative
of communities they work in,
andenhancing our in-country
deliverycapabilities
– Building the capacity and technical
capability of local suppliers –
understanding the capabilities of
local supply chains, supporting
skills development, and promoting
technology transfers
– Sourcing goods and services
locally – reducing our reliance
on international supply chains,
matching local suppliers with
projectopportunities, and
improvingour efficiencies
– Investing in our local presence and
host communities – ensuring that
our community engagement initiatives
support our local operations, and
are closely aligned with our strategic
priorities (see pages 8 and 9)
A three-year implementation plan was
agreed, along with key performance
indicators for each of the pillars.
Supporting local economies
In 2021, just taking into account our major
non-joint operations projects (as listed on
page 78), where we have direct control
over procurement and subcontracting, we
purchased almost US$158 million worth of
goods and services, and supported more
than 33,000 jobs at our project sites.
The proportion of locally-sourced goods
and services marginally increased to
54%in 2021, up from 53% in 2020.
This reflects our continued work to
sourcemore local goods and services,
build the capability of our supply chain,
and invest in our local presence.
Indicative examples from across our
operations include:
India
As part of the implementation of the ICV
strategy, the local market was assessed,
and service providers, vendors and
partners identified to support our plans
in India.
Given the maturity of the Indian market,
almost all goods and services are
already sourced locally, other than
licensor-mandated imported items.
A focus for 2021 was to build our locally-
based bidding and project execution
teams with a view to maximising our
in-country delivery capabilities and
minimising any requirement for external
support. For 2022, we aim to increase
thecapabilities further and establish
India asanoperations hub for bids and
projectsin Africa.
Oman
In Oman, where we have worked on
manyof the Sultanate’s most significant
energy assets and jointly operate the
prestigious Takatuf Petrofac Oman training
centre, our formal ICV programmes have
been running for more than 16 years, and
we have a dedicated ICV management
team in place to optimise and quantify
ourimpact.
In 2021, we appointed a new Country
Manager, Dr Khalid Al Jahwari, recruited
afurther 41 Omani nationals, identified
new ways to strengthen our in-country
teams, and presented plans for our
nationalisation programme to the Ministry
of Labour. We also received an award
from our client, Petroleum Development
Oman (PDO) for our ICV performance,
while our Ghazeer project was named
Commercial Project ofthe Year in the
2021 Construction Week Oman Awards.
In selecting vendors and subcontractors,
weroutinely give priority to local providers
and offer formal support to small and
medium-sized enterprises (SMEs).
In 2021, we placed orders worth around
US$60 million with Omani vendors, many
of which were SMEs.
For 2022, priorities include strengthening
our Omani middle management teams
and continuing ourOmani graduate
programmes. We alsointend to assess
thecapabilities of the local supply chain
in the new energies sector, identify gaps,
and providesupport accordingly.
Helping to establish
UAE as a global hub for
new energy projects
With a significant presence in the
UAE,we are working with local
partnersto deliver a number of new
energy projects, while also creating
outstanding new opportunities for our
Emirati graduate engineers.
We chose to fabricate the facilities of
two of our new energy projects at the
Drydocks World Dubai and Eversendai
facilities respectively. We assigned
23 Emirati graduate engineers to
theirdelivery.
To add to their formal studies at the
Petrofac Academy, these graduates
benefited from on-the-job training,
support, and real-world experience
inthe new energies sector. Meanwhile,
Petrofac benefited from their enthusiasm,
their ambition, and their commitment to
the local economy, while the UAE builds
its credentials in one of the world’s most
important and rapidly growing sectors.
Delivering locally
to global standards
is key to Petrofac’s
strategy and unlocks
in-country value for all
stakeholders, wherever
we operate.”
Sami Iskander
Group Chief Executive
54 Petrofac Limited 2021 Annual report and accounts
Strategic report
Environmental, Social and Governance
continued

Algeria
Petrofac’s commitment to Algeria is
reflected in the scale and nature of our
in-country operations. A support office
in Algiers is supplemented by a busy
operations hub in Hassi Messaoud, plus
project sites in Tinrhert and Ain Tsila.
We also operate the Hassi Messaoud
Construction Skills Training Centre.
In 2021, more than 85% of the people
working on our project sites were
Algeriannationals.
For 2022, our priorities include
capabilitybuilding initiatives, including
evolving our contracting model
and establishing more framework
agreementswith local suppliers.
UAE
Our Sharjah office is home to 1,450
employees and a significant part of our
heritage is closely associated with the
Emirates. As an operational hub for
manyof our projects, we source goods
and execute large-scale fabrication
works in the UAE for export to our clients
worldwide. In 2021 we continued to focus
on localising strategically critical parts of
our business, and worked with selected
subcontractors to build their capabilities
and promote decarbonisation initiatives
tolower their carbon footprint.
To support the development of our
localworkforce, an HR review evaluated
future resource needs and prioritised the
recruitment and development of more
Emirati middle managers and project
staff, both through external recruitment
and internal professional development
programmes. We also partnered with
Sharjah Research Technology and
Innovation Park as part of an initiative
toidentify and co-create innovative
solutions to emerging energy challenges.
Kuwait
In recent years, Petrofac has delivered five
major projects in Kuwait, helping clients
to increase production and modernise
their infrastructure. In doing so, we have
established project offices, recruited
local leadership teams and graduates,
and spent around US$3.4 billion on local
goods and services. For 2022, we intend
to step up our Kuwaitisation programme
and appoint a local Country Manager.
Australia
Our Australian operations have built
astrong reputation for well engineering
services. We are working on Australia’s
largest commercial scale green hydrogen
project, and we are extending our
involvement in the region’s energy
industry. For 2021, for example, we
signeda Memorandum of Understanding
(MOU) with Boya Energy, a majority
Aboriginal-owned Western Australian
renewable energy project developer.
Making a significant contribution
to public finances
Through the taxes we pay, Petrofac makes
a significant contribution to the public
finances of the local economies in which
we operate.
The total amount paid to governments
in 2021 was US$157 million, comprising
corporate income tax, employment
taxes,and other forms of tax and social
security contributions.
55Petrofac Limited 2021 Annual report and accounts
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Human rights
Respecting human rights across
our supply chain
We strive to protect and respect
human rights throughout our business
operations and extended supply chain.
Our commitments are set out in our Code
of Conduct, and we work in accordance
with our Social Performance Framework,
the UN Guiding Principles on Business
and Human Rights, and the Fundamental
Conventions of the International Labour
Organization (ILO). We are also proud of our
long-term commitment to the United Nations
Global Compact and disclose annually our
progress against its Ten Principles.
However, we acknowledge that the nature
of our global operations and the type of
geographies we work in at times present
human rights risks. Our main exposure is in
the extensive supply chains of our large EPC
projects, particularly the labour practices
of subcontractors and the recruitment
agents and brokers they use.
Evaluating our performance
Each year, we assess our operations
for human rights issues and take a
risk-based approach to addressing
any incidents of modern slavery related
to forced and bonded labour, worker
welfare infringements, and other labour
rights abuses. This review is detailed in
our annual Modern Slavery Statement,
published in accordance with the UK
Modern Slavery Act 2015, which outlines
the steps taken in respect to human
rights. This can be found on our website
atwww.petrofac.com.
All third-party suppliers undergo human
rights and labour rights due diligence
screening as part of prequalification onto
our vendor management system, and are
required to read and commit to Petrofac’s
Labour Rights and Worker Welfare
Standards. We also review compliance
with our standards through our audit,
review, and inspection programmes.
Where issues are identified, we work
collaboratively with third parties to
supportimprovement plans.
In 2021, there were no incidents of
modernslavery or human rights violations
reported through our auditing or internal
incident reporting mechanisms. However,
we did uncover several labour rights issues
arising from the ongoing challengesof
thepandemic.
Supporting labour rights
throughthe pandemic
While the pandemic has impacted the
entire supply chain, it is often our less
financially resilient subcontractors who are
most vulnerable. Across several projects,
our labour rights monitoring and grievance
management systems highlighted instances
of labour rights infringements. For example,
due to country travel restrictions, some
subcontracted workers opted to work
extended rotations rather than return
to their home countries and risk finding
themselves unable to return to work. In other
instances, lower-tier subcontractors with
cash flow problems were unable to pay
workers’ salaries or health insurance on
time, ormade unacceptable cuts in the
welfareprovision.
In all instances, we worked in collaboration
to facilitate solutions, monitoring the
situation until resolved. As a preventive
measure, we also stepped up our reviews
ofthe welfare of our subcontracted
workers and provided additional support
where necessary.
Refreshing labour
rightsawareness
To remind our subcontractors of the
importance of worker welfare, the
principles we follow, and the support
wemake available on each of our project
sites, a programme of labour rights
refresher training was implemented
(aligned to the International Finance
Corporation Standards on Environmental
& Social Sustainability, Labour Standard
2). Information campaigns were also
developed in multiple languages, such
asposters and discussion topics for
toolbox talks with groups of workers.
Enhancing project
grievanceprocesses
At each project site, we operate grievance
processes, which are designed to be
transparent and accessible, and based
on engagement and constructive
dialogue. Workers can raise complaints
and suggestions for improvement both
anonymously and in person, and we
engage with all parties to support the
fair and prompt resolution of any issues
raised. Given the potential impacts of the
pandemic, we worked to raise awareness
of these grievance systems and how to
access them.
Giving a voice to workers
As part of our focus on worker welfare in
2021, all project sites were encouraged
to elevate the role of their worker welfare
committees. The committees represent an
important component of our commitment
to labour rights, and are an important
pillar in our due diligence framework.
We worked to ensure that regular monthly
meetings are held, that workforce groups
are fairly represented, and an effective
dialogue is maintained between all parties.
56 Petrofac Limited 2021 Annual report and accounts
Strategic report
Environmental, Social and Governance
continued

Governance
Why this is important to our
business model and strategy
Responsible governance and
ethical business practice are critical
considerations for Petrofac.
As a key stakeholder and a significant part
of the supply chain in the industries and
countries in which we operate, we must
uphold the highest standards of integrity
and transparency, and consistently earn
the trust of clients, governments, partners,
and the wider energy industry.
We therefore recognise the responsibility
and opportunity we have to enable and
embody ethical behaviours. We take this
commitment seriously and continue to
invest in our people and processes to
ensure that we live up to it.
Alleged breaches of the Code of
Conduct reported via Speak Up
Proportion of employees with line
management responsibility who
completed mandatory Code of
Conduct e-learning
Number of substantiated
allegations
* This number does not reflect 15 ongoing cases from 2021
2019
2020
2021
61
57
125
2019
2020
2021
97.9
9 9.3
97.2
2019
2020
2021
24
21
39*
Proportion of employees who
completed mandatory e-learning
(Share Dealing Code, Standard for the
Prevention of Bribery & Corruption,
Codeof Conduct)
Number of employees facing
discipline or dismissal following
substantiated allegations
Number of employees attending
training conducted by the
complianceteam
(Code of Conduct, trade compliance,
investigations)
2019
2020
2021
9 9.2
98.9
98.5
2019
2020
2021
20
39
41
2019
2020
2021
n/a
997
1,449
Proportion of employees who
completed an annual declaration
confirming their compliance with
theCode of Conduct
2019
2020
2021
99.7
100.0
9 9.9
Our performance
100% of employees
completed an annual declaration
confirming compliance with
the Code of Conduct
Speak Up reports increased
indicating a more transparent
Speak Up culture
Strategic report Governance Financial statements
Strategic report
Environmental, Social and Governance
continued
57Petrofac Limited 2021 Annual report and accounts

Ethical behaviour
andcompliance
Over recent years, and in the wake of
theSerious Fraud Office (SFO) investigation,
we have put significant effort into reinforcing
the importance of ethical behaviour to
ourpeople and enhancing our systems
and processes.
Over the past five years, the size of our
compliance team has grown from two
to 12 people, the skills and experience
within it have been significantly enhanced,
and the budget almost doubled. We also
benefit from a new unequivocal Code of
Conduct, more codified behaviours and
values, and the frequent delivery of clear
and consistent messages from all tiers
ofleadership.
At the close of the investigation, the SFO
and the Court commented on the extent
and integrity of our reforms. We know
that we have emerged a better company,
backed by a world-class compliance
regime, and an open reporting culture
in which reporting unethical behaviour
is actively welcome. We believe that,
because of these major enhancements,
the type of behaviours that prompted the
investigation would not now occur.
We also believe that ethical behaviour
andcompliance are ongoing considerations
that require consistent attention and
enhancement, which is what our three
lines of defence structure brings.
Continuing to embed a
compliance ethos across
theGroup
Following the launch of our revised Code
of Conduct in 2020, we continued with
our related training and communications
programmes. Although face-to-face
training programmes were restricted by
the pandemic, we continued with our
online programmes, with a total of 1,449
employees receiving training from the
compliance team.
To complement the communications
and frequent messaging from the senior
leadership, we also focused on fostering
more openness among middle managers
and their direct reports, especially those
working in higher risk roles and locations.
We launched and rolled out a mandatory
Code of Conduct e-learning module for
everyone at middlemanagement levels
and below.
Enabling Group-wide engagement
The compliance team continued to
implement new ways to engage with
and support colleagues from across the
business. Aside from their day-to-day
operational responsibilities, all senior
compliance team members have a
remit to work closely with the leadership
team of a given business unit, act as a
compliance focal point, and provide support
and problem-solving advice. We also
implemented compliance review rhythms
with the senior leaders of our business units.
Optimising our processes
andcontrols
The purpose of our compliance processes
and controls is to prevent deviations from
our policies, highlight any new or emerging
risks, and detect and flag deviations
orsuspicious-looking activities.
A major focus for 2021 was to revamp
our due diligence systems, eliminate
any remaining manual processes, and
transition to a new cloud-based platform,
as well as bringing increased efficiencies
and enhanced controls. This means that
our due diligence and financial controls
are now fully integrated. It also means
that we benefit from live monitoring of
counterparty risks, and are able to take
immediate action if issues should arise.
Encouraging more people
toSpeak Up
It is vital that everyone working with or
for us can raise any concerns they might
have, without fearing retaliation, and have
the option to do so anonymously.
Following the 2020 improvements to our
Speak Up tool (which is how employees,
contractors, suppliers, and customers
and any other third parties can report
any breach or suspected breach of our
Code of Conduct, policies, standards,
procedures or local laws), the priority
for 2021 was to encourage more open
reporting through the tool or through
management. This entailed additional
training, again targeting middle-level
managers, to promote a strong and
healthy Speak Up culture, reinforced
bya top-down cascade to all employees
on the importance of speaking up.
To ensure our stakeholders, and especially
our employees, feel safe in speaking
up, weintroduced a standalone Non
Retaliation policy.
As a result, we saw an increase in Speak
Up reports, which more than doubled
to 125. This is in line with recognised
international benchmarks. It demonstrates
that people feel more comfortable in
reporting and discussing their concerns,
which is indicative of the more open and
transparent culture we are nurturing.
Three lines of defence
Each line in our defence system includes a feedback loop that informs improvement
2.
Processes
and controls
3.
Assurance
1.
Leadership
and people
58 Petrofac Limited 2021 Annual report and accounts
Strategic report
Environmental, Social and Governance
continued

Bringing more rigour and
consistency to our investigations
Where concerns are reported, we respond
to them promptly and investigate them
objectively and independently. We ensure
that whoever reports a concern is
kept abreast of the outcome and that
recommended actions are implemented
in a timely manner. This is the result of
a major redesign of the investigations
function, procedures and tools.
Maintaining strong third-party
assurance
To help us develop and implement our
enhanced compliance regime, in 2019
we appointed the specialist law firm
Freeh, Sporkin & Sullivan. In 2021, we
confirmed that this would be a long-
Tax transparency
Petrofac is committed to ensuring
compliance with the tax laws and
regulations of the countries where we
operate. We have an open, cooperative
and collaborative working relationship
withtax authorities.
Our Tax Strategy and Tax Policy explain
how we approach the management of
our tax affairs (these are available for
download at www.petrofac.com).
The total amount that we pay in taxes is
not limited to the corporate income tax
disclosed within the financial statements.
It also includes employee and employer
taxes and social security payments, VAT
and sales taxes, and other taxes such as
withholding, property and other indirect
taxes. The total amount paid by Petrofac
to governments worldwide includes those
taxes which are borne by Petrofac, as well
as taxes collected by Petrofac, but which
are recoverable from tax authorities or
clients and suppliers.
We report our taxes paid and collected
on a cash basis, except for VAT and
sales taxes, which are shown on an
accrual basis. We believe this is the
mostmeaningful way to demonstrate
ourannual tax contribution.
term engagement and a key part of
ourassurance processes – helping us
monitor our performance and adapt
ourapproach accordingly.
Continuing priorities for 2022
For 2022, we will continue to enhance
ourapproach. Plans include a detailed
andelaborate communications and
training programme using lessons
learnt, emerging trends and other
communications channels. This will have
an emphasis on continuing to nurture a
culture of openness and transparency
– so that all our people feel comfortable
discussing our Code ofConduct, and
all tiers of management understand the
right ways to engage in these discussions
and, where appropriate, to escalate
theoutcomes.
It is vital that everyone
working with or for us
can raise any concerns
they might have, without
fearing retaliation, and
have the option to do
soanonymously.”
59Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

We operate
in challenging
environments and
understand that risks
are an inherent part
ofour business.
Identifying and
managing risks and
opportunities is key to
the successful delivery
of our strategy.
Our knowledge and insight, coupled with
the right set of tools and processes, help
us understand the factors that lead to risk,
and enable us to manage them effectively.
Our risk management framework provides
us with a consistent approach to identify,
manage and oversee the risks that may
impact our business and is designed
to underpin the Group’s longer-term
sustainability. Based on the principles
and guidelines of BS ISO 31000:2018
Risk Management, our framework
encompasses the policies, standards,
procedures, culture, behaviours,
organisational design, systems and
otheraspects of the Group that, taken
together, enable Petrofac to operate
effectively andefficiently.
Governing our risk
managementframework
Petrofac’s system of risk governance
comprises several committees and
management processes which bring
together reports on the management
of risk at various levels. The Board has
overall responsibility for risk management,
which includes establishing the Group’s
risk appetite and its enterprise risk
arrangements, and ensuring we have
aneffective risk management framework
in place.
The Audit Committee has been delegated
the responsibility of monitoring and
reviewing the integrity and effectiveness
of the Group’s overall risk management
and internal control systems. The Audit
Committee primarily, but not solely, utilises
the processes and reports set out below
to evaluate the risk management and
control activities of the Group.
– The Principal Risk Report identifies
and assesses the principal risks and
emerging risks facing the Group,
outlines how these are managed,
reviews the effectiveness of relevant
controls and monitors exposures
with respect to our risk appetite.
Coupled with updates from the Group
Chief Executive, Chief Financial Officer
and the Group Risk Team, this report is
submitted quarterly and is considered
at both Committee and the Board level
throughout the year. A summary of this
Report is provided on pages 63 to 69.
– Management Reports for various
principal risks are submitted either to
the Board or to one of its Committees
whose area of expertise best aligns
with the risk area under consideration.
The purpose is to enhance the level
of oversight for each principal risk.
The relevant Committee is responsible
for reviewing the status of each
principal risks, seeking information
on controls and processes, and
considering mitigation and management
strategies. Following its review, each
Committee provides feedback to the
Audit Committee and to the Board
fordiscussion and recommendations.
– Control Self-Assessment (CSA)
certificates are a way for management
to review and maintain adequate
internal controls. These certificates
are completed by each function and
business unit to check and assure the
adequacy of controls and disclose any
reportable weaknesses in the control
environment. They are then cascaded
and consolidated to confirm the extent
to which the internal controls have
operated effectively throughout the
year. Further reviews are performed
by the internal Audit team. The Audit
Committee received regular updates
from the Head of Internal Audit on the
effectiveness of the internal controls.
Risk governance framework
Board
– Sets risk appetite
– Approves principal risks
– Reviews and approves significant
opportunities
Audit Committee
– Reviews principal risks, emerging risks
and risk appetite
– Provides assurance on risk
management and internal controls
framework
Group Risk Committee
– Oversight of the Enterprise Risk
Management Framework, including
theprincipal and emerging risks and
risk appetite
– Reviews and recommends significant
opportunities
Divisional Risk Review Committees
– Divisional management oversight and
review of opportunities
Service lines
– Risk management is embedded within
each service line
Group functions
– Assurance to management, the Audit
Committee and the Board
Board
Internal
audit
Divisional
Risk Review
Committees
Service
lines
Group
functions
Group Risk
Committee
Audit
Committee
60 Petrofac Limited 2021 Annual report and accounts
Strategic report
Risk management

Integration with key
business processes
– Delegated authorities
– Strategic planning/
budgeting
– Treasury/financial
planning
– Stage-gate reviews
– Project controls &
management
– Procurement and vendor
management
– Business continuity and
crisis management
Alignment with
assurancefunctions
viaprincipal risks
– Compliance
– Value assurance
– Financial control
– HSE
– Cyber security
Risk management process
In addition to these activities, reports are
submitted to the Audit Committee by our
internal and external auditors, as well as
from our newly established Assurance
function. In reviewing each of the submitted
reports, the Committee considers:
– How effectively risks have been identified
– How they have been mitigated and
managed
– Whether appropriate and prompt action
is being taken to remedy any failings or
weaknesses
– Whether the cause of the failing or
weakness was the consequence
of poor decision making, a need
for more extensive monitoring, or a
reassessment of process effectiveness
These considerations are intended
toprovide the Audit Committee with
abalanced assessment of the Group’s
principal risks and the effectiveness
ofthesystems of internal controls.
The Group Risk Committee is responsible
for the oversight of the risk management
framework, as agreed by the Board,
including the review of Group policies
andthe management of the Group’s
Delegated Authorities.
In addition to the Group’s regular risk
review meetings, the Group Executive
Committee meets regularly to discuss
safety, compliance, operational, commercial
and finance matters, with changes in risks
and opportunities being identified and
addressed as appropriate.
The diagram on the previous page sets out
the risk governance framework, showing
the interaction between the various risk
review and management committees.
Identifying and managing our risks
The Group’s divisions and functions
conduct regular risk assessments and the
risk information from these are consolidated
into our principal risks. Emerging risks are
identified as part of the business planning
cycle, with a view to considering those risks
that may have a material impact beyond
theplanning horizon.
The list of principal and emerging risks
isreviewed by the Group Risk Committee,
endorsed by the Audit Committee and
approved by the Board. Once approved,
each principal risk is categorised and
assigned to an executive owner who
isaccountable for coordinating the risk
assessment, reviewing the adequacy
ofrelevant internal controls, establishing
aresponse plan and reporting.
Depending on the category of the risk,
the Assurance teams may be engaged to
devise and support an effective assurance
programme. The Board may also appoint
a relevant Committee to enhance the level
of oversight.
We assess the materiality of each principal
risk and aim to contain them within the
context of our risk appetite framework.
Our risk appetite statements are
established in three layers:
– The first layer aligns with Petrofac’s vision,
purpose, business model, and strategy
– The second layer ties into the business
plan through overall risk indicators
– The third layer operationalises the
previous layers through specific
Risk management framework
Company values and culture
Enterprise Risk Management system (and other tools)
Leadership, communications and engagement
statements and indicators relevant to
each of our principal risks
The Board and the Group Risk
Committee jointly govern all material
new business opportunities and projects
(including bid submissions, new country
entries, joint ventures, investments,
acquisitions and disposals) and provide
direction as to the management and
mitigation of any related risk exposures.
Proposals are only presented to the
Group Risk Committee after being
reviewed and supported at divisional
level.Based on the recommendations
of the Group Risk Committee, the Board
then has responsibility for approving
ordeclining any high-risk opportunities.
Enhancing our risk management
framework
During 2021, we enhanced our
risk management in several ways.
We continued to integrate risk management
into our key processes and further aligned
authority levels with our risk appetite.
Following the review of the effectiveness
of our internal control systems, we also
created a new Value Assurance team and
a framework was established to coordinate
and oversee various assurance activities
throughout our opportunity life cycle and
across our operations.
In 2022, we plan to continue this work by:
– Integrating the value assurance
framework further into our operations
– Further aligning and integrating
assurance efforts throughout the
organisation
Communicate and consult
1.
Risk
identification
2.
Risk
assessment
3.
Risk
treatment
4.
Risk
monitoring
5.
Risk
reporting
Assurance
61Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

The Group’s principal risks were reviewed and revised at the end of 2021, drawing on feedback from the business, Executive
management and the Audit Committee. Key changes made to our principal risks are outlined below. No new emerging risks were
identified during the year.
Key changes to
ourprincipalrisks Details
Reflecting the
impact of
the COVID-19
pandemic
The COVID-19 pandemic continues to have a significant impact on our business and is
accounted for in the assessment of the principal risks listed below:
– ‘Adverse geopolitical and macro-economic changes in key geographies’ to reflect the
potential for a long-term global recession as well as economic/social impact in some of our
keymarkets
– ‘Low order intake’ to reflect the risks related to COVID-19 and the subsequent impact on
investment by our existing and potential clients
– ‘Operational and project performance’ to reflect the risk to project delivery due to restrictions
in workforce mobilisation, remote working practices, delay/suspension in project execution
due to supply chain issues and the impact on client relationships due to these conditions
– ‘HSSE incidents’ to reflect the COVID-19 related risks to the health and safety of our
employees, customers and service providers
Rewording and
reclassification of
‘Energy Transition’
emerging risk
The Energy Transition emerging risk was identified in 2019 and embedded as a sub-risk under
the principal risk ‘Failure to deliver strategic initiatives’ in 2020. This risk was reclassified as a
standalone emerging risk in 2021 and reworded as ‘Failure to deliver New Energy Services
strategy’ reflecting the establishment of New Energy Services (NES).
Rewording some
principal risks
We revised the wording of certain principal risks, specifically:
– ‘Historic or future breaches of laws, regulations, and ethical standards’ to ‘Breach of laws,
regulations, and ethical standards’
– ‘HSSEAI incidents’ to ‘HSSE incidents’ for simplicity and consistency
The Group’s current principal and emerging risks are outlined below:
Strategic risks
Adverse geopolitical
and macro-economic
changes in key
geographies
Low order intake Failure to deliver
strategic initiatives
Failure to deliver NES
strategy
Operational risks
Operational and project
performance
Insufficient IT
resilience
HSSE incidents
Financial risks
Loss of financial
capacity
Misstatement of
financial information
Legal and
Compliance risks
Breach of laws,
regulations, and ethical
standards
People risks
Inadequate leadership
and talent management
Due to adverse changes in our business volume and balance sheet, we saw a reduction in our risk-bearing capacity in 2021.
This wasreflected in our risk assessment methodology, specifically in financial materiality levels. In some extreme cases, this
resultedin an increase in the severity of some of the risks, despite a reduction in absolute risk levels.
62 Petrofac Limited 2021 Annual report and accounts
Strategic report
Principal risks and uncertainties

Adverse geopolitical and macro-economic changes in key geographies
The Group’s backlog is concentrated in emerging markets, which may increase our vulnerability to adverse geopolitical events.
Recent global economic conditions and the enduring impact of the COVID-19 pandemic is having an impact on economies that are
exposed to the downturn in commodities. This, in turn, places greater pressure on governments to find alternative means of raising
revenues and increases the risk of social and labour unrest.
The impact of adverse geopolitical changes in our key geographies includes risks to the successful delivery of our strategy, our
operations and associated impact on margins, the safety of our people, security issues, material logistics, and travel restrictions.
Risk appetite
– We actively assess risks associated with geopolitical
changes in our key geographies, and we have appetite
for more risk in this area where we have the experience
ofmanaging it
– Where we operate in countries that have very high or
highgeopolitical risks, we actively monitor risks associated
with geopolitical events and have plans in place to support
the ongoing delivery, or suspension, of our business in
each country
Risk appetite measures
– Cash flow exposed to geopolitical risk
Sub-risks
Sub-risks are specific to each country where we operate
based on scenarios triggered by various threats such as:
– The COVID-19 pandemic and subsequent reduced
demand for hydrocarbon
– Civil unrest
– Recession and fiscal stress
– Increased controls over trade and payments
For more information see:
pages 8-9, 13-15, 18-19 and 52-56
Assessment: Increased
The risk remained unchanged in absolute terms. However, due
to recalibration of financial materiality thresholds it increased
in 2021. The increase in our risk profile was mainly driven by
re-entry into countries such as Libya. It was offset by reduced
exposures in countries exposed to high geopolitical risks and
growth of our backlog and pipeline in the EU and the UK.
The recent increase in geopolitical risks due to the conflict
between Russia and Ukraine is offset by reduced exposure
inthis country.
Risk category: Strategic
Link to our strategy: Return to growth
Mitigation and management
The Group Risk Committee (GRC) and the Board actively
monitor political developments and seek to avoid or minimise
our exposure to jurisdictions with risk levels beyond our
appetite. A detailed risk analysis is conducted before entering
any new country and while pursuing and executing projects
innew geographies.
We have good experience in project execution and
maintain positive relationships with key stakeholders.
Careful consideration is given to contractual terms and
security conditions through our detailed risk review process
and we seek external advice on specialist issues as required.
The delivery model is modified to suit each project and we
limit exposure to single sources of supply and service. We limit
our fixed asset commitment within each contract and closely
monitor and manage our cash flow and commitments.
Our Business Continuity Management System considers
response to and recovery from geopolitical incidents. There is
also continued focus on evacuation and emergency response.
Our operations are assessed and executed in accordance
with our security policy and security standards.
In 2021, we continued to enhance our Business Continuity
Management System and expanded it to cover all the key
geographies where we operate and execute projects.
63Petrofac Limited 2021 Annual report and accounts
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Low order intake
The risk is that our clients exercise capital discipline, which impacts the demand for our services through the cancellation or delay
ofplanned investments. The potential impact is that the Group could fail to deliver its anticipated backlog and growth targets.
The Group wins most of its work through a competitive bidding process, and as competition increases, there is a risk that we could
failto maintain differentiated margins.
Risk appetite
– We pursue opportunities consistent with our strategic
focusand core competencies, and expect to secure
adiversified portfolio in order to de-risk adverse events
inourcore markets
– We have appetite for more risk provided we review each
opportunity, taking account of its respective risk profile
andputting in place relevant controls to adequately mitigate
risks to the planned execution strategy. We do not enter,
or will exit, an opportunity, if we cannot ensure compliance
with laws and regulations, execution quality or the safety
and security of our people or reputation.
Risk appetite measures
– Book-to-bill ratio
Sub-risks
– Oil and gas industry downturn driven by lower oil price
– Loss of key markets due to geopolitical/litigation/
budgetaryconcerns
– Increased competition in our core geographies/sectors
– Reduced bidding competitiveness
– COVID-19 pandemic and subsequent impact on
investments
For more information see:
pages 8-10, 13-15 and 18-19
Assessment: No change
The increase in the principal risk during the first half of
2021 was offset by the resolution of the SFO investigation.
We expect further improvement when we are able to return
to bidding in markets from which we have been temporarily
excluded in recent years.
Risk category: Strategic
Link to our strategy: Return to growth
Mitigation and management
Our order intake is driven by our strategy, the development
of which is overseen by the Board. Our service lines work
together to identify, review and win opportunities. We regularly
analyse our business development activities, bid-to-win ratios
and our competition.
We responded to the reduced number of awards in all our
key markets in 2021 and prepare Petrofac for a recovery by
addressing client objectives such as increased in-country
value and improving sustainability.
Notwithstanding the challenging environment, we continued to
secure new orders during 2021, including projects in Oman, the
UK, Azerbaijan, Libya, Bahrain and Lithuania. We continue to
focus on converting opportunities in target adjacent geographies
and sectors. We see a good pipeline of bidding opportunities
for 2022 and 2023 in our core markets and targeted growth in
selective new markets. We anticipate tendering activity will pick
up in response to a recovery in the oil price and increased capital
investment by clients.
64 Petrofac Limited 2021 Annual report and accounts
Strategic report
Principal risks and uncertainties
continued

Failure to deliver strategic initiatives
Each of our strategic priorities is supported by various strategic initiatives that are overseen by senior management and the Board.
To build enterprise value, we ensure each initiative is de-risked and respective success targets are met, assuring shareholders and
opinion formers that we are pursuing an appropriate strategy capable of delivering shareholder value. The impact is reflected in the
appetite from new investors and, consequently, the market valuation of the Group.
Risk appetite
– We have limited appetite for risks affecting our strategic
initiatives, although we recognise that the delivery of these
is also a function of market dynamics. We identify and
adequately mitigate the risks to each initiative, having some
appetite to be flexible over the timing of their delivery.
Risk appetite measures
– Initiative impact (cost, value) and schedule targets
– Initiative-specific success goals
Sub-risks
– Failure to deliver structural cost reduction
– Failure to deliver functional excellence through a single
technical organisation (1tec)
– Failure to deliver on our digitalisation initiatives
– Failure to rebuild backlog from core and new geographies
– Failure to deliver on client centricity
For more information see:
pages 6-10, 13-15, 16-19 and 24
Assessment: No change
Good progress has been made in all our strategic initiatives,
and the risk remained stable during 2021.
Risk category: Strategic
Link to our strategy: Best-in-class delivery, and Return to growth
Mitigation and management
Each strategic initiative is governed by a stage-gate process
and overseen by GEC or a formal Group-level steering
committee. The Board regularly assesses our strategic
initiatives and overall strategic plan to satisfy itself that the
right balance of risk, capability and reward is maintained.
We conduct detailed sensitivity analysis to assess the
robustness of our plans.
The GRC reviews all material new business opportunities
andprojects, new country entries, joint ventures, investments,
acquisitions and disposals.
In a challenging environment, we continued to deliver our
strategic initiatives in 2021. Key achievements for the year include:
– Finalisation of our structural cost reduction programme and
introduction of the new operating model including creation
of 1tec, a single technical services organisation
– Establishment of digital solutions, bringing tangible
benefits to more clients, including cost savings, emissions
reductions, and optimised uptime
– Approval and execution of a formal ICV programme with
key targets and strategies agreed in order to drive growth
in our core and new geographies
– Setting up of new partnerships and continued push into
new territories
The priorities for 2022 include leveraging the new operating
model to drive our excellence agenda; preserve our cost-
competitiveness; further strengthen our ICV proposition
incoremarkets; and continue to digitalise the business.
65Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Failure to deliver New Energy Services strategy
Due to climate change and the energy transition, our markets are changing and the portfolios of our clients are going through a major
transformation. New Energy Services (NES) was established to respond to this change, and the Group has outlined a medium-term
ambition for 20% of revenue to come from this area by 2025. An inability to meet changing market needs will limit our future growth,
and would hinder our commitments with regard to our response to climate change.
Risk appetite
– We are willing to be exposed to more risk in the new energies
sector and recognise that lower margins are to be expected
as we seek growth
Risk appetite measures
– Short and medium-term growth forecasts
Sub-risks
– Inability to secure partnerships
– Adverse/delayed change in government policies
– Changes in client requirements (T&Cs and funding)
– Failures in our supply chain
– Failures in delivery and execution of NES projects
For more information see:
pages 6-10, 12, 13-15 and 26-29
Assessment: New risk
This emerging risk aims to assure the success of our response
to changing market needs due to the energy transition.
Good progress in pursuit of our medium-term ambition was made
in 2021, with 6 FEED awards, new alliances and partnerships
signed, and a NES pipeline of US$9 billion of opportunities.
Risk category: Strategic – emerging risk
Link to our strategy: Best-in-class delivery, and Return to growth
Mitigation and management
NES focuses on four clearly defined segments of the market,
namely offshore wind, CCUS, hydrogen and waste-to-value
where we have a strong track record and relevant experience.
The growth will be facilitated through partnering in relevant
technologies and with established developers; monitoring
of relevant government policies; and supporting the NES
organisation with 1tec expertise to successfully execute
anddeliver NES projects.
In 2021, we:
– Established an agile NES organisation and aligned 1tec to
support the core team
– Extended our reach to government and representative
bodies of relevant industries
– Agreed several strategic partnerships, including Protium
and Boya Energy
– Demonstrated rapid progress in NES by securing new
contracts in 2021
Insufficient IT resilience
The Group’s performance is increasingly dependent on the ongoing capability and reliability of our IT platforms. We (as with all
companies) continue to be exposed to external cyber-security threats.
Risk appetite
– We will manage our IT infrastructure to ensure the security
of confidential information and the availability of our critical
systems are not compromised.
– We have some appetite for risks to our IT infrastructure and
cyber-security that do not impact services provided to our
clients or deteriorate the effectiveness of key controls
Risk appetite measures
– Number of significant cyber incidents
– System resilience and access
– Removal of legacy systems
Sub-risks
– System breach due to malware attack
– Unavailability/loss of data due to inadequate response/recovery
– Cyber-attacks
– Network unavailability due to end-of-life devices
– Compromise of user accounts through phishing and social
engineering attacks
– System unavailability due to legacy and unsupported
applications and server infrastructure
– Operational technology breach leading to operational disruption
For more information see:
page 48
Assessment: No change
The risk remained stable during 2021. A number of initiatives
were implemented during 2021 to further enhance our resilience.
Risk category: Operational
Link to our strategy: Best-in-class delivery
Mitigation and management
We operate a Group-wide information/cyber-security
programme and utilise a ‘cloud’ strategy to maintain a resilient
IT platform.
In 2021, we continued to improve our information security
controls through:
– Establishment of new enterprise storage and network
access control solutions
– Limiting the use of flat networks
– Upgrading, retiring or re-engineering existing applications in
order to upgrade older servers
– Implementing a specific cyber-security programme to
protect our industrial systems and networks
66 Petrofac Limited 2021 Annual report and accounts
Strategic report
Principal risks and uncertainties
continued

Operational and project performance
Our portfolio typically includes a relatively small number of large value contracts, a larger number of smaller value contracts and some
sizeable oil and gas assets. Cost or schedule overruns on any of the large value contracts, or operational issues affecting production
within our key assets could negatively impact the Group’s profitability, cash flows and relationships with key stakeholders.
Risk appetite
– We have limited appetite for risks affecting execution of our
portfolio. Portfolio margins will be maintained to support
the delivery of our target total shareholder return relative to
our global peers over the cycle.
Risk appetite measures
– Division level cash flow and net income
Sub-risks
– Project execution
– Operation of assets
For more information see:
pages 6-10, 16-17, 18-19, 23 and 72-81
Assessment: No change
Project risks increased further during 2021 as the COVID-19
pandemic created execution challenges. However, the pandemic
became more contained in the final quarter of the year, and
the risk was reduced to 2020 levels.
Risk category: Operational
Link to our strategy: Best-in-class delivery, and Superior returns
Mitigation and management
Key risks to delivery are initially identified at the tender
stage,through the risk review process by relevant risk review
committees and escalated to the GRC or Board, as required.
On award, detailed execution strategies are further developed.
During the execution phase, emerging risks and opportunities
aremanaged through assurance, operational and project reviews.
Lessons learnt are cascaded through leadership lines and our
quality initiatives are focused on a ‘right first time’ approach.
In 2021, a new operating model was established including
the creation of 1tec (a single technical services organisation
focused on technical excellence). A new, independent
assurance function was also introduced, and a value
assurance framework was devised to govern all aspects
ofproject delivery across our operations.
Due to the COVID-19 pandemic, we continued to monitor
closely contractual and execution challenges in our supply
chain, with our subcontractors and our clients. Project recovery
plans were maintained and project delivery remained a
significant area of focus for executive management and the
Board throughout the year.
HSSE incidents
There are several factors that could impact our ability to operate safely. These include safety and asset integrity risks and extend to a
range of environmental risks. The risk is the potential harm to our people, and the commercial and/or reputational damage that could
be caused.
Risk appetite
– We have no appetite for activities that do not meet our
Horizon Zero vision
Risk appetite measures
– Number of projects/assets at risk
– Total recordable incident rate
Sub-risks
– Oil spills/gas leaks
– Integrity failure
– Loss of well control
– Driving accidents
– Fall from heights/lifting accidents/accidents during
commissioning
– Contractor/JV partner/client with inadequate HSSE
standards/controls
– Threats to security of our staff
– COVID-19 health threats
For more information see:
pages 30-31, 32-33 and 45-48
Assessment: Decreased
The risk reduced in 2021 as a result of further improvements
to our safety culture, and enhanced situational awareness.
Risk category: Operational
Link to our strategy: Best-in-class delivery
Mitigation and management
Safety is a core value for Petrofac and the risk is governed
largely by our operating framework, Group policies, and
systems that cover all elements of occupational health and
safety, security, environmental and asset integrity programmes.
Following up on the lessons learnt from some isolated incidents
in 2020 and in the first quarter of 2021, we launched and
executed a ‘Safety – Back to Basics’ campaign to enhance our
already strong safety culture. Details of our Safety Improvement
Plan for 2021 and 2022 are provided on pages 45 and 46.
A Driver Safety Programme was also rolled out to enhance
driver monitoring. Our response to the COVID-19 pandemic
was extended to cover the mental wellbeing of our employees.
67Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Loss of financial capacity
Failure to maintain adequate liquidity or provide guarantees to our customers could adversely affect our ability to deliver our strategy
and may ultimately result in financial loss and/or ability to comply with our financial covenants.
Costs of debt may rise as a result of rating agency downgrades or reduced access to funding.
Access to funding is critical to our sustainability and future growth. Reduced access to funding could hamper the Group’s growth
and/or adversely affect the Group’s financial performance.
Risk appetite
– We have no appetite for a loss of financial capacity that
results in a failure to meet our financial obligations as they
fall due and remain solvent, or that impairs our ability to
meet client requirements for guarantees
Risk appetite measures
– Liquidity
– Credit rating
– Unfunded facilities
Sub-risks
– Failure to maintain adequate liquidity
– Failure to provide guarantees
For more information see:
pages 4-5, 25, 83 and 87.
Assessment: No change
Through a successful, comprehensive refinancing in late 2021,
we strengthened the balance sheet, and secured a sustainable,
long-term capital structure. However, in 2021 the overall
risk rating remained unchanged as key financial measures
–liquidity, leverage and credit rating were below target.
Risk category: Financial
Link to our strategy: Superior returns
Mitigation and management
We maintain an adequate level of liquidity in the form of readily
available cash, short-term investments, or committed credit
facilities and ensure minimum level of liquidity as defined by
the Audit Committee is maintained.
Debt, cash and liquidity balances are monitored on a daily
basis We prepare cash flow forecasts on a quarterly basis
aligned to our reforecast cycle, and rolling cash forecasts
on a monthly basis to help manage liquidity and short-term
forecasting. Our financial policy targets BBB investment grade
credit metrics over the long term.
In 2021, we further reduced our overhead and project support
cost. In 2022, we will continue to collect cash and maintain
financial discipline.
Misstatement of financial information
We execute complex projects in a dynamic environment across various jurisdictions with numerous clients. Due to operational volatility
and financial complexity, our assumptions and financial estimates may not accurately reflect our business performance and financial
results, or provide inadequate information to key decisions. These may negatively impact investor confidence.
Risk appetite
– We have no appetite for reporting materially incorrect
financial information
Risk appetite measures
– Assessment of effectiveness of financial controls
– Reporting errors/restatements
Sub-risks
– Inaccurate revenue recognition
– Breakdown in transactional accounting controls
– Asset carrying amounts exceeding recoverable amounts
– Inaccurate corporate income tax reporting
– Breakdown in system access controls
– Inaccurate financial consolidation and reporting
For more information see:
pages 107, 110-113 and 132-139
Assessment: No change
In 2021, the risk remained stable despite a reduction in
financial materiality thresholds.
Risk category: Financial
Link to our strategy: Best-in-class delivery
Mitigation and management
Our Financial Control Framework ensures that adequate
controls are identified, implemented and monitored throughout
all of our key financial activities. Adequacy of these controls
are certified and reviewed by various assurance activities
andoverseen by the Audit Committee.
External auditors review and test our financial accounts.
In 2021, we continued to improve our controls in this area with
implementation of a new Enterprise Resource Planning (ERP)
platform, and the project will continue in 2022.
We continued to upgrade our IT systems and platforms to
further enhance the operating effectiveness of the Group’s
financial controls.
68 Petrofac Limited 2021 Annual report and accounts
Strategic report
Principal risks and uncertainties
continued

Breach of laws, regulations and ethical standards
Non-compliance with laws, regulations and ethical standards due to failures in our compliance controls or unethical behaviour,
including but not limited to bribery, corruption, money laundering, trade sanctions and labour rights may result in fines and/or adverse
impact on our reputation.
Risk appetite
– We have no appetite for non-compliance with laws and
regulations
– We expect our direct and indirect staff and third parties to
act according to the highest ethical standards and in line
with our Code of Conduct
Risk appetite measures
– Third-party due diligence
– Employee completion of mandatory compliance training
and annual declaration of compliance
– Investigations of ‘Speak Up’ cases
Sub-risks
– Violation of laws and regulations, including: FCPA, UK
Bribery Act; Whistleblower Protection; Trade Compliance;
Modern Slavery Act; Anti-Money Laundering; and Antitrust
and Competition
For more information see:
pages 4-5, 6-10, 25, 30-31, 32, 56, 57-58 and 114-115.
Assessment: No change
Risk of a future breach is reduced due to improvements in
our compliance programme. However, the overall risk level
remained unchanged due to the sustained impact of the
SFOinvestigation.
Risk category: Legal and Compliance
Link to our strategy: Best-in-class delivery
Mitigation and management
We operate a Group level compliance programme overseen
by the Compliance and Ethics Committee. We have continued
to enhance this programme during 2021. Specifically, we have:
– Created a new compliance risk assessment methodology
– Enhanced our compliance training programmes
– Conducted an independent review and subsequent regular
audit process on the effectiveness of our compliance
processes and culture
– Built further awareness to encourage open reporting
through our Speak Up tool
Further information on our compliance programme is provided
on pages 57 and 58.
Inadequate leadership and talent management
Our operations are heavily dependent on our ability to attract, retain and lead the right level of skilled and experienced personnel. Failure
to do so could negatively impact our distinctive, delivery-focused culture, and prevent us from maintaining our operational capability and
relationships with clients.
Risk appetite
– We take a balanced approach towards risks to establishing
and maintaining a talented workforce within the context of
prevailing job market economics
– Our leaders live our values and behaviours and operate as
“one team” at all times
Risk appetite measures
– Results of employee surveys
– Staff turnover
– Diversity and inclusion targets
– Succession plans
Sub-risks
– Inability to attract and retain the capability necessary to
deliver the business plan
– Fragility in our succession planning for key roles
– Leadership fails to live our values and behaviours
– Reduced performance of staff due to insufficient diversity
and inclusion
For more information see:
pages 23, 30-31, 32, 49-51, 56 and 105
Assessment: Increased
The risk has increased since our last update due to a higher
attrition rate, although this had a limited impact on our
operations in a quieter year for project execution.
Risk category: People
Link to our strategy: Best-in-class delivery
Mitigation and management
We remain confident that our policies to attract, retain, train,
promote and reward our people are appropriate for the Group,
and will enable us to meet our strategic goals.
We continued fine-tuning our organisational structure in 2021,
including the creation of 1tec and the establishment of NES
to capitalise on the energy transition. Diversity and inclusion
initiatives were extended with creation of our employee
network groups, and the introduction of more ambitious
targets to hire and promote a diverse workforce, including
leadership roles.
The Workforce Forum meetings continued in 2021, providing
an additional avenue for employees to directly engage with
Board Directors and senior management.
69Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

70 Petrofac Limited 2021 Annual report and accounts
Strategic report
Viability statement
In accordance with the requirements of the 2018 UK Corporate
Governance Code (‘the Code’), the Directors confirm that they
have performed a robust assessment of the Group’s prospects
and its ability to continue in operation and meet its liabilities
as they fall due over the period of their assessment. In doing
so, they have considered the Group’s current position and
the principal risks and uncertainties that would threaten the
viability of the business. The Group’s financial statements for
2021 are prepared on a going concern basis, with no material
uncertainties identified. Details of the Group’s risk governance
and management framework, and a description of its principal
risks and uncertainties are included in the Strategic report on
pages 60 to 69.
In addition to the inherent risk of delivering large and complex
projects on time, on budget and in an HSSE compliant
manner, the key medium- to long-term factors affecting the
Group’s prospects together with the Group’s current position
and outlook,which inform the Directors’ assessment are set
outbelow:
Factors affecting the Group’s prospects Group’s current position and outlook
Oil price: the oil price environment impacts the timing and
quantum of new awards, principally in our E&C division as
wellascash generated from oil and gas production.
Economic and market environment: the appetite of clients
to award contracts and any restrictions on access to certain
markets reflects the macro-economic environment, geopolitical
conditions and other macro events.
Continued access to markets: in both existing and new
accessible markets, and any developments in restricted markets
following the conclusion of the SFO investigation.
Addressable market: the Group’s addressable market, excluding
the UAE, Saudi Arabia and Iraq, is estimated to grow to more
than US$105 billion per annum by 2025, driven by growing
energy demand and a lack of investment in the industry in recent
years. Significant growth is expected in the MENA region, driven
by spending from national oil companies, where Petrofac has
adifferentiated position with its local delivery model.
Near-term visibility: at 31 December 2021, the Group had
backlog of US$4.0 billion, of which less than 1% is from Russia
– with secured revenue in 2022 of US$2.2 billion (55%) – with
a current tendering pipeline of approximately US$37 billion
of opportunities scheduled for award in 2022, excluding
opportunities in UAE, Saudi Arabia, Iraq and Russia.
Medium-term ambition: the Group is targeting a medium-
term revenue of US$4 billion - US$5 billion, sector-leading EBIT
margins of 6%-8% and a net cash position, which is supported
by the business plan.
Energy transition: the nature and speed of the transition to new
energies, and the Group’s ability to address these new market
opportunities in the medium to long term.
Energy transition: the Group is well positioned in the new
energy services market, with more than a 10-year track record
in offshore wind and is quickly developing credentials in carbon
capture utilisation and storage, hydrogen production and waste-
to-value. To enhance its competitive position, the Group has
established alliances with technology providers and developers
to position the Group to expand in these markets.
Cost competitiveness: the ability to maintain a sustainable,
cost competitive position to win contracts and positive economic
returns through operational excellence.
Cost management: the Group focuses on continuous
innovation, the application of technology and other measures
todeliver cost savings and maintain its cost competitiveness.
Availability of funding: the capital markets’ and banking
appetite to finance the global energy industry and the Group.
Net debt and liquidity: at 31 December 2021, the Group
had cash and cash equivalents of US$620 million, net debt
of US$144 million, with liquidity of US$705 million and was
in compliance with its financial covenants. US$600 million
(68%) ofthe Group’s borrowing facilities remain available until
November 2026, with the remaining 32% maturing in October
and November 2023.
The Group’s prospects are subject to inherent forecasting risks
relating to the Group’s principal risks and uncertainties, which
include inter alia low order intake, loss of financial capacity,
macro-economic uncertainty, prevailing oil price environment,
impact of energy transition, ability to re-enter core markets,
andthe ability of the Group to deliver its strategic initiatives.
The Directors have determined that a three-year period to
31 December 2024 (the ‘Period’) is the most appropriate duration
for its viability assessment period. This Period has been selected
as it provides the Board sufficient visibility into the Group’s clients’
capital and operational expenditure plans, it covers the period
over which existing backlog is executed, and it is consistent with
the Group’s business plan duration. These elements comprise
the foundation for modelling the Group’s financial performance,
including sensitivities and scenarios, which instructs the Directors
on whether there isareasonable expectation of viability over
thePeriod.
The key assumptions within the Group’s business plan for the
Period include:
– Oil price: US$70 per barrel in 2022 and 2023, reducing to
US$65 per barrel in 2024
– Accessible market: continued access to a diversified pipeline
of opportunities throughout the Period, even excluding the
UAE, Saudi Arabia, Iraq and Russia

71Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements
Prioritised principal risks and uncertainties Scenarios
– Adverse geo-political and macro-economic changes in key
geographies
– Low order intake
A material decline in new order intake, notably an approximate
50% reduction in new awards across the Period, which could
be driven by factors such as, but not limited to, a low oil price
environment, economic uncertainty, and an accelerated energy
transition and other restrictions such as sanctions
– Failure to deliver strategic initiatives
– Poor project execution
Net profit margin deterioration, which could be driven by cost
overruns, adverse commercial or legal settlements
– Loss of financial capacity The Group retains access to a sufficient level of financing to meet
its funding requirements and secure guarantees in support of
new contract awards
– Breach of laws, regulations, and ethical standards No financial impact that threatens viability would crystalise from
contingent liabilities during the Period (refer to note 30)
– New order intake: a book-to-bill of 1x or greater in each year
ofthe plan in both E&C and AS business units
– Margins: net profit margins in E&C remain at lower levels in the
near term as a result of higher costs from COVID-19 related
disruption, low order intake in recent periods, with recovery in
the medium term driven by an expected improvement in market
conditions. AS is expected to continue its resilient performance
with continued revenue growth at strong margins
– Liquidity and net debt: the Group has a long-term capital
structure, with options to repay, extend or refinance at the time
of the maturity of the RCF and bilateral loans in October and
November 2023 as required
The continued operational and financial impact from the
COVID-19 pandemic was considered in the business plan.
With the majority of projects returning to pre-pandemic activity
levels, the most pronounced impact was forecast inthe
E&C business unit in 2022, through the delay to close out
ofsettlement positions and catch up in milestone billing and
payments during the Period following the progress delays at
theend of 2021.
In order to assess the resilience of the Group to threats to its
viability, the Group’s business plan forecasts were subjected to
robust multi-variable stress test and sensitivity analysis together
with an assessment of potential mitigating actions. This analysis
included scenarios that assumed the realisation of principal risks
and uncertainties arising from the following:
The scenarios above were modelled in combination to assess the
impact on the Group’s liquidity headroom and financial covenant
metrics. The Group is expected to retain sufficient liquidity and
covenant compliance under this downside scenario.
The Directors have also evaluated mitigating actions that
management could realistically take to avoid or reduce the
impact or occurrence of the principal risks and uncertainties
materialising. Management acted decisively to successfully
implement such measures during 2020 and 2021 in response to
the impact of COVID-19 pandemic and fall in oil prices generating
over US$250 million of cost savings compared to pre-pandemic
levels. The Directors are confident that management could build
on such measures in response to the crystallisation of principal
risks and uncertainties.
The Directors also considered the following key assumptions in
their viability assessment:
– Oil price: with the recent sustained higher oil price
environment, compared to the budgeted price of US$70 per
barrel, the Group will benefit from improved profitability in its
IES division and an expected short-term improvement in the
new order outlook and commercial and operating environment
in both the E&C and AS divisions
– Winning work: the Group will continue to win work based on
its resources, competencies, experience and track record as
a leading contractor to the energy industry, and the impact of
restricted geographies in the pipeline will not have a material
impact on future prospects - Russia comprises less than
10% of the pipeline, whilst the Group has been reinstated to
ADNOC’s bidding list in the UAE
– Access to finance: the Group will continue to have access to
finance at maturity of the existing facilities during the Period,
ifrequired to maintain liquidity to support operations
– Other adverse events and conditions: the Group is exposed
to inherent risks, for example, poor operational execution,
unfavourable commercial settlements and/or adverse
outcomes in disclosed contingent liabilities (see note 30),
which could – based on the nature, amount and timing of
such events and conditions – threaten its viability. Based on
available liquidity headroom, the occurrence of such events
and conditions are assessed not to fully erode liquidity or
covenant headroom, after available mitigations.
– Mitigations available: the specific mitigations modelled include
reducing operating costs, minimising uncommitted capital
expenditure and continued suspension of the dividend.
Additional actions are in the control of – or realistically available
to – management, such as further disposals of non-core assets.
The Group actively monitors and responds to the risks identified
in the viability assessment scenarios. There is an inherent risk
that the outcome to events and conditions is more adverse than
assumed. However, the Directors concluded, after conducting
a robust assessment taking into account the Group’s current
position, prospects, principal risks and uncertainties, and
assumptions listed above, that it has a reasonable expectation
that the Group will be able to continue in operation and meet its
liabilities as they fall due over the three-year assessment period
to31 December 2024.

OQ-LPG, Oman
With a daily processing capacity of eight
million cubic metres, the new OQ-LPG
facility will enable Oman to get more
value from its gas assets and has the
potential to become a new energy hub
for the region.
Together with the central processing
facility, the vast EPC project entailed
storage facilities, jetties, and tie-ins to
the Sultanate’s pipeline infrastructure.
Several innovative construction techniques
were deployed. The roofs of two 48-metre
diameter cryogenic tanks were lifted into
place using nothing but air. To increase
the efficiency of the execution, we also
trialled our Connected Construction
digitalsolution. By giving the project team
real-time insights into the location and
movements of onsite people, equipment,
and materials, this contributed to the
project’s intricate sequencing.
In all, 15 million work hours were entailed.
At peak, 4,800 people were working
onsite. The project team also had
tocontend with several unexpected
challenges, such as the disruption
wrought by the pandemic, a spate
of cyclones, and the most severe
monsoon storms for more than 50
years. Yet everything was delivered
safely without a single lost-time incident.
Best-in-class
delivery
Strategic report
Key achievements of 2021
72 Petrofac Limited 2021 Annual report and accounts

At the height of
production, Hewett was
delivering 20% of the
UK’s total gassupply.”
Hewett,
United Kingdom
Dating back to the 1960s and located
20 miles off the UK coastline, the Hewett
gas field was one of the first developments
in the North Sea. At the height of production,
it was delivering 20% of the UK’s total
gassupply.
As Duty Holder and Pipeline Operator,
Petrofac’s involvement dates back almost
20 years, and we are now managing its
decommissioning. The biggest challenge
stems from the age of the cluster of
platforms that make up the facility. They
were built, piece-by-piece, at a time when
little thought was given to when and how
they may need to be dismantled.
Together, the team are working through
a methodical process, involving the
cessation of production, the plugging
andabandonment of the wells, the
removal of the conductors, and the
making safe of the platforms. With this
done, they can prepare for the arrival of
aheavy lift vessel to remove what is left
ofthe platforms and transport them back
to shore to be dismantled and recycled.
By 2025, there should be no trace the
facility ever existed.
Thaioil Clean Fuel
Project, Thailand
Awarded in 2018, the Thaioil Clean Fuel
project sees us extend our credentials
in downstream projects and move into
a less familiar geographic territory. It is
therefore a strategically significant contract
for Petrofac, which also contributes to
Thailand’s long-term energy stability and
economic development.
The project will transform the existing
Sriracha Refinery into an environmentally
friendly facility producing high-quality, low-
emission fuels, and lift production capacity
from 275,000 to 400,000 barrels per day.
Valued at around US$4 billion, and covering
engineering procurement, construction,
and commissioning, it is being delivered
ina consortium with Saipem and Samsung.
As the lead partner, Petrofac’s share is
around US$1.4 billion.
It is a busy, congested site, which is
home to a live production facility, and is
hemmed in on all sides. With no space for
laydown areas, warehousing, or traditional
construction techniques, a modularisation
strategy had to be pursued. Around 380
vast components, weighing-in at anything
up to 2,000 tonnes, are being pre-
fabricated offsite, primarily in India
andChina, and then transported, fully
intact, tobe pieced together onsite with
millimetre precision.
The project also involves around
1,400interfaces with the existing plant,
which brings another layer of complexity.
The delivery therefore entails precision
planning and intricate sequencing – our
teams have likened it to assembling a
Swiss watch.
Strategic report Governance Financial statements
73Petrofac Limited 2021 Annual report and accounts

Tinrhert, Algeria
Located in the heart of Illizi Province,
around 1,500 kilometres south of
Algiers, the Tinrhert Field Development
is a 36-month, US$500 million,EPC
project, which sees Petrofac bringing
this strategically important gasfield
online on behalf of our client, Sonatrach.
In addition to a new inlet separation
and compression centre, the
overall scope of work includes a
pipeline network of approximately
400km to connect 36 wells, along
with commissioning, start-up, and
performance testing of facilities.
At peak, almost 1,400 people have
been working onsite. Despite the
disruption wrought by the pandemic,
the new facilities were tied-in comfortably
ahead of schedule, pre-commissioning
work is well underway, and first gas is
expected by mid-2022.
Despite the challenges
of COVID, pre-
commissioning
iswellunderway.”
74 Petrofac Limited 2021 Annual report and accounts
Strategic report
Key achievements of 2021
continued

75Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Engineering &
Construction
Asset Solutions Integrated
EnergyServices
Revenue
2
019 4,47
5
2
020 3,090
2
021
1,971
Revenue
2
019
889
2
020 933
2
021
1,111
Revenue
2
019
195
2
020 110
2
021
50
Business performance net margin
2
019 6.2
%
2
020
2
2.0%
2
021
0.4
%
Business performance net margin
2
019
5.4%
2
020
2
4.3%
2
021
7.7%
Business performance net margin
2
019
(2.1)%
2
020 (16.4)%
2
021
(10.0)%
Business performance net profit
1
2
019
278
2
020
2
63
2
021
8
Business performance net profit
1
2
019
48
2
020
2
40
2
021
86
Business performance net loss
1
2
019
(4)
2
020 (18)
2
021
(5)
Group revenue contribution (2021)
64%
Group revenue contribution (2021)
34%
Group revenue contribution (2021)
2%
Headcount at 31 Dec 21
3,350
Headcount at 31 Dec 21
4,350
Headcount at 31 Dec 21
250
US$ million Revenue
Business performance
net profit
1,2
EBITDA
For the year ended 31 December 2021 2020 2021 2020
3
2021 2020
3
Engineering & Construction 1,971 3,090 8 63 10 114
Asset Solutions 1,111 933 86 40 84 60
Integrated Energy Services 50 110 (5) (18) 21 39
Corporate, others, consolidation adjustments and eliminations (75) (52) (54) (35) (11) (2)
Group 3,057 4,081 35 50 104 211
% Revenue growth
Business performance
net margin
1,2
EBITDA margin
For the year ended 31 December 2021 2020 2021 2020
3
2021 2020
3
Engineering & Construction (36.2) (30.9) 0.4 2.0 0.5 3.7
Asset Solutions 19.1 4.9 7.7 4.3 7.6 6.4
Integrated Energy Services (54.5) (43.6) (10.0) (16.4) 42.0 35.5
Group (25.1) (26.2) 1.1 1.2 3.4 5.2
1 Attributable to Petrofac Limited shareholders, as reported in the consolidated income statement.
2 This measurement is shown by Petrofac as a means of measuring underlying business performance (see note 4 of the consolidated financial statements).
3 The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs, in April 2021 (see note 2.9 of the consolidated financial statements).
76 Petrofac Limited 2021 Annual report and accounts
Strategic report
Segmental overview

Engineering &
Construction
The Engineering
&Construction (E&C)
division delivers
onshore and offshore
engineering, procurement,
construction, installation
and commissioning
services. Lump-sum
turnkey is the predominant
commercial model used,
but we also offer our
clients the flexibility of
other models. The division
has a 40-year track record
in designing and building
major oil, gas, refining,
petrochemicals and
newenergies projects.
1 The prior year numbers are restated in relation to the
adoption of the IFRIC decision on cloud configuration and
customisation costs, in April 2021 (see note 2.9 of the
consolidated financial statements).
Operational performance
E&C continued to demonstrate its
ability to deliver for clients across
the portfolio despite the challenges
presented by the COVID-19 pandemic.
Operational performance was impacted
by stringent health protocols, travel
restrictions, and supply chain disruption,
resulting in a reduction in productivity
and extensions to project schedules.
The emergence of the Omicron variant
caused further disruption in Q4 and
extended the expected period through
which such challenges will need to
benavigated.
Force majeure claims in our contracts
allow for extensions of time in response to
the disruption, but clients have generally
adopted more inflexible commercial
positions in relation to the recovery
of incremental costs, which has had
a material impact on profit margins.
We experienced some improvements in
thesecond half of the year, with several
clients agreeing variation orders that
provide partial compensation for the
additional costs.
Despite the challenging environment,
we have continued to deliver to a high
standard for our clients, minimising delays
and disruption, and good progress was
made on all projects in 2021. Notably, our
LPG project for OQ was commissioned in
Salalah, Oman. The Yibal Khuff Project,
delivered for Petroleum Development Oman,
was officially inaugurated in December
2021. We also completed the successful
integration of Kuwait Oil Company’s new
Crude Oil Control Centre at the Lower Fars
heavy oil development project.
In our offshore wind portfolio, both
substation jackets were successfully
installed for HZK Alpha and Beta and
the first of two topside High Voltage
Alternating Current (HVAC) units was
installed in December. On the Seagreen
offshore wind project, we reached a major
milestone with the successful installation
of the offshore substation jacket, also in
December and ahead of schedule.
Our delivery of the Ghazeer project was
recognised at the 2021 Construction Week
Oman Awards, securing the ‘Commercial
Project of the Year’ title, having been safely
delivered ahead of schedule and exceeding
a demanding in-country-value target.
Financial performance
Revenue for the year decreased 36%
to US$2.0 billion (2020: US$3.1 billion),
driven by a decline in project activity
and COVID-19 related project delays.
Business performance net profit
decreased to US$8 million (2020
restated
1
: US$63 million), with net profit
margin declining 1.6ppts to 0.4% (2020
restated
1
: 2.0%) due to cost increases
related to continued COVID-19 related
disruption and the recognition of full life
losses on a small number of contracts.
This was partly mitigated by management
actions to reduce costs and by tax
provision releases. The latter contributed
US$29 million to net profit in the year.
Elie Lahoud
E&C Chief Operating Officer
US$2.4bn
Backlog at 31 Dec 21 by country
Lithuania 26%
Thailand 24%
Algeria 19%
Iraq 4%
Kuwait 3%
UK 3%
Oman 11%
Libya 4%
Others 6%
US$2.4bn
Backlog at 31 Dec 21 by market
Refining 57%
Upstream gas 24%
Upstream oil 14%
New energies 5%
77Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Onshore project, UAE
94%
Duqm Refinery, Oman 91%
Tinrhert, Algeria 88%
HKZ Alpha – Netherlands 88%
HPCL Visakh, India 87%
Seagreen, United Kingdom 82%
Majnoon CPF, Iraq 76%
HKZ Beta, Netherlands 73%
Clean Fuels Project, Thailand
66%
Ain Tsila, Algeria 66%
Mabrouk, Oman 14%
Erawin, Libya 3.0%
PC Orlen, Lithuania 0.5%
NOC/NOC-led consortium IOC company/consortium Electric utility
Engineering & Construction – Key project progress
Value of Work Done (VOWD) at 31 December 2021
1
Key Project status, % completion, December 2021
Strategic partnership with Gazprom
In October 2021, we signed a strategic
partnership with Gazprom through
Gazprom’s INTI – Russian Institute Oil/
Gas Technology Initiatives to export
and promote the ambition, quality,
andstandards of the Russian energy
industry domestically and internationally.
However, in light of the current geopolitical
situation in Russia, the Group has decided
to remove opportunities in this market
from the bidding pipeline.
New orders
The contraction in capital spending by
clients, initially triggered by the decline
in oil prices and the COVID-19 pandemic
in 2020, continued into 2021 in our
addressable markets. As a result, new
order intake in the year was US$1.2 billion
(2020: US$0.7 billion), comprising EPC
contracts in Oman, Libya and Lithuania
and other net variation orders.
Marmul Gas Compression project,
Oman
In February 2021, E&C secured a
c.US$100 million EPC contract with
Petroleum Development Oman (PDO), along
with a c.US$200 million project delivery
contract for the Asset Solutions division.
This new facility will eliminate permanent
flaring and manage associated gas
production from the Marmul development.
Erawin Field Development Project,
Libya
In September 2021, we secured a contract
valued at over US$100 million with Zallaf
Libya Oil & Gas Exploration and Production
Company, to deliver their Erawin Field
Development Project Phase 1 Early
Production Facilities. Libya holds some
ofthe largest oil and gas reserves in Africa
and this contract represents an attractive
entry point to position the Group for a large
potential pipeline of opportunities.
Mažeikiai Refinery upgrade and
expansion project, Lithuania
In October 2021, we were awarded
anEPC contract by PC ORLEN Lietuva,
valued at around EUR550 million
(approx US$640 million), to support
a comprehensive modernisation,
environmental upgrade and expansion
programme at its Mažeikiai Refinery in
North-West Lithuania. This project is
designed to meet the requirements for
cleaner fuels and improve the operational
and carbon efficiency of theplant.
Project completion is planned for
theendof2024.
1 Excludes projects that are >95% complete.
78 Petrofac Limited 2021 Annual report and accounts
Strategic report
Segmental overview
continued

Asset Solutions
The Asset Solutions (AS)
division (previously known
as Engineering & Production
Services) provides services
across the full life cycle
of energy infrastructure.
It manages and maintains
client operations, both
onshore and offshore,
delivers small to medium
scale brownfield EPC
projects and provides
concept, feasibility and front-
end engineering design
(FEED) services. The division
is also home to market-
leading well engineering,
decommissioning and
training capabilities.
The majority of AS
servicesare executed
on a reimbursable basis.
1 The prior year numbers are restated in relation to the
adoption of the IFRIC decision on cloud configuration and
customisation costs, in April 2021 (see note 2.9 of the
consolidated financial statements).
Operational performance
Operational performance for Asset
Solutions in 2021 was strong, with growth
across each of its service lines (Asset
Operations, Asset Development, and
Wells and Decommissioning). Engineering,
procurement and construction activity
on Asset Developments project portfolio
progressed well, overcoming challenges
presented by the COVID-19 pandemic,
with a notable increase in activity levels
on several projects in the MENA region.
Activity in Asset Operations increased,
particularly in the UK, due to healthy order
intake and the recovery from fewer people
working offshore in 2020 as a result of the
pandemic. In the US, our subsidiary W&W,
which provides field maintenance and
production services in the Permian basin,
recovered quickly from the downturn,
delivering results in Q4 above its pre-
pandemiclevels.
The volume of work in new energies
sectors, including carbon capture and
storage, hydrogen, waste-to-value and
offshore wind increased markedly from
2020, with Asset Solutions executing 16
contracts, predominantly Pre-FEED and
FEED studies, up from two contracts in
2020. We invested in capability, expanding
the business development team and range
of subject matter experts, positioning
this business segment for continued
momentum into 2022 and beyond.
Financial performance
Growth in both revenue and
margins delivered a strong financial
performance in Asset Solutions.
Revenue for the yearincreased 19%
to US$1.1 billion (2020: US$0.9 billion).
Business performance net profit increased
115% to US$86 million (2020 restated
1
:
US$40 million), with business performance
net profit margin increasing 3.4ppts to 7.7%
(2020 restated
1
: 4.3%) reflecting higher
revenues, a lower overhead ratio, higher
contract margins on certain projects,
higher income from associates and tax
provision releases. The underlying business
performance net profit margin, excluding
tax provision releases, was 5.5%, a 1.2ppts
increase on prior year.
New orders
Asset Solutions had another strong year
of order intake, securing US$1.0 billion of
awards and extensions in the year (2020:
US$0.9 billion), representing a book-to-bill
of 0.9x.
Key awards included:
– In Asset Developments (previously named
‘Projects’), we secured a number of EPC
contracts for upstream oil and gas facilities
in Oman, Bahrain, Malaysia and Algeria.
Many of these awards are evidence of
the synergistic potential of an improved
‘one Petrofac’ approach, leveraging
E&C’s strong relationships in Oman and
Algeria, and our front-end engineering
capability through RNZ in Malaysia.
Continued geographic expansion
through growth in small to medium size
projects is a core part of our strategy
and is an area where we see growth
as operators allocate capital to existing
assets to protect asset integrity, enhance
production and extend asset life.
− In Asset Operations (previously named
‘Operations’), we extended our contract
Nick Shorten
Asset Solutions
Chief Operating Officer
US$1.6bn
Backlog at 31 Dec 21 by country
UK 53%
Azerbaijan 11%
Oman 8%
Malaysia 6%
Iraq 4%
Kazakstar 3%
Bahrain 7% Other 8%
Backlog at 31 Dec 21 by market
Asset operations 47%
Asset development 40%
Wells & Decommissioning 13%
US$1.6bn
79Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

to operate the Iraq Crude Oil Export
Expansion Project (ICOEEP), as well as
securing a number of new awards and
extensions with clients, such as Shell,
AOC, NEO, and Ithaca in the UK North
Sea, maintaining our exceptional track
record of contract renewals
− In Wells, we announced a number of
well management and well operator
support contracts in the UK North Sea,
including with Dana Petroleum and NEO
to support ongoing drilling operations.
Internationally we have also been
successful in MENA and Asia Pacific
Good progress was made in New Energies
with a significant increase in awards in
2021, including:
− Carbon Capture: several contracts for
the Acorn project in the UK, supporting
the lead developer as their technical
delivery partner, including the pre-FEED
for the first large-scale Direct Air Capture
Facility in Europe. Awards also included
a FEED contract for a CO
2
capture
facility at a combined heat and power
plant in Sweden, for Stockholm Exergi,
which will be the largest Bio Energy
Carbon Capture and Storage (Bio-CCS)
plant anywhere in Europe (see page 27)
− Hydrogen: expansion of engineering
scope on Arrowsmith in Australia, which
has the potential to be a large-scale
green hydrogen project (see page 26);
pre-FEED and FEED contracts for green
hydrogen project developments to
support the decarbonisation of clients in
the food and beverage sector, displacing
their use of natural gas for process heat
and enabling hydrogen fuelled trucking
− Waste-to-value: a number of pre-
FEED and FEED contracts for projects
ranging from tyre waste-to-fuel plants
tosewage-to-sustainable aviation fuel
− Offshore wind: engineering studies
forseveral offshore wind developments
In addition to the new contracts secured,
we entered into a number of strategic
alliances with leading technology providers.
These included:
− Protium (hydrogen): Strategic
partnership to leverage Protium’s leading
green hydrogen expertise in the UK with
Petrofac’s world-class engineering and
EPC capabilities
− CO
2
Capsol (carbon capture):
Preferred engineering and EPC
partner for CO
2
Capsol’s hot potassium
carbonate carbon capture technology.
We are currently working together on
theStockholm Exergi Bio-CCS project
− Storegga (carbon capture): Technical
Delivery Alliance partner to support
Storegga in developing future carbon
capture, utilisation and storage projects
globally, leveraging our combined
experience and learnings from the Acorn
project in the UK through PMC, owner’s
engineer, engineering and operations
support services
80 Petrofac Limited 2021 Annual report and accounts
Strategic report
Segmental overview
continued

Integrated Energy
Services
Integrated Energy
Services (IES) is Petrofac’s
upstream oil and gas
business, providing an
integrated service for
clients under flexible
commercial models that
are aligned with their
requirements.
Following the completion
of the sale of our 51%
interest in our Mexico
operations in November
2020, our interest in
the Production Sharing
Contract (PSC) for Block
PM304 in Malaysia’s
offshore Cendor field
is our sole remaining
material IES asset.
Operational performance
On a like-for-like basis, excluding
production from the divested Mexico
assets in 2020, net production for the
year decreased by 35% to 640 thousand
barrels of oil equivalent (kboe) in 2021
(2020 PM304: 990 kboe).
Production in the main Cendor field was
approximately 60% lower than the prior
year (c.0.9 kboed) due to an unplanned
outage that occurred in December 2020.
The issue is expected to be resolved in the
second half of 2022, returning production
in this field close to previous levels.
The East Cendor development topsides
were installed and development drilling
commenced in Q2 2021, with six production
wells and two water injectors being
drilled on schedule and under budget.
Production commenced in June 2021,
rising to a peak production of 1.6 kboed
by the end of December, with all wells
flowing naturally and responding well
towater injection.
As a result of the production from East
Cendor, the exit rate net production was
2.9 kboe/d compared with an average of
1.8 kboe/d for the full year. The average
realised oil price increased by 92% to
US$75/boe in 2021 (2020: US$39/boe).
IES has placed a strong emphasis
onreducing the carbon intensity of its
production and made significant progress
in 2021. In November, a workover was
performed on a well to shut off some
of the gas producing reservoir zones.
This achieved the desired effect of
reducing the amount of gas flared by
approximately 5mmscf per day (gross).
Financial performance
Revenue for the year decreased 55%
toUS$50 million (2020: US$110 million),
reflecting the disposal of our Mexico
operations in the second half of 2020 and
the unplanned outage in the main PM304
Cendor field, partly offset by production
from the East Cendor development. Like-
for-like revenue, excluding the divested
Mexico assets, increased by 19%,
with theincrease in oil price more than
offsetting lower production in PM304.
EBITDA declined 46% to US$21 million
(2020: US39 million), principally reflecting
the divestment of the Mexico assets.
On alike-for-like basis, EBITDA increased
by 40%.
IES generated a business performance net
loss of US$5 million (2020: US$18 million;
US$14 million loss on a like-for-like basis),
with lower interest and depreciation
partially offset by lower EBITDA and lower
tax credits.
Impairment of PM304
The PSC for Block PM304 in Malaysia
expires in 2026, and we are currently in
technical and commercial discussions with
Petronas and the joint venture partners in
respect of an extension.
However, based on developments in
the current year and the associated
uncertainty in respect of securing that
extension, management feels it is no
longer appropriate to assume that it
will be secured when assessing the
carrying value of the asset at the year-
end. Consequently, management has
concluded that an impairment charge
of US$15 million should be recognised,
reducing the carrying value of the asset.
Furthermore, given the significant impact
this assumption has on the recoverability
of the associated deferred tax asset (DTA),
management has also written off the
full amount of the DTA balance brought
forward at 1 January 2021, of $43 million.
As a result of the impairment, the net book
value carrying amount of Block PM304 as
of 31 December 2021 is US$99 million.
Net PM304 production (kboe/d)
2020
2021
2021
2.6
1.8
2.9
exit rate
81Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Strategic report
Financial review
82 Petrofac Limited 2021 Annual report and accounts

The Group’s financial performance
in 2021 reflected lower activity levels
and challenging market conditions for
Engineering & Construction (E&C), caused
by continued COVID-19 related disruption
and delays to tender awards, partly offset
by strong performance in Asset Solutions
(previously known as Engineering &
Production Services). Overall, revenue
and profitability declined, while the
impact on net margins was mitigated
bymanagement actions to reduce costs
and the impact of tax provision releases,
following successful tax audits and
assessments resolved during the year.
In November 2021, we successfully
concluded a comprehensive refinancing
and capital raise to create a long term
capital structure. This included an equity
raise of US$275 million
4
, US$600 million
of senior secured notes due in 2026 and
a new US$180 million two-year revolving
credit facility. An existing US$90 million
bilateral term loan was also repaid and
replaced with a new US$50 million term
loan, maturing in October 2023.
Afonso Reis e Sousa
Chief Financial Officer
Successful capital
raise and debt
refinancing for
long term capital
structure.”
Year ended 31 December 2021 Year ended 31 December 2020 (restated)
3
Business
performance
2
US$m
Separately
disclosed
items
US$m
Reported
US$
Business
performance
2
US$m
Separately
disclosed
items
US$m
Reported
US$
Revenue 3,057 – 3,057 4,081 – 4,081
EBITDA 104 n/a n/a 211 n/a n/a
Net profit/(loss)
1
35 (230) (195) 50 (242) (192)
83Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

UK, Algeria, Thailand
and Oman were the top
four markets in 2021.”
Year ended
31December 2021
Engineering &
Construction
US$m
Asset
Solutions
US$m
Integrated
Energy
Services
US$
Corporate &
others
US$m
Consolidation
adjustments
& eliminations
US$m
Business
performance
2
US$m
Total revenue 1,971 1,111 50 – (75) 3,057
EBITDA 10 84 21 (11) – 104
EBITDA margin 0.5% 7.6% 42.0% n/a n/a 3.4%
Year ended
31December 2020
3
Engineering &
Construction
US$m
Asset
Solutions
US$m
Integrated
Energy
Services
US$
Corporate &
others
US$m
Consolidation
adjustments
& eliminations
US$m
Business
performance
2
US$m
Total revenue 3,090 933 110 – (52) 4,081
EBITDA 114 60 39 (2) – 211
EBITDA margin 3.7% 6.4% 35.5% n/a n/a 5.2%
Revenue by geography: 2021
Income statement
Revenue
Group revenue decreased 25% to
US$3.1 billion (2020: US$4.1 billion).
This was principally due to a decline in
revenue in the E&C operating segment,
which decreased 36%, driven by a decline
in backlog and COVID-19 related project
delays. Revenue in Asset Solutions
increased by 19% with growth across all
of its service lines (Asset Operations, Asset
Development and Wells). Revenue in the
Integrated Energy Services (IES) operating
segment decreased 55%, primarily reflecting
prior year asset sales in Mexico. On a like-
for-like basis, revenue in IES increased by
19% with higher realised oil prices partially
offset by lower production in PM304 due
tothe outage in the main Cendor field.
The Group generated revenue from a
broad range of geographic markets in
2021, with UK, Algeria, Thailand and
Oman generating 65% of Group
revenue (2020: top four markets –
Oman, Thailand, Algeria and UK
generated 60% of revenue).
Earnings Before Interest, Tax,
Depreciation and Amortisation
(EBITDA)
2
Business performance EBITDA
decreased 51% to US$104 million (2020:
US$211 million), reflecting lower revenue
and margins. The decline in E&C margins
was driven by cost increases due to
continued COVID-19 related disruption,
the relative maturity of the current project
portfolio and the recognition of losses on a
small number of contracts. Higher margins
in Asset Solutions were due to a lower
overhead ratio, higher contract margins
on certain projects and higher net profit
from associates. The decline in IES
margins principally reflects the divestment
of the Mexico assets in the prior year.
Consequently, Group EBITDA margin
declined to 3.4% (2020 restated
3
: 5.2%).
UK
Algeria
Thailand
Oman
Kuwait
Iraq
UAE
Netherlands
Other
24%
14%
14%
13%
6%
5%
5%
4%
15%
US$3.1bn
84 Petrofac Limited 2021 Annual report and accounts
Strategic report
Financial review
continued

Depreciation and amortisation
The depreciation and amortisation decreased to US$68 million
(2020restated
3
: US$123 million), principally due to a one-off
US$34 million impairment charge in IES in the prior year (recorded
within amortisation), predominantly in relationto the disposal
of our Mexico operations. On a like-for-likebasis, excluding
the impairment recognised in the prioryear, depreciation
andamortisation reduced by 23%.
2021
US$m
2020
(restated)
3
US$m
Engineering & Construction 24 35
Asset Solutions 10 10
Integrated Energy Services 27 69
Corporate 7 9
Total 68 123
Finance income/(expense)
Finance income decreased to US$6 million (2020: US$9 million)
due to lower bank interest and lower unwinding of discount on
receivables. Business performance finance expense increased
to US$44 million (2020: US$37 million), largely reflecting
higher amortisation of debt acquisition costs following the
refinancing processes completed in April and November 2021.
Finance expense on Group borrowings marginally increased with
a higher interest expense following the November refinancing
offsetting lower average interest rates prior to the refinancing,
which benefited from the relatively low cost of the £300 million
COVID Corporate Finance Facility that was in place between
1 February and 30 November 2021.
Finance income
2021
US$m
2020
US$m
Bank interest 1 3
Unwinding of discount on receivables 5 6
Total finance income 6 9
Finance expenses
2021
US$m
2020
US$m
Group borrowings (including
amortisation of debt acquisition costs) (36) (27)
Lease liabilities (7) (9)
Other (1) (1)
Total business performance
finance expense (44) (37)
Taxation
The Group benefited from a business performance income
tax credit for the year of US$40 million (2020: US$19 million
expense), principally reflecting successful tax audits and
assessments resolved during the year resulting in the release
ofUS$57 million of tax provisions, as well as the change in
mixofprofits in the jurisdictions in which the profits are earned.
Reported income tax expense was US$3 million (2020: US$18 million)
due to the write-down of a US$43 million deferred tax asset
in Malaysia as part of the impairment of the PM304 asset (see
‘Separately disclosed items’).
Separately disclosed items
During the year, the Group incurred US$230 million (2020:
US$242 million) of separately disclosed items.
These predominantly related to:
– US$106 million penalty imposed by the UK courts in
connection with the conclusion of the SFO investigation
– US$10 million of legal and other costs associated with the
SFO resolution
– US$28 million of costs in relation to the Group’s refinancing in
Q4 2021
– A non-cash impairment charge of US$58 million (post-tax)
following a review of the carrying amount of the investment in
Block PM304 in Malaysia based on the likelihood of agreeing
an extension for the Production Sharing Contract beyond the
current term, which expires in 2026. This comprises:
1. A US$15 million impairment charge of the carrying amount
of the asset; and
2. A US$43 million write-down of the associated deferred tax
asset based on the shorter recoverability period.
– Other net separately disclosed items of US$28 million,
including cloud ERP software implementation costs
(US$12 million), other fair value adjustments (US$8 million),
aloss in Asset Solutions related to the disposal of part of the
UK training business, and professional service fees in the
Corporate reporting segment (total of US$4 million)
Further details of these separately disclosed items can be seen in
note 6 of the consolidated financial statements.
Net profit
Business performance net profit attributable to Petrofac Limited
shareholders for the year decreased 30% to US$35 million (2020
restated
3
: US$50 million) with the lower EBITDA and higher net
finance expense being partially offset by the income tax credit
and lower depreciation and amortisation. Business performance
net margin was broadly in line with the prior year at 1.1% (2020
restated
3
: 1.2%).
A reported net loss of US$195 million (2020 restated
3
:
US$192 million) resulted from separately disclosed items of
US$230 million (2020 restated
3
: US$242 million), as noted above.
Earnings per share
Business performance diluted earnings per share decreased
34% to 9.7 cents per share (2020 restated
3
: 14.8 cents per share),
reflecting both the decrease in business performance net profit
and a higher weighted average number of ordinary shares as a
result of the equity raise (see note 9 of the consolidated financial
statements). Reported diluted loss per share was 53.8 cents per
share (2020 restated
3
: 57.0 cents loss per share), reflecting lower
business performance profit and the increased number of shares
in issue.
85Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Cash flow
Operating cash flow
Operating activities generated a net cash outflow of
US$161 million (2020 restated
3
: US$30 million), principally
reflecting the decline in EBITDA, operating profit cash flow
adjustments and a working capital outflow during the year.
The operating profit cash flow adjustments of US$(70) million
included payment of end of service employment benefits
that were provided for in the prior year, the reversal of certain
expected credit losses (for which the associated receivable
balances will now be collected in future periods) and the impact
ofa reduction in other provisions. Net income taxes paid
decreased to US$42 million (2020: US$74 million).
2021
US$m
2020
(restated)
3
US$m
EBITDA 104 211
Operating profit adjustments (70) 26
Operating profit before changes
inworking capital and other items 34 237
Net working capital movement (125) (160)
Separately disclosed items paid (28) (33)
Net income taxes paid (42) (74)
Net cash flows used
inoperatingactivities (161) (30)
The net working capital outflow of US$125 million (2020:
US$160 million) was due to cash outflows on accrued contract
expenses and contract liabilities more than offsetting cash inflows
in trade and other receivables and contract assets. These cash
inflows were largely driven by the reduction in revenue in the
E&C division, while the underlying DSO (days sales outstanding)
increased due to longer billing cycles as a result of COVID-19
related disruption on E&C projects as well as slower cash
collections from clients.
Accrued contract expenses decreased due to lower volumes,
higher payment milestones being reached in the year relating to
vendors and subcontractors predominantly in the E&C division
and the maturity of the E&C project portfolio. Consequently, trade
and other payables increased as accrued contract expenses
migrated into trade payables.
Working capital inflow/(outflow):
2021
US$m
2020
(restated)
3
US$m
Inventories (15) 4
Trade and other receivables 211 122
Contract assets 78 409
Related party receivables – 1
Other net current financial assets (106) (25)
Assets and liabilities held for sale – 7
Trade and other payables 120 (156)
Contract liabilities (59) (153)
Accrued contract expenses (354) (369)
Net working capital movements (125) (160)
Free cash flow
The free cash outflow for the year of US$(281) million (2020
restated
5
: US$(123) million) primarily reflects the higher net cash
outflow generated from operating activities.
Group capital expenditure increased to US$53 million (2020
restated
3
: US$43 million), with approximately 50% being incurred
in IES for the planned East Cendor development in Malaysia.
Free cash flow benefited from the lower amount of interest paid
inthe year as well as lower repayments of lease liabilities.
2021
US$m
2020
(restated)
3
US$m
Net cash flows used inoperating
activities (161) (30)
Capital expenditure (53) (43)
Divestments 9 28
Other investing activities, including
dividends received from associates
and JVs 14 8
Net cash flows used
ininvestingactivities (30) (7)
Interest paid (27) (36)
Separately disclosed items –
refinancing-related costs paid (23) –
Repayment of lease liabilities (40) (50)
Free cash flow (281) (123)
Balance sheet
IES carrying amount
The carrying amount of the IES portfolio stood at US$99 million
at 31 December 2021 (2020: US$116 million), solely comprising
the Group’s interests in its operations in Malaysia and reflecting
the impairment described above.
Deferred and contingent consideration associated with the
sale ofnon-core assets in prior years is excluded from the IES
carrying amount as it is included in other financial assets (see
note 17 of the consolidated financial statements).
Leases
Net lease liabilities, calculated as gross lease liabilities less
theamount receivable from joint operation partners, decreased
9% to US$124 million at 31 December 2021 (31 December
2020: US$136 million). Net lease liabilities attributable to PM304
amounted to US$59 million (31 December 2020: US$76 million)
and largely relate to the bareboat charters for the floating
equipment used for block operations.
Total equity
Total equity at 31 December 2021 increased to US$485 million
(2020 restated
3
: US$410 million), reflecting US$250 million
generated from the issue of shares through the equity raise
(netof associated costs), offset by the reported loss for the year
ofUS$192 million. No dividends were paid in the year (2020: nil).
Of the US$485 million total equity at 31 December 2021,
US$475 million (2020 restated
3
: US$403 million) was attributable
to Petrofac Limited shareholders and US$10 million (2020:
US$7 million) was attributable to non-controlling interests.
86 Petrofac Limited 2021 Annual report and accounts
Strategic report
Financial review
continued

Refinancing, net debt and liquidity
Refinancing and capital raise
In October and November 2021, the Group successfully
concluded a comprehensive refinancing and capital
raise. This included a capital increase of US$275 million
4
,
US$600 million of senior secured notes (due 2026), a new
US$180 million two-year revolving credit facility, a new
US$50 million bilateral loan facility maturing in October
2023 (denominated in AED) and amendments to an existing
US$50 million bilateral loan facility maturing in November 2023.
The new facilities, together with the proceeds from the capital
raise, were used in part to repay and cancel existing credit
facilities including the £300 million of commercial paper under the
UK Government’s COVID Corporate Financing Facility (US$405m
at 30 November 2021, when it was repaid), the previous revolving
credit facility and a bilateral term loan.
Details of the Group’s interest-bearing loans and borrowings
areset out in note 26 of the consolidated financial statements.
Net debt
Net debt, excluding net finance leases, increased to
US$144 million at 31 December 2021 (2020: US$116 million),
predominantly reflecting lower cash conversion (see A10 in
Appendix A of the consolidated financial statements).
Total gross borrowings less associated debt acquisition
costs were US$764 million at 31 December 2021 (2020:
US$800 million). This consisted of US$580 million senior secured
notes, US$85 million drawn on the revolving credit facility and
US$99 million of term loans (all net of debt acquisition costs).
31 December 2021
US$m
31 December 2020
US$m
Cash and short-term deposits 620 684
Interest-bearing loans and
borrowings (764) (800)
Net debt (144) (116)
Liquidity
Following the refinancing, the Group’s total available borrowing
facilities, excluding bank overdrafts, were US$880 million at
31 December 2021 (2020: US$1,250 million).
Of these facilities, US$85 million was undrawn at 31 December
2021 (2020: US$495 million). Combined with the Group’s cash
and short-term deposits of US$620 million (2020: US$639 million,
excluding US$45 million cash from bank overdrafts), the Group
had US$705 million of liquidity available at 31 December 2021
(2020: US$1,133 million).
Borrowing facilities Amount (US$m) Maturity date
Senior secured notes 600 Nov-26
Revolving credit facility 180 Oct-23
Term loan 1 50 Oct-23
Term loan 2 50 Nov-23
Total borrowing facilities 880
The revolving credit facility and the term loans are subject to two
financial covenants relating to leverage (net debt to EBITDA) and
interest cover (EBITDA to finance expense). At 31 December
2021, the Group was in compliance with both covenants:
Leverage Interest cover
Covenant ≤3.75x ≥3.0x
Ratio at 31 December 2021 2.8x 3.1x
The Group has a BB- (positive outlook) credit rating from S&P
and a B+ (negative outlook) credit rating from Fitch.
Backlog
The Group’s backlog decreased 20% to US$4.0 billion at
31 December 2021 (2020: US$5.0 billion), reflecting low new
order intake in E&C due to the contraction in capital spending
by clients, initially triggered by the decline in oil prices and the
COVID-19 pandemic in 2020. Backlog in Assets Solutions
declined marginally.
Overall, Group order intake for the year was US$2.2 billion,
representing a book-to-bill of 0.7x. Order intake in E&C was
US$1.2 billion (2020: US$0.7 billion), comprising EPC contracts
in Oman, Libya and Lithuania and other net variation orders.
Order intake in Asset Solutions increased to US$1.0 billion
(2020: US$0.9 billion), with good growth in awards in the Asset
Developments service line including brownfield projects in Oman,
Bahrain, Malaysia and Algeria.
31 December 2021
US$m
31 December 2020
US$m
Engineering & Construction 2.4 3.3
Asset Solutions 1.6 1.7
Group 4.0 5.0
Return on capital employed
The Group’s return on capital employed for year decreased
to3.7% (2020 restated
3
: 7.1%), due to the reduction in business
performance earnings before interest, tax and amortisation
(EBITA), partially offset by a reduction in the average capital
employed. Details of this alternative performance metric
calculation are contained in A9 in Appendix A.
Dividends
In April 2020, the Board cancelled the payment of the final
dividend in response to the COVID-19 pandemic and the fall in
oil prices. The Board recognises the importance of dividends to
shareholders and expects to reinstate them in due course, once
the company’s performance has improved. Under the terms
of the new debt facilities, the company will be permitted to pay
dividends from 1 January 2023, subject to the satisfaction of
certain covenant tests.
Afonso Reis e Sousa
Chief Financial Officer
23 March 2022
Notes:
1 Attributable to Petrofac Limited shareholders.
2 This measurement is shown by Petrofac as a means of measuring underlying business
performance, see note 4 of the consolidated financial statements.
3 The prior year numbers are restated in relation to the adoption of the IFRIC decision on
cloud configuration and customisation costs, in April 2021 (see note 2.9 of the consolidated
financial statements).
4 On 26 October 2021, the Company announced a proposed equity raise of US$275 million
via the issuance of 173,906,085 ordinary shares. On completion of the equity raise on
15 November 2021 shares were issued at £1.15 per share generating gross proceeds
of approximately £200 million (US$268 million) before issue and associated costs of
US$18 million.
5 Definition amended to include the repayment of lease liabilities.
87Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Dear shareholder
On behalf of the Board, I am pleased to present the Group’s
Corporate governance report for 2021.
Governance
Throughout 2021, the Board maintained its governance focus,
despite continuing to operate virtually as a result of the ongoing
COVID-19 related travel restrictions. While the challenges facing
the Group as a result of the pandemic continued to have an
impact on our business, progress in a number of areas was
achieved. Further details are set out on pages 7 to 12.
Significant time, effort and focus were given by all Directors
throughout the year. This is evidenced by the 42 meetings
held during 2021, during which 48% of the additional time was
spent focusing on SFO matters and 34% on strategic financing
considerations. This concerted effort enabled us to conclude
the investigation in October 2021, closely followed by the
completion of a capital raise and refinancing of debt facilities.
The Group’s continued considered response to the pandemic,
the strong client-focused culture of the organisation, coupled
with the commitment of our employees, enabled us to live our
purpose, to enable our clients to meet the world’s evolving
energy needs. We have also continued to deliver on our ESG
commitments and continue our journey towards meeting our
Net Zero greenhouse gas emission targets.
On behalf of the Board, I would like to express our sincere
thanks to each of our employees and recognise their
outstanding contribution throughout the year.
Board changes
We started 2021 with a new Group Chief Executive in Sami
Iskander. His contribution and commitment throughout the
year have been nothing short of exceptional. He, along with
thisexecutive management team, have made excellent progress
in their efforts to rebalance, reshape and rebuild the business.
In August 2021 Alastair Cochran stepped down from the Board,
having served five years as Chief Financial Officer. He was
succeeded by Afonso Reis e Sousa, an internal appointment,
who most recently was Group Treasurer and Head of Tax.
During 2022, there will be further changes to the Board as
Andrea Abt and George Pierson, both of whom joined the
Board in 2016, will step down in May and will not seek re-
election at the Annual General Meeting (AGM). Further details
oneach of these changes are set out on page 103.
Looking ahead
Over the year ahead, we will continue to focus on developing
our strategic response to the challenges faced over recent
years. The Board will maintain its stakeholder engagements
so we can strive to ensure that we make the right decisions
tosupport the long-term sustainable success of our business
and create long-term value for all stakeholders.
I would like to thank our shareholders for their continued
support, loyalty and patience during these challenging times.
René Médori
Chairman
23 March 2022
Good
governance is
central to our
business.”
René Médori
Chairman
88 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Chairman’s introduction

Petrofac Limited (Petrofac) is subject
to the principles and provisions of the
UK Corporate Governance Code (UK
Code), which underpins the corporate
governance framework for premium
listed companies. The 2018 UK Code
sets out a number of principles and
provisions of good governance with
compliance with the UK Code resting
with the Board. A copy of the UK
Code is available at www.frc.org.uk.
As a Jersey incorporated company listed
in the UK, Petrofac is required to explain
how the Company has complied with the
UK Code and applied the principles and
provisions set out therein.
This governance report details how the
principles of the UK Code have been
consistently applied. For the year ended
31 December 2021, the Board has been
compliant in all but one aspect of the
UKCode.
Provision 19 of the UK Code states that
the chair of a company should not remain
in post beyond nine years from the date
of first appointment, although it does allow
for an extension of the chair’s tenure for a
limited time to support effective succession
planning and development of a diverse
board. René Médori’s tenure as a Board
member reached nine years during 2021.
The 2020 Annual Report noted that
MrMédori’s tenure would be extended
to provide continuity on the Board as a
result of executive management changes.
Given the challenges faced by the Group
during 2021, the Nominations Committee
has recommended that he remain as
Chairman until the AGM to be held in 2023,
when he will step down from the Board.
Further details are set out on page104.
During 2021, the Company complied
withall relevant requirements of the
Disclosure and Transparency Rules,
theUK Listing Rules and narrative
reporting requirements.
The table opposite sets out where
shareholders can find further information
on how the Company has applied the
principles of the UK Code within this
Annual Report.
Strategic report Governance Financial statements
The UK Corporate
GovernanceCode
1. Board leadership and company purpose
The Board sets the tone of the Company with regard to the corporate governance
framework and the application of corporate values and behaviours. The Board also
maintains oversight to ensure resources are in place for the Company to meet its
objectives and that there is an established risk framework for the management
ofeffective controls.
a. Effective Board Pages 92 to 98
b. Purpose, values and culture Pages 2 to 12, 16 and 94
c. Governance framework and controls Pages 94, 95 and 109
d. Stakeholder engagement Pages 22 to 25, 101 and 102
e. Workforce engagement Pages 23, 49 and 50
2. Division of responsibilities
There is a clear definition of Board responsibilities, with Directors collectively
responsible for the development of strategy and the long-term success of the
Company. We believe all Directors are able to work together in an atmosphere
of openness, trust and mutual respect. To ensure there is a clear division of
responsibilities, while retaining control of key decisions, the Board has in place a
Schedule of Matters Reserved that sets out items for its consideration and approval.
f. Board roles and responsibilities Pages 96 and 97
g. Independence Pages 92 and 93
h. External appointments and Board attendance Pages 92, 93 and 98
i. Key activities of the Board, information and support Pages 90 and 98
3. Composition, succession and evaluation
The Company has a formal, rigorous and transparent selection procedure for the
appointment of all new Directors. The Nominations Committee has the responsibility
of identifying and nominating all candidates, with emphasis given to ensuring Board
composition remains well balanced with the multi-disciplinary skills and experience
needed to support Petrofac’s future plans.
j. Appointments to the Board Page 103
k. Board skills, experience and knowledge Pages 91 to 93
l. Annual Board evaluation Pages 99 and 100
4. Audit, risk and internal control
The Board maintains a sound risk management and internal controls framework to
ensure the Group’s long-term strategic objectives can be achieved. The Board has
established transparent policies and procedures to ensure the independence and
effectiveness of the Group audit function, with well-established committees in place
to assist it in the undertaking of its delegated duties.
m. Internal and external audit functions;
financial reporting and narrative statements Pages 108, 110 and 111
n. Fair, balanced and understandable assessment of the report Page 110
o. Internal control framework and risk management Pages 60 to 69 and 109
5. Remuneration
The Remuneration Committee ensures that there is a formal and transparent
process for determining and reporting on Executive Director and senior management
remuneration. Remuneration policies and practices have been designed to support
the Group’s strategy, in alignment with the newly-formed purpose, values and
expected behaviours and to promote the long-term success of the organisation.
p. Alignment of remuneration with purpose, strategy and values Pages 116 and 117
q. Remuneration policy Page 116
r. Performance outcomes and strategic targets Pages 118 to 121
89Petrofac Limited 2021 Annual report and accounts

Major Board activities
How the Board spent its time during the year 2021
Sami Iskander was appointed to the
Board as Group Chief Executive with
effect from 1 January 2021.
Afonso Reis e Sousa was appointed to
the Board as Chief Financial Officer with
effect from 1 September 2021.
Board changes
42
Board meetings held
during theyear
2
new Board members
2
employee Workforce
Forum meetings held
84%
employee engagement score
for 2021
120
investor meetings
held during 2021
100%
Board meeting attendance
for scheduled meetings
Highlights
Financial matters
Governance
Leadership and
people development
Project approvals
Risk management
and internal controls
Strategic matters
SFO review
Strategic refinancing
9%
10%
2.5%
0.5%
2%
12%
39%
25%
Director tenure
as at March 2022 (years)
10+
2
6-9
1
4-5
3
2-3 2
0-2
2
90 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Governance at a glance

4
Directors falling within the Parker
Review’s classification
as at 31 December 2021
30%
female representation
on our Board
as at 31 December 2021
Our Board
10
different nationalities
represented on our Board
as at 31 December 2021
Geographical mix of the Board
Geographical mix
of the Board
UK
3
E
urope
5
US
1
Middle East
1
0
Executive and Non-executive Directors
as at March 2022
6
of our Board have
oiland gas experience
5
of our Board have
financialexperience
10
of our Board have
internationalexperience
7
of our Board
have engineering
experience
7
of our Board haveregulatory
and governance experience
10
of our Board have
leadershipexperience
8
of our Board have
HSEexperience
Executive Directors 2
Independent Non-executive Directors 6
Non-independent Non-executive 1
Chairman 1
6
of our Board have
digitalexperience
10
of our Board have
operational/strategic
management
experience
Key expertise
Strategic report Governance Financial statements
91Petrofac Limited 2021 Annual report and accounts

1
5
9
2
6
10
3
7
11
4
8
1. René Médori
Non-executive Chairman
Committees: Nominations (Chair)
Appointed to the Board: January 2012
Non-executive Chairman: May 2018
Independent: On appointment
Key strengths and experience
Extensive international financial experience,
with knowledge of balance sheet strengthening
opportunities and financing arrangements.
Well-established knowledge of governance and
regulatory matters and a good understanding
of operational and strategic management.
Stepped down as Finance Director of Anglo
American plc in April 2017 and retired from
the company in January 2018, after 12 years.
Until December 2017 he was a non-executive
director of De Beers and Anglo American
Platinum Limited. He was a non-executive
director of SSE plc until December 2017
andCobham plc until January 2020.
External appointments
Non-executive chairman of Puma Energy.
non-executive director of Vinci SA and
Newmont Corp.
2. Sami Iskander
Group Chief Executive
Appointed to the Board: January 2021
Independent: Not applicable
Key strengths and experience
More than 30 years’ international experience in
both oilfield services and upstream companies.
Executive Vice President for Royal Dutch Shell’s
upstream joint ventures from February 2016
until May 2019.
From 2008, prior to joining Shell, he worked
for BG Group plc where he held the position
of Chief Operating Officer from November
2013. In this role, he was responsible for BG
Group’sglobal upstream operations as well as
BG Technical. From 2009, he was Managing
Director for Africa, Middle East & Asia, where
he was responsible for all upstream, midstream
and downstream activities in the region.
Prior to BG Group, he held many
keyleadership roles with Schlumberger,
undertaking assignments in the Middle East,
Africa, Europe,Latin America and the USA.
External appointments
None
3. Afonso Reis e Sousa
Chief Financial Officer
Appointed to the Board: September 2021
Independent: Not applicable
Key strengths and experience
Extensive experience in corporate andproject
finance, specialising mainly in energy-related
and infrastructure financing. Afonso joined
Petrofac in 2012 as Group Head of Structured
Finance and accumulated a portfolio of
increasing responsibility including Group
Treasurer, Head of Tax and Group Head of
Enterprise Risk. He has more than 25 years’
experience in finance, including a background
in investment banking, having begun his career
with Deutsche Morgan Grenfell.
External appointments
None
4. Matthias Bichsel
Senior Independent Director
Committees: Audit, Compliance and Ethics,
Nominations, Remuneration (Chair)
Appointed to the Board: May 2015
Senior Independent Director: May 2018
Independent: Yes
Key strengths and experience
More than 40 years’ experience in the oil
and gas industry. Extensive commercial and
strategic capabilities. Deep understanding
of operational, project and technology
management. Broad knowledge of
sustainabledevelopmentissues.
Until 2014, held several senior managerial
roles over his 34-year career with Royal Dutch
Shell. His last position was as a member
of the Group’s executive committee and
director of Capital Projects and Technology.
Other positions include director of Petroleum
Development Oman; President of Shell
International Exploration & Production Inc and
MD of Shelldeepwater services in Houston;
executive vice president global exploration
and executive vice president technical of Shell
Upstream in The Hague.
External appointments
Non-executive director of Sulzer AG
(Switzerland), Canadian Utilities Limited
(Canada), South Pole Group (Switzerland)
andVoliro (Switzerland). Member of the
advisory board of Chrysalix Energy Venture
Capital (Canada).
92 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Board of Directors

5. Andrea Abt
Non-executive Director
Committees: Compliance and Ethics, Nominations,
Remuneration
Appointed to the Board: May 2016
Independent: Yes
Key strengths and experience
Extensive background in a variety of
functional roles, including sales, finance,
procurement, supply chain and logistics.
Specialist knowledge of the European market.
She started her career at Dornier Luftfahrt,
acompany of the Daimler-Benz Group,
before joining Siemens in 1997. At Siemens
she held various leadership roles, including
Head of Supply Chain Management and Chief
Procurement Officer for Infrastructure & Cities
from 2011 to 2014. She was a non-executive
director of Brammer plc until February 2017,
anon-executive director of SIG plc until
February 2020, a non-executive director
ofJohn Laing Group plc until September 2021
and a non-executive director of Polymetal
International plc until March 2022.
External appointments
Non-executive director of Exide Technologies.
A member of the supervisory board of
Gerresheimer AG.
6. Sara Akbar
Non-executive Director
Committees: Nominations, Remuneration
Appointed to the Board: January 2018
Independent: Yes
Key strengths and experience
More than 40 years’ experience in the oil and
gas industry with a unique insight into the Middle
Eastern region. Wide-ranging international
experience and significant operational and
project management capabilities.
Until the end of 2017, Sara was Chief Executive
Officer of Kuwait Energy KSC, which she
founded in 2005 to leverage the opportunity
foran independent engineering and production
company in the Middle East and North
Africa and Eurasia regions. Served in various
positions in the oil and gas industry in Kuwait
and internationally from 1981 to 1999. Holds a
BScin Chemical Engineering. Former Member
of the Kuwait Supreme Council for Planning
andDevelopment.
External appointments
Chairman and CEO of Oil Serve and Chairperson
of the Advisory Board to the American University
of Kuwait, and an active member of the Board of
Trustees of Kuwait’s Silk Territory project.
7. Ayman Asfari
Non-executive Director
Committees: Nominations
Appointed to the Board: January 2002
Non-executive Director: January 2021
Independent: No
Key strengths and experience
Distinguished record with strong operational
leadership skills and international focus.
Extensive entrepreneurial and business
development skills, a clear strategic vision, and an
in-depth knowledge of the oil and gasindustry.
Established Petrofac International in 1991.
Following a corporate reorganisation in
2002, acquiring the original US business and
subsidiaries, became Group Chief Executive.
In 2005, he led the successful initial public
listing of the Company. He has more than
40 years’ experience in the energy industry.
Formerly worked as MD of a major civil and
mechanical construction business in Oman.
Stepped down as Group Chief Executive with
effect from 31 December 2020.
External appointments
Executive Chairman of Venterra Group plc. Co-
founder and Chairman of the Asfari Foundation.
Member of the board of trustees of the
American University of Beirut. Member of the
board of trustees for the Carnegie Endowment
for International Peace. Fellow of the Royal
Academy of Engineering and member of the
Chatham House Panel of Senior Advisors.
8. David Davies
Non-executive Director
Committees: Audit (Chair), Nominations
Appointed to the Board: May 2018
Independent: Yes
Key strengths and experience
Extensive international financial experience,
including capital and debt raising as well as
managing companies exposed to substantial
and rapid change. Chartered Accountant with
an MBA from the City University Business
School. Served on the boards of listed
companies in seven different countries.
More than 35 years’ experience as a financial
professional with a successful career as Chief
Financial Officer and Deputy Chairman of the
executive board at OMV Aktiengesellschaft.
Served as Group Finance Director for both
Morgan Crucible Company plc and London
International Group plc, and was a Non-
executive Director of Ophir Energy Plc until
May2019 and of Uniper SE until April 2020.
External appointments
Non-executive director of Wienerberger AG.
9. Francesca Di Carlo
Non-executive Director
Committees: Nominations, Remuneration
Appointed to the Board: May 2019
Independent: Yes
Key strengths and experience
Extensive background in various senior
positions, specialising in corporate finance
operations, strategy, audit, and human
resources and procurement.
Holds a BA in Economics from La Sapienza
University in Rome. She began her professional
career in 1987 in London at the UBS Group
where she specialised in Corporate Finance.
Currently she is the Head of Global Procurement
of the Enel Group. Previously she was Director
of the People and Organization division,
Director of Group Audit and Head of Corporate
Strategy in Enel Group. She covered a wide
range of roles at the Telecom Italia Group,
including Head of Investor Relations, Head
of Financial Planning and Head of Corporate
Development and Mergers & Acquisitions,
andwas a director of Open Fiber, Italy’s largest
broadband operator. Former Chairperson of
Stream andTelespazio, as well as a former
director ofSky Italy.
External appointments
Group Executive Vice President of Procurement
at ENEL S.p.A.
10. George Pierson
Non-executive Director
Committees: Audit, Compliance and Ethics (Chair),
Nominations
Appointed to the Board: May 2016
Independent: Yes
Key strengths and experience
A qualified lawyer and engineer. Extensive
background in risk management, contracting,
construction law, compliance and cost
efficiency. Excellent understanding of
operational and engineering management.
Appointed as President and Chief Executive
Officer of Parsons Brinckerhoff between
2010and 2014 having been General
Counsel and Secretary from 2006 and
COO of its Americas operations from 2008.
Previously non-executive director of WSP
Global Inc, Terracon Consultants, Inc.
and Railworks LLC. Joined The Kleinfelder
Group Inc. in August 2016 and served
asPresident and Chief Executive Officer
untilbecoming Executive Chairman in
September 2019.
External appointments
Executive Chairman of The Kleinfelder Group
Inc. and the Vertex Companies, Inc., and
Non-executive director of Citadel Systems
Integration Holdings LLC.
11. Alison Broughton
Head of Company Secretariat and
Secretary to the Board
Key strengths and experience
Joined Petrofac in August 2011, and is responsible
for the Group’s regulatory, governance and
listing rule compliance framework.
A Fellow of ICSA: The Chartered Governance
Institute, with 25 years’ experience in a UK-
listed environment. She is Secretary to the
Board and its committees.
Prior to joining Petrofac, she spent eight years
with Wolseley plc (now Ferguson plc) as Deputy
Company Secretary. In 2002, she joined the
company secretariat of Shell Exploration &
Production Limited, part of the Royal Dutch
Shell group, following the takeover of Enterprise
Oil plc, where she started her company
secretarial career in 1997.
93Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Core to the
Petrofac offering
is the Group’s
distinctive,
delivery-focused
culture.”
Board governance structure
The Board seeks to ensure there is a strong and effective
governance framework in place across the Group. It recognises
that the Group’s long-term success depends on a commitment
to good corporate governance standards and acknowledges
thatgood governance is something that should be ingrained
in our behaviours, the way we make decisions and run our
business, rather than simply a compliance metric.
The Board sets the Group’s strategy, with the aim of delivering
onits purpose, within an agreed risk appetite. As a unitary Board,
our Directors share equal responsibility for all decisions taken,
with Directors collectively responsible for strategic direction.
In determining the Group’s strategy, and the sustainability of
thebusiness model, the Board is conscious of itsresponsibilities,
not just to shareholders but to all stakeholders. It seeks to ensure
that the necessary corporate and managementstructures are in
place for our strategy to be implemented effectively.
The UK Companies Act 2006 sets out a number of general duties
to which all Directors are expected to adhere. While Petrofac
Limited, as a Jersey-registered entity, is not required to comply
with this legislation, our Directors have duties under the
Companies (Jersey) Law but are also informed by UK practice
and wish to act in good faith to promote the long-term success
ofthe Group.
Matters reserved
The Board has a formal schedule of matters reserved for
its decision making and approval. These matters include
responsibility for the overall management and performance of
the Group and the approval of its long-term objectives, strategy,
budgets, material contracts, capital commitments, risk appetite,
the long-term viability statements and key policies. The matters
reserved for decision by the Board are regularly reviewed and
approved by the Board.
Purpose, values and culture
The Board recognises that having a defined purpose and
vision, with values and supporting behaviours embedded within
the organisation, can help to create a culture that optimises
performance and delivers long-term results. The Company’s
purpose, vision and values, which were updated at the start of
2021, see page 16. The Board sets the tone of the Group with
regard to the application of our corporate values and behaviours,
taking into consideration the views and interests of all stakeholders.
The Company’s values articulate the qualities we wish all employees
to demonstrate and we aim to have these embedded within our
operational practices throughout the organisation. The Group
Executive Committee is delegated with the responsibility for ensuring
that policies and behaviours set at Board level are communicated
and implemented effectively across the Group.
Governance framework
We believe our corporate governance framework underpins
good governance practices and enables the Board to provide
effective stewardship of the Company. The Board is assisted by
four committees – Audit, Compliance and Ethics, Nominations
and Remuneration – and matters which the Board considers
suitable for delegation are contained in their respective terms
of reference. Copies of these documents are available at
www.petrofac.com. In addition to these Board committees,
there are several executive management committees, which are
involved in the day-to-day operational management of Petrofac
and which have been established to consider various matters for
recommendation to the Board and its committees. Our corporate
structure framework is set out on page 95.
Key focus areas
The main priorities of the Board are primarily to provide leadership
and guidance in support of the Group’s strategic priorities, with
consideration to the Group’s financial performance. This was
evidenced throughout 2021 by the focus given to the resolution of
the SFO investigation and in relation to the refinancing programme
which was undertaken by the Company and completed towards
the end of 2021.
The Board also focuses on best-in-class delivery and maintaining
bidding discipline to secure new orders. It concentrates on good
governance, compliance, and risk management procedures
and processes to ensure they are fully embedded across the
Group and ensures succession plans are in place throughout
theorganisation. How the Board spent its time during 2021
andthe key matters considered are set out on page 90.
Regulatory investigation
The Company has reported in prior reports that in May 2017
the SFO had commenced an investigation into the activities of
Petrofac Limited, its subsidiaries and their officers for suspected
bribery, corruption and/or money laundering.
Following significant engagement with the SFO during the
year, this investigation reached a conclusion in October
2021. The sentencing brought to an end the investigation into
suspected bribery and corruption as far as Petrofac and its
subsidiaries are concerned.
94 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Board leadership and
companypurpose

Shareholders
The Board
The Board’s role is to provide leadership and direction for the Group and to ensure long-term success by setting a sustainable
strategy and overseeing its implementation. The Board provides rigorous challenge to management and ensures appropriate
systems and processes are in place to monitor and manage enterprise risk and internal controls. The Board is responsible for
thefinancial performance and overall corporate governance of the Group.
The Board delegates certain matters to its principal committees, which report to the Board at every meeting.
Executive management
Responsible for day-to-day operational management, the communication and implementation of strategic decisions, and
administrative matters. Identifies and reviews matters for recommendation to the Board and its committees. Supported by
a number of management committees, including the Group Executive Committee, Third Party Risk Committee, Disclosure
Committee, Guarantee Committee and Group Risk Committee.
Audit
Committee
Chaired by: David Davies
Reviews and monitors the
integrity of the Group’s
financial statements;
reporting processes;
financial and regulatory
compliance; the systems
of internal control and
risk management; and
the external and internal
auditprocesses.
Nominations
Committee
Chaired by: René Médori
Reviews the structure, size
and composition of the
Board and its committees.
Takes primary responsibility
for succession planning
and Director succession.
Identifies and nominates
suitable candidates for
Board appointments.
Compliance and
Ethics Committee
Chaired by: GeorgePierson
Supports the Board
infulfilling its oversight
responsibilities
in all respects of
compliance andethics.
Provides assurance that
the Group’s compliance
and ethics policies
remaineffective.
Remuneration
Committee
Chaired by: MatthiasBichsel
Sets the remuneration
policy for Executive
Directors and determines
individual compensation
levels for Executive
Directors, the Chairman
and members of senior
management. Oversees the
remuneration framework for
the Group.
Elect the Directors
Informs
Informs
Reports
Reports
Ongoing engagement
Committee report on pages
116 to 127
Committee report on pages
114 an d 115
Committee report on pages
103 to 105
Committee report on pages
106 to 113
95Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements
Governance framework

The relationships between these roles are of particular
importance, as these individuals represent the views of both
management and Directors, respectively. The combination of
these meetings ensures that the Chairman is fully informed of
theviews of the Directors and management, which assists in
setting meeting agendas and ensures all Directors can contribute
effectively through their individual and collective experiences.
The Nominations Committee has the responsibility for monitoring
the external commitments of the Non-executive Directors
who, from appointment, are each made aware of the need
to allocate sufficient time to the Company to discharge their
responsibilities effectively. Any proposed change to a Director’s
external commitments must be notified to the Board immediately
in order that any potential conflict of interest, time commitment
orresidency status issues can be considered.
Meeting attendance
The Board normally holds six scheduled meetings each year,
which are supplemented with ad hoc meetings to review any
items of business that need to be addressed ahead of the
next scheduled meeting. All Directors are also invited to attend
Audit Committee meetings, and the Chairman, Group Chief
Executive and Chief Financial Officer are also invited to attend
Remuneration Committee meetings, where appropriate.
As a result of the key matters under review during the year,
primarily relating to the resolution of the SFO investigation and
the refinancing project, the Board met 42 times during 2021.
Directors participated in all meetings using secure virtual
meeting technology, dealing with matters efficiently and with
the appropriate level of oversight and rigour. Details of individual
Director attendance are set out on page 98.
To enhance their knowledge of the business, and as part of the
process of maintaining an awareness of the Group’s strategic
activities and assessing the ability of the management team,
members of operational and functional management, one and
two tiers below Director level, are routinely invited to present on
matters under consideration at Board and Committee meetings.
The Directors feel that these presentations enable them
to deepen their understanding of Petrofac at both a local
and functional level, while gaining an awareness of specific
nuances that may not always be obvious in written reports.
Attendance atthese meetings also affords managers the
opportunity to bring matters to the attention of the Board and
allows the Board to consider key individuals who have been
identified through the succession planning process.
Board site visit
In response to Government COVID-19 guidance and continuing
worldwide travel restrictions, physical site visits were put on hold
during 2021. However, we intend to reintroduce physical site visits
for the full Board as soon as conditions permit.
Where feasible, virtual site safety visits were arranged on an
individual basis for members of senior management to continue
to meet with local management, project teams and graduates.
Board composition
At the date of this report, the Board has ten Directors, comprising
the Chairman (who was independent on appointment), six
independent Non-executive Directors, one non-independent Non-
executive Director and two Executive Directors. Full biographies,
setting out their career background, relevant skills, external
appointments, and Committee memberships are detailed on
pages92 and 93.
In line with the requirements of the UK Code, the Board comprises
a majority of independent Non-executive Directors. All new Board
appointments are subject to a formal and rigorous procedure
led by the Nominations Committee. Further details on the work
undertaken by this Committee during 2021 are set out on pages
103 to 105. Each of our Directors has a varied career history,
and considerable effort has been taken to ensure that the Board
retains the right balance of skills, capabilities, knowledge diversity
and industry expertise (see pages 91 to 93) to ensure we are able
torun the business effectively and deliver sustainable growth.
Our two Executive Directors have rolling service contracts,
containing a notice period provision of 12 months by either party.
Our Non-executive Directors each have letters of appointment
that contain a termination provision of three months’ notice by
either party. The terms and conditions of appointment of all
Directors are available for inspection at our registered office
in Jersey and at our Corporate Services office in London.
In accordance with the UK Code, Directors offer themselves
forreappointment by shareholders at each AGM.
At the AGM to be held In May 2022, Andrea Abt and George
Pierson will step down from the Board, each having served
forsix years. Recognising the current size of the organisation,
webelieve it is commensurate to reduce the size of the Board at
this time. This will be kept under review, with consideration given
to increasing the size of the Board as we start to rebuild.
Board roles
The roles and responsibilities of our Directors, including the
Chairman, Group Chief Executive and Senior Independent
Director (SID) are set out on page 97. Our Non-executive
Directors are encouraged to share their experience, and each
is well positioned to support management, whilst providing
constructive challenge. All Directors are encouraged to be open
and forthright in their approach as we believe this helps to forge
strong working relationships, allowing them to make their best
possible contribution.
Regular meetings between the Chairman and Group Chief
Executive are held throughout the year, particularly before and
after scheduled Board meetings, allowing general matters to be
discussed and enabling them to reach a mutual understanding of
each other’s views, especially in matters where they may initially
not be in agreement. The Chairman and SID also maintain regular
contact between scheduled Board meetings, with time also set
aside at each meeting for the Chairman to meet with the Non-
executive Directors without the presence of management.
96 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Board leadership and company purpose
continued

Director Responsibility
Chairman
• Leads the Board and ensures effective communication flows between Directors
• Promotes an inclusive forum to facilitate effective contribution, challenge and debate
• Builds a well-balanced Board, with consideration given to succession planning and Board
composition
• Is responsible for ensuring effective board governance and oversees the board evaluation process
• Ensures effective communication with stakeholders, which enables their interests to be
represented at Board meetings
Senior
Independent
Director
• Acts as a sounding board and confidant to the Chairman
• Available to meet shareholders to answer questions that cannot be addressed by the
Chairman or Group Chief Executive
• Meets annually with other Directors to appraise the Chairman’s performance, and on such
other occasions as is deemed appropriate
• Acts as an intermediary for other independent Directors
Non-executive
Directors
• Support executive management, whilst providing constructive challenge and rigour
• Monitor the delivery of strategy within the risk management framework set by the Board
• Bring sound judgement and objectivity to the Board’s decision-making process
• Review the integrity of financial information, controls and risk management processes
• Share skills, experience and knowledge from other industries and environments
• Have prime roles in the Board composition and succession planning process
Group Chief
Executive
• Implements agreed strategy and objectives, and develops attainable goals and priorities
• Provides leadership and day-to-day management of the Group. Has delegated authority from the
Board to deliver the Company purpose
• Develops proposals to present to the Board on all areas reserved for its judgement and ensures
the Board is fully informed of all key matters
• Develops Group policies for approval by the Board and ensures effective implementation.
Supported by the leadership team, has responsibility for driving execution of the Group’s
strategic aims
• Maintains relationships with key external stakeholders, including investors, clients and governments
Chief
Financial
Officer
• Manages the Group’s finances and is responsible for financial planning and presenting and
reporting accurate and timely historical financial information, both internally and externally
• Ensures an effective financial control environment fully compliant with regulations. Develops and
implements the Group’s finance strategy and funding
• Manages the Group’s financial risk and is responsible for mitigating key elements of the Group’s
risk profile
• Maintains relationships with key external stakeholders, including shareholders, lenders and credit
rating agencies
Secretary
to the Board
• Acts as Secretary to the Board and its committees.
• Advises the Board on all governance, legislation and regulatory requirements as well as best
practice corporate governance developments.
• Puts in place processes designed to ensure compliance with Board procedures. Facilitates the
Board evaluation, induction and development processes. Available to individual Directors in
respect of Board procedures to provide general support and advice.
Board roles
97Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements
Corporate governance
Division of responsibilities

Board information and support
A tailored approach to developing agendas is adopted for
each Board meeting. A significant element of each agenda is
dedicated to strategic matters, providing the Board with sufficient
time to review and discuss strategic matters. We believe the
flexibility of this approach allows Directors to engage effectively
and encourages scrutiny and constructive debate, with Non-
executive Directors able to seek clarification from management
where required. Each scheduled Board meeting includes a report
from the Group Chief Executive, which covers health and safety,
operational and overall business performance, and a report
from the Chief Financial Officer including financial performance,
cashflow and net debt, analysts’ reviews and share price
performance. Any actions arising from meetings are overseen
by the Company Secretariat and updated action lists form the
agenda for the next scheduled meeting.
All Directors utilise a dedicated secure app to access their
papers. This provides them with immediate and secure access
to documentation and ensures information can be provided in
atimely manner and in a format and quality appropriate to enable
the Board to discharge its duties effectively.
Dealing with potential conflicts of interest
In the event a potential conflict of interest should arise during
aterm of appointment, processes and procedures are in
place for Directors to identify and declare any such conflict,
whether matter-specific or situational. The Company’s Articles
of Association permit the Board to authorise any such conflicts,
which can be limited in scope. Notifications are required to be
made by the Director concerned prior to or at a Board meeting,
and all Directors have a duty to update the whole Board of any
changes in personal circumstances. During 2021, all conflict
management procedures were adhered to, managed and
reported effectively.
Deeds of indemnity
In accordance with our Articles of Association, and to the
maximum extent permitted by Jersey Law, all Directors and
Officers of Petrofac Limited are provided with deeds of indemnity
in respect of liabilities that may be incurred as a result of their
office. The Group also has appropriate insurance coverage in
respect of legal action that may be brought against its Directors
and Officers. Neither the Company’s indemnities nor insurance
policies provide any cover where a Director or Officer was found
to have acted fraudulently or dishonestly.
2021 Board and Committee meeting attendance:
Director Role
Board meeting
(scheduled)
Board meeting
(ad hoc)
Nominations
Committee
Audit
Committee
C&E
Committee
Remuneration
Committee
René Médori Chairman 6 (6) 36 (36) 3 (3) – – –
Sami Iskander Group Chief Executive 6 (6) 36 (36) – – – –
Afonso Reis e Sousa
1
Chief Financial Officer 2 (2) 7 (7) – – – –
Andrea Abt
2
Non-executive Director 6 (6) 30 (36) 3 (3) – 3 (3) 5 (6)
Sara Akbar
2
Non-executive Director 6 (6) 34 (36) 2 (3) – – 6 (6)
Ayman Asfari Non-executive Director 6 (6) 36 (36) 3 (3) – – –
Matthias Bichsel Senior Independent Director 6 (6) 30 (36) 3 (3) 7 (7) 3 (3) 6 (6)
David Davies
2
Non-executive Director 6 (6) 33 (36) 3 (3) 7 (7) – –
Francesca Di Carlo
2
Non-executive Director 6 (6) 35 (36) 3 (3) – – 6 (6)
George Pierson
2
Non-executive Director 6 (6) 33 (36) 3 (3) 7 (7) 3 (3) –
Former Director
Alastair Cochran
2,3
Chief Financial Officer 4 (4) 26 (29) – – – –
1 Afonso Reis e Sousa was appointed to the Board with effect from 1 September 2021.
2 Some Directors were absent from at least one ad hoc Board meeting, due to pre-existing commitments as a result of the meetings being called at short notice.
3 Alastair Cochran stepped down from the Board on 31 August 2021.
98 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Division of responsibilities
continued

Y3 – 2022
External evaluation
Facilitated externally.
Will be conducted towards the
end of 2022, with the final report
presented to the Board in early 2023.
Further details will be provided in
next year’s Annual Report.
Board training
The Board believes that continuous training and development
supports Board effectiveness. It is committed to offering relevant
training opportunities, tailored to each individual, that provide
Directors with the necessary resources to refresh, update and
enhance their skills, knowledge and capabilities.
With the ever-evolving regulatory landscape in which the Group
operates, it is critical that the Board remains aware of recent
and upcoming developments in the wider legal and regulatory
environment. Board members are therefore encouraged to attend
seminars, conferences and training events as required and to
proactively identify any areas where they would like additional
information to ensure they are adequately informed about
theGroup.
The Secretary to the Board regularly updates the Board on the
governance, legislative and regulatory matters that may impact
theGroup and, where relevant, briefings from external advisors on
a variety of topics that are significant for the Group and its strategy
are provided. During 2021, updates on governance consultations
were provided, including the FCA’s consultation on diversity and
inclusion on company boards, and the BEIS consultation on audit
reform and corporate governance. These were considered as
key focus areas for the Board, particularly as the outcome of the
consultations are expected to bring significant regulatory changes
or new primary legislation into effect.
Training records for all Directors are maintained by the Company
Secretariat and are reviewed during the annual Board evaluation
process. Over the course of 2021, approximately 54 hours of
virtual training were recorded by Directors.
Board evaluation
Our annual Board evaluation provides the Board and its
Committees with an opportunity to consider and reflect on
how it operates and the quality and effectiveness of its decision
making, the range and level of discussion, and for each member
to consider their own contribution and performance. The UK
Code also requires the Board to undertake a formal andrigorous
annual evaluation of its performance and that of itscommittees,
with a provision of the UK Code requiring that this be externally
facilitated every three years. In accordance withour three-year
cycle, the Board’s last external evaluation took place in 2019
and the next will take place in 2022. The Board understands
the benefits of annual performance evaluations, both for
Directors on an individual basis, as well as for the Board as a
whole. It continually strives to improve its effectiveness and
believes these evaluations can provide avaluable opportunity to
recognise strengths, and identify anyweaknesses, thereby driving
continuous improvement.
2021 Board evaluation process
This year’s review of the Board’s effectiveness was facilitated
internally by the Chairman and the Secretary to the Board.
The review was again conducted via a confidential online self-
evaluation tool, using the Thinking Board
®
platform created
by Independent Audit, who carried out the Board’s externally
facilitated review during 2019.
Detailed questionnaires were created for the Board, with all
Directors and regular meeting attendees requested to respond
to the anonymous questionnaires. The questionnaires covered
a broad range of matters and topics aimed at addressing issues
raised in prior evaluations. It enabled participants to provide
Y2 – 2021
Internal evaluation
Facilitated by the Chairman
and the Secretary to the Board,
using confidential self-evaluation
questionnaires.
Results collated and presented to
the Board in March 2022, with an
action plan to be agreed and
reviewed during the year.
Y1 – 2020
Internal evaluation
Facilitated by the Chairman
and the Secretary to the Board,
using confidential self-evaluation
questionnaires.
Action plan agreed and reviewed
throughout 2021.
The Board performance evaluation cycle
comments on all aspects of performance, including matters
such as: Board succession, Board and Committee composition;
meeting conduct; strategy and culture; risk management and
internal controls; measuring and monitoring performance;
content and scope of topics covered at meetings; the nature
and dynamics of Director contributions during meetings and
stakeholder engagement; and to provide written comments
andhighlight any areas for improvement.
The responses were collated and provided, on an anonymous
basis, to the Chairman. This enabled him to discuss the outputs
with Directors and to assess performance and contribution,
identifying development areas for individuals and the Board
asa whole. The Senior Independent Director also led the Non-
executive Directors in a review of the Chairman’s performance,
with feedback provided directly. In consultation with the
Secretary to the Board, a detailed report on the output of the
effectiveness review was prepared and presented at the March
2022 Board meeting.
99Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements
Corporate governance
Composition, succession
andevaluation

Progress against actions arising from the 2020 effectiveness review
The outcome of last year’s external evaluation identified areas where the Board might improve and develop, with progress made
throughout the year:
Theme Area for recommended improvement Progress
Strategy Greater focus to be given to strategic
developments within the industry, including
reviewing threats and opportunities to further
develop longer-term strategy. Regularly
reviewing progress against strategic priorities
with increased engagement between the
Board and senior management.
Regular updates were provided to the Board throughout
the year on progress against strategic developments.
Significant engagement took place between the Board
and senior management as the strategic priorities were
further developed and as the functional excellence 1tec
framework was introduced.
Risk management Recalibration of the Company’s appetite for
risk, ensuring it remains aligned with emerging
longer-term strategy. Deep dives to be
undertaken, with the creation of lessons learnt
documents to assist with future initiatives.
A revised risk framework has been developed to better
articulate risk appetite, with regular updates provided
to the Board and its committees on new and emerging
risks. Key changes to principal risks and their mitigation
measures were discussed, with the aim of addressing
any systemic issues.
ESG Greater focus to be given to the
developmentof the Group’s ESG strategy,
ensuring it is fully embedded throughout
theorganisation and reflected in operating
key performance indicators.
The Board reviewed the Company’s strategy and roadmap
to achieve Net Zero by 2030, providing feedback and
endorsing a three-year implementation plan, with targets
set and decarbonisation levers considered.
It was agreed that the key actions defined by the Chairman from the latest evaluation would form part of the Board’s agenda for the
coming year. These actions are set out in the table below:
The key recommendations arising from the 2021 effectiveness review:
Theme Area for recommended improvement
Strategy
Following the conclusion of the SFO investigation in 2021, focus to be given to clearly defining the
medium- and long-term strategy to help stabilise the organisation, and thereby restore stakeholder
confidence. Continued focus to be given to implementing the necessary actions to enable the business
to deliver on the strategy, by rebalancing the Group’s financial health and rebuilding the backlog by
winning new orders and re-entering core geographies. Deep-dives on key strategic initiatives to be
provided during the course of the year.
ESG
To continue the development of the sustainability strategy and the ESG roadmap, clearly defining the
Group’s direction on energy transition. To drive our continual corporate reforms to promote cultural
changes throughout the organisation and ensuring the ESG strategy is fully embedded across the
Group and reflected in operating key performance indicators.
Succession planning To review the Board composition, ensuring Director succession plans are in place for the immediate
and medium term. Continued focus to be given to leadership and talent development initiatives, with
the aim of retaining key talent and developing suitable measures to curb attrition.
2021 Board evaluation outcome
The Chairman considered the results of the evaluation and
separately assessed the independence and time commitment of
each Director. It was concluded that each Director’s performance
continued to be effective and that they demonstrated significant
commitment to their roles.
The overall assessment from this year’s internal evaluation
was that the Board continued to work effectively and to a high
standard to achieve Group objectives, and that each Director
performed well during the year despite the challenges faced
bythe Group.
It was agreed that all Directors demonstrated a collaborative
and constructive attitude, ensuring an open environment within
meetings for participation and challenge. The Board considered
it had performed well and, in particular, noted the significant
engagement and contribution given throughout the year in
relation to the SFO and refinancing discussions, where it was
felt the most value had been added during the year. Extensive
focus was given to the financial performance of the Group. The
Board composition changes, and the executive management
succession processes, were felt to have been well managed.
There were no material issues identified, although as always
therewere areas identified for continued focus and improvement.
100 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Composition, succession andevaluation
continued

Stakeholder engagement
The Board has always placed significant importance on
listeningto, and establishing and maintaining good relationships
with, stakeholders. This engagement allows the Board to
better understand the impact on its stakeholders of any
decisions taken, and ensures the Board is also kept informed
of significant changes in the market, including the identification
of emerging risks and trends, which in turn can be factored into
strategicdiscussions.
Stakeholder considerations are integral to our Board discussions
and are central to the execution of our strategy. Our stakeholder
engagement processes enable the Board to better understand
what matters to each stakeholder group, and to recognise their
differing interests. The Board acknowledges that it is not always
possible to provide positive outcomes for all stakeholders and
that, on occasion, decisions must be made based on competing
priorities. In such circumstances, all relevant factors are taken
into consideration by the Board to ensure that the course of
action selected is in the best interests of the Group and the
business as a whole, with the needs of the different stakeholders,
as well as the consequences of any decision in the long term,
considered carefully.
Engaging with employees is valued highly by the Board. They are
kept informed on the outcomes of all employee engagement
surveys and are active participants in the Workforce Forum,
which was established in 2019. This continued engagement
andthe sharing of views throughout the year provides insight
onthe realities being faced by employees across the Group.
Open and constructive engagement with major shareholders is
also considered vital and enables the Board to understand their
views on governance, while providing the opportunity to explain
performance against strategy. These discussions not only focus
on delivering increased shareholder value, but also assess the
impacts of decisions on the Group’s wider stakeholders.
Section 172 arrangements
Under Section 172 of the UK Companies Act 2006, boards have
a duty to promote the success of their company for the benefit of
their members as a whole, whilst having regard for the interests
of employees, the success of their relationships with suppliers
and customers, the impact of their operations on the community
and environment and maintaining a reputation for high standards
of business conduct.
As a Jersey incorporated company, Petrofac is not required
to comply with this legislation. Nevertheless, our Directors are
informed by UK practice and, in any event, wish to act in good
faith to promote the long-term success of the Group for the
benefit of all stakeholders. When making any decisions, each
Director is encouraged to act in the way they consider, in good
faith, to best promote the Company’s success for the benefit of
its members as a whole, while having due regard to the Section
172 requirements.
An overview of how and why we engage with our key stakeholders
and how we have considered their requirements relating to
principal decisions taken during the year to ensure effective
andcontinued engagement is set out on pages 22 to 25.
Investor Relations programme
Open and constructive engagement with shareholders is
considered vital by the Board, as this enables the Directors to
better understand their views, while establishing and maintaining
goodrelationships.
Our Investor Relations (IR) team acts as the focal point for contact
with key investors and analysts, with an annual programme of
meetings with both existing and potential shareholders, as well
as analyst and investor meetings scheduled throughout the
year. The IR programme includes presentations to institutional
investors and research analysts, in addition to question-and-
answer sessions with stakeholders following the publication
of our full-year and half-year financial results. During 2021,
the Head of IR, as well as the Group Chief Executive and
the Chief Financial Officer, maintained regular dialogue with
institutional shareholders focusing on key operational matters.
Additional meetings were also held with our corporate brokers
to better understand shareholder sentiment in light of ongoing
market pressures.
Governance-specific meetings were also arranged during
the year for the Chairman and Senior Independent Director.
This allowed them the opportunity to gain insights on governance
matters from a shareholder perspective, and to hear directly
from key investors on matters such as succession planning and
remuneration. Analyst research notes are regularly circulated to
all Directors and a formal broker’s report is issued to Directors
inadvance of each Board meeting.
Over the last two years, the vast majority of investor meetings
have been held virtually, as a result of the continuing travel
restrictions imposed by the COVID-19 pandemic. All parties
have adapted well to this virtual environment, with approximately
120 meetings held during 2021. A large proportion of these
meetings were held towards the end of the year, primarily due
to the significant engagement following the conclusion of the
regulatory investigation and the subsequent launch of the
capitalraise and refinancing of debt facilities in October 2021.
The Board plans to continue to develop its comprehensive
programme of stakeholder engagement over the coming year.
Share capital
The Company’s ordinary shares are quoted on the London
Stock Exchange and, at the date of this report, the issued share
capital (and total voting rights) consisted of 521,157,442 ordinary
shares. The Company’s share capital was increased during the
year as a result of the capital raising transaction which took place
inNovember 2021.
The Company is not aware of any agreements between
shareholders that may result in restrictions on the transfer of
securities and/or voting rights. The only restrictions which may
bein force, from time to time, are insider trading regulations
where, in accordance with the UK Market Abuse Regulations,
certain Company employees, including all Directors, are required
to seek approval from the Company to deal in its securities.
The Board requires express authorisation from shareholders to
issue or purchase ordinary shares in the Company. These general
authorities were granted by shareholders at the 2021 AGM, and it is
proposed that they will be renewed at the 2022 AGM. Details relating
to the rights and obligations attached to the Company’s ordinary
shares are set out in the Company’s Articles of Association.
101Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements
Corporate governance
Stakeholder engagement

Major shareholders
In accordance with the Financial Conduct Authority’s Disclosure Guidance and Transparency Rules (DTR 5), information provided to
the Company is published on a Regulatory Information Service and on the Company’s website at the time of receipt. The Company
has received notification of the following material interests in voting rights over the Company’s issued ordinary share capital, noting
that the issued share capital was increased to 521,157,442 on 3 March 2022:
Name
Percentage of issued share capital
as notified at 31 December 2021
Percentage of issued share capital
as notified at 22 March 2022 Nature of holding
Ayman Asfari and family 17.11% 17.07% Direct and indirect
Schroders plc 16.95% 14.69% Indirect
Disclosures required under Listing Rule 9.8.4R
The information required to be disclosed in accordance with Listing Rule 9.8.4R of the Financial Conduct Authority’s Listing Rules
can be located on the following pages of this Annual report and accounts:
Listing rule Detail Page reference
9.8.4R (1-2) - (5-14) Not applicable Not applicable
9.8.4R (4) Long-term incentive schemes 120, 121, 123 and 126
Annual General Meeting (AGM)
Full details of this year’s AGM are set out in the Notice of Meeting.
As a matter of good practice, all resolutions will be conducted on
a poll and the results will be announced to the market as soon as
practicable after the meeting. All shareholders are invited to the
Company’s AGM at which they can put questions to the Board
and meet with those Directors who are able to attend.
Shareholders who are unable to attend the AGM are reminded
that they can submit questions to the Board in advance of the
meeting to agmquestions@petrofac.com. The Board will consider
all questions received and, to the extent practicable, will respond
directly or publish answers on our website. Shareholders are
also encouraged to submit their votes on the resolutions to be
submitted to the 2022 AGM electronically. The results of the
voting will be announced to the London Stock Exchange and
made available on our website as soon as practicable after
themeeting.
At last year’s AGM, all resolutions were passed, with votes in
support ranging from 61.10% to 99.96%.
Response to shareholder voting less than 80%
Following the voting outcome of Resolution 2 (Annual Report on
Remuneration) at the 2021 AGM, the Chairman of the Remuneration
Committee engaged with key investors and proxy advisors to better
understand the views expressed. From this engagement it was
recognised that while the majority of shareholders were supportive
of the key remuneration recommendations, the concerns raised,
which primarily related to the onboarding arrangements for the
new Group Chief Executive, were understood. Having reflected
on the comments received, greater transparency and clarity on
remuneration decision-making processes have been provided
thisyear, with confirmation that all discretionary awards have
beenmade in accordance with remuneration policy and in line
withthe UKCode.
As part of the Chairman’s annual engagement with key investors,
the voting outcome relating to Resolution 7 (re-election of Ayman
Asfari) at the 2021 AGM was discussed. While the position taken
by some shareholders and proxy advisors in relation to former
Executive Directors remaining on the Board is understood,
theBoard is content that Mr Asfari continues to discharge his
role effectively and that his retention on the Board has provided
additional support and stability in a year of significant challenge and
transition for the business. The Board has noted that MrAsfari has
indicated his intention to step down from theBoardat the AGM to
be held in 2023.
Meetings held with shareholders by country
Europe
Rest of World
UK
US
32%
3%
51%
14%
Shareholders’ distribution
Shareholders (ownership) by territory
UK
North America
Rest of Europe
Rest of World
68.1%
13.7%
14.8%
3.4%
102 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Stakeholder engagement
continued

Role and responsibilities of the Committee:
– Review the composition, size and structure of the Board
and its committees, taking into consideration the skills,
knowledge, experience, diversity of gender, social and
ethnic backgrounds, and cognitive and personal strengths
ofDirectors
– Identify and recommend for Board approval suitable
candidates to be appointed to the Board, fully evaluating
thebalance of existing skills, knowledge and experience
required to support the strategic objectives of the Group
– Consider the effectiveness and rigour of the succession
planning processes for the Group and maintain oversight
ofthe development of a diverse pipeline for succession
tobothBoard and senior management roles
Dear shareholder
This report provides an overview of the work of the Nominations
Committee and its activities during the year. There were no
changes to the Committee’s membership during the year.
The biographies for all Committee members are set out on
pages92 and 93.
Board composition
The Committee takes the lead on all Board and committee
appointments, including the process for identifying and
nominating candidates for approval by the Board. The Committee
also oversees the development of a diverse pipeline of candidates
to ensure orderly succession plans are in place for both Board
and senior management positions.
The Committee remains committed to ensuring the Board and its
Committees have the right balance of skills and experience to help
achieve our strategic objectives. Our approach when considering
the recruitment of new Board members involves the adoption of
a formal and transparent procedure, with due regard to the skills,
knowledge, diversity and level of experience required.
Board changes during the year
As we reported last year, following a formal and rigorous
recruitment process, Sami Iskander was appointed as Group
Chief Executive with effect from 1 January 2021, following the
retirement of Ayman Asfari at the end of 2020. Sami’s prior
experience, knowledge and personal strengths were all taken
into consideration during the interview process, and it was
agreed by the Committee that his appointment would provide
strong leadership as well as strengthen the Board, especially
considering the challenges and opportunities facing the Group.
On 31 August 2021, Alastair Cochran stepped down from
theBoard as Chief Financial Officer. Alastair had contributed
tothe Board during his five years with the Company, pioneering
our transformation back to a capital-light business and assisting
in ensuring the Company is positioned for efficient and effective
execution as markets start to recover. Ahead of his departure,
aconsidered succession exercise was undertaken and we were
delighted that Afonso Reis e Sousa was appointed as Alastair’s
replacement with effect from 1 September 2021. Afonso, who
had been with Petrofac for almost nine years on appointment
tothe Board, has extensive experience in a variety of senior
finance roles, most recently as Group Treasurer & Head of
Tax and Group Head of Enterprise Risk. His biography is set
out on page 92. This internal appointment demonstrates the
Committee’s commitment to developing a strong talent pipeline.
Future Board changes
Andrea Abt and George Pierson, having each served on the
Board for two consecutive three-year terms, will step down from
the Board at the 2022 AGM. Accordingly, neither will stand for
re-election. The Board recognises the significant contributions
Andrea and George have each made to Petrofac over the last six
years, not only their substantial time commitments in recent years
but in their resolute support for improving and embedding our
compliance framework across the Group. On the Board’s behalf,
I would like to thank them for their support and for being valued
members of the Board, especially over the last 12 months.
How the Committee spent its time during the year – 2021
Governance/other
Board composition
Diversity and
inclusion
Talent development
24%
28%
21%
27%
René Médori
Chairman of the
Nominations Committee
103Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements
Corporate governance
Nominations Committee report

Director re-election
In line with the findings of our internally facilitated Board
effectiveness review, as set out on page 100, and supported
bytheir biographies (pages 92 and 93), we believe the Directors
possess a broad range of skills and experience froma variety
ofindustries. The Board believes that the electionand re-
electionat the 2022 AGM of those Directors standing is
inthebest interests of the Company. Further details on
theAGMcan be found at www.petrofac.com.
Chairman succession
My own succession has also continued to be a matter of
consideration during 2021. I originally joined the Board as a Non-
executive Director in January 2012, before becoming Chairman
in May 2018. My tenure on the Board accordingly reached nine
years in 2021, which the Board acknowledges is at the maximum
threshold of Provision 19 of the UK Corporate Governance Code.
Given the recent changes and challenges faced by the Group,
and following key shareholder engagement in 2021, it was
previously agreed that I should continue as Chairman until
the AGM in 2022. However, as the SFO investigation was not
concluded until October 2021, and extensive time was required
from the Board in relation to the capital raise and debt refinancing
project in November 2021, the recruitment process to appoint my
successor as Chairman was delayed. The Committee has now
proposed that, given this delay and to provide continuing stability
to the Board, it is content for me to continue as Chairman until
the 2023 AGM, with the process to find a suitable successor to
commence during 2022. It should be noted that Matthias Bichsel,
as Senior Independent Director, chairs all discussions relating to
Chairman succession and I absent myself from thesemeetings.
Succession planning and talent management
Succession planning for senior management remains a key
focus area for the Committee. Significant interest is taken in
thedevelopment of the Group’s future leaders and, on a regular
basis, the Committee considers those employees who have been
identified as high-potential talent from across the Group with the
HR and management teams.
This process is integral to the Group’s strategic plans, and
effective succession planning and the development of a diverse
talent pipeline have been key priorities for the Committee over
thelast few years. Our current talent programme at a senior level
iswell embedded across the Group.
A principal objective for the Committee is to build a strong,
resilient and diverse talent pipeline for the future, which is in
line with Petrofac’s purpose and values, and a key focus has
been to develop employee skills and capabilities for the future.
The progression of emerging talent is reviewed on an annual
basis, not only to check that appropriate processes are in place
to identify and monitor future potential leaders, but also to allow
the Committee to discuss such talent on an individual basis.
A programme has also been developed for Group Executive
Committee members to have individual get-to-know-you meetings
with those employees identified as high performing/high potential
on a cross-divisional basis, with the aim of strengthening the talent
pipeline and developing our succession plans further.
Board evaluation
Our Board evaluation process for 2021 was internally facilitated.
Details of the outcome from the 2020 process, along with actions
arising from the 2021 review, are set out on pages 99 and 100.
In accordance with our three-year cycle, an externally facilitated
evaluation process will be undertaken during 2022.
Director induction process
On appointment to the Board, all new Directors undertake a
detailed, tailored, comprehensive induction programme. This is
intended to account for individuals’ differing requirements and
to concentrate on key focus areas, thus ensuring each Director
is fully prepared for their new role, taking their background and
experience into consideration and, where relevant, to provide
abroad introduction to the Group.
All newly appointed Directors are provided with external
training to address their role and duties, receiving a compulsory
presentation led by our external legal advisors on the duties,
responsibilities and obligations of being a UK-listed company
director. In addition, depending on which committees they will
join, presentations are also provided by the Group’s auditors,
brokers and remuneration consultants.
Our Directors visit the Group’s main operating offices as part
oftheir induction and they are also encouraged to make at least
one site visit each year throughout their tenure. Site visits are
regarded as an important part of continuing education as well as
an essential part of the induction process, as they help Directors
understand the Group’s activities through direct experience
ofseeing operations in action and by having discussions with
arange of employees. Physical site visits have been curtailed
during the last two years as a consequence of COVID-19
imposedtravel restrictions, but, where possible, virtual meetings
havebeen organised.
Sami Iskander, our Group Chief Executive, was appointed to
the Board with effect from 1 January 2021. Having joined the
Company in late 2020 as Deputy Chief Executive, his induction
programme started on joining. Full details of his induction are set
out in our 2020 Annual report and accounts.
Afonso Reis e Sousa, our new Chief Financial Officer, was
appointed to the Board with effect from 1 September 2021.
Having been with the Company for more than eight years,
Afonso already had a deep understanding of Petrofac and had
established strong relationships across the Group. Accordingly,
the focus of his induction has been to increase his understanding
of the role and duties of a Jersey director of a UK-listed company,
with external training provided. This comprehensive induction
process will be ongoing over the coming year.
104 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Nominations Committee report
continued

Diversity and inclusion
The Committee considers diversity and inclusion to be
key factors in the Company’s success. It has continued to
provide oversight to ensure effective strategies are in place
that will develop and strengthen our talent pipelines to deliver
improvements and promote a culture that upholds the Group’s
principles of inclusion, diversity and equality. We believe this
will support the delivery of our strategic objectives, allowing us
to attract a diverse talent base, reflective and representative of
ourcore geographies and of the communities in which we work.
The Committee remains committed to not only helping improve
the levels of female representation throughout the Group, but
to developing a diverse workforce and an inclusive working
environment, irrespective of gender, race, colour, religion, sexual
orientation or marital status. Petrofac aims to create a workplace
that celebrates the diversity of all its employees and stakeholders.
We are committed to engaging everyone from different cultures,
backgrounds and experiences to create an environment of
excellence and to ensure all employees are involved, engaged
andrespected, irrespective of any personal characteristics.
Petrofac is fundamentally a people business and our employees
arethe driving force behind our Group.
The Committee recognises that, as a business, various initiatives
have been implemented to address gender diversity over recent
years, although it is acknowledged that work remains to be done
in terms of diversity, both within our senior leadership positions
and across the organisation. Notwithstanding that engineering
continues to be a predominately male-dominated profession,
we are determinedthat further progress can be made in this
area over the coming years. The gender balance of our Group
Executive Committee remains an area for further improvement,
and while we appreciate there are long-term challenges to
overcome, we are pleased with the significant improvements
thathave been made in respect to gender diversity within the
Group’s talent pipeline.
An overview of our significant progress against the FTSE
Woman Leader Review, formerly the Hampton-Alexander
recommendations, over the last three years areset out below:
2019 33.0%
6.3%
2020
30%
18.7%
2021
30%
25.8%
Women on the Board Women in senior roles
A formal mentoring programme was introduced during 2021,
whereby all members of the Group Executive Committee
have mentored at least one high-potential female employee.
This programme will continue and be expanded in 2022.
Improvements in overall diversity awareness have also continued
throughout 2021, with several initiatives introduced to drive the
diversity agenda further and develop a comprehensive diversity
strategy. Two new employee networking groups, a Women’s
and a Pride network, were established, with key diversity and
inclusion events celebrated throughout the year. We believe this
continued promotion of diversity in its widest sense will lead to
greater engagement across the organisation.
During 2021, work was also undertaken to appoint more local
talent as country leaders in our key revenue generating markets,
with targets set to continue the progress in this area. In addition,
more local nationals have been appointed as country managers
or business development heads in our key markets.
Our Diversity and Inclusion policy, the purpose of which is
to ensure equality of opportunity and fairness in all areas of
employment, has been in place across the Group since August
2016. Our policy allows us to value the diversity of our employees,
while promoting an inclusive culture across theGroup.
The Committee will continue to monitor the Group’s progress
as it delivers improvements in workforce diversity and will make
recommendations to the Board on how to further promote
diversity and inclusion across the Group. Further information
onour approach to diversity and inclusion and the initiatives
taken during 2021 are set out on page 49.
Ethnicity
In terms of ethnicity, Petrofac is a very diverse organisation,
with more than 60 nationalities employed across the Group.
Towards the end of 2021, we launched the voluntary collection
of Ethnicity Data in the UK. To date, more than 33% of our UK
workforce has responded, with 8.4% identifying as BAME.
The Board is also in full compliance with the recommendation
ofthe Parker Review, with four Directors on the Board falling within
the review’s methodology classification
1
.
Employee engagement
My fellow Non-executive Directors and I were pleased to be
able to meet with Workforce Forum representatives twice during
the year. We recognise that this forum has been very beneficial
in allowing us to hear directly from employee representatives,
particularly in light of the significant challenges faced by the
business over the last two years. The Committee remains
committed to engaging with employees to understand their
concerns and to ensure the appropriate culture is in place across
the organisation. The Committee also receives feedback from
employees through the PetroVoices annual survey. Further details
on employee engagement are set out on pages 23, 49 and 50.
Focus for the year ahead
During 2022, the Committee’s primary focus will remain on
mysuccession. However, we will continue to oversee the talent
pipeline and succession initiatives, and monitor the developments
arising from evolving best practice, overseeing actions that will
enable us to meet our diversity targets.
René Médori
Chairman
23 March 2022
1 Those individuals with evident heritage from African, Asian, Middle-Eastern
andSouthAmerican regions.
105
Strategic report Governance Financial statements
Petrofac Limited 2021 Annual report and accounts

David Davies
Chairman of the
Audit Committee
Role and responsibilities of the Committee:
– Monitors the integrity of the Group and Company’s
financialstatements
– Reviews formal announcements relating to the Group’s
financial performance, position and prospects
– Evaluates the significant financial reporting judgements and
estimates and related disclosures, including going concern
assessments and viability statements
– Reviews the effectiveness of risk management and internal
control systems, and provides reasonable assurance to
theBoard
– Monitors and reviews the effectiveness of the Group’s internal
audit function
– Manages the appointment and oversees the independence,
effectiveness and remuneration of the Group’s externalauditor
– Approves the remuneration and terms of engagement of the
Group’s external auditor and makes recommendations to the
Board regarding its reappointment
– Develops, implements and monitors compliance with the non-
audit services policy
– Advises the Board on how it has discharged its responsibilities
and considers whether the Annual report and accounts, taken
as a whole, is fair, balanced and understandable
Dear shareholder
I am pleased to present the report of the Audit Committee,
providing an overview of the Committee’s activities and areas of
focus for this financial year.
Throughout 2021, the Committee was cognisant of the ongoing
challenges facing the Group. The COVID-19 pandemic continued
to have a significant impact on the business, which was reflected
in our financial results.
Consequently, the Committee’s focus has been to ensure
the Group’s risk management and internal control processes
continued to operate effectively and remain appropriate
for the changing environment in which Petrofac operates.
The Committee has also actively challenged the appropriateness
of financial reporting judgements and estimates to ensure the
reliability of the financial statements.
The Committee continues to play a vital role in providing
independent oversight on the risk management process, with
ongoing monitoring of the principal and emerging risks being
faced by the Group. The Committee also reviews an emerging
risks dashboard, which is monitored on an ongoing basis, to
ensure risks have been identified, assessed, treated and reported
appropriately.
Throughout 2021, the assumptions and evidence supporting
the going concern and viability statements were reviewed and
challenged extensively by the Committee. Financial models
of scenarios prepared by management demonstrating the
ongoing operational challenges, including the potential impact
of COVID-19 on the business over the assessment period, as
well as the liquidity position of the Group, the principal risks, the
level of headroom against committed facilities and compliance
with financial covenants, were considered by the Committee.
Taking into consideration the detailed analysis undertaken, the
Committee was satisfied that the going concern and viability
statements were appropriate.
2021 saw the conclusion to the legacy SFO investigation.
Following this, a capital raise and the refinancing of debt facilities
was undertaken in the second half of the year. Unsurprisingly, this
was a significant area of focus for the Committee.
A key role of the Committee is to provide assurance to the Board
that it is satisfied that the Annual report and accounts are fair,
balanced and understandable, and provide the information
necessary for shareholders to assess the Company’s position,
performance, business model and strategy. Our review process,
which confirms the Committee is content to provide this
assurance, is set out on page 110.
How the Audit Committee spent its time during the year – 2021
External audit,
including non-audit
services review
Finance reporting
Finance reporting:
Going concern
Governance matters
Risk management
and internal
control systems
Tax
Refinancing
18%
21%
5%
6%
32%
2%
16%
106 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Audit Committee report

Looking ahead
Over the coming year, it is likely that the Group will continue to
face challenges related to COVID-19 and the market dynamics
continuing to impact the sector.
The Committee will continue to maintain its focus on significant
judgements and estimates impacting financial reporting and will
look to further enhance the Group’s principal risks reporting,
including improved articulation of the overall risk appetite to
ensure the effective oversight of risk management and internal
controls by the Committee.
The Committee will continue to monitor the ongoing
developments in the UK’s audit environment, including the
reforms proposed by UK Government’s Department for Business,
Energy & Industry Strategy (BEIS) to improve trust in audit and
corporate governance, following its consultation on the formation
of a new regulator, the Audit Reporting and Governance Authority
(ARGA), which is expected to be in place from April 2023.
The Committee will work to ensure that the Group has
appropriate plans in place and is compliant with any new
regulations when they come into force.
I would like to thank my fellow Committee members, other
Directors and the management team, and the internal
and external auditors for their continued support, for the
open discussions held, and for the contributions provided
in the support of the Committee’s work throughout this
challengingyear.
David Davies
Chairman of the Audit Committee
23 March 2022
Principal matters considered during the year by the Audit Committee
The Committee met eight times during the year, with meetings coinciding with key points in the financial reporting cycle. Additional meetings
were also held during the year to consider the refinancing project. The principal matters reviewed and considered were as follows:
Financial reporting – Reviewed and discussed reports from the Chief Financial Officer on the financial statements, considered
management’s accounting judgements and the policies being applied
– Reviewed and assessed the principal accounting matters in relation to the full-year and half-year reporting
periods
– Reviewed the Annual report and accounts and provided a recommendation to the Board that, as awhole,
it complied with the 2018 UK Code principle to be ‘fair, balanced and understandable’
– Reviewed and recommended for Board approval the press releases relating to the full year and halfyear
– Considered the implications of the new EU legislation for the European single electronic reporting format
(ESEF) and reviewed the obligations to enable reports to be prepared, published and filed in accordance
with the requirements
Going concern – Reviewed and approved the going concern and viability statements for inclusion in the Annual report and
accounts
Internal audit – Considered and discussed the internal audit reports presented at each meeting
– Provided assurance that management had resolved or was in the process of resolving any outstanding
issues and actions
– Reviewed and approved the internal audit plan for the year
External audit – Considered the Group external auditor’s year-end audit observations
– Agreed the statutory audit fee for the year
– Considered the Group external auditor’s letters to management and its interim results review
– Discussed, reviewed and approved the non-audit services and fees
– Considered the Group external auditor’s 2021 year-end planning report
Internal
controls and
riskmanagement
– Reviewed the effectiveness of the Group’s Enterprise Risk Management (ERM) processes and procedures
and internal control systems
– Reviewed the Group’s principal risks and risk appetite
– Reviewed the Treasury Risk Management Policy
Governance – Reviewed the Committee’s terms of reference and recommended they be approved by the Board
– Received an update from the Group external auditor on the changes to be introduced in the audit and
governance landscape
Other – Discussed, reviewed and recommended for Board approval all elements of the capital raise and debt
refinancing project
– Reviewed and approved the annual tax update
– Reviewed and approved the change in accounting policy regarding configuration and customisation
costs incurred in implementing Software-as-a-Service (SaaS) and the resulting prior year restatement
disclosures, following the publication of the April 2021 IFRIC agenda decision
– Reviewed and approved the 2021 insurance programme renewal
107Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Accountability
Committee composition
There have been no changes to the Committee’s membership
during 2021. However, at the AGM to be held in May 2022,
George Pierson will be stepping down from the Board, having
served for six years. Sara Akbar will be appointed to the
Committee from May 2022. Biographical details of the current
and future Committee members are set out on pages 92 and 93.
As required by the UK Code, the Board is satisfied that the
Committee members have met the expected independence
andexperience parameters. David Davies has significant, recent
and relevant financial experience, while Matthias Bichsel and
George Pierson have competence relevant to the Group’s sector.
Furthermore, all members of the Committee have extensive general
management and commercial expertise.
To assist the Committee in its deliberations, the Chairman and all
other Board members are invited to attend all Committee meetings.
In addition, the Head of Audit, the Director of Group Finance and the
Senior Enterprise Risk Manager are also invited to attend all or part
of any meeting, as and when considered appropriate or necessary.
The lead audit partner from Ernst & Young LLP also has a standing
invitation to attend all Committee meetings.
Role and responsibilities
The Committee’s purpose is to assist the Board in the effective
discharge of its responsibilities for financial reporting, internal
control and risk management. The Committee believes it is
well positioned to challenge and debate the performance and
relevance of the Group’s financial reporting, risk management
and internal controls to safeguard the interests of shareholders
and other stakeholders.
The Group has an internal control and risk management
framework in place, which includes policies, standards and
procedures, to ensure that adequate accounting records are
maintained, and transactions are accurately recorded. In addition,
the Committee has oversight of financial initiatives that remain
under continuous review, which are designed to strengthen our
control environment and improve financial reporting. This ensures
that the Group’s financial reporting process and communications
to the market provide a fair, balanced and understandable
assessment of the Group’s performance, position and prospects.
Internal Audit
Internal Audit is an independent assurance function available
tothe Board, the Committee and all levels of management.
The role of Internal Audit is to provide independent and objective
assurance and advice on the overall design of the Group’s
risk management, internal control systems, and governance
processes. Internal Audit appropriately challenges and supports
executive management to improve the effectiveness of these
processes and provides assurance that any corrective action
required is taken in a timely manner.
At each Committee meeting, the Head of Audit presents an update
covering an overview of the work undertaken during the period,
actions arising from audits conducted, the tracking of remedial
actions, audit resources, and progress against the internal audit plan.
The Committee also meets with the Head of Audit without
executive management present, to discuss, among other matters,
management’s responsiveness to any recommendations and the
effectiveness of the internal audit process. The Head of Audit
hasdirect access to the Committee Chairman and meets with
the Group’s external auditor whenever required.
Each year, internal audit develops an annual risk-based audit
programme for approval by the Committee. The Group’s internal
audit programme for 2021 was considered and approved bythe
Committee in November 2020. The 2021 programme was further
developed during the year to take into account the Group’s
principal risks, identifying where they primarily occur in the
business; through discussions with the Committee and senior
management; recognising changes in the Group and the external
environment; and with consideration to prior audit coverage.
In approving the 2021 audit programme, the Committee
considered the coverage of the Group’s principal risks by the
proposed audits. It was agreed that primary focus should be
onthe design and operating effectiveness of controls to manage
risks associated with overarching management controls, such
as the compliance programme and compliance due diligence
processes; controls designed to prevent non-compliance with
laws and regulations, such as money laundering, trade sanctions,
tax governance, and remote office controls; project level controls
such as project governance processes, project and logistics
management; health and safety controls; financial controls; digital
and automation initiatives; and governance controls in the ongoing
Group-wide ERP project.
One of the Committee’s key roles is to challenge this audit
programme, and specifically to determine whether the key
risk areas identified as part of our risk management process
are being audited with appropriate frequency and depth.
Following the completion of each planned audit, Internal Audit
seeks feedback from management and reports to the Committee
onthe findings of the audit, detailing progress, and including
any key findings or actions that may be required. Where any
significant areas of concern are identified during an audit,
an implementation plan is agreed with management for any
required corrective actions to be addressed on a timely basis,
with follow-up audits arranged. Action closures are reported
to,andmonitored by, the Committee.
During 2021, 19 internal audit assignments were carried out,
the results of which were included in Internal Audit’s annual
assessment of the audited elements of the system of internal
controls. In response to the COVID-19 restrictions, Internal
Audit implemented an enhanced and agile audit methodology,
consisting of weekly team reviews to inform audit testing and
align risks, leveraging technology where possible.
Where new audit findings were identified, management
actions were agreed and all Group level findings and agreed
management actions were reported to the Committee, enabling
progress to be monitored and trends to be identified. All Group
level findings were carefully considered by the Committee, with
management direction given to ensure the necessary steps
were taken to mitigate any arising issues. In November 2021,
theCommittee reviewed and approved the Internal Audit Charter
and Internal Audit programme for 2022.
To assist Group Compliance, Internal Audit continued to assist
inthe triaging of allegations raised from the confidential Speak Up
line to the appropriate teams for investigation, providing support
to the relevant investigations based on specific requests from
Group Compliance.
108 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Audit Committee report
continued

Risk management
The Board has overall responsibility for establishing the Group’s
risk appetite, its enterprise risk processes and for ensuring
that the Group has in place an effective risk management
framework. In accordance with the requirements of the Guidance
on Risk Management, Internal Control and Related Financial
and Business Reporting published by the FRC, the Board has
delegated responsibility to the Committee for monitoring and
reviewing the integrity and effectiveness of the Group’s overall
systems of risk management and internal controls.
Major improvements this year, driven by this review, included
the centralisation of the value assurance function and the
establishment of a value assurance framework to enable
moreefficient and aligned assurance efforts throughout each
project’s life cycle and operations. Compliance controls have
alsobeen overseen and the review of and improvement of these
controls are further detailed on pages 60 and 61. Additionally,
when needed, the Board or other Board committees perform
deep dives into principal risk areas and provide feedback
totheCommittee.
The Committee performed a robust review of the Company’s
principal and emerging risks and uncertainties during the
year. The assessment of these risks is detailed on pages
62to 69. COVID-19 continued to have a major influence on
the Group’s principal risks, with order intake and compliance
with laws, regulations and ethical standards remaining a major
focus. Following the conclusion of the SFO investigation, there
hasbeenan improvement in the Group’s overall risk profile.
The Group’s principal risk reports are updated each quarter,
capturing and assessing the principal and emerging risks
facingthe Group. These reports outline how risks are managed,
and monitor exposures against the Group’s risk appetite.
The principal risk reports, along with other management
reports submitted to the Committee, provide assurance on the
robustness, integrity and effectiveness of the systems in place,
including those that could threaten the Group’s business model,
operations, future performance, solvency and liquidity. This helps
to provide the Committee with a balanced assessment of the
Group’s principal risks and the effectiveness of the systems
ofinternal controls.
The Committee, in line with the processes described above and on
pages 60 and 61, and in accordance with the FRC guidance cited
above, performed the review on the integrity andeffectiveness
of the Group’s overall systems of risk management and internal
controls, including financial, operational and compliance controls.
As a result, the Committee was content to provide confirmation
to the Board that the systems of internal control, including risk
management and the risk framework and processes, operated
effectively during 2021.
Further details of the Group’s risk management systems
and controls, including an overview of the risk governance
and management frameworks, as well as the key principal
and emerging risks of the business and how those risks are
identifiedand managed, are presented on pages 60 to 69.
Internal controls
Petrofac aims to ensure that a sound system of internal controls,
based on the Group’s policies, standards and procedures, remains
in place for all material associate and joint arrangement entities.
Where any failings or weaknesses are identified in the course of
a review of internal control systems, management puts in place
robust actions to address these on a timely basis, with action
closures reported to and monitored by the Committee.
As with all companies, an internal control system can provide
only reasonable and not absolute assurance against material
financial misstatement or fraud, as it is designed to manage
rather than eliminate the risk of failure to achieve business
objectives. The Committee is content that the ongoing reviews
have established that management places a strong focus on
closingaudit actions and ensuring timely completion.
Insurance programme
Petrofac utilises the insurance market as a risk transfer
mechanism to cover the types of insurable risks normally
associated with an energy services provider, operating in similar
challenging territories across the world. The cover procured is
structured under a Group-wide insurance programme, designed
to avoid potential coverage gaps and duplication across the
Group, whilst also ensuring that the Group benefits from
economies of scale.
The effectiveness of the various global insurance policies is
continually challenged against business activities, to ensure
that the insurance cover will respond to our ever-changing risk
exposures. This stress-testing also provides additional certainty
that our cover remains as wide as commonly available across the
insurance market, whilst continuing to represent a cost-effective
risk transfer solution, considering various factors, including policy
limits, deductible levels, and policy conditions. During 2021,
a structured and targeted marketing exercise concerning the
main Group policies was undertaken. As previously reported, the
insurance market has undergone significant challenges in recent
years, as underwriters reduce their appetite for certain risks,
particularly those associated with the oil and gas industry. This has
resulted in a reduction in market capacity, blanket rate increases
and more restricted cover. Following detailed engagement, the
2021 Group insurance programme was renewed at an overall
increase in cost of just 1% compared with 2020.
These challenging market conditions have continued into early
2022. The extent of rate increases appears to be abating, with
the Group insurance policies due for renewal in April 2022.
Treasury
As part of its remit, the Committee supports the Board in
monitoring performance against the Group’s funding plan,
aswell as reviewing the Group’s compliance with the Treasury
Risk Management Policy, a copy of which is available at
www.petrofac.com. During the year, the Committee continued
toclosely monitor the Group’s funding and liquidity, particularly
in light of the economic impact of COVID-19 and the ongoing
challenging market conditions facing the Group and the
resulting effect on financing. Following the resolution of the SFO
investigation, the Committee reviewed and addressed the Group’s
funding and liquidity position. This resulted in a successful capital
raise and debt refinancing initiative, which was completed in
November 2021. Further details are set out on page 87.
109Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Assurance
At the year-end, and as required by the UK Code, formal
assurance is provided to the Board that effective governance,
risk management and internal control processes are in place
and remain relevant, to ensure that the Group will continue to
beviable for at least the next three years. This assurance covers
all material controls, including strategic, financial, operational
and compliance controls. Further details on the overall control
processes are set out on pages 108 to 110.
Fair, balanced and understandable
Each year, the Committee advises the Board on whether, in its
opinion, the Annual Report and Accounts (Annual Report) when
taken as a whole is fair, balanced and understandable, and
provides the information necessary for shareholders to assess
the Group’s position, performance, business model and strategy.
Throughout 2021, the Committee monitored the integrity
ofthe Group’s reporting process and financial management,
considered the results of management’s assessment of going
concern and viability, reviewed in detail the work of the external
auditor, and reviewed the significant financial judgements and
estimates made by management.
In reaching its conclusion, the Committee assessed the results of
the processes undertaken by management to provide assurance
that the Group’s financial statements were fairly presented.
The processes included a review of all material matters to
ensure that the Annual Report correctly reflected the Company’s
performance during the reporting year, and fairly reflected the
continuing impact of the COVID-19 pandemic on the business,
toensure it presented a consistent message throughout.
This process was led by an internal team, consisting of
members of the Group Finance, Company Secretariat, Group
Communications and Investor Relations teams, who each
collaboratively prepare sections of the Annual Report. This team
also performed procedures to provide assurance to the Committee
that the Annual Report was balanced, complete and accurate.
This ensured that there was a clear and integrated link between
the three main sections of the Annual Report – the Strategic
report; the governance report; and the financial statements.
Each Committee Chair participated in the preparation of their
individual Committee report, with the Board and management
afforded the opportunity to submit their comments during the
preparation process. The Committee was then presented with
afull and final draft of the Annual Report for comment.
The Committee concluded that following its review, it was content
to present the 2021 Annual Report to the Board for final approval
with an assurance that it was fair, balanced and understandable,
it was representative of the year under review, and provided
shareholders with the necessary information to assess the
Group’s position, performance, business model and strategy.
The Board subsequently approved the Committee’s
recommendation that a fair, balanced and understandable
statement reflecting this conclusion could be provided.
This statement is set out on page 128. The Group’s external
auditor’s report can be found on pages 130 to 140.
Group external auditor
Ernst & Young LLP (EY) continued as the Group and Company’s
global external auditor throughout the year. In accordance with
regulation, the lead audit partner responsible for the Group audit
was last rotated at the end of the 2017 audit. The current external
lead audit partner, Mr Colin Brown, will be required to rotate after
the conclusion of the 2022 audit.
The Committee considers the effectiveness of the external
auditor on an ongoing basis, considering its independence,
expertise, performance and understanding of the Group, its
resourcing capabilities, culture, and objectivity. The Committee
remains satisfied, through its own observations and enquiries,
aswell as the interactions with executive management
throughout the year, with the independence and objectivity
of the external auditor and the effectiveness of the audit
process. In making this assessment, the Committee gave
due consideration to the information and content of reports
and advice provided, the execution of the audit plan, and the
robustness of EY’s understanding and challenge to management
on key accounting matters.
During the year, the Committee met with the lead audit partner
on several occasions without management present, to discuss a
range of customary financial reporting and internal control matters.
The Committee Chairman also maintained regular contact with
the lead audit partner throughout the year outside of the formal
meeting schedule, discussing formal agenda items ahead of
upcoming meetings and reviewing any other significant matters.
Each year, EY submits its proposed audit strategy and scope,
thereby ensuring the audit can be aligned with the Committee’s
expectations. This work is carried out with due regard to
the identification and assessment of business and financial
statement risks that could impact the audit as well as continuing
developments within the Group.
During 2021, the audit scope focused on management’s
judgements and estimates concerning fixed-price engineering,
procurement and construction contracts; robustness of
management’s going concern and viability statement
assessments and disclosures; impairment assessments
andfair value re-measurements; uncertain tax treatments
andrecoverability of deferred tax assets; consideration of the
macro-economic challenges being faced by the Group as
a resultof the COVID-19 pandemic in key markets; HMRC’s
challenge to the historical application of national insurance
contributions; accounting matters arising from the SFO
investigation; presentation of the separately disclosed items;
accounting matters arising from the Group’s capital raise
and debt refinancing; and accounting for cloud computing
implementation costs following the IFRS Interpretations
Committee decision issued in April 2021.
In 2021, the Committee requested that EY perform a
review on the Group’s 2021 half-year financial statements
and, inaddition, engaged them to complete the reporting
accountant work required in respect of the capital raise
anddebtrefinancingproject.
110 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Audit Committee report
continued

Audit tenure
Petrofac is fully compliant with the provisions of The Statutory
Audit Services for Large Companies Market Investigation
(Mandatory Use of Competitive Tender Processes and Audit
Committee Responsibilities) Order 2014 (the Order) as at
31 December 2021.
The Order provides that the Company must put its statutory
audit services engagement out to tender no less frequently than
every 10 years. While this order is not requried to be complied
with under Jersey law, it was applied voluntarily. Petrofac last
conducted a competitive tender process in 2016 and, following
completion of this exercise, the Committee recommended that
EY be retained as the Company’s external auditor. In making this
recommendation, the Committee concluded that the decision
was in the best interests of the Company and its shareholders.
EY was first appointed as external auditor in October 2005 and
the last year it will be permitted to act as external auditor for the
Group and Companywill be 2024, which is the 20-year audit
limit permitted under the Order. As a result, the next competitive
tender process will take place no later than 2024.
Non-audit services
To preserve the independence and objectivity of the external
auditor, the Group has a non-audit services policy that restricts
the nature of non-audit services that can be provided by the
external auditor. This policy was last reviewed and amended in
2020 to reflect the FRC’s latest Ethical Standards and the more
restrictive list of services that are now permitted for an equivalent
UK company with a premium listing. The policy provides clear
definitions of the services that our external auditor may and may
not undertake. A summary of this policy is set out below, while
acopy of the full policy can be found at www.petrofac.com.
To ensure compliance with the policy, the Committee reviews
the Group’s cumulative non-audit expenditure each year and
gives prior approval to the appointment of EY before any work
is carried out should the nature or size of the proposed work
require it.
The Committee is satisfied that EY’s objectivity and
independence was not impaired during the year by any non-
audit service agreements and confirms there were no breaches
to the policy during 2021. In addition, EY has confirmed that
it was compliant with FRC Ethical Standards in relation to the
auditengagement.
For 2021, there was an increase in the non-audit spend.
The increase was primarily driven by management’s decision,
approved by the Committee, to engage EY to perform a Group
half-year review, in addition to the reporting accountant work
completed in respect of the capital raise and debt refinancing
project. This resulted in the non-audit spend for the year, as a
percentage of the overall audit fee, being 46.7% (2020: 4.2%).
Had these two items been excluded, the non-audit spend for
theyear, as a percentage of the overall audit fee, would have
been 4.0%.
All engagements during 2021 were pre-approved by the
ChiefFinancial Officer or by the Chair of the Audit Committee
anddid not include any activities defined as prohibited services
by the Group’s non-audit services policy. In addition, and in
parallel, EY performed similar safeguarding procedures to ensure
that the proposed non-audit engagements could be accepted.
Non-audit services policy summary:
– There is a general prohibition on the provision of non-audit
services by the Group external auditor (and its network) which
applies to Petrofac Limited and its subsidiaries. A narrow list of
permitted non-audit services will continue to be allowed
– Certain non-audit services are subject to an absolute
prohibition
– Permitted non-audit services (other than those required
by national legislation) provided to Petrofac Limited and its
subsidiaries are subject to a 70% cap (the Cap)
– The Cap is defined as permitted non-audit fees (other than
those required by national legislation) expected to be incurred
in the current financial year not exceeding 70% of the average
Group statutory audit fees for the previous three financial
years
– If the Cap is expected to be breached, then the Audit Committee
must be informed in advance to ensure that enhanced
procedures are performed to obtain assurance on the Group
external auditor’s independence and objectivity (as defined
byreference to the FRC’s Revised Ethical Standard 2019)
– All permitted non-audit services are subject to the prior
approval of the Committee in advance of work commencing,
subject to limited exceptions*
– The Chief Financial Officer’s (the CFO) approval is required
prior to engaging the Group auditor on any pre-approved
permitted non-audit services*
– The CFO will ensure that a full list of permitted non-audit
service engagement, associated fees and continued
compliance with the Cap is presented to the Committee every
six months unless the Cap is expected to be breached
– The Audit Committee will seek assurance at least once a
year from the Group auditor on its policy and safeguards to
maintain independence and objectivity
* Committee pre-approval for permitted non-audit services is given where the estimated
cumulative engagement fee in any one financial year is below US$50,000.
All services with estimated fee levels above the cumulative
US$50,000 threshold must be sent to the Committee for approval
prior to commencement of the engagement even if defined as
permitted non-audit services.
111Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Significant judgements
The Committee is responsible for reviewing and assessing whether the significant reporting judgements contained in the Group’s
financial statements are reasonable and appropriate.
Focus area Why this area is significant Role of the Committee Conclusion
Revenue and
margin recognition
on fixed-price EPC
contracts
Financial review on
page 83 and Note
4 to the Financial
statements on page
163
The quantification and timing of
revenue and profit recognition
from fixed-price EPC contracts
is a material driver of the
Group’s financial performance
and position, which is subject
to significant management
judgement and estimation. There
is an inherent risk of bias or error
in judgements and estimates
concerning, for instance: variable
consideration e.g. variation orders,
liquidated damages; contract
contingencies; and estimate-to-
complete cost forecasts.
The Committee reviewed and
challenged the reasonableness of
evidence to support judgements
and estimates regarding revenue
and profit recognition, including
non-recognition in certain instances,
through regular discussions with
executivemanagement.
The Committee focused on variable
consideration; contract contingencies;
and estimate-to-complete cost
forecasts, particularly in light of the
ongoing deterioration in market
conditions caused by the pandemic
and the below-expectation order intake.
The Group’s external auditor also
challenged management on the key
drivers of revenue and profit recognition
on fixed-price EPC contracts and
reported its findings to the Committee.
The Committee concluded after
thorough deliberation that the
quantification and timing of revenue
and profit recognition on fixed-price
EPC contracts, as well as associated
reporting, was in accordance with
the relevant International Financial
Reporting Standards and the Group’s
accounting policies.
Accounting
for contingent
and deferred
consideration
Financial review on
page 86 and Note
11 to the Financial
statements on page
173
Executive management made
several key judgements and
estimates, under conditions of
high uncertainty, associated with
the recoverability of contingent
and deferred consideration arising
from past disposals.
The Committee evaluated the
reasonableness and appropriateness
ofinternally generated data and
other data points used in determining
judgements and estimates through
reviewing and challenging management
papers presented.
The Committee also examined the
notes of the consolidated financial
statements to ensure the risks
associated with these judgements and
estimates were clear and complete.
The Committee was satisfied
that reasonable and appropriate
judgements and estimates were
applied by management on the
financial recognition, measurement
and disclosure of these focusareas.
Recoverability of
PM304 oil and gas
asset
Financial review on
page 83 and Note
6 to the Financial
statements on page
167
Executive management made
several key judgements and
estimates, under conditions of
high uncertainty, associated with
the recoverability of the PM304
oil and gas asset. This included
determining the fair value of the
assets in light of the current
adverse economic developments
and the ongoing commercial
negotiations with the client
regarding the Company’s existing
production sharing contract which
is scheduled to expire in 2026.
The Committee evaluated the
reasonableness and appropriateness
of internally generated data and
other data points used in determining
judgements and estimates through
reviewing and challenging management
papers presented. The Committee also
examined the notes of the consolidated
financial statements to ensure the risks
associated with these judgements and
estimates were clear and complete.
The Committee was satisfied
that reasonable and appropriate
judgements and estimates were
applied by management on the
financial recognition, measurement
and disclosure of these focus areas.
Taxation
Financial review on
page 85 and Note
8 to the Financial
statements on page
170
The global nature of the Group’s
operations and the increasingly
complex nature of local tax rules
increases the risk of an income
tax expense misstatement.
Management is required to make
several judgements and estimates
around: uncertain tax treatments
given the commercial structure
of individual contracts; the
increasing activity of the relevant
tax authorities; and the valuation
and recoverability of deferred
taxassets.
The Group’s tax judgements and
estimates were reviewed by the
Committee to ensure that the
recognition of income tax expense,
uncertain tax treatments, and deferred
tax assets were based on reasonable
and appropriate assumptions.
Reports outlining principal tax matters
were reviewed and discussed with
management and the Group’s external
auditor, which also reported to the
Committee on its procedures and
findings in relation to the Group’s
taxaffairs.
The Committee was satisfied
that taxation-related judgements
and estimates were reasonable
and appropriate and that the
Group’s tax affairs were being
managed, accounted and reported
in accordance with the relevant
legislation, International Financial
Reporting Standards and Group
policies.
112 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Audit Committee report
continued

Focus area Why this area is significant Role of the Committee Conclusion
Intangible assets
- capitalisation
of cloud-based
software and
development costs
Financial review on
page 85 and Note
2.7 to the Financial
statements on page
150
Management has made
judgements when applying
the Group’s new accounting
policy in relation to the IFRIC
agenda decision regarding
configuration and customisation
costs incurred in implementing
SaaS. Where software costs
are incurred as part of a service
agreement, judgement is required
in assessing whether the Group
has control over the resources
defined in the arrangement.
Such judgements are inherently
subjective and can have a material
impact on determining whether
such costs should be capitalised
or expensed as incurred.
The Committee evaluated the
reasonableness and appropriateness
of the new accounting policy and
the assessment of the data used in
determining judgements and estimates
through reviewing and challenging
management papers presented. The
Committee also examined the notes of
the consolidated financial statements to
ensure the disclosures associated with
these judgements and estimates were
clear and complete.
The Committee was satisfied
that the new accounting policy
was appropriate and consistent
with the IFRIC agenda decision
released during the year, and
that reasonable and appropriate
judgements and estimates were
applied by management on applying
this standard, both in the year
and in respect of the prior year
restatements.
Going concern
andviability
Notes 2.5 and 2.7
to the Financial
statements on pages
147 to 151
Management is required to make
a decision whether to prepare the
Group’s financial statements on a
going concern basis.
The Committee spent considerable
time throughout the year discussing
going concern and performed a robust
assessment over the going concern
assessment period to 31 March 2023
(the Assessment Period) and the
period beyond. This included reviewing
and challenging the Group’s forecast
cash flows, liquidity and borrowing
requirements; evaluating downside
scenarios based on the Group’s
principal risks and uncertainties; and
appraising the mitigation strategies
available to management.
The Committee also evaluated
the going concern disclosure to
ensure that it was fair, balanced
andunderstandable.
The Committee concluded, after
rigorously evaluating relevant,
available information, and following
completion of the refinancing
project, that there were no events or
conditions that may cast significant
doubt upon the Group’s ability to
continue as a going concern over
the Assessment Period and that the
continued use of the going concern
basis of preparing the Group’s
financial statements remained
appropriate.
The Committee recommended to the
Board that the going concern basis
of preparing the financial statements
could be adopted together with
management’s proposed going
concern disclosure.
Provision
recognition or
contingent liability
disclosure of Her
Majesty’s Revenue
and Custom’s
(HMRC) challenge
to the historical
application of
National Insurance
Contributions to
workers in the
United Kingdom’s
Continental Shelf
Note 30 to the
Financial statements
on page 196
Several key judgements,
under conditions of significant
uncertainty, were required in
relation to determining whether
recognition or disclosure of this
matter was required. This included
but was not limited to assessing
the applicability of tax legislation
cited by HMRC to the facts of the
enquiry; and critically evaluating
advice from independent legal
and tax specialists.
The Committee evaluated
management’s assessment of
developments during 2021. In
particular, the Committee focused
on ensuring that management had
critically appraised advice provided by
independent legal and tax specialists
as well as ensuring that there was an
awareness and prevention of inherent
bias implicit in management’s position.
The Committee concluded, after
reviewing information and challenging
management, that it remained
appropriate for this matter to continue
to be disclosed as a contingent
liability note in the consolidated
financial statements.
113Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

George Pierson
Chairman of the
Compliance and Ethics
Committee
Role and responsibilities of the Committee:
– To maintain direct oversight over key compliance and ethical
risks and monitor the adequacy and effectiveness of controls
in place and any mitigation activities
– To evaluate the compliance and ethical aspects of Group
culture and make recommendations to the Board on steps
to be taken to ensure a culture of integrity and honesty in the
Group’s business dealings
– To ensure that ethical policies and practices are subject
to an appropriate level of independent internal scrutiny;
overseeing the development of, and amendments to, the
Group Compliance Charter, its Code of Conduct and other
compliance policies, procedures and standards
– To support the Company in any engagement with regulatory
bodies, industry groups, advisors and other stakeholders,
as necessary and where permitted by law, regarding ethical
issues and compliance matters
– To oversee, review and approve the adequacy and security
of the Group’s whistleblowing line as a tool available for
employees and third parties to raise concerns, in confidence,
about possible wrongdoing
– To receive reports and review findings of significant internal
and external compliance-related investigations and audits and
exercise oversight, where possible, over any such investigation
impacting the Group
Dear shareholder
2021 saw further compliance improvements being embedded
throughout the Group. The Committee continued to oversee
existing processes, while providing challenge to management,
to ensure the adequacy and effectiveness of the Group’s
compliance activities could be maintained or improved.
Regular updates from the Group Compliance function were
received and direct engagement with management took place
throughout the year.
Notwithstanding the conclusion of the SFO investigation,
theCommittee recognises the need to ensure that compliance
processes are continuously developed, proportionate to the
risks identified. This ongoing and improved monitoring provides
enhanced insight and greater assurance into the effectiveness
ofthe compliance programme. The Committee acknowledges the
improvements that have been achieved to automate compliance
processes and to close out actions quicker, but accepts that work
must continue to drive the compliance agenda forward.
Committee membership
There were no changes to the Committee’s membership
during2021. However, at the 2022 AGM, Andrea Abt and
I willbe stepping down from the Board, both of us having
served for six years. As a result, Francesca Di Carlo and David
Davies will be appointed to the Committee from May 2022, with
Francesca succeeding me as Committee Chair. Over the last
two years, both have received all Committee papers and, where
diaries have permitted, attended Committee meetings. We are
confident that Francesca’s operational and HR background, in
addition to her experience as VP for Audit and Compliance for
Enel between 2008 and 2014, coupled with David’s extensive
financialcontrols and audit experience, will support and oversee
the Board’s continued leadership of this critical area as we work
to build a more transparent and open culture across the Group.
Biographical details of the current and future Committee members
are set out on pages 92 and 93.
To assist the Committee in its deliberations, the Chairman, other
Board members, the Group General Counsel, Chief Compliance
Officer and Director of Investigations are invited to attend all
Committee meetings. In addition, the Head of Audit, along with
external advisors, may be invited to attend all or part of any
meeting, when considered appropriate or necessary.
Gap analysis
Following a recommendation by the Committee, a gap analysis
on the current compliance programme was undertaken in
early 2021. This review, performed in consultation with Freeh
Sporkin &Sullivan, LLP (FSS), an external body which originally
commenced working with the Company when it conducted
an external review of the compliance function in 2019, aimed
toidentify any potential areas that required additional review.
The scope of the gap analysis involved a robust and thorough
self-evaluation programme, with documented analysis prepared
for each element of the compliance function. Where gaps were
identified, the analysis set out defined actions, assigned priorities,
specific owners, time horizons, and the desired end-state of
each item, to ensure gaps could be narrowed or, ideally, closed.
These identified actions were closely monitored and reviewed
quarterly with FSS. The aim of the exercise, which was carried
out in line with legal expectations set out by the UK Ministry
Whistleblowing
Compliance
strategy
Compliance
programme review
Governance/other
Third Party Risk
Committee
33%
22%
35%
8%
2%
How the Committee spent its time during the year – 2021
114 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Compliance and Ethics
Committeereport

of Justice, was to provide certainty to the Committee that the
Group had a well-functioning compliance programme in place
tomeet external expectations. Progress reports were provided
to the Committee at each meeting and it is intended that this
gapanalysis review will berevisited by the end of 2022.
Evaluation and monitoring programme
To provide continuous improvement of the compliance
programme, to ensure its effectiveness, and assure that the
prevention and detection mechanisms are fully operational, an
evaluation and monitoring programme was also designed during
the year. This was led by the Group Compliance team, in line with
best practice, and reviewed externally by FSS. Specific testing
was designed and conducted to ensure continued improvements
and enhancements to the programme could be identified and
progress maintained. A ‘traffic light’ system was introduced
to ensure all compliance elements were both in place and
workingas expected. This programme will be built into ongoing
compliance processes, with reports provided to the Committee
ateach meeting.
Compliance function
As part of the development of the Group Compliance function,
further appointments to the investigations team were made
during 2021. These new appointments enabled the skills within
the team to be enhanced, while providing the opportunity to
further embed the cultural tone being permeated throughout the
Group. These additional resources ensured that lead times for
performing increased due diligence requests and turnaround
times in responding to an increased number of investigations
were not negatively impacted.
At the end of 2020, a Compliance focal point programme was
introduced to facilitate improved engagement and interaction
with the business. During 2021, this programme was further
developed and has provided an increased level of compliance
oversight and visibility at an operational level, with improved
interaction at all levels.
Due diligence
During 2021, Petrofac transitioned to a new external due diligence
platform operated by Dow Jones. While the implementation was
slightly delayed as work was undertaken to integrate the relevant
IT systems, ahead of the go-live date, more than 40,000 existing
third parties and related entities were migrated to the new
platform. For 2022, the process will be further refined to enhance
our approach to due diligence reviews, thereby increasing the
emphasis on compliance evaluation and ongoing monitoring
ofallthird parties.
Training
The Group’s revised Code of Conduct was formally launched
inJanuary 2020, following which a mandatory e-learning training
module was rolled out to the 2,600 most senior employees
across the Group. This programme continued into 2021 and was
provided to a further 7,000 employees, including all new hires,
with the aim of entrenching the key messages and empowering
individuals to take ownership of compliance, wherever they might
work in the business. Several other compliance training initiatives
were also launched during 2021, including specific training
events on fostering a healthy Speak Up culture. This mandatory
training was given to more than 1,000 managers to highlight the
importance ofa manager’s role in the process of creating a safe
environment for raising concerns.
This was followed by a top-down Speak Up communication
campaign, which was cascaded from the Group Executive
Committee to reach more than 4,000 employees by the year-end.
The outcome has been to embed our commitment to non-retaliation
and to reiterate the message that a strong and healthy Speak
Up culture can have a positive impact on the integrity ofour
business. Further details are set out on page 58.
Group investigations
Following the introduction of the training campaign to strengthen
the Company’s Speak Up facility and the launch of an improved
digital platform, a total of 125 Speak Up reports were received in
2021. This represents a 248% increase in reports received over
the prior year, and exceeds the international benchmark of 1.4
cases per 100 employees.
As part of the Company’s investigations protocol, the Group
investigations ‘triage’ committee considers all high-risk investigations
into alleged breaches of the Company’s Code ofConduct to verify
the severity level assigned and to decide on the most appropriate
course of action. As a result of the increase in Speak Up reports
being received, it was agreed that only those cases identified by the
triage committee as high-risk would be submitted to the Committee
for formal review, having been categorised by country, severity and
status. During the year, progress reports on all cases were provided
to the Committee, while full granularity of each high-risk case was
shared and considered in detail.
Further details of our whistleblowing programme, including the
number of alleged breaches of our Code of Conduct reported
viathe Speak Up facility, the number of substantiated allegations,
and the number of employees facing disciplinary action following
a substantiated allegation are provided on page 57.
Third Party Risk Committee
As required by the Committee’s terms of reference, minutes
ofthe meetings held by the Third Party Risk Committee (TPRC)
were reviewed during the year. A total of 17 new third parties
within the TPRC’s remit, including logistics andtax, legal and
visaservices, were engaged by the Group during 2021.
Looking forward
Looking forward, the Committee recognises the need to continue
to strengthen the compliance message, and ensure all employees
acknowledge that how we do business is just as important as
what we do. I am confident that under the continued leadership
of Sami Iskander and his management team, the importance of
strong compliance and ethics will be maintained and monitored
throughout the year.
I am very satisfied with the progress in compliance reform that
has been achieved and that the Committee has overseen since
its inception in 2017. The Committee was established to support
the Board in fulfilling its responsibilities in all aspects relating
to compliance across the Group and to uphold the continued
implementation of good principles. I believe this has been
achieved and, as I pass over my chairmanship to Francesca,
I am sure that her experience will help to drive the behaviours
necessary to ensure this work continues and will be further
developed in the years to come; thus ensuring the highest
ethicalstandards are embedded throughout the organisation.
George Pierson
Chairman of the Compliance and Ethics Committee
23 March 2022
115Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Matthias Bichsel
Chairman of the
Remuneration Committee
Role and responsibilities of the Committee:
– Determine, implement and review, on behalf of the Board, the
framework and policy for the remuneration of the Company
Chairman, the Executive Directors and other members of
executive management. Review the ongoing appropriateness
and relevance of the remuneration policy
– Ensure that the objectives of the remuneration policies and
practices are transparent, support the Company’s strategy
and promote long-term sustainable success, while addressing
the six principles set out in the UK Code of clarity, simplicity,
risk, predictability, proportionality and alignment to culture
– Review and oversee wider workforce remuneration and related
policies and ensure that incentive schemes and rewards drive
behaviours that are consistent with our purpose, values, and
strategy, and take these into account when setting the policy
for Executive Director remuneration
– Approve the design of, and determine targets for, any
performance-related pay schemes and review the total annual
payments made under such schemes
– Ensure that outcomes are only earned for achieving stretching,
but fair, performance targets and that remuneration schemes
and policies enable the use of Committee discretion and
independent judgement to override
– Maintain contact, and promote effective engagement, with
principal stakeholders, as required, on matters relating to
executive remuneration
Dear shareholder
On behalf of the Board, I am pleased to present the Directors’
remuneration report for the year ended 31 December 2021.
As a Jersey-incorporated company, Petrofac is not subject to the
remuneration reporting regulations that apply to UK-incorporated
companies. Nevertheless, the Committee recognises the
importance of effective corporate governance, and we will
therefore continue to operate in line with the UK remuneration
reporting regulations.
Accordingly, we will be asking shareholders at our 2022
Annual General Meeting (AGM), to vote on this Report, which
summarises the remuneration outcomes for 2021 and explains
how we intend to apply our remuneration policy during 2022.
Our remuneration policy and accompanying notes, which were
approved at the 2020 AGM, can be found at www.petrofac.com.
2021 Group performance
The Group has faced a very challenging year with continued
disruptions in our operations caused by the COVID-19 pandemic
and subsequent delays in both project completions and new
awards. The Group reported lower revenue of approximately
US$3,057 million and full-year business performance net profit
was materially lower than in 2020, down 30% to US$35 million.
Nevertheless, we continued to deliver high-quality projects and
services, as attested by our clients, and successfully moved into
the New Energies business, while doing everything within our
control to protect the health and well-being of our people.
In 2021 we brought closure to the SFO investigation and continued
to move forward with our turnaround and growth strategy,
successfully completing a refinancing exercise. It is pleasing that
thiswas heavily over-subscribed, as shareholders and lenders
were convinced of our ability to implement our strategy over
the next few years, delivering consistent, long-term sustainable
performance. Under the direction of a new Group Chief Executive
and Chief Financial Officer, it is clear that the Group is uniting
around our strategy to rebalance, reshape and rebuild Petrofac.
During 2021, the Group Executive Committee, all of whom
havebeen appointed in the last five years, successfully managed
to balance the time-consuming regulatory investigation and
refinancing issues with delivering business performance. In this
regard, it is particularly encouraging that the second half of
2021 marked a return to growth for our order backlog as we
moved into new geographies and into New Energies. Against this
backdrop, the Committee is determined to provide a package of
pay and benefits that attracts, retains and incentivises our people
to help grow and transform Petrofac, while also ensuring that all
stakeholders, including investors, employees and clients, benefit
from a successful turnaround of the business.
The remuneration outcomes for 2021
The total bonus pool for 2021 was US$19 million (down from
US$55 million in 2019 – no bonus was awarded in 2021 in respect
of the 2020 financial year). Notwithstanding the challenging
market, this outcome reflects successful progress against key
strategic objectives during the year that are critical to growth and
our delivery of sustainable future profits. Our bonus deferral also
ensures that beyond the initial performance period, Executive
Directors remain focused on further successful realisation of
valuefrom these objectives in order to maintain or grow their equity
investments. Most regrettably, we had an employee fatality in our
2021 remuneration
arrangement
Governance/investor
consultation and
review of external
environment
Wider workforce
remuneration
considerations
Review of employee
share plans and
performance
conditions, including
new share plans
reviews
43%
26%
11%
20%
How the Committee spent its time during the year – 2021
116 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Directors’ remuneration report

Thailand operation in January 2021. Consequently, the Committee
exercised downward discretion and reduced the bonus award
ofall Executive Directors and the Group Executive Committee
by5%.Further details of the Annual Bonus Plan can be found
onpages 118 and 119.
The 2019 Performance Share Plan (PSP) vested at 6% of the
maximum. This reflects the performance of one key strategic
measure (cost challenge) which was substantially over-achieved
(US$202m saving versus a target of US$75m) over the period
2019 to 2021. All other elements of the 2019 PSP did not
result in any vesting. Further details are set out on page 120.
The Committee considered that this 6% vesting for our long-term
incentive plan was commensurate with Petrofac’s delivery over
that period and was satisfied that no discretionary adjustment
wasnecessary. The Committee noted that over the last eight
years the PSP hadpaid out zero for the initial five years and
15-16% in 2019 and2020.
SFO investigation
Following the conclusion of the SFO investigation, the Committee
discussed whether and what actions should be taken regarding
past share awards. It was noted that no existing employees
orExecutive Directors had been either charged or convicted
ofany charge under the investigation. However, in recognition
ofthe corporate failings that led to the Court penalty in relation
to the SFO investigation, four individuals who were in positions
of responsibility at the time of these failings, and who have
subsequently left the business, had their outstanding
awardscancelled.
Executive Directors
Alastair Cochran stepped down from the Board as Chief Financial
Officer on 31 August 2021. As he had resigned, in line with our
plan rules, all his share awards lapsed. Details of Mr Cochran’s
treatment on separation can be found on page 120. Mr Cochran
remains subject to the post-employment shareholding guidelines
and will retain all existing vested shares for a period of two years
from his separation date.
Afonso Reis e Sousa was appointed Chief Financial Officer and
Executive Director effective 1 September 2021. Mr Reis e Sousa
was awarded a salary of £350,000 per annum for the initial
period of his appointment, with a view to reassessing the position
for 2022 as he developed and gained experience in the role.
Following a highly successful transition and an outstanding first
six months in the new role, we now propose to increase his salary
to £400,000 with effect from 1 April 2022. As with the recent
Group Chief Executive appointment, Mr Reis e Sousa is paid less
than his predecessor and we have also taken the opportunity to
align his pension treatment to that of the wider UK workforce, as
previously pledged and in accordance with the UK Code. Mr Reis
e Sousa’s bonus plan will also be structured such that any future
pay-out will be 50% cash and 50% in deferred shares. Mr Reis
e Sousa will receive a bonus of £127,887 (55% of maximum
prorated for his time as Chief Financial Officer), and a PSP award
at 200% of salary (capped at three times face value at award
date). Details of his remuneration can be found on page 118.
Sami Iskander was appointed as Group Chief Executive on
1 January 2021. Mr Iskander will receive a bonus for his 2021
performance of £587,067 (45% of maximum) for his contribution
and personal performance in 2021, as outlined on page 119.
The average salary of the UK workforce will increase by between
3.5% and 6% on 1 April 2022. Mr Iskander will be awarded a
3.5% increase in basic salary on that date. He will also will be
awarded a PSP equal to 200% of salary in April 2022 (capped
in line with policy), which will vest in early 2025, subject to
performance conditions. Further details of his remuneration
canbe found on page 118.
Ayman Asfari retired from the role of Group Chief Executive
on 31 December 2020. His remuneration arrangements were
detailed in last year’s Annual Report. He received no bonus
orshare awards in 2021.
Changes to be made in 2022
There are no changes proposed to the annual bonus or PSP
frameworks in 2022. However, we intend to hold a policy review
during 2022 ahead ofsubmitting our remuneration policy for
shareholder approval at the AGM to be held in 2023.
Pay outcomes
In April 2020, the Group cancelled previously awarded annual
payincreases and, in addition, implemented a 10% pay cut.
This cut was applied to all levels of the Group, including
the Executive Directors, the senior leadership team and the
Non-executive Directors.
In April 2021, the decision was taken to award a 5% pay increase
worldwide to those employees who had taken a 10% pay cut, but
excluding the Executive Directors, the senior executive team and
the Non-executive Directors. The Company has now determined
that it will award a further 5% increase to these employees in
April2022. In reversing the 10% pay cut, the Company expresses
confidence in the future and gives due recognition for the hard
work and loyalty of our employees in this challenging period.
Effective April 2022, we will reverse the 10% cut in salary for
thesenior executive team. We will also reverse the 10% cut in
fees that had been imposed on the Chairman and the Non-
executive Directors. This returns the Non-executive Director fees
to the levels prior to April 2020, which have not been increased
since 2018.
Our employees have shown tremendous loyalty and commitment
over the last few years, despite experiencing pay cuts and low
or zero bonuses. The Committee intends to ensure that as the
business recovers, all stakeholders are able to benefit from the
Group’s growth and successful business performance.
Conclusion
Over the last two years, the Committee has had to respond
quickly and decisively to the challenges of COVID-19, the
SFOsettlement and the major refinancing of the business,
aswell as the transition to a new Group Chief Executive and
theappointment of a new Chief Financial Officer. We have had
tomake some difficult decisions, but at all times we have sought
toact in the best interests of Petrofac and all our stakeholders.
I hope you find the report clear and informative, and that
the Committee has your support for the Annual Report on
Remuneration at the forthcoming AGM.
Matthias Bichsel
Chairman of the Remuneration Committee
23 March 2022
117Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Annual Report on Remuneration
Looking backwards
The information presented from this section, until the relevant note on page 123, represents the audited section of this report.
Single total figure of remuneration
The following table sets out the total remuneration for Executive Directors for the year ended 31 December 2021, with prior year
figures also shown.
Base salary Taxable benefits
Cash in lieu of
pension and
other benefits
Annual cash
bonus
Long-term
incentives
Total
remuneration
Total fixed
remuneration
Total variable
remuneration
(a) (b) (c) (d) (e) (f) (g)
Executive Director
1
US$000 US$000 US$000 US$000 US$000 US$000 US$000 US$000
2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020
Sami Iskander
2
894 144 29 4 63 10 807 383 0 0 1,793 541 986 158 807 383
Afonso Reis e Sousa
3
158 0 0 0 10 0 176 0 0 0 344 0 168 0 176 0
Former Director
Alastair Cochran
4
359 524 24 1 64 89 0 0 0 50 447 664 447 614 0 50
Notes to the table
1 The Executive Directors are paid in sterling. All amounts have been translated to US dollars based on the prevailing rate at the date of payment or award.
2 Sami Iskander was appointed as Group Chief Executive on 1 January 2021. He joined the Company as Deputy Chief Executive on 1 November 2020 and accordingly the 2020 figures reflect
the period from 1 November to 31 December 2020.
3 Afonso Reis e Sousa was appointed as a Director on 1 September 2021. The 2021 figures reflect the period from 1 September to 31 December 2021.
4 Alastair Cochran ceased to be a Director from 31 August 2021. The 2021 figures reflect the period from 1 January 2021 to this date.
Further notes to the table – methodology
(a) Salary and fees – the cash paid in respect of 2021.
b) Benefits – the taxable value of all benefits paid in respect of 2021, including private health insurance and appropriate life assurance. Sami Iskander received a car allowance during the period
and Alastair Cochran received holiday pay.
(c) Cash in lieu of pension and other benefits – our Executive Directors receive a cash allowance in place of pension contributions. This reflects the application of the Company’s remuneration
policy. Directors do not receive specific pension contributions from the Company.
(d) Annual cash bonus in respect of performance during 2021. The value for Afonso Reis e Sousa has been prorated for time based on the period from appointment as an Executive Director.
(e) Long-term incentives – 6% of the 2019 awards under the Performance Share Plan are due to vest on 23 March 2022. A value of US$377 is due to vest for Afonso Reis e Sousa, prorated for
time based on the vesting period from his appointment as an Executive Director. This value represents an estimate of the market value of the shares that are due to vest, based on a three-
month average share price of 133.02 pence (1 October to 31 December 2021). Of the value due to vest, £(653) of the figure is attributed to a share price depreciation of 316.9 pence per share,
based on an actual award price of 449.9 pence. The 2020 values in this column (relating to awards which vested in April 2021) have been revised from last year’s report, based on the actual
share price of 125.53 pence at the date of vesting on 20 April 2021.
(f) Total fixed remuneration is the total of (a) base salary, (b) taxable benefits and (c) cash in lieu of pension and other benefits.
(g) Total variable remuneration is the total of (d) annual cash bonus and (e) long-term incentives.
Additional disclosures in respect of the single figure table
Annual bonus
The financial elements of our annual bonus comprise 60% of the overall weighting, while the remainder of the annual bonus (40%) is
subject to metrics covering seven strategic areas: Health and Safety, Customer and Service Quality; Growth; People; Sustainability (ESG);
Energy Transition and strategic initiatives. The table below sets out the outcomes for the Executive Directors against our financial targets:
Performance targets
Measure
Weighting
US$m
Threshold
US$m
Target
US$m
Maximum
US$m
Actual 2021
outcome
US$m
Pay-out
as %
Group net profit
1
20% 27.1 39.1 52.1 35.0 43.17%
Group order intake 20% 1,800 2,405 3,000 2,239 44.51%
Group free cash flow
2
20% (233) (158) (58) (281) 0%
As a % of maximum 29.23%
As a % of salary earned (out of 120% for financial elements) 35.07%
1 Measured as Group business performance before separately disclosed items.
2 The Group free cash flow measure for the purposes of the annual bonus performance target is a management reporting metric calculated as free cash flow generated from operating
activitiesand investing activities, less interest paid, repayment of finance lease principal and amounts received from non-controlling interests (see note A7 in Appendix A of the consolidated
financial statements).
Group level performance was principally affected by the weaker performance of the E&C division during the year, following subdued
new order intake and a delay in contract awards over the past couple of years and the continued challenge of COVID-19. However, this
was partially offset by our continued delivery of significant cost reductions and the strong performance in the Asset Solutions division,
where revenue and margins grew in the year across each of its service lines. Overall, this has resulted in a between threshold and target
outturn for Group net profit. New order intake improved as the year progressed with some significant project wins in both E&C and
Asset Solutions, which resulted in a between threshold and target outturn for Group order intake. The working capital outflows (primarily
resulting from longer billing cycles as a result of COVID-19 related disruption) were partially offset by lower tax payments and cash
conservation measures; however overall, this resulted in a below threshold outturn for Group free cash flow.
118 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Directors’ remuneration report
continued

Discretion
The Committee reviewed the final bonus against Petrofac’s overall performance and the Executive Directors’ individual performance.
Notwithstanding the formulaic outcomes of the financial and personal performance measures, the Committee was mindful of the
tragic loss of life in the Thai Oil project. As a result, the Committee decided to exercise downward discretion and reduce the bonus
award of all Executive Directors and the Group Executive Committee by 5%.
Director Performance
Formulaic
outcome
of bonus
calculation
Downward
discretion
adjustment
applied
2021 annual
bonus after
discretion
As a %
of base
salary
Financial
element (60%)
Strategic areas
element (40%) Overall
Sami Iskander
1
35.1% of maximum 75% of maximum 50.0% of maximum £617,966 £(30,898) £587,067 90%
Afonso Reis e Sousa
2,3
35.1% of maximum 100% of maximum 61.0% of maximum £134,618 £(6,731) £127,887 109%
1 Based on figures rounded by pence values.
2 Reflects the bonus for the period 1 September to 31 December 2021 as Chief Financial Officer.
3 Reflects the prorated salary for the period 1 September to 31 December 2021 as Chief Financial Officer.
Sami Iskander
Sami Iskander joined Petrofac in November 2020, initially as Deputy CEO. He was appointed Group Chief Executive in January 2021.
His detailed scorecard was reviewed initially by René Médori, the Chairman and then with the Committee. The Chairman and the
Committee felt there were a number of achievements that went “above and beyond” his normal duties and responsibilities.
Mr Iskander replaced Ayman Asfari, one of our founders, our largest shareholder, and our only Chief Executive since listing in 2005.
The appointment of a new Group Chief Executive was a major event for the Group and it was essential that both parties worked well
together through the transition, ensuring confidence amongst investors, clients, employees and all stakeholders. The Committee has
been delighted by the smooth handover and the ongoing working relationship between these key individuals. In the second and third
quarter of 2021, Mr Iskander was heavily involved in discussions with the SFO to bring the long-standing investigation to a conclusion.
Under his leadership, the Company was able to achieve a settlement that enables the business to move on. Mr Iskander was able to
convince the Court and the SFO that Petrofac is a changed organisation, has established a world class compliance regime, and is
firmly committed to working in an ethical and appropriate manner in all future business dealings. Following the conclusion of the SFO
investigation, Mr Iskander was then heavily involved in intensive engagements over a number of weeks with new and existing investors.
He was able to present a credible investment proposition and an exciting future strategy. Under his leadership, a successful capital
raise and refinancing programme was completed. Finally, Mr Iskander has engaged relentlessly with clients around the world and,
during the second half of 2021 the Company saw an increase in order backlog, for the first time in more than four years.
This has been a period of great uncertainty for the Group and all of its stakeholders. Despite the extraordinary challenges of COVID-19,
the SFO investigation, the capital raising and refinancing programme, and the change in Executive Directors, Mr Iskander was able
to steady the ship, keep the team focused and even deliver an employee engagement score of 84%. After reviewing hisscorecard
performance and, in particular taking into consideration the exceptionally challenging achievements set out above, theCommittee
agreed to rate his performance as 4 (Substantially Exceeded Expectations) on our 5-point scale. This has resulted inthebonus
outcome reported above.
Afonso Reis e Sousa
In early 2021, Alastair Cochran gave the Company notice of his resignation as Chief Financial Officer. The Company subsequently
engaged with an executive search firm but quickly determined that the best candidate for the role was Mr Reis e Sousa, who was
Group Treasurer, Head of Tax and Group Head of Enterprise Risk, and who had been with the Group for more than eight years.
Hewas subsequently appointed Chief Financial Officer and Executive Director with effect from 1 September 2021.
Sami Iskander reviewed the detailed scorecard of Mr Reis e Sousa’s performance in 2021 with the Chairman of the Board and with the
Committee. In addition to the normal duties of a senior executive and head of function, a number of Mr Reis e Sousa’s achievements
were felt to be particularly noteworthy. In his role at the start of the year, Mr Reis e Sousa had developed excellent relationships with
our banks and key partners. He had been instrumental in extending existing debt facilities, including terms loans and revolving credit
facilities. On appointment to the role of CFO, Mr Reis e Sousa was required to fill the critical finance positions of Group Controller and
Head of Finance for E&C, in addition to his own replacement. The Board have been impressed by the appointments made. He also
had to stabilise the team which was suffering from high attrition and low morale at all levels. Positive comments have been received
from the external auditor and others on the improved performance of the finance team under his leadership. Mr Reis e Sousa was
intimately involved in the resolution of the SFO investigation and was able to provide supporting evidence that resulted in a penalty
thatwas affordable and preserved the long term viability of the Group. Mr Reis e Sousa implemented the comprehensive capital
raising and refinancing programme that provided a long-term capital structure for the future, working intensively over many months
with all our stakeholders to achieve a highly successful outcome.
After reviewing Mr Reis e Sousa’s scorecard performance and, in particular, recognising that the resignation of his predecessor
had accelerated his appointment in his first role as a Chief Financial Officer, the Committee agreed to rate his performance as 5
(Outstanding) on our 5-point scale. This has resulted in the bonus outcome reported above.
119Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Resignation from office
Following Alastair Cochran’s resignation from the role of Chief Financial Officer, the Board agreed to reduce his 12-month notice period
and accordingly he stepped down from the Board on 31 August 2021. Mr Cochran did not receive any pay in lieu of notice and all his
salary and allowances ceased on 31 August 2021. He received no annual bonus for the 2021 financial year, and the outstanding
awards under the 2019, 2020 and 2021 PSP lapsed on his cessation of employment. The vested post-tax 2018 Performance Share
Planshares, which vested in April 2021, remain subject to the two-year holding period until 20 April 2023. In line with the post-
cessation shareholding guidelines, Mr Cochran will continue to hold his entire shareholding for two years following departure, unless
thevalue of the shareholdings should exceed the guideline amount. The Annual Bonus and PSP awards continue to be subject to
malus and clawback provisions in accordance with the remuneration policy and Mr Cochran is expected to abide by the provisions
ofhis service agreement. No payment for loss of office was made.
Appointment arrangements for Afonso Reis e Sousa
With the resignation of Alastair Cochran, Afonso Reis e Sousa was appointed by the Board as the Chief Financial Officer from
1 September 2021. Effective from this date, Mr Reis e Sousa’s arrangements have been aligned to the remuneration policy for Executive
Directors, including annual bonus, long-term incentive plan opportunities, and the shareholding requirements for employment
andpost-cessation shareholdings. Mr Reis e Sousa was awarded a salary of £350,000 per annum on appointment, with a view to
reassessing theposition for 2022 as he developed and gained experience in the role. Following a highly successful transition and an
outstanding first six months, it is proposed to increase his salary to £400,000 with effect from 1 April 2022. As with the recent Group
Chief Executive appointment, Mr Reis e Sousa is paid less than his predecessor. We have also taken the opportunity to align his pension
treatment tothatof the wider UK workforce, as previously pledged, and in accordance with the UK Code. Mr Reis e Sousa’s bonus plan
will also be structured such that any future pay-out will be 50% cash and 50% in deferred shares.
Performance Share Plan
The performance conditions for the 2019 PSP award are set out below. As a result of the over maximum achievement of one out of
five of the strategic objectives, 6% of this award is due to vest on 23 March 2022.
TSR element (70% of award):
The comparator group and vesting schedule are set out in the following tables:
Daelim Industrial Co JGC Corporation Saipem Tecnicas Reunidas
Fluor Corporation KBR, Inc Samsung Engineering Co., Ltd Worley Parsons
GS Engineering & Construction Corp Maire Tecnimont Technip FMC Wood Group (John)
Hyundai E&C McDermott International, Inc
Target range
1
Outcome
Less than median performance 0%
Median performance 25%
Median to upper quartile performance 100%
TSR element vesting 0% (below median performance)
1 Straight-line vesting operates between these points.
Strategic element (30% of award):
Performance measure Weighting Threshold On-target Maximum Outturn
Vesting
(as a % of
maximum)
Vesting %
(actual)
Protecting our core E&C
business E&C net margin 6% 5.5% 6.5% 7.5% 4.4% 0.0% 0.0%
Best-in-class delivery
Global cost
challenge savings 6% $50m $75m $100m $202m 100.0% 6.0%
Positioning for a return to growth New orders 6% $12,798m $17,298m $21,798m $7,037m 0.0% 0.0%
Improving operational
efficiencies Cash conversion 6% 72% 86% 100% 44.2% 0.0% 0.0%
Enhancing returns ROCE
2
6% 15% 18% 25% 13.1% 0.0% 0.0%
Strategic element vesting 20% of maximum
Overall award vesting 6% of maximum
2 Given the impact of the capital raise completed in November 2021, the ROCE return measure has been normalised.
120 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Directors’ remuneration report
continued

Share plan interests awarded during the financial year
Performance Share Plan awards
As detailed in our remuneration policy, PSP awards are granted over ordinary shares representing an opportunity to receive Petrofac
shares if performance conditions are met over the relevant three-year period. The number of shares under award is determined by
reference to a percentage of base salary. Details of the actual number of shares granted are set out on page 123. The following table
provides details of the awards made under the PSP. Performance for these awards is measured over the three financial years from
1 January 2021 to 31 December 2023.
Type of award Face value
Face value
(% of salary)
Threshold vesting
(% of face value)
Maximum vesting
(% of face value)
End of performance
period
Sami Iskander
Performance
shares
£1,949,999 300%
25% 100% 31 Dec 23
Afonso Reis e Sousa £306,885 88%
Alastair Cochran £778,679 200%
Awards were made to Sami Iskander and Alastair Cochran on 23 April 2021, based on a share price of 117.20 pence. The award to
Afonso Reis e Sousa was made on 25 May 2021, along with other members of senior management, based on a share price of 132.10
pence. The face values shown have been calculated on this basis. The face value as a percentage of salary for Afonso Reis e Sousa is
reflective of a percentage of his current salary as Chief Financial Officer. This share price represents the three-day average share price up
to respective date of award. While the Committee recognises that the share price had fallen over the preceding year, it was satisfied that
the level of awards remained appropriate given that they remain subject to a cap, such that the maximum value that can be delivered in
the year of vesting is limited to three times the face value of the award at the time of grant. The award for Alastair Cochran lapsed on his
departure from the Company.
TSR element
50% of the 2021 award is based on relative TSR. The comparator group and vesting schedule for 2021 are set out in the following
tables:
Aker Solutions Maire Tecnimont Samsung Engineering Co., Ltd Wood Group
Fluor Corporation Saipem Technip FMC
Hunting SNC Lavalin Tecnicas Reunidas
KBR, Inc Subsea7 Worley Parsons
Vesting schedule
Three-year performance against the comparator group Vesting as a % of maximum
Performance equal to median 25%
Performance equal to upper quartile 100%
Straight-line vesting operates between the points above
Strategic element
The remaining 50% of the 2021 award is based on a basket of key strategic measures. We believe these measures align our incentives
with the delivery of critical long-term strategic goals. Each measure is subject to stretching targets over the three-year period. At this
stage, the Committee considers the precise targets for 2021 to be commercially sensitive. However, we intend to provide detailed
disclosure of targets and performance against those targets following the end of the performance period.
The key strategic priorities and associated measures for the 2021 award are as follows:
Key strategic priorities and associated measures Performance measures 2021 to 2023
Conserving cash Cash conversion
Maintain competitiveness Overhead ratio
Rebuild backlog Book-to-bill
Deliver operational excellence Operational performance (on-schedule, on-budget)
Promote sustainability Energy transition (New Energy Services revenue)
Diversity (FTSE Women Leaders)
Greenhouse gas emissions
Employee engagement
121Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Single total figure of remuneration for the Chairman and Non-executive Directors
The following table sets out the total remuneration for the Chairman and Non-executive Directors for the year ended 31 December
2021, with prior year figures also shown. All figures are presented in US dollars. At 1 January 2021, the Non-executive Directors
received a basic fee of £67,500 per annum, of which £5,000 per quarter was used to purchase Petrofac Limited shares. The basic
Non-executive Director fee was reduced by 10% from £75,000 to £67,500 from 1 April 2020, in line with the reduction received by
the wider Petrofac workforce. Additional fees of £15,000 per annum are paid for acting as either the Chairman of a Board Committee
(excluding the Nominations Committee) or as the Senior Independent Director.
The Chairman received a fee of £288,000 per annum. This fee was reduced by 10% from £320,000 per annum with effect from 1 April 2020,
in line with the wider Petrofac workforce arrangement. A total of £20,000 per quarter of his fee is used to purchase Petrofac Limited shares.
Committee membership and other responsibilities Fees US$000
Audit
Committee
Compliance
and Ethics
Committee
Nominations
Committee
Remuneration
Committee Other 2021 2020
Non-executive Directors
1
René Médori Chairman Chairman of the Board 395 374
Matthias Bichsel Member Member Member Chairman Senior Independent Director 134 126
Andrea Abt Member Member Member 93 88
Sara Akbar Member Member 93 88
Ayman Asfari
2
Member 20 996
David Davies Chairman Member 113 107
Francesca Di Carlo Member Member 93 88
George Pierson Member Chairman Member 113 107
Notes to the table
1 Non-executive Directors are paid in either Sterling, Euros or US dollars. All amounts above have been translated to US dollars based on the prevailing rate at the date of payment.
2 As reported in the 2020 Annual report and accounts, Ayman Asfari retired from the role of Group Chief Executive on 31 December 2020. He was appointed as a Non-executive Director
with effect from 1 January 2021. His 2020 fee represents the total 2020 remuneration received as an Executive Director. The total amount received in 2020 of US$996,000 is lower than the
amount disclosed in the 2020 report as the value of the 2018 PSP award, which vested on 20 April 2021, was revised, based on the actual share price of 125.53 pence achieved on the date
of vesting. The value of the 2019 PSP award, which will vest on 23 March 2022 is US$22,305. This value represents an estimate of the market value of the shares that are due to vest, based
on a three month average share price of 133.02 pence (1 October to 31 December 2021). Mr Asfari’s notice period commenced on 12 October 2020. The balance of his notice payment
equated to £563,800, which was paid to him in lieu. He also received an additional £40,000 to cover the loss of healthcare benefits. Mr Asfari received no bonus during 2021 and agreed
toreceive no Board fees between 1 January and 11 October 2021. Accordingly, the 2021 fee represents the period from 12 October 2021 to 31 December2021.
Statement of Directors’ shareholding and share interests
Directors’ shareholdings held during the year and as at 31 December 2021 and share ownership guidelines
The number of shares held by Directors during the year and as at 31 December 2021 or as at the date of departure are set out in the
table below, along with the progress against their respective shareholding requirements:
Director
% of salary held under
shareholding guidelines
Shares owned outright at
31 December 2021
Interests in outstanding share
incentive schemes awarded,
subject to performance conditions,
at 31 December 2021
Shares owned outright at
31 December 2020
or at date of appointment
Sami Iskander
1,5
13% 217,391 1,759,658 –
Afonso Reis e Sousa
2,5
6% 36,813 289,174 24,543
Matthias Bichsel – 50,331 – 18,000
René Médori – 194,972 – 67,757
Andrea Abt – 50,331 – 18,000
Sara Akbar – 50,331 – 18,000
Ayman Asfari
3
>100% 88,947,298 331,051 65,139,247
David Davies – 71,679 – 32,232
Francesca Di Carlo – 42,907 – 13,062
George Pierson – 128,781 – 96,450
Former Director
Alastair Cochran
4
22% 147,541 – 132,267
1 Sami Iskander is expected to build up a shareholding of three times salary. He was appointed as Group Chief Executive on 1 January 2021 and is yet to fulfil this shareholder guideline.
2 Afonso Reis e Sousa is expected to build up a shareholding of two times salary. He was appointed as an Executive Director on 1 September 2021 at which point he held 24,543 shares.
Accordingly he is yet to fulfil this shareholding guideline.
3 Ayman Asfari ceased to be an Executive Director from 31 December 2020. He is, however, expected to retain 100% of the shareholder guideline (three times salary) for the first year following
departure, and 50% of the guideline for the second year following departure. He has substantially exceeded this requirement.
4 Alastair Cochran ceased to be an Executive Director from 31 August 2021. The shares owned outright reflect the position on the date he stepped down from the Board. He is, however,
expected to retain 100% of the shareholder guideline for the first year following departure, and 50% of the guideline for the second year following departure. As the shareholding guideline was
not met prior to his departure from the Board, he is required to retain all his outstanding shares until 31 August 2023.
5 For the purposes of determining Executive Director shareholdings, the individual’s salary as at 31 December 2021 or at the date of leaving, and the share price as at 31 December 2021
of115.3 pence per share have been used.
122 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Directors’ remuneration report
continued

Share interests – share plan awards at 31 December 2021
Share awards held at the year-end, or at date of leaving, including awards of shares made to Executive Directors during 2021, are
shown in the table below:
Director and date of grant Plan
Number of
shares under
award at
31 December
2020
1
Shares granted
in year
Adjustment for
Open Offer
Shares lapsed
in year
Shares vested
in year
Total number of
shares under
award at
31 December
2021 (or at date
of leaving)
Dates from which
shares ordinarily
vest
Sami Iskander
23 April 2021 PSP – 1,663,822 95,836 – – 1,759,658 23 April 2024
1,759,658
Afonso Reis e Sousa
27 March 2018
2
PSP 14,813 – – 12,426 2,387 – 6 March 2021
27 March 2018
4
DBSP 5,080 – – – 5,080 – 6 March 2021
6 March 2019
3
PSP 16,717 – 962 – – 17,679 6 March 2022
6 March 2019
4
DBSP 10,658 – 306 – 5,328 5,636 6 March 2022
6 March 2020 PSP 24,396 – 1,405 – – 25,801 6 March 2023
6 March 2020
4
DBSP 17,862 – 686 – 5,952 12,596 6 March 2023
25 May 2021 PSP – 232,313 13,381 – – 245,694 25 May 2024
307,406
Ayman Asfari
27 March 2018
2
PSP 291,491 – – 247,244 44,247 – 6 March 2021
6 March 2019
3,5
PSP 329,341 – 11,065 137,226 – 203,180 6 March 2022
6 March 2020
5
PSP 483,633 – 6,964 362,726 – 127,871 6 March 2023
331,051
Former Director
Alastair Cochran
27 March 2018
2
PSP 179,245 – – 150,387 28,858 – 6 March 2021
6 March 2019
7
PSP 206,434 – – 206,434 – – 6 March 2022
6 March 2020
7
PSP 309,084 – – 309,084 – – 6 March 2023
23 April 2021
7
PSP – 664,402 – 664,402 – – 23 April 2024
0
1 The award amounts disclosed under the PSP are the maximum number that may vest if all performance conditions attached to the awards are satisfied in full.
2 Following the end of the three-year performance period in respect of the March 2018 PSP award, the performance conditions were partially satisfied and therefore 16.1% of the maximum
award vested on 20 April 2021.
3 Shares awarded on 6 March 2019 have satisfied the performance conditions and therefore 6% of the maximum award will vest on 23 March 2022. Based on a share price of 118.30 pence,
which is the closing share price on 22 March 2022 (being the latest practicable date prior to the adoption of this report by the Committee), the value of the awards made to Afonso Reis e
Sousa, prorated for time based on the vesting period from when he was appointed as an Executive Director, would be £244. The value of the award made to Ayman Asfari would be £14,422.
4 On 20 April 2021, a third of the 2018 Deferred Bonus Share Plan (DBSP) award, a third of the 2019 DBSP award and a third of the 2020 DBSP award vested. The share price on the date of
vesting was 125.53 pence. Following his appointment to the Board on 1 September 2021, no further awards under the DBSP will be made to Afonso Reis e Sousa. However, future awards
may be made to all Executive Directors under the new Deferred Bonus Plan, which was approved by shareholders at the 2021 AGM.
5 The shares awarded to Ayman Asfari have been prorated for time, based on his retirement date of 31 December 2020.
6 All outstanding awards of shares lapsed on 31 August 2021 when Alastair Cochran ceased to be an Executive Director of the Company.
This represents the end of the audited section of the report.
123Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Historical TSR performance and Group Chief Executive remuneration outcomes
The chart below compares the TSR performance of the Company over the past 10 years with the TSR of the FTSE 250 Index.
This index has been chosen because it is a recognised equity market index of which Petrofac was a member from December 2014
until March 2021.
The table below the chart summarises the Group Chief Executive single figure for total remuneration, annual bonus pay-outs and long-
term incentive plan vesting levels as a percentage of maximum opportunity over this period.
Petrofac FTSE 250
01 Jan 12 01 Jan 13 01 Jan 14 01 Jan 15 01 Jan 16 01 Jan 17 01 Jan 18 01 Jan 19 01 Jan 20 01 Jan 21 01 Jan 22
0
50
100
150
200
250
300
350
TSR – rebased to 1 January 2011
Source: Datastream
TSR chart – one-month average basis
Group Chief Executive 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Group Chief Executive single figure of
remuneration (US$000) 4,663 2,658 1,245 1,162 1,817 1,946 2,250 1,153 999 1,793
Annual bonus pay-out
(as a % of maximum opportunity) 81% 59% 0% 0% 47.5% 60.4% 69.9% 0% 0% 45%
PSP vesting outturn
(as a % of maximum opportunity) 100% 13% 0% 0% 0% 0% 0% 15.2% 16.1% 6%
Pay ratios of Group Chief Executive to UK employees
The table below illustrates the pay ratio of the Group Chief Executive to the 25th, median and 75th percentile of the total remuneration
of the full-time equivalent UK employees.
Financial Year ended Method
25th percentile pay ratio
(lower quartile)
50th percentile pay ratio
(median)
75th percentile pay ratio
(upper quartile)
31 December 2021 Option A 1:21 1:17 1:16
31 December 2020 Option A 1:16 1:12 1:10
The Group Chief Executive’s total remuneration is calculated on the same basis as the single figure of remuneration table set out on page
118. The lower, median and upper quartile employee’s remuneration was calculated on full-time equivalent data as at 31 December 2021.
Option A was chosen as it is considered to be the most accurate way of identifying the best equivalents of 25th, 50th and 75th percentile
figures and is aligned with best practice and investor expectations.
In reviewing the employee pay data, the Committee is satisfied that the individuals identified within each category appropriately reflect
the employee pay profile at those quartiles, and that the overall picture presented by the ratios is consistent with our pay, reward and
progression policies for UK employees.
The following table provides further information on the total pay figures used for each quartile employee and the salary component
within this:
Financial Year ended Element of pay CEO remuneration
25th percentile pay ratio
(lower quartile)
50th percentile pay ratio
(median)
75th percentile pay ratio
(upper quartile)
31 December 2021 Salary £650,000 £51,480 £64,000 £73,161
Total remuneration £1,303,682 £61,221 £74,742 £84,239
124 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Directors’ remuneration report
continued

Relative importance of the spend on pay
The chart below illustrates the change in total remuneration,
dividends paid and net profit from 2020 to 2021.
The figures presented have been calculated on the followingbases.
– Dividends – dividends paid in respect of the financial year.
– Net profit – our reported net profit in respect of the financial
year. This is a key performance indicator for the Company.
– Total remuneration – represents total salaries paid to all Group
employees in respect of the financial year (see page 166 of the
report for an explanation as to how this value is calculated).
Note that this includes social security costs, benefit and pension
costs and share-based payment expenses.
Spend in respect of the financial year US$m
Dividends $0 0%
$0
Net profit
$50 (30)%
$35
Total remuneration
$804 (4.5)%
$768
2020 2021
Looking forward to 2022
Implementation of remuneration policy in 2022
This section provides an overview of how the Committee
isproposing to implement our remuneration policy in 2022.
A review of the remuneration policy will be undertaken in 2022
and submitted for shareholder approval at the AGM in 2023.
Base salary
The table below shows the base salaries for 2022 effective
1 April2022:
2022 basic
salary
from 1 April
2022 basic
salary from
1 January
2021
basic salary
to 31 December
Sami Iskander £672,750 £650,000 £650,000
Afonso Reis e Sousa £400,000 £350,000 –
Benefits
There are no changes proposed to the benefit framework in 2022.
Cash allowance in lieu of pension and car allowance
The table below shows cash allowances for 2022:
Cash allowances Cash allowances
2022 2021
Pension Car Pension Car
Sami Iskander
7% of
salary £20,000
7% of
salary £20,000
Afonso Reis e Sousa
6.2% of
salary – – –
As expected, the ratio has increased with the payment of bonuses resuming for the 2021 performance period. Our pay ratio still
remains towards the lower end of the range, which is reflective of the highly skilled and technically challenging nature of our roles
across the UK.
Annual percentage change in Directors’ remuneration compared with average employee remuneration
In accordance with The Companies (Directors’ Remuneration Policy and Directors’ Remuneration Report) Regulations 2019, as
applicable to an equivalent UK company, the table below illustrates the percentage change in each Executive and Non-executive
Directors’ total remuneration, including salary, benefits (excluding cash allowance in lieu of pension) and annual bonus for executives, and
annual fees for non-executives, compared with a representative group of the Company’s employees. For these purposes, we have used
all UK-based employees as the comparator group, as this represents the most appropriate comparator group for reward purposes:
% change in
base salary
2021/2020
% change in
base salary
2020/2019
% change
in benefits
2021/2020
% change
in benefits
2020/2019
% change
in annual bonus
2021/2020
% change
in annual bonus
2020/2019
René Médori
1
-2.7% -7.5% – – – –
Matthias Bichsel
1
-1.9% -5.4% – – – –
Andrea Abt
1
-2.7% -7.5% – – – –
Sara Akbar
1
-2.7% -7.5% – – – –
Ayman Asfari
1,5
-97.7% -5.7% – 0% – 0%
David Davies
1
-2.2% -6.3% – – – –
Francesca Di Carlo
1
-2.7% -7.5% – – – –
George Pierson
1
-2.2% -6.3% – – – –
Sami Iskander
2,3
– – – – – –
Afonso Reis e Sousa
2,4
– – – – – –
All UK-based employees 5.3% -3.2% 0% 0% 100% -100%
1 For the Non-executive Directors, fees are paid in US dollars, Sterling or Euros as determined by each Director. The table sets out the change in total fees. Base fees were reduced by 10%
during 2020. There were no changes to the additional fees of £15,000 per annum, which are paid for acting as either the Chairman of a Board Committee (excluding the Nominations
Committee) or as the Senior Independent Director.
2 Base salary is paid in sterling but translated into US dollars based on the prevailing rate at the date of payment (as set out on page 118).
3 Sami Iskander was appointed as an Executive Director on 1 January 2021.
4 Afonso Reis e Sousa was appointed as an Executive Director on 1 September 2021.
5 Mr Asfari retired from the role of Group Executive Director on 31 December 2020. He was appointed as a Non-executive Director with effect from 1 January 2021.
125Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

Non-executive Chairman and Director remuneration
The fees payable to the Non-executive Chairman and Directors
were increased in 2018 and at that time it was proposed
that there will be no further increase for the next three years.
During 2020, the fees payable to the Chairman and Non-
executive Directors were reduced by 10% in line with the wider
workforce as a result of the impact of the COVID-19 pandemic.
With effect from 1 April 2022, the fees for the Chairman and the
Non-executive Directors will be reinstated to pre-2020 levels:
2022 fees 1 January-31 March from 1 April
Chairman of the Board fee £288,000 £320,000
Basic Non-executive Director fee £67,500 £75,000
Board Committee Chairman fee £15,000 £15,000
Senior Independent Director fee £15,000 £15,000
Annual bonus
The maximum annual bonus opportunity for Executive Directors
will remain at 200% of base salary for 2022.
The table below sets out the financial elements, which comprise
60% of the total annual bonus:
Financial measures Weighting in total bonus
Group earnings before interest and tax
1
20%
Group net order intake 20%
Group free cash flow 20%
1 Measured as Group business performance before separately disclosed items.
The remaining 40% of the annual bonus will comprise robust
metrics covering seven strategic areas: Health and Safety;
Customer and Service Quality; Growth; People; Sustainability
(ESG); Energy Transition; and strategic initiatives. This will provide
the Committee with the ability to consider not only financial
achievements, but also the wider health of the Company and
the manner and behaviours by which our performance has been
delivered. The Committee will set stretching 2022 targets and
willprovide disclosure at the end of the performance year.
Any bonus will be paid to Executive Directors half in cash and
halfin deferred shares under the new Deferred Bonus Plan,
which will vest in equal tranches over one, two and three years
from the date ofaward.
The annual bonus is subject to malus and clawback provisions as
set out in more detail in our remuneration policy. The Committee
also retains the option to apply an additional discretion as
deemed appropriate, based on the performance of the Company
or the relevant Director during the financial year under review.
Performance Share Plan
For 2022, Mr Iskander and Mr Reis e Sousa will receive an award
of 200% of base salary in line with the remuneration policy. As for
previous years, and recognising recent share price performance,
the Committee has retained the cap of three times face value
that can be delivered from the 2022 PSP award. Other than
in exceptional circumstances (for which the Committee would
provide justification), it is intended that the maximum value that
can be delivered in the year of vesting will be limited to three
times face value of the award at grant. This three times face
value cap will apply to all PSP awards made to the Company’s
executive team in 2022.
For 2022, the PSP framework will remain at 50% relative TSR and
50% strategic element. This enables the utilisation of strategic
measures, in addition to financial metrics, around ESG and our
move into energy transition solutions.
1) TSR element (50% of award)
The tables below set out the TSR comparator group for the
purposes of the 2022 awards and the vesting schedule used to
determine the performance outcome. The TSR comparator group
is unchanged from the prior year:
Aker Solutions Saipem Technip FMC
Fluor Corporation SNC Lavalin Tecnicas Reunidas
Hunting Subsea7 Worley Parsons
KBR, Inc
Samsung
Engineering Co., Ltd
Wood Group
Maire Tecnimont
Vesting schedule
Three-year performance against the Comparator group of maximum
Performance equal to median 25%
Performance equal to upper quartile 100%
Straight-line vesting between the points above
2) Strategic element (50% of award)
The remaining 50% of the 2021 PSP award will be subject to
three-year strategic performance conditions. For the 2022
awards, the Committee will set stretching targets to five key
strategic priorities. These strategic priorities and the associated
measures for the 2022 award are as follows:
Strategic priorities Performance measure 2021-2023
Conserve cash Cash conversion
Maintain competitiveness Overhead ratio
Rebuild backlog Book-to-bill
Deliver operational excellence Operational performance
(on-schedule, on-budget)
Promote sustainability Energy transition
(New Energy Services revenue)
Diversity (FTSE Women Leaders)
Greenhouse gas emissions
Employee engagement
Under each strategic priority, vesting for threshold performance
will be 25% of maximum with straight-line vesting up to 100%
of maximum. Each of the eight performance measures will
have a weighting of 6.25%. The Committee considers that
the precise financial targets for the 2022 to 2024 period are
commercially sensitive. However, detailed disclosure of targets
and performance against targets will be provided at the end of
the performance period.
Any vested post-tax shares will be subject to an additional two-year
holding period. In addition, where participants have notreached
the shareholding guideline target, they will be required to continue
to hold any shares after the holding period until the guideline is
reached. PSP awards are subject to malus and clawback provisions
as set out in more detail in our remuneration policy. The Committee
also retains the option to apply an additional discretion as deemed
appropriate, based on the performance of the Company or the
relevant Director during the financial year under review.
126 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Directors’ remuneration report
continued

Post-employment shareholding guideline
Executive Directors are required to maintain a shareholding
of100% of their shareholding guideline (or actual shareholding
at the point of departure, if lower) for a period of 24 months
following departure.
Awards granted under any Company long-term incentive plan, which
have vested but are subject to a holding period, will count towards
the guideline (on a net of tax basis). The Company has implemented
a mechanism for Executive Directors by which to enforce the
application of these post-employment guidelines. As part of this
arrangement, a restriction will be placed on shares held that will
prevent their sale or transfer without prior authorisation by the
Company until the guideline has been satisfied.
Consideration by the Directors of matters relating to
Directors’ remuneration
Support for the Committee
During the year, the Committee received independent advice on
executive remuneration matters from Deloitte LLP (Deloitte), which
was formally appointed as advisor by the Committee in October
2005. Deloitte is a member of the Remuneration Consultants
Group and, as such, voluntarily operates under a code of conduct
inrelation to executive remuneration consulting in the UK.
The Committee has reviewed the advice provided by Deloitte
during the year and is satisfied that it has been objective and
independent. Total fees received by Deloitte in relation to the
remuneration advice provided to the Committee during 2021
amounted to £63,700 based on the required time commitment.
During 2021, Deloitte did not provide any other services to
theCompany.
The Secretary to the Board acts as Secretary to the Committee.
During the year, the Group Chief Executive, Chief Financial Officer
and the Group Director of Human Resources attended meetings
on an ad hoc basis at the invitation of the Committee and provided
information and support as requested. However, no individual was
present when their own remuneration was being discussed.
Governance
The Board and the Committee consider that, throughout 2021
and up to the date of this report, the Company has complied
withthe provisions set out in the UK Corporate Governance Code
relating to Directors’ remuneration. In addition, relevant guidelines
issued by prominent investor bodies and proxy voting agencies
have been presented to and considered by the Committee during
its discussions.
The Committee endeavours to consider executive remuneration
matters in the context of alignment with risk management
and, during the year, had oversight of any related factors to
be taken into consideration. The Committee believes that the
remuneration arrangements in place do not raise any health and
safety, environmental, social or ethical issues, nor inadvertently
motivateirresponsible behaviour.
External board appointments
Executive Directors are normally entitled to accept one non-
executive appointment outside the Company with the consent
of the Board. Any fees received may be retained by the Director.
As at the date of this report, no Executive Director holds an
externally paid non-executive appointment.
Shareholder voting
The table below outlines the result of the advisory vote of the
2020 Directors’ remuneration report at the 2021 AGM.
Annual Report on Remuneration
Number of votes cast
excluding abstentions For Against Abstentions
178,302,456 108,939,472 69,362,984 382,287
61.10% 38.90%
The Committee recognises that more than 20% of votes were
cast against this resolution. As a result, and in accordance with
Provision 4 of the UK Code, engagement with key investors and
proxy advisors was undertaken to better understand the views
expressed. Details of this engagement is set out on page 102.
The table below outlines the result of the advisory vote of the
2019 policy report received at the AGM held on 15 May 2020.
Remuneration policy report
Number of votes cast
excluding abstentions For Against Abstentions
234,052,554 224,428,003 9,624,551 125,143
95.89% 4.11%
Availability of documentation
Service contracts and letters of appointment for all Directors are
available for inspection by any person at our registered office in
Jersey and at our corporate services office in London. They will
also be available for inspection during the 30 minutes prior to the
start of our 2022 AGM.
Annual General Meeting
As set out in my statement on pages 116 and 117, our Annual
Report on Remuneration will be subject to an advisory
shareholder vote at the AGM to be held on 26 May 2022.
On behalf of the Board
Matthias Bichsel
Chairman of the Remuneration Committee
23 March 2022
127Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements

128 Petrofac Limited 2021 Annual report and accounts
Corporate governance
Directors’ statements
Directors’ responsibilities
The Directors are responsible for preparing the Annual report
and accounts and the financial statements in accordance with
applicable law and regulations.
The Directors have chosen to prepare the financial statements
in accordance with International Financial Reporting Standards
(IFRS). The Directors are also responsible for the preparation
ofthe Directors’ remuneration report, which they have chosen
to prepare, being under no obligation to do so under Jersey
law. The Directors are also responsible for the preparation of
theCorporate governance report under the UK Listing Rules
andFRCregulations.
Jersey Company law (the ‘Law’) requires the Directors to prepare
financial statements for each financial period in accordance
with generally accepted accounting principles. The financial
statements are required by law to give a true and fair view of the
state of affairs of the Company at the period end and of the profit
or loss of the Company for the period then ended. In preparing
these financial statements, the Directors should:
– Select suitable accounting policies and then apply
themconsistently
– Make judgements and estimates that are reasonable
– Specify which generally accepted accounting principles
havebeen adopted in their preparation
– Prepare the financial statements on a going concern basis,
unless it is inappropriate to presume that the Company will
continue in business
The Directors are responsible for keeping proper accounting
records, which are sufficient to show and explain the Company’s
transactions and to disclose with reasonable accuracy at any
time the financial position of the Company and enable them to
ensure that the financial statements prepared by theCompany
comply with the requirements of the Law. They arealso
responsible for safeguarding the assets of the Group and
Company and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.
The Directors are responsible for the maintenance and
integrityof the corporate and financial information included
onthe Company’s website. Legislation in Jersey governing
thepreparation and dissemination of financial statements
maydiffer from legislation in other jurisdictions.
Directors’ approach
The Board’s objective is to present a fair, balanced and
understandable assessment of the Company’s position and
prospects, particularly in the Annual report and accounts, half-
year results announcement and other published documents
and reports to Regulators. The Board has established an Audit
Committee to assist with this obligation.
Going concern
The Company’s business activities, together with the factors
likely to affect its future development, performance and position,
are set out in the Strategic report on pages 6 to 17. The financial
position of the Company, its cash flows, liquidity position and
borrowing facilities are described in the Financial review on pages
83 to 87. In addition, Note 2.5 to the financial statements includes
the Company’s objectives, policies and processes for managing
its capital; its financial risk management objectives; details of its
financial instruments and hedging activities; and its exposures to
credit and liquidity risk.
The Company has considerable financial resources together with
long-term contracts with a number of clients and suppliers across
different geographic areas and industries. Consequently, the
Directors believe that the Company is well placed to manage its
business risks successfully.
The Directors have a reasonable expectation, as set out in Note
2.5 to the Financial statements on page 147, that the Company
has adequate resources to continue in operational existence
for the period of at least 12 months from the date of signing the
Group financial statements to 31 March 2023. Thus they continue
to adopt the going concern basis of accounting in preparing the
annual financial statements.
Responsibility statement of the Directors
inrespectof the Annual Report
Each of the Directors listed on pages 92 and 93 confirms that,
tothe best of their knowledge:
– The Annual report and accounts, taken as a whole, is fair,
balanced and understandable, and provides the information
necessary for shareholders to assess the Company’s position
and performance, business model and strategy
– The financial statements, prepared in accordance with IFRS,
give a true and fair view of the assets, liabilities, financial
position and profit of the Company and the undertakings
included in the consolidation taken as a whole
– The Strategic report contained on pages 4 to 87 includes
a fairreview of the development and performance of
the business and the position of the Company and the
undertakings included in the consolidation taken as a
whole, together withadescription of the principal risks
anduncertainties thatthey face
By order of the Board
Afonso Reis e Sousa
Chief Financial Officer
23 March 2022

Financial statements
Group financial
statements
Pages
Independent auditor’s report to the members
of Petrofac Limited 130
Consolidated income statement 141
Consolidated statement of other comprehensive income 142
Consolidated balance sheet 143
Consolidated statement of cash flows 144
Consolidated statement of changes in equity 145
Notes to the consolidated financial statements
Note 1 Corporate information 146
Note 2 Summary of significant accounting policies 146
Note 3 Revenue from contracts with customers 162
Note 4 Segment information 163
Note 5 Expenses and income 166
Note 6 Separately disclosed items 167
Note 7 Finance income/(expense) 169
Note 8 Income tax 170
Note 9 Earnings per share 172
Note 10 Dividends paid and proposed 172
Note 11 Deferred consideration 173
Note 12 Property, plant and equipment 173
Note 13 Non-controlling interests 174
Note 14 Goodwill 175
Note 15 Intangible assets 177
Note 16 Investments in associates and joint ventures 178
Note 17 Other financial assets and other financial liabilities 180
Note 18 Inventories 184
Note 19 Trade and other receivables 184
Note 20 Contract assets and contract liabilities 186
Note 21 Cash and short-term deposits 187
Note 22 Share capital 188
Note 23 Employee Benefit Trust (EBT) shares 188
Note 24 Share-based payment plans 189
Note 25 Other reserves 191
Note 26 Interest-bearing loans and borrowings 192
Note 27 Provisions 193
Note 28 Trade and other payables 194
Note 29 Leases 195
Note 30 Commitments and contingent liabilities 196
Note 31 Related party transactions 196
Note 32 Accrued contract expenses 197
Note 33 Risk management and financial instruments 197
Note 34 Subsidiaries, associates and joint arrangements 200
Appendices 203
Strategic report Governance Financial statements
129Petrofac Limited 2021 Annual report and accounts

Independent Auditor’s Report
to the members of Petrofac Limited
Opinion
In our opinion:
– Petrofac Limited’s Group financial statements and parent company financial statements (the financial statements) give a true and fair
view of the state of the Group’s and of the parent company’s affairs as at 31 December 2021 and of the Group’s loss and the parent
company’s loss for the year then ended;
– the financial statements have been properly prepared in accordance with International Financial Reporting Standards; and
– the financial statements have been properly prepared in accordance with the requirements of the Companies (Jersey) Law 1991.
We have audited the financial statements of Petrofac Limited (the parent company) and its subsidiaries (the Group) for the year ended
31 December 2021 which comprise:
Group Parent company
Consolidated income statement for the year ended 31
December 2021
Company income statement for the year ended 31 December 2021
Consolidated statement of comprehensive income for the year
ended 31 December 2021
Company statement of comprehensive income for the year ended
31 December 2021
Consolidated balance sheet at 31 December 2021 Company balance sheet at 31 December 2021
Consolidated statement of cash flows for the year ended 31
December 2021
Company statement of cash flows for the year ended 31 December
2021
Consolidated statement of changes in equity for the year ended
31 December 2021
Company statement of changes in equity for the year ended 31
December 2021
Related notes 1 to 34 to the financial statements, including a
summary of significant accounting policies
Related notes 1 to 25 to the financial statements including a
summary of significant accounting policies
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law.
Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements
section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
We are independent of the Group and parent company in accordance with the ethical requirements that are relevant to our audit of the
financial statements, including the UK FRC’s Ethical Standard as applied to listed public interest entities, and we have fulfilled our other
ethical responsibilities in accordance with these requirements.
The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the Group or the Company and we remain
independent of the Group and the Company in conducting the audit.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the Directors’ use of the going concern basis of accounting in the
preparation of the financial statements is appropriate. Our evaluation of the Directors’ assessment of the Group and parent company’s
ability to continue to adopt the going concern basis of accounting included:
– confirming our understanding of the Directors’ going concern assessment process.
– assessing the adequacy of the going concern assessment period to 31 March 2023 and considering the existence of any significant
events or conditions beyond this period.
– the lead audit partner increasing his time directing and supervising the audit procedures on going concern and utilising an EY
specialist to assist in assessing the model and the key assumptions employed.
– verifying inputs against Board-approved forecasts and debt facility terms.
– reviewing borrowing facility documentation to confirm availability to the Group through the going concern period and to assess the
completeness of covenants identified by management.
– assessing management’s forecasting process and the consistency of the assessment with information obtained from other areas of
the audit, such as accounting estimates.
– testing the assessment, including forecast liquidity and covenant compliance under base and downside scenarios, for clerical accuracy.
– assessing whether assumptions made were reasonable with reference to information obtained elsewhere in the audit and, in the
case of downside scenarios, appropriately severe in light of the Group’s relevant principal risks and uncertainties.
– challenging the amount and timing of identified mitigating actions available to respond to a ‘severe but plausible’ downside scenario,
and whether those actions are feasible and within the Group’s control.
– performing independent sensitivity analysis on assumptions, including applying incremental adverse cashflow and covenant
impacts, and a more conservative view on future mitigating actions.
– we performed reverse stress testing in order to identify and understand what factors and how severe the downside scenarios would
have to be to result in the Group utilising all liquidity or breaching a financial covenant during the going concern period.
– for covenant amendments agreed with lenders on 4 March 2022, we inspected the amendment agreements approved to
understand the revised covenant levels during the going concern assessment period to 31 March 2023.
Petrofac Limited 2021 Annual report and accounts130

– we assessed the plausibility of whether further covenant amendments or waivers would be approved by lenders, if required.
Our audit procedures included assessing the conclusions of the Group’s external debt advisor, and the involvement of an EY debt
advisory specialist to help us form an independent view.
– assessing the appropriateness of going concern disclosures.
Our key observations
– The Directors’ assessment forecasts that the Group will maintain sufficient liquidity and covenant compliance throughout the going
concern assessment period in both the base case and mitigated ‘severe but plausible’ downside scenario.
– However, headroom against the revised covenants approved on 4 March 2022 is limited in the mitigated ‘severe but plausible’
downside scenario and further covenant amendments may be required in the going concern assessment period.
– The Directors’ conclusion is that it is a plausible that further covenant amendments or waivers would be approved by lenders if
required. The Directors identified this as a significant judgement, which we concluded has been appropriately disclosed.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that,
individually or collectively, may cast significant doubt on the Group’s and parent company’s ability to continue as a going concern
foraperiod of at least twelve months from when the financial statements are authorised for issue to 31 March 2023. Going concern
has also been determined to be a key audit matter.
In relation to the Group and parent company’s reporting on how they have applied the UK Corporate Governance Code, we have
nothing material to add or draw attention to in relation to the directors’ statement in the financial statements about whether the
directors considered it appropriate to adopt the going concern basis of accounting.
Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the relevant sections of this
report. However, because not all future events or conditions can be predicted, this statement is not a guarantee as to the Group and
parent company’s ability to continue as a going concern.
Overview of our audit approach
Audit scope – We performed an audit of the complete financial information of five components and audit
procedures on specific balances for a further five components.
– The components where we performed full or specific audit procedures accounted for 95% of the
Group’s revenue, 89% of its business performance profit before tax and 92% of its total assets.
Key audit matters – Going concern
– Revenue and margin recognition on fixed price engineering, procurement and construction
contracts
– Recoverability of PM304 oil & gas asset and certain contingent and deferred consideration
balances
– Recoverability of deferred tax assets and assessment of uncertain tax treatments
– HMRC National Insurance inquiry
– Conclusion of SFO investigation
Materiality – We set overall group materiality at US$8.0m, representing 0.25% of revenue.
An overview of the scope of our audit
Tailoring the scope
Our assessment of audit risk, our evaluation of materiality and our allocation of performance materiality determine our audit scope
foreach company within the Group. Taken together, this enables us to form an opinion on the consolidated financial statements.
We consider the account size, risk profile, the organisation of the Group and effectiveness of group-wide controls, changes in the
business environment and other factors such as recent internal audit results when assessing the level of work to be performed at
eachcomponent.
In assessing the risk of material misstatement to the Group financial statements, and to ensure we had adequate quantitative coverage
of significant accounts in the Group financial statements, we selected components covering entities within the UAE, the UK, Malaysia
and the USA, which represent the principal business units within the Group. The primary audit team performs audit procedures
directly on those areas of accounting performed centrally, most notably impairment testing, contingent and deferred consideration
accounting, taxation, matters relating to the conclusion of the SFO investigation, the HMRC National Insurance inquiry and
consolidation procedures.
Of the ten components selected, we performed an audit of the complete financial information of five components (“full scope
components”) which were selected based on their size or risk characteristics. For the remaining five components (“specific scope
components”), we performed audit procedures on specific accounts within that component that we considered had the potential for
the greatest impact on the significant accounts in the consolidated financial statements either because of the size of these accounts or
their risk profile. The audit scope of these components may not have included testing of all significant accounts of the component but
will have contributed to the coverage of significant accounts tested for the group.
The primary audit team also performed specified procedures on one further component.
Strategic report Governance Financial statements
131Petrofac Limited 2021 Annual report and accounts

Number % Group revenue
% Group business
profit performance
before tax
% Group total
assets
Full scope components 5 86% 83% 86%
Specific scope components 5 9% 6% 6%
Total 10 95% 89% 92%
Of the remaining components that together represent 5% of the Group’s revenue, none are individually greater than 1% of the
Group’srevenue. For these components, we performed other procedures including journal entry testing, analytical review, testing
ofconsolidation entries, intercompany eliminations and foreign currency translation calculations to respond to potential risks of
material misstatement to the Group financial statements.
Changes from the prior year
The key change to our scoping from 2020 was the removal of one review scope component as a result of the disposal of the Group’s
Mexican operations in the prior year.
Involvement with component teams
In establishing our overall approach to the Group audit, we determined the type of work that needed to be undertaken at each of the
components by us, as the primary audit engagement team, or by component auditors from other EY global network firms operating
under our instruction. Of the five full scope components, audit procedures were performed on two of these directly by the primary
audit team, with the remainder performed by UAE, UK and Malaysian component teams. For the five specific scope components,
audit procedures were performed on three of these directly by the primary audit team, with the remainder performed by UAE and
UKcomponent teams.
Where the work was performed by component auditors, we determined the appropriate level of involvement to enable us to determine
that sufficient audit evidence had been obtained as a basis for our opinion on the Group as a whole.
The COVID-19 pandemic and ongoing travel restrictions resulted in the primary audit team being unable to conduct physical site
visitswith our component teams for the 2021 audit. To ensure that the lead audit partner or his designates were able to appropriately
direct the audit and to exercise oversight during key audit activities at planning and execution, physical site visits were replaced with
virtual site visits using video conference and more frequent conference calls with component teams. The nature and extent of these
interactions were designed relative to the size and risk of the individual components, and the division of responsibilities between the
component teams and the primary audit team on the significant risk areas applicable to each component. During the current year’s
audit cycle, interactions were held with all component teams. These interactions involved discussing the audit approach with the
component team and any issues arising from their work, meeting virtually with local management, attending planning and closing
meetings and reviewing key audit working papers on risk areas. The primary audit team also attended all closing meetings for each
fulland specific scope location via video conference. This, together with the additional procedures performed at Group level, gave
usappropriate evidence for our opinion on the Group financial statements.
Climate change
There has been increasing interest from stakeholders as to how climate change will impact Petrofac Limited. The Group has
determined that the most significant future impacts from climate change on its operations will be from managing the transition
toalower carbon economy and developing its capabilities to unlock value for its clients as well as achieving its Net Zero targets.
These are explained on pages 37 to 43 in the required Task Force for Climate related Financial Disclosures and on pages 62 to 69
intheprincipal risks and uncertainties, which form part of the “Other information,” rather than the audited financial statements.
Our procedures on these disclosures therefore consisted solely of considering whether they are materially inconsistent with the
financial statements or ourknowledge obtained in the course of the audit or otherwise appear to be materially misstated.
As explained in Note 2 of the Consolidated Financial Statements (pages 146 to 161), governmental and societal responses to climate
change risks are still developing, and are interdependent upon each other, and consequently financial statements cannot capture all
possible future outcomes as these are not yet known. The degree of uncertainty of these changes may also mean that they cannot
betaken into account when determining asset and liability valuations and the timing of future cash flows under the requirements of
International Financial Reporting Standards.
Our audit effort in considering climate change was focused on ensuring that the effects of material climate risks disclosed in Note 2
have been appropriately reflected in asset values and associated disclosures where values are determined through modelling future
cash flows, being the recoverable amounts of property, plant and equipment, goodwill, intangible assets, and deferred tax assets.
We also challenged the Directors’ considerations of climate change in their assessment of going concern and viability and
associateddisclosures.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial
statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud)
that we identified. These matters included those which had the greatest effect on: the overall audit strategy, the allocation of resources
in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the
financial statements as a whole, and in our opinion thereon, and we do not provide a separate opinion on these matters.
Independent Auditor’s Report
to the members of Petrofac Limited
continued
Petrofac Limited 2021 Annual report and accounts132

Risk Our response to the risk
Key observations
communicated to the
Audit Committee
Revenue and margin
recognition on fixed price
engineering, procurement
and construction contracts
Refer to the Audit Committee
Report (page 112); Accounting
policies (pages 153 and 154);
and Note 3 of the Consolidated
Financial Statements (page 162)
These contracts are reported
inthe Engineering and
Construction (E&C) segment.
Total E&C revenue for
theyearwas US$2.0bn
(2020:US$3.1bn) and 64%
ofGroup revenue (2020: 75%).
Accounting for fixed price
engineering, procurement and
construction contracts requires
significant judgement and
estimation, which increases the
risk of bias or error and subjects
the process to the risk of
management override of controls.
Judgement and estimation
areneeded in the following
areas which directly impact
revenue recognised:
– recognition of variation orders
and claims not yet approved
by the customer in contract
value;
– estimation of variable
consideration in respect of
liquidated damages as a
deduction to contract value;
and
– forecasting of costs to
complete including
contingencies.
The audit of these contracts was performed by a component team based in the
UAE, with direct review, oversight and challenge from the primary audit team.
Our audit involved detailed testing on a selection of the most significant
and judgemental contracts; these 18 contracts represent 79% of the
revenue subject to this risk. On the remaining 21%, we performed other
procedures including analytical review, management enquiry and cost and
accrual testing where material.
Our audit procedures were primarily substantive in nature, however, we identified
and assessed key controls over revenue recognition including:
– senior audit team members virtually attended a selection of key quarterly
contract review meetings held during the year where we observed
constructive challenge as to contract status, risks and project forecast costs
to complete; and
– transactional controls underpinning contract-related cost balances, including
the purchase to pay and payroll process.
For the 18 contracts selected for detailed testing:
– we re-performed percentage of completion calculations, testing the clerical
accuracy of revenue recognised in line with IFRS 15 Revenue from Contracts
with Customers.
– we inspected the contractual terms relevant to recognised variations and
claims to ensure their recognition was supported by enforceable rights under
the relevant contract.
– we corroborated management assertions in relation to the recognition of
unapproved variation orders and claims, and the non-recognition of potential
liquidated damages by inspecting correspondence and minutes of meetings
between senior management and the customer and by reviewing the track
record of settlements with the customer and/or in the wider region.
– we inspected supporting documentation and tested a sample of underlying
costs supporting the recognition of variation orders and claims not yet
approved in contract value.
– where management had engaged a third-party claims specialist, we obtained
and reviewed their reports, met directly with the specialist and assessed their
competency and objectivity.
– we tested contract cost accruals on a sample basis by agreeing components
of accruals to purchase orders, progress reports and payroll data.
– we tested cost to complete estimates by agreeing project material and
subcontractor costs to quotations or rate schedules and manpower costs
tomobilisation reports. We performed analytical procedures comparing
budgets and prior period estimates and retrospectively assessed the
accuracy of historical forecasts. We also challenged management’s
assessment and the legal basis for the treatment of subcontractor claims.
– we challenged the adequacy of the contract contingencies included in
forecast costs to complete with respect to the physical progress on the
project and remaining costs to complete based on our understanding of
theproject status, Petrofac’s experience and consideration of any contra-
indicators, including external sources. We analysed the movements
throughout the life of the contract, compared against similar contracts and
challenged management’s conclusions in light of remaining contract tenure
and the associated risks.
– in addition to the procedures over contract revenue and cost set out above,
for those contracts identified as onerous we challenged the completeness
and accuracy of the estimate of future contract losses provided for, and the
disclosure of this provision in the Group financial statements.
In addition to the above, for all significant revenue streams, we executed data
analysis techniques to identify higher risk patterns, trends and anomalies for
further testing to understand the business rationale, authorisation and
appropriateness of the entry.
We concluded that
revenue and margin
recognition on fixed
price engineering,
procurement and
construction contracts
has been appropriately
recognised in
accordance with
therequirements
ofIFRS 15.
We are satisfied
thatestimates made
inrelation to variation
orders and claims,
liquidated damages,
cost accruals and
forecast costs to
complete, including
contingencies, are
appropriate and in
linewith IFRS 15
andthe Group’s
accounting policy.
We are also satisfied
that the significant
judgements and
estimates associated
with revenue
recognitionhave been
appropriately disclosed
in Note 2 to the Group
financial statements.
Strategic report Governance Financial statements
133Petrofac Limited 2021 Annual report and accounts

Independent Auditor’s Report
to the members of Petrofac Limited
continued
Risk Our response to the risk
Key observations
communicated to the
Audit Committee
Recoverability of PM304 oil
& gas asset and certain
contingent and deferred
consideration balances
Refer to the Audit Committee
Report (page 112); Accounting
policies (page 152); and Notes
6 and 17 of the Consolidated
Financial Statements (page 167
and 180)
PM304 Impairment
During 2021, the Group
reviewed the carrying
amountof its Block PM304
oiland gas assets, recognising
an impairment charge of
US$15 million. As part of
thisassessment, significant
assumptions were made in
respect of field performance,
future oil prices and the
likelihood of securing a PSC
licence extension beyond 2026.
Mexico contingent
consideration
The consideration associated
with the disposal of the Group’s
Mexican operations is carried
atfair value and experienced a
US$5m downward adjustment
in 2021. The estimation of this
fair value is highly judgemental,
requiring assumptions about
theoutcome of uncertain
futureevents.
JSD6000 deferred
consideration
The deferred consideration
associated with the disposal
ofJSD6000 installation vessel
iscarried at fair value, which at
year-end was determined to
beUS$55m (2020 US$55m).
The fair value of the deferred
consideration is dependent on
key assumptions around the
Group’s partner’s continued
intent and capability to
completethe construction
andcommissioning of the
vesselwithin the due timeframe
and the market for such a vessel
when it is ready for sale.
PM304 Impairment
We challenged the significant assumptions underlying the impairment
assessment. Our procedures included:
– making enquiries of Petrofac reserves specialist teams as to the
feasibility of field performance and development assumptions;
– making enquiries of key management and reviewing external
correspondence to validate assumptions around the uncertainty
ofsecuring of a licence extension; and
– independently validating the future oil price assumptions made in the
cashflow forecasts by comparing to external forecasts made by peers,
banks, brokers and consultants.
We also tested the clerical accuracy of the impairment model and involved
EY valuations specialists to assist us in concluding on the appropriateness
of the discount factor applied.
Mexico contingent consideration
We reviewed correspondence, met with external legal counsel and
challenged the assumptions made by management in determining
thefairvalue of the contingent consideration receivable amount
recognised. We performed sensitivity analysis using reasonable
alternativeassumptions to test whether management’s value was
withinareasonable range of acceptable outcomes. We also challenged
management on the adequacy and transparency of disclosures
surrounding the significant estimates made in this regard.
JSD6000 deferred consideration
We obtained management’s valuation analysis for the deferred
consideration receivable, which is underpinned by a vessel valuation
reportfrom a third-party specialist engaged by management. We made
enquiries of management as to the future plans for completion of the
vessel and met directly with management’s external valuation specialist.
We inspected relevant evidence, including the year end vessel progress
report. We alsoengaged internal EY valuation specialists to assist us in
evaluatingmanagement’s external valuer’s findings and considering any
contra-evidence to conclude whether management’s valuation was within
a range of acceptable values.
We have concluded that
the PM304 impairment
charge and the fair
value of the Mexico
andJSD6000
consideration
receivables have
beenappropriately
determined. For all
items, the estimates
offair value fell
withinarange of
acceptablevalues.
We have also reviewed
the disclosures in Note
2 to the Group financial
statements regarding
the significant
estimation uncertainties
inherent in accounting
for these items
andhaveconcluded
that thedisclosures
areappropriate.
Petrofac Limited 2021 Annual report and accounts134

Risk Our response to the risk
Key observations
communicated to the
Audit Committee
Recoverability of deferred
tax assets and assessment
of uncertain tax treatments
Refer to the Audit Committee
Report (page 112); Accounting
policies (page 151); and Note 8
of the Consolidated Financial
Statements (page 170)
The Group recognises deferred
tax assets in a number of
jurisdictions, with the most
significant being US$18 million
in the UK (2020: US$18 million).
The recognition of this deferred
tax asset requires probable
forecast taxable profits to
support its recoverability.
The Group also operates in
multiple tax jurisdictions where
uncertain tax treatments may
be challenged at a later date
bythe relevant authorities.
Liabilities of US$101 million
(2020: US$131 million) are held
principally in respect of tax
deductions previously taken,
transfer pricing arrangements
and ongoing tax audits.
This isan area which requires
management to exercise
significant judgement as to
thelikelihood of an adverse
outcome for the group, and
estimation as to the likely
outflow in the event of such
afinding.
Deferred tax assets
We evaluated management’s assessment of the likelihood of recovery
ofthe UK deferred tax asset balance by obtaining profit forecasts for the
relevant businesses and testing whether these were reasonable and
consistent with Board-approved plans.
We reviewed external correspondence supporting management’s view
that the probability of a licence extension for the PM304 block is now
lesslikely and thus that is now improbable that the operation will generate
sufficient taxable profits to utilise any of the deferred tax asset, leading to
the de-recognition of the previous US$43 million deferred tax asset.
Uncertain tax treatments
Our primary tax audit team based in the UK coordinated our audit
approach to uncertain tax treatments. Local tax experts in relevant
jurisdictions were involved as needed to address specific local tax matters.
We evaluated the risks associated with these exposures and any claims or
assessments made by tax authorities to date. We also inspected
documentation, considering whether developments in any ongoing tax
audits during the year necessitated a change in estimate on any provision.
We also considered whether any interest or penalties should apply based
on relevant legislation and historical experience with the authority in
question.
We were satisfied
thatthe remaining
UKdeferred tax asset
isappropriately
recognised on the
basisthat there will
beprobable future
taxable profits available.
We concluded that the
de-recognition of the
deferred tax asset
inMalaysia was
appropriate. We were
also satisfied that
deferred tax assets are
appropriately presented
and disclosed in the
financial statements.
Liabilities in respect
ofuncertain tax
treatments, including
penalties where
appropriate, have
beenaccounted for in
accordance with the
requirements of IFRIC
23 Uncertainty over
Income Tax Treatments.
We are satisfied
thattheamounts
recognised represent
management’s best
estimate based on the
Group’s experience in
the relevant jurisdictions
and historical tax
assessments concluded
with the tax authorities.
We have also reviewed
the disclosures in Note
2 to the Group financial
statements regarding
the significant
estimation uncertainties
inherent in accounting
for these items and
have concluded that
thedisclosures are
appropriate.
Strategic report Governance Financial statements
135Petrofac Limited 2021 Annual report and accounts

Independent Auditor’s Report
to the members of Petrofac Limited
continued
Risk Our response to the risk
Key observations
communicated to the
Audit Committee
HMRC National Insurance
inquiry
Refer to the Audit Committee
Report (page 113); and Note 30
of the Consolidated Financial
Statements (page 196)
HMRC are seeking to establish
whether a UK subsidiary of the
Group is a host employer for
offshore employees and
therefore liable for payment of
secondary National Insurance
Contributions between 1999
and 2014.
In 2020, HMRC provided a
decision notice to the Group,
informing of its conclusion that
aGroup subsidiary is liable for
unpaid contributions plus
interest in the amount of
£124 million. A further £3m of
interest has accumulated to the
2021 year-end, and the total
exposure translates to US$172m
as at 31 December 2021.
The Group strongly disagrees
with the merit of the decision
notice and have filed an appeal.
Judgement is required to
assess whether, at this
stage,the matter satisfies
therecognition criteria for
aprovision, or should
continuetobe disclosed
asacontingentliability.
We obtained an update from management on current year developments in
the matter and inspected correspondence between the Group and HMRC.
We engaged an EY taxation specialist familiar with the relevant National
Insurance legislation and HMRC dispute resolution to assist us in forming
an independent view on the likelihood of an adverse outcome for
theGroup.
Together with our specialist we inspected advice received by the group
from external legal counsel engaged on this matter and confirmed this
advice directly with external counsel.
We assessed the adequacy of the Group’s updated disclosure of the
matter in Note 30 to the Group financial statements.
We have concluded that
the facts and
circumstances continue
to support the position
taken by the group at
this time, that disclosure
as a contingent liability
remains appropriate at
31 December 2021 and
that this disclosure is
adequate and
appropriate.
Petrofac Limited 2021 Annual report and accounts136

Risk Our response to the risk
Key observations
communicated to the
Audit Committee
Conclusion of SFO
investigation
Refer to the Group Chief
Executive’s review (page 7); and
Note 6 of the Consolidated
Financial Statements (page 167)
The SFO’s investigation into
theGroup came to a conclusion
on 4 October 2021 with a
£77mpenalty being imposed
following the Group’s admission
of guilt on seven charges under
Section 7 of the UK Bribery
Act2010.
There are risks that:
– the conclusion of the
investigation is
inappropriately reflected
inthe annual report and
accounts;
– post-settlement risks arise
following the conclusion of
the SFO’s investigation into
the Group including, but not
limited to, the potential for
shareholder action; or
– the findings from the
investigation indicate that the
internal control environment
does not support the
prevention, or detection and
correction, of material
misstatements relevant to
financial reporting arising
from non-compliance with
laws and regulations,
including instances of
briberyand corruption.
In response to the risks identified we:
– reviewed minutes of Board meetings.
– met regularly with Group General Counsel.
– reviewed the package of documents submitted to the Courts.
– made inquiries of external legal counsel to validate our understanding
ofdevelopments in the current period and obtain their views on any
post-settlement risks facing the company.
– updated our understanding of the control environment with respect to
anti-bribery and corruption by reviewing the presentations made to the
SFO by the group and its advisors.
– obtained an understanding of the elements of the current control
framework that are designed to prevent non-compliance with laws and
regulations, including bribery and corruption.
– performed a walkthrough of processes and controls over the
identification and authorisation of higher-risk third parties, and the
processes and controls in place to prevent payment to unauthorised
third parties.
– assessed the disclosures of the conclusion of the investigation and
penalty in the annual report.
Our procedures were supported by specialists from our EY Forensic
&Integrity Services team.
We were satisfied with
the presentation of the
penalty amount as a
separately disclosed
item in the year and
withthe adequacy of
the related disclosure
inthe annual report.
No specific matters
were raised with
theAudit Committee
inrelation to our
assessment of the
internal control
environment.
Strategic report Governance Financial statements
137Petrofac Limited 2021 Annual report and accounts

Independent Auditor’s Report
to the members of Petrofac Limited
continued
Our application of materiality
We apply the concept of materiality in planning and performing the audit, in evaluating the effect of identified misstatements on the
audit and in forming our audit opinion.
Materiality
The magnitude of an omission or misstatement that, individually or in the aggregate, could reasonably be expected to influence the
economic decisions of the users of the financial statements. Materiality provides a basis for determining the nature and extent of our
audit procedures.
We determined materiality for the Group to be US$8.0 million (2020: US$10.0 million), which is 0.25% (2020: 0.25%) of Group revenue.
We believe that stakeholders and users of the financial statements continue to be focused on revenue and revenue-related metrics,
such as new order intake and backlog. Revenue has historically also been a leading indicator for the profitability and cash flow
generating ability of the Group. Thus, we determined that revenue continues to represent an appropriate basis on which to set
materiality in 2021.
We determined materiality for the Parent Company to be US$9.4 million (2020: US$6.8 million), based on 0.5% (2020: 0.5%) of total assets.
During the course of our audit, we reassessed our initial materiality assessment and concluded that no changes were necessary.
Performance materiality
The application of materiality at the individual account or balance level. It is set at an amount to reduce to an appropriately low level the
probability that the aggregate of uncorrected and undetected misstatements exceeds materiality.
On the basis of our risk assessments, together with our assessment of the Group’s overall control environment, our judgement was
that performance materiality should be set at 50% (2020: 50%) of our materiality, namely US$4.0m (2020: US$5.0m).
Audit work at component locations for the purpose of obtaining audit coverage over significant financial statement accounts is
undertaken based on a percentage of total performance materiality. The performance materiality set for each component is based
onthe relative scale and risk of the component to the Group as a whole and our assessment of the risk of misstatement at that
component. In the current year, the range of performance materiality allocated to components was US$0.8m to US$4.0m (2020:
US$1.3m to US$4.3m).
Reporting threshold
An amount below which identified misstatements are considered as being clearly trivial.
We agreed with the Audit Committee that we would report to them all uncorrected audit differences in excess of US$0.4m (2020:
US$0.5m), which is set at 5% of planning materiality, as well as differences below that threshold that, in our view, warranted reporting
on qualitative grounds. We also agreed that we would report to the Audit Committee any uncorrected reclassification misstatements
above 2% of the any primary financial statement line items to which the misstatement relates.
We evaluate any uncorrected misstatements against both the quantitative measures of materiality discussed above and in light of other
relevant qualitative considerations in forming our opinion.
Other information
The other information comprises the information included in the annual report set out on pages 1 to 128, including the Strategic
Report and Governance Report, other than the financial statements and our auditor’s report thereon. The directors are responsible
forthe other information contained within the annual report.
Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in this
report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent
with the financial statements or our knowledge obtained in the course of the audit or otherwise appears to be materially misstated.
If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise
toa material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there
isa material misstatement of the other information, we are required to report that fact.
We have nothing to report in this regard.
Petrofac Limited 2021 Annual report and accounts138

Opinion on other matters, as agreed in our Engagement Letter
In our opinion, based on the work undertaken in the course of the audit:
– the part of the Directors’ Remuneration Report to be audited has been properly prepared in accordance with the basis of
preparation described therein;
– the information given in the Strategic Report and Governance Report for the financial year for which the financial statements are
prepared is consistent with the financial statements and those reports have been prepared in accordance with applicable legal
requirements;
– the information about internal control and risk management systems in relation to financial reporting processes and about share
capital structures, given in compliance with rules 7.2.5 and 7.2.6 in the Disclosure Rules and Transparency Rules sourcebook made
by the Financial Conduct Authority (the FCA Rules), is consistent with the financial statements and has been prepared in accordance
with applicable legal requirements; and
– the information about the Company’s corporate governance code and practices and about its administrative, management and
supervisory bodies and their committees complies with rules 7.2.2, 7.2.3 and 7.2.7 of the FCA Rules.
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of
the audit, we have not identified material misstatements in the Strategic Report or the Governance report.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters in relation to which the Companies (Jersey) Law 1991 requires us to
report to you if, in our opinion:
– proper accounting records have not been kept by the Company, or proper returns adequate for our audit have not been received
from branches not visited by us; or
– the financial statements are not in agreement with the Company’s accounting records and returns; or
– we have not received all the information and explanations we require for our audit.
Corporate Governance Statement
We have reviewed the directors’ statement in relation to going concern, longer-term viability and that part of the Corporate Governance
Statement relating to the Group’s compliance with the provisions of the UK Corporate Governance Code specified for our review by
the Listing Rules.
Based on the work undertaken as part of our audit, we have concluded that each of the following elements of the Corporate
Governance Statement is materially consistent with the financial statements or our knowledge obtained during the audit:
– Directors’ statement with regards to the appropriateness of adopting the going concern basis of accounting and any material
uncertainties identified set out on page 128;
– Directors’ explanation as to its assessment of the company’s prospects, the period this assessment covers and why the period is
appropriate set out on page 70;
– Director’s statement on whether it has a reasonable expectation that the group will be able to continue in operation and meets its
liabilities set out on page 128;
– Directors’ statement on fair, balanced and understandable set out on page 110;
– Board’s confirmation that it has carried out a robust assessment of the emerging and principal risks set out on pages 60 to 69;
– The section of the annual report that describes the review of effectiveness of risk management and internal control systems set out
onpages 109; and
– The section describing the work of the audit committee set out on pages 106 to 113.
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement set out on page 128, the Directors are responsible for the
preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the
Directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether
due to fraud or error.
In preparing the financial statements, the Directors are responsible for assessing the Group and the parent company’s ability
tocontinue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless the Directors either intend to liquidate the Group or the parent company or to cease operations, or have no realistic
alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is
ahighlevel of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Strategic report Governance Financial statements
139Petrofac Limited 2021 Annual report and accounts

Independent Auditor’s Report
to the members of Petrofac Limited
continued
Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect irregularities, including fraud. The risk of not detecting a material misstatement due to fraud
ishigher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery
orintentional misrepresentations, or through collusion. The extent to which our procedures are capable of detecting irregularities,
including fraud is detailed below. However, the primary responsibility for the prevention and detection of fraud rests with both those
charged with governance of the Company and management.
– We obtained an understanding of the legal and regulatory frameworks that are applicable to the Group and determined that the
most significant are International Financial Reporting Standards, the Companies (Jersey) Law 1991, the UK Corporate Governance
Code, the UK Bribery Act, employment law, environmental regulations, health and safety, and tax legislation in the jurisdictions
where the group operates.
– We understood how the Group is complying with those frameworks by making enquiries of management, those charged with
governance, internal audit, those responsible for legal and compliance procedures and the company secretary. We corroborated
our enquiries through our review of board minutes and papers provided to the Audit Committee, as well as by considering the
results of our audit procedures across the group. Our assessment considered the tone set from the top by senior management
andthe emphasis placed on a culture of honest and ethical behaviour.
– We assessed the susceptibility of the financial statements to material misstatement, including how fraud might occur, by meeting
with individuals from various parts of the business to gather their views. We considered the programmes and controls that the
Group has established to address the risks identified, or that otherwise prevent, deter or detect fraud, and how senior management
monitors those programmes and controls. We engaged our forensics specialists to provide input on specific aspects of our audit
approach to the risk of fraud and non-compliance with laws and regulations.
– Based on this understanding we designed our audit procedures to identify non-compliance with laws and regulations that could
give rise to a material misstatement in the financial statements; this included the provision of specific instructions to component
teams. Our procedures focused on enquires of Group management, those charged with governance, legal counsel, and internal
audit; addressing the risk of management override through procedures on accounting estimates (as set out in the Key Audit Matters
section of this report) and journal entry testing; as well as a specific work programme to address the risks of bribery and corruption.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s
website at https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Other matters we are required to address
– We were first appointed by the company to audit the financial statements for the year ending 31 December 2005 and subsequent
financial periods. The period of total uninterrupted engagement including previous renewals and reappointments is 17 years,
covering the years ending 31 December 2005 to 31 December 2021.
– The audit opinion is consistent with the additional report to the audit committee.
Petrofac Limited 2021 Annual report and accounts140
Use of our report
This report is made solely to
the company’s members, as a body, in accordance with Article 113A of the Companies (Jersey) Law 1991.
Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in
an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone
other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
Colin Brown
for and on behalf of Ernst & Young LLP
London
23 March 2022

Consolidated income statement
For the year ended 31 December 2021
Notes
Business
performance
(1)
US$m
Separately
disclosed
items
US$m
Reported
2021
US$m
Business
performance
(1)
(restated)
(2)
US$m
Separately
disclosed
items
(restated)
(2)
US$m
Reported
2020
(restated)
(2)
US$m
Revenue 3 3,057 – 3,057 4,081 – 4,081
Cost of sales
5a (2,879) – (2,879) (3,802) – (3,802)
Gross profit 178 – 178 279 – 279
Selling, general and administration expenses
5b,6 (175) (159) (334) (165) (243) (408)
Expected credit loss reversal/(allowance)
5e 25 – 25 (9) – (9)
Other operating income
5f 8 – 8 21 – 21
Other operating expenses
5g (7) – (7) (43) – (43)
Operating profit/(loss) 29 (159) (130) 83 (243) (160)
Finance income
7 6 – 6 9 – 9
Finance expense
6,7 (44) (28) (72) (37) – (37)
Share of net profit of associates and joint
ventures
16 7 – 7 5 – 5
(Loss)/profit before tax (2) (187) (189) 60 (243) (183)
Income tax credit/(expense)
8a 40 (43) (3) (19) 1 (18)
Net profit/(loss) 38 (230) (192) 41 (242) (201)
Attributable to:
Petrofac Limited shareholders 35 (230) (195) 50 (242) (192)
Non-controlling interests
13 3 – 3 (9) – (9)
38 (230) (192) 41 (242) (201)
Earnings/(loss) per share (US cents)
Basic
9 9.7 (63.5) (53.8) 14.8 (71.8) (57.0)
Diluted
9 9.7 (63.5) (53.8) 14.8 (71.8) (57.0)
(1) This measurement is shown by the Group as a means of measuring underlying business performance; see note 2 and Appendix A.
(2) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
Strategic report Governance Financial statements
141Petrofac Limited 2021 Annual report and accounts

Notes
2021
US$m
2020
(restated)
(1)
US$m
Reported net loss (192) (201)
Other comprehensive income/(loss) to be reclassified to consolidated income
statement in subsequent periods
Net changes in fair value of derivatives and financial assets designated as cash flow hedges
25 1 (15)
Foreign currency translation gains/(losses)
25 3 (18)
Other comprehensive income/(loss) to be reclassified to consolidated income statement in
subsequent periods 4 (33)
Other comprehensive income reclassified to consolidated income statement
Foreign currency translation losses reclassified to the consolidated income statement
25 8 3
Other comprehensive income reclassified to consolidated income statement 8 3
Total comprehensive (loss) for the year (180) (231)
Attributable to:
Petrofac Limited shareholders (183) (222)
Non-controlling interests
13 3 (9)
(180) (231)
(1) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
Consolidated statement of comprehensive income
For the year ended 31 December 2021
Petrofac Limited 2021 Annual report and accounts142

Notes
2021
US$m
2020
(restated)
(1)
US$m
1 Jan 2020
(restated)
(1)
US$m
Assets
Non-current assets
Property, plant and equipment
12 283 288 398
Goodwill
14 101 101 99
Intangible assets
15 43 51 50
Investments in associates and joint ventures
16 34 35 38
Other financial assets
17 209 202 316
Deferred consideration
11 55 55 61
Deferred tax assets
8c 18 61 50
743 793 1,012
Current assets
Inventories
18 23 8 17
Trade and other receivables
19 668 877 1,103
Contract assets
20 1,580 1,652 2,064
Other financial assets
17 183 148 135
Income tax receivable 20 9 4
Cash and short-term deposits
21 620 684 1,025
3,094 3,378 4,348
Assets held for sale – – 600
Total assets 3,837 4,171 5,960
Equity and liabilities
Equity
Share capital
22 10 7 7
Share premium
22 251 4 4
Capital redemption reserve
22 11 11 11
Employee Benefit Trust shares
23 (69) (88) (110)
Other reserves
25 42 43 84
Retained earnings 230 426 621
Equity attributable to Petrofac Limited shareholders 475 403 617
Non-controlling interests
13 10 7 281
Total equity 485 410 898
Non-current liabilities
Interest-bearing loans and borrowings
26 764 50 599
Provisions
27 143 171 189
Other financial liabilities
17 195 166 315
Deferred tax liabilities
8c 29 38 37
1,131 425 1,140
Current liabilities
Trade and other payables
28 1,090 887 1,075
Contract liabilities
20 58 120 273
Interest-bearing loans and borrowings
26 – 750 411
Other financial liabilities
17 81 179 166
Income tax payable 142 191 231
Accrued contract expenses
32 780 1,134 1,599
Provisions
27 70 75 47
2,221 3,336 3,802
Liabilities associated with assets held for sale – – 120
Total liabilities 3,352 3,761 5,062
Total equity and liabilities 3,837 4,171 5,960
The consolidated financial statements on pages 141 to 202 were approved by the Board of Directors on 23 March 2022 and signed on
its behalf by Afonso Reis e Sousa – Chief Financial Officer.
(1) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
Consolidated balance sheet
At 31 December 2021
Strategic report Governance Financial statements
143Petrofac Limited 2021 Annual report and accounts

Notes
2021
US$m
2020
(restated)
(1)
US$m
Operating activities
Loss before tax (189) (183)
Separately disclosed items
6 187 243
Profit before tax and separately disclosed items (2) 60
Adjustments to reconcile profit before tax and separately disclosed items to net cash flows:
Depreciation, amortisation, business performance impairment and write-off
5a, 5b, 5g 68 123
Expected credit loss (reversal)/allowance recognised
5e (25) 9
Share-based payments
24 7 15
Difference between other long-term employment benefits paid and amounts recognised in the
consolidated income statement
27 (29) (18)
Net finance expense
7 38 28
Net movement in other provisions
27 (13) 24
Share of net profit of associates and joint ventures
16 (7) (5)
Net other non-cash items (3) 1
34 237
Working capital adjustments:
Inventories (15) 4
Trade and other receivables 211 122
Contract assets
20 78 409
Related party receivables
31 – 1
Other net current financial assets
17 (106) (25)
Assets and liabilities held for sale – 7
Trade and other payables 120 (156)
Contract liabilities
20 (59) (153)
Accrued contract expenses (354) (369)
Net working capital adjustments (125) (160)
Cash generated from operations (91) 77
Separately disclosed items paid – operating costs (28) (33)
Net income taxes paid (42) (74)
Net cash flows used in operating activities (161) (30)
Investing activities
Purchase of property, plant and equipment (43) (33)
Payments for intangible assets
15 (10) (10)
Contingent consideration paid
17 – (3)
Dividends received from associates and joint ventures
16 8 9
Loans paid to associates and joint ventures
16 – (2)
Disposal costs paid – (3)
Net proceeds from disposal of subsidiaries, including receipt against contingent consideration 9 31
Proceeds from disposal of property, plant and equipment 5 1
Interest received 1 3
Net cash flows used in investing activities (30) (7)
Financing activities
Issue of shares net of associated transaction costs
22 250 –
Proceeds from interest-bearing loans and borrowings, net of debt acquisition cost
17 1,484 870
Repayment of interest-bearing loans and borrowings
17 (1,470) (1,015)
Repayment of lease liabilities
29 (40) (50)
Separately disclosed items paid – refinancing related costs paid (23) –
Interest paid (27) (36)
Purchase of Company’s shares by Employee Benefit Trust
23 (2) (11)
Net cash flows generated from/(used in) financing activities 172 (242)
Net decrease in cash and cash equivalents (19) (279)
Net foreign exchange difference – 4
Cash and cash equivalents at 1 January 639 914
Cash and cash equivalents at 31 December
21 620 639
(1) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
Consolidated statement of cash flows
For the year ended 31 December 2021
Petrofac Limited 2021 Annual report and accounts144

Attributable to Petrofac Limited shareholders
Issued share
capital
US$m
Share
premium
US$m
Capital
redemption
reserve
US$m
Employee
Benefit Trust
shares
(1)
US$m
(note 23)
Other
reserves
US$m
(note 25)
Retained
earnings
US$m
Total
US$m
Non-
controlling
interests
US$m
Total
equity
US$m
At 1 January 2020 (as reported) 7 4 11 (110) 84 637 633 281 914
Impact of change in accounting policy
in respect of cloud configuration and
customisation costs (note 2.9) – – – – – (16) (16) – (16)
At 1 January 2020 (restated)
(2)
7 4 11 (110) 84 621 617 281 898
Restated net loss
(2)
– – – – – (192) (192) (9) (201)
Other comprehensive loss – – – – (30) – (30) – (30)
Total comprehensive loss – – – – (30) (192) (222) (9) (231)
Purchase of Company’s shares by
Employee Benefit Trust (note 23) – – – (11) – – (11) – (11)
Issue of Company’s shares by
Employee Benefit Trust (note 23) – – – 33 (30) (3) – – –
Transfer to share-based payments
reserve for Deferred Bonus Share
Plan Invested Shares (note 24) – – – – 4 – 4 – 4
Credit to equity for share-based
payments charge (note 24) – – – – 15 – 15 – 15
Disposal (note 17) – – – – – – – (265) (265)
At 31 December 2020 (restated)
(2)
7 4 11 (88) 43 426 403 7 410
At 1 January 2021 7 4 11 (88) 43 426 403 7 410
Reported net (loss)/profit – – – – – (195) (195) 3 (192)
Other comprehensive income – – – – 12 – 12 – 12
Total comprehensive income/(loss) – – – – 12 (195) (183) 3 (180)
Issue of own shares (note 22) 3 247 – – – – 250 – 250
Purchase of Company’s shares by
Employee Benefit Trust (note 23) – – – (2) – – (2) – (2)
Issue of Company’s shares by
Employee Benefit Trust (note 23) – – – 21 (20) (1) – – –
Credit to equity for share-based
payments charge (note 24) – – – – 7 – 7 – 7
At 31 December 2021 10 251 11 (69) 42 230 475 10 485
(1) Shares held by Petrofac Employee Benefit Trust.
(2) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
Consolidated statement of changes in equity
For the year ended 31 December 2021
Strategic report Governance Financial statements
145Petrofac Limited 2021 Annual report and accounts

1 Corporate information
Petrofac Limited (the 'Company') is a limited liability company
registered and domiciled in Jersey under the Companies (Jersey)
Law 1991 and is the holding company for the international group
of Petrofac subsidiaries. Petrofac Limited and its subsidiaries at
31 December 2021 comprised the Petrofac Group (the 'Group').
Information on the Group’s subsidiaries, associates and joint
arrangements is contained in note 34 to these consolidated
financial statements. Information on the Group’s related party
transactions is provided in note 31. The Group’s principal activity
is to design, build, manage and maintain infrastructure for the
energy industries.
The Company’s and the Group’s financial statements
(the'consolidated financial statements') for the year ended
31 December 2021 were authorised for issue in accordance
witha resolution of the Board of Directors on 23 March 2022.
The Company’s financial statements for the year ended
31 December 2021 are shown on pages 210 to 226.
2 Summary of significant accounting policies
2.1 Basis of preparation
The consolidated financial statements have been prepared in
accordance with International Financial Reporting Standards (IFRS)
as issued by the International Accounting Standards Board (IASB)
and applicable requirements of Jersey law. The Group has revised
its accounting policy in relation to configuration costs incurred
inimplementing Software-as-a-Service (SaaS) arrangements
inresponse to the IFRS Interpretations Committee decision
(Configuration or Customisation Costs in a Cloud Computing
Arrangement (IAS 38 Intangible Assets)). The Group assessed the
impact of this change in accounting policy on such arrangements
entered by the Group during prior years and restated comparative
figures accordingly (note 2.9).
The consolidated financial statements have been prepared on
ahistorical cost basis, except for derivative financial instruments,
financial assets measured at fair value through profit and loss,
and deferred consideration receivable that has been measured
atfair value. The consolidated financial statements are presented
in United States dollars and all values are rounded to the nearest
million (US$m), unless otherwise stated.
2.2 Presentation of results
The Group uses Alternative Performance Measures (APMs)
whenassessing and discussing the Group’s financial
performance, financial position and cash flows that are not
defined or specified under IFRS. The Group uses these APMs,
which are not considered to be a substitute for or superior to
IFRS measures, toprovide stakeholders with useful information
on underlying trends and additional useful information by
adjusting for separately disclosed items which impact upon IFRS
measures or,by defining new measures, to aid the understanding
of the Group’s financial performance, financial position and cash
flows (refer to notes 2.8 and 6 and Appendix A for more details).
2.3 Adoption of new financial reporting standards,
amendments and interpretations
Effective new financial reporting standards
The Group applied for the first time certain standards and
amendments, which are effective for annual periods beginning
onor after 1 January 2021. The Group has not early adopted any
other standard, interpretation or amendment that has been
issued but is not yet effective.
The following amendments apply for the first time in 2021, but do
not have an impact on the consolidated financial statements of
the Group:
– Amendment to IFRS 16 – COVID-19-Related Rent Concessions
(effective 1 June 2020)
– Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16
Interest Rate Benchmark Reform – Phase 2 (effective
1 January2021)
Application of IFRIC agenda decisions
In April 2021, the IFRS Interpretations Committee (IFRIC)
published an agenda decision on the accounting treatment in
relation to the configuration and customisation costs incurred
inimplementing SaaS arrangements as follows:
– Amounts paid to the cloud vendor for configuration and
customisation that are not distinct from access to the cloud
software are expensed over the contract term
– In limited circumstances, other configuration and customisation
costs incurred in implementing SaaS arrangements may give
rise to an identifiable intangible asset, for example, where
additional code is created, from which the customer has the
power to obtain the future economic benefits and to restrict
others’ access to those benefits
– In all other instances, configuration and customisation costs
will be expensed as the customisation and configuration
services are received
See note 2.9 for further details.
2.4 Financial reporting standards, amendments and
interpretations issued but not yet effective
Certain new financial reporting standards, amendments and
interpretations have been published that are not mandatory
forthe 31 December 2021 reporting period and have not been
early adopted by the Group. The Group is currently assessing
theimpact of the amendments to IAS 12 ‘Income Taxes’ on
deferred tax related to assets and liabilities arising from a single
transaction. With the exception of amendments to IAS 12, no
significant impact is expected from the adoption of new financial
reporting standards, amendments and interpretations.
Notes to the consolidated financial statements
For the year ended 31 December 2021
Petrofac Limited 2021 Annual report and accounts146

2.5 Going concern
Introduction
The Directors performed a robust going concern assessment
forthe period to 31 March 2023, to validate the continued
application of the going concern basis in the preparation of
thefinancial statements of the Group. This included reviewing
and challenging downside scenarios considered to be severe
butplausible, based on the principal risks and uncertainties set
out on pages 62 to 69.
The Directors evaluated the Group’s funding position, liquidity
and financial covenant profile to ensure it will have sufficient
access to liquidity and covenant headroom to meet its obligations
as they fall due from the date of signing the Group’s consolidated
financial statements on 23 March 2022 to 31 March 2023 (the
“Assessment Period”). Furthermore, and in accordance with the
Financial Reporting Council’s guidance, the Directors considered
events or conditions that may cast significant doubt on the
Group’s ability to continue as a going concern in the period
beyond the Assessment Period and concluded that the
disclosures contained herein sufficiently address relevant
eventsand conditions in both the Assessment Period and
theperiod beyond.
Approach
In evaluating whether the going concern assumption is
appropriate, the Directors performed the following procedures:
– Reviewed the Group’s forecast cash flows, liquidity, covenant
compliance and borrowing requirements over the Assessment
Period. Cash flow and liquidity projections were based on
management’s best estimates of future commodity prices,
neworder intake, project and contract schedules and costs,
commercial settlements, oil and gas production and capital
expenditure
– Evaluated a range of severe but plausible downside scenarios
to reflect uncertainties inherent in forecasting future operational
and financial performance, including changes in geo-political
ormacro-economic environments. These include, but are
notlimited to, lower order intake, cost overruns, adverse
commercial settlements, deterioration in net working capital,
adverse outcomes on contingent liabilities and delays to or
reductions in disposal proceeds
– Appraised the mitigation actions available to management
including, but not limited to, reducing costs through further
headcount, salary and third-party cost reductions and
conserving cash through working capital management and
reductions in uncommitted capital expenditure. Under each
scenario, mitigating actions are deemed to be in the control
ofmanagement
– Performed a stress test analysis to establish the impact of a
remote downside scenario, which extended the severe but
plausible downside scenario analysis by modelling the impact
of no new orders being secured in the Assessment Period
Impact of COVID-19
The risks to which forecast cash flows are most sensitive over the
Assessment Period are (i) lower new order intake, (ii) contract
cost overruns, (iii) adverse commercial settlements and (iv)
working capital movements. With low backlog and high working
capital balances, including an increase in uncollected assessed
variation orders in the E&C operating segment during 2021, these
four risks could have a significant impact on the performance of
the Group and its ability to maintain covenant compliance over
the Assessment Period. However, the Directors noted that
theimpact of COVID-19 related delays and cost increases was
already reflected in the Group’s financial performance in 2020
and 2021 and in the margin forecasts for 2022 and beyond.
Given the maturity of the current project portfolio, and a return to
pre-pandemic levels of activity, the Directors have concluded that
the risk of further COVID-19 related disruption and cost increases
in the Assessment Period is reduced, notwithstanding the risks
inherent in EPC contracts.
Compliance with financial covenants
The Group complied with its financial covenants throughout
2021. However, the extended impact of COVID-19 and the
Omicron variant in particular, which increased costs on existing
projects and delayed new contract awards in the E&C segment,
resulted in lower EBITDA in Q4 2021 and higher net debt than
had been forecast at the time of the capital raise and debt
refinancing in October 2021. In preparing the three-year business
plan for 2022-2024, the Directors determined that an amendment
to the existing financial covenants was required in order to
maintain compliance during 2022 and 2023, both in the base
case and in the mitigated severe but plausible downside case,
due to the carryover effect of the trading result in Q4 2021
(covenants are calculated on a rolling 12-month basis).
Amendments to the leverage and interest cover covenants
intheRevolving Credit Facility and the two term loan facilities
wereapproved by the lenders of each facility on 4 March 2022.
The Group is therefore projected to comply with its financial
covenants in the mitigated severe but plausible downside
scenario; however, in this scenario, the covenant headroom
intheperiod to 30 September 2022 is limited.
If financial performance deteriorates significantly below this
case,the Group may have difficulty complying with the financial
covenants in their current form and further adjustments may
berequired. In their assessment of the Group’s going concern
position, the Directors have made a significant judgement that
theGroup will remain in compliance with its current financial
covenants or, alternatively, if a covenant breach became likely,
that the Group would be able to secure appropriate amendments
or waivers to the covenants to ensure compliance. The factors
that supported this judgement include:
– The Group’s lenders have been supportive over a number
ofyears including, with respect to financial covenant setting
during the debt refinancing in October 2021 and the
amendments to financial covenants in March 2022
– The Group has a positive outlook following the settlement of
the SFO investigation, the reinstatement to ADNOC’s bidding
list, the capital raise and debt refinancing, the recovery in
energy prices and the associated macro-economic outlook for
the industries in which it operates
– The Group continues to forecast positive liquidity throughout
the Assessment Period with improvement expected thereafter
Assessment
The Directors considered the following in their assessment:
– The Group retains sufficient liquidity to support operations, and
settle debt as it becomes due, throughout the Assessment
Period in the mitigated severe but plausible downside scenario
– The Group remains compliant with the amended financial
covenants throughout the Assessment Period in the mitigated
severe but plausible downside scenario
Strategic report Governance Financial statements
147Petrofac Limited 2021 Annual report and accounts

– The Group remains liquid in the remote downside scenario
ofsecuring no new orders in the Assessment Period, as
demonstrated in the unmitigated stress test scenario, though
insuch a scenario it would breach its financial covenants
– The Group has a proven track record of taking timely actions
toeffectively mitigate downside risks, including cutting costs,
conserving cash and divesting assets
– At 31 December 2021, the Group had cash and short-term
deposits of US$620m and net debt of US$144m
– The Group’s reinstatement to ADNOC’s bidding list will provide
a wider accessible market than assumed in the Group’s
business plan projections
– The recent developments in Russia are not expected to have
amaterial impact on the business over the Assessment Period,
with less than 1% of the backlog at 31 December 2021 derived
from Russian projects and no new awards in Russia assumed
in this period
– A sustained oil price above US$70 per barrel (the price
usedinthe Group’s business plan projections) will provide
additional headroom on liquidity and financial covenant ratios
(asustainedimprovement of US$10 per barrel would equate
toapproximately US$8m EBITDA improvement). Additionally,
sustained high energy prices and heightened energy security
considerations are likely to increase investments in our core
markets as well as in new energies
Conclusion
The Directors concluded, after rigorously evaluating relevant
available information, that there are no events or conditions
thatcast significant doubt upon the Group’s ability to continue
asagoing concern during the Assessment Period that require
disclosure in the Group’s consolidated financial statements for
theyear ended 31 December 2021. This conclusion required a
significant judgement with respect to the risk of a covenant breach
over the period to 30 September 2022, as described above.
The Directors also evaluated potential events and conditions
during the period beyond the Assessment Period that may cast
significant doubt on the going concern assessment, concluding
that there were no other such events or conditions, with the
Directors expecting to have options to either repay, extend or
refinance the Revolving Credit Facility and term loans, which are
otherwise available for use until October 2023, and November
2023 for the second term loan.
Based on this comprehensive assessment, the Directors
concluded that the continued use of the going concern basis
ofaccounting in preparing the Group’s financial statements for
the year ended 31 December 2021 remains appropriate.
2.6 Basis of consolidation
The consolidated financial statements comprise the financial
statements of the Company and entities controlled by the
Company (its subsidiaries) as at 31 December 2021. Control is
achieved when the Group is exposed, or has rights, to variable
returns from its involvement with the investee and has the ability
to affect those returns through its power over the investee.
Generally, there is a presumption that a voting rights majority
results in control. Net profit or loss and each component of other
comprehensive income (OCI) are attributed to Petrofac Limited
shareholders and to non-controlling interests, even if this results
in the non-controlling interests having a deficit balance.
When necessary, adjustments are made to the financial
statements of subsidiaries to align their accounting policies
withthe Group’s accounting policies.
All intra-group transactions, balances, income and expenses are
eliminated on consolidation.
A change in the ownership interest of a subsidiary, without a loss
of control, is accounted for as an equity transaction.
If the Group ceases to control a subsidiary, it derecognises
therelated assets (including goodwill), liabilities, non-controlling
interest and other components of equity while any resultant gain
or loss is recognised in the consolidated income statement.
Any investment retained is recognised at fair value.
Business combinations and goodwill
Business combinations are accounted for using the acquisition
method. The cost of an acquisition is measured as the aggregate
of the consideration transferred, measured at acquisition date,
andthe amount of any non-controlling interests in the acquiree.
For each business combination, the Group elects whether to
measure the non-controlling interests in the acquiree at fair value or
at the proportionate share of the acquiree’s identifiable net assets.
All transaction costs associated with business combinations are
charged to the consolidated income statement in the reporting
period of such combination.
Any contingent consideration to be transferred by the Group will
be recognised at fair value at the acquisition date.
Contingent consideration classified as equity is not re-measured
and its subsequent settlement is accounted for within equity.
Contingent consideration classified as a liability that is a financial
instrument and within the scope of IFRS 9 ‘Financial Instruments’,
is measured at fair value with the changes in fair value recognised
in the consolidated income statement in accordance with IFRS 9.
Goodwill is initially measured at cost, being the excess of the
aggregate consideration transferred and the fair value of the
netassets acquired together with the amount recognised for
non-controlling interests, and any previous interest held.
Following initial recognition, goodwill is measured at cost less
anyaccumulated impairment losses. Goodwill is reviewed for
impairment annually or more frequently if events or changes
incircumstances indicate that the carrying amount may
beimpaired.
For the purpose of impairment testing, goodwill is allocated to
thecash-generating units that are expected to benefit from the
synergies of the combination.
Impairment is determined by assessing the recoverable amount
of the cash-generating units to which the goodwill relates.
Investment in associates and joint ventures
An associate is an entity over which the Group has significant
influence. Significant influence is the power to participate in the
financial and operating policy decisions of the investee but is not
control or joint control over those policies.
The considerations made in determining significant influence
orjoint control are similar to those considerations applied to
determine control over subsidiaries.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
2 Summary of significant accounting
policiescontinued
Petrofac Limited 2021 Annual report and accounts148

Associates and joint ventures
The Group’s investments in its associates and joint ventures are
accounted for using the equity method.
The consolidated income statement reflects the Group’s share
ofthe net profits of the associate or joint venture.
Any unrealised gains and losses resulting from transactions
between the Group and associates and joint ventures are
eliminated to the extent of the Group’s ownership interest in
theseassociates and joint ventures.
The financial statements of the associates and joint ventures
areprepared for the same reporting period as the Group.
When necessary, adjustments are made to align the accounting
policies with those of the Group.
At the end of each reporting period, the Group determines
whether there is objective evidence that its investment in its
associates or joint ventures are impaired. If there is such
evidence, the Group estimates the amount of any impairment as
the difference between the recoverable amount of the associate
or joint venture and its carrying amount and recognises this
impairment loss in the consolidated income statement.
Joint operations
The Group’s interests in joint operations are recognised in relation
to its interest in a joint operation’s:
– Assets, including its share of any assets held jointly
– Liabilities, including its share of any liabilities incurred jointly
– Revenue from the sale of its share of the output arising from
the joint operation
– Share of the revenue from the sale of the output by the joint
operation
– Expenses, including its share of any expenses incurred jointly
For joint operations, the Group’s share of revenue earned and
expenses incurred are recognised in the consolidated income
statement. Assets controlled and liabilities incurred by the Group
are recognised in the consolidated balance sheet.
Foreign currency translation
The consolidated financial statements are presented in United
States dollars (US$).
Each entity in the Group determines its own functional currency
and items included in the financial statements of each entity are
measured using that functional currency. Functional currency is
defined as the currency of the primary economic environment in
which the entity operates. The Group uses the direct method of
consolidation and on disposal of a foreign operation, the gain or
loss that is reclassified to net profit or loss reflects the amount
that arises from using this method.
Transactions and balances
Transactions in foreign currencies are initially recorded by the
Group’s entities at their respective functional currency spot rates
at the date the transaction first qualifies for recognition.
Monetary assets and liabilities denominated in foreign currencies
are translated at the functional currency spot rates of exchange at
the reporting date.
Differences arising on the settlement or translation of monetary
items are recognised in other operating income or other operating
expenses line items, as appropriate, of the consolidated
incomestatement.
Non-monetary items that are measured at historical cost in a
foreign currency are translated using the exchange rates at the
dates of the initial transactions.
Group subsidiaries
On consolidation, the assets and liabilities of subsidiaries with
non-United States dollars functional currencies are translated
intoUnited States dollars at the rate of exchange prevailing
atthereporting date and their income statements are translated
atmonthly average rates. The exchange differences arising on
translation for consolidation are recognised in the consolidated
statement of other comprehensive income. On disposal of
asubsidiary with non-United States dollars as a functional
currency, the component of the consolidated statement of
othercomprehensive income relating to currency translation
isrecognised in the consolidated income statement.
2.7 Significant accounting judgements and estimates
The preparation of the consolidated financial statements requires
management to make judgements and estimates that affect the
reported amounts of revenues, expenses, assets and liabilities,
and the accompanying disclosures.
Judgements
In the process of applying the Group’s accounting policies,
management has made the following judgements, separate to
those involving estimations (see below), which have the most
significant effect on the amounts recognised in the consolidated
financial statements:
Significant judgements associated with revenue recognition
– Revenue recognition on fixed-price engineering, procurement
and construction contracts: the Group measures progress and
recognises revenue on fixed-price engineering, procurement
and construction contracts using the input method, based on
the actual cost of work performed at the end of the reporting
period as a percentage of the estimated total contract costs at
completion. The Group considers the input method to faithfully
depict the Group’s performance in transferring control of goods
and services to the customer and provides meaningful
information in respect of progress towards the satisfaction
ofperformance obligations on its contracts.
– In the early stages of contract completion, the outcome of
acontract generally cannot be estimated reliably. The Group
hasestablished a threshold where contract revenues are
recognised only to the extent of costs incurred to reflect this
uncertainty. This threshold has been applied by the Group
using a rebuttable presumption that contracts below 15%
completion cannot yet be estimated reliably; however,
judgement may be applied to deviate from this threshold
dependent upon an objective evaluation of operational and
contractual risks, e.g. taking into account contract value,
duration, geography, complexities involved in the execution
ofthe contract, past experience with the customer and
riskmitigations.
– Management applies certain judgements associated with
recognition and non-recognition of variable consideration,
suchas assessed variation orders and liquidated damages.
The factors considered when determining whether to recognise
variable consideration, together with the associated estimation
uncertainty, are discussed below under section ‘Estimation
uncertainty’.
Strategic report Governance Financial statements
149Petrofac Limited 2021 Annual report and accounts

– Revenue recognition on joint arrangement contracts: the Group
recognises its share of revenue and profit from contracts
executed as part of a consortium in accordance with the
agreed consortium contractual arrangement. In selecting the
appropriate accounting treatment, the main consideration is
the determination of whether the joint arrangement is a joint
operation or joint venture (though not directly related to revenue
recognition, this judgement has a material impact on
presentation in the consolidated income statement) in
accordance with IFRS 11 ‘Joint Arrangements’.
Significant judgements associated with contingent liabilities
and provisions
Management applies significant judgements in determining
whether it has a present or a possible obligation to disclose
acontingent liability or a probable obligation to recognise a
provision in the consolidated financial statements (note 27).
Management, in certain instances, takes into consideration legal
advice from its legal counsel and external legal advisors as well
as independent specialist advice, to determine the probability of
an outflow of resources embodying economic benefits that will
be required to settle the obligation, if determined. Typically, the
contingent liabilities include pending legal and tax cases with
regulatory authorities and/or third parties; see note 30.
Significant judgements associated with cloud-based software
and development costs
When the Group incurs customisation and configuration costs,
aspart of a service agreement, judgement is also required in
assessing whether the Group has control over the resources
defined in the arrangement. Management has considered the
IFRIC agenda decision in April 2021 on the clarification of
accounting in relation to these costs and applied the following
judgements which have the most significant impact on the
amounts recognised in the consolidated financial statements.
(i) Determining whether cloud computing arrangements contain
a software licence intangible asset
The Group evaluates a cloud computing arrangement to
determine if it provides a resource that the Group can control.
The Group determines that a software licence intangible asset
exists in a cloud computing arrangement when the following
criteria is met at the inception of the arrangement:
– The Group has the contractual right to take possession of the
software during the hosting period without significant penalty
– The costs incurred to configure or customise SaaS
arrangements result in the creation of a resource which is
identifiable, and the Group has the power to obtain the future
economic benefits flowing from the underlying resource and
torestrict the access of others to those benefits
– It is feasible for the Group to run the software on its own
hardware or contract with another party unrelated to the
supplier to host the software
(ii) Determining whether configuration and customisation costs
provide a distinct service from access to the SaaS
The Group applies judgement in determining whether costs
incurred provide a distinct service, aside from access to the
SaaS. Where it is determined that no distinct service is
identifiable, the related costs are recognised as expenses
overthe duration of the service contract.
As a result of the above assessment, US$12m was expensed
(2020 restated: US$14m) in relation to SaaS arrangements where
the configuration and customisation were assessed to provide a
distinct service to access the SaaS. See notes 2.3, 2.9, 6 and 15
for further details.
Significant judgements associated with climate change-related risks
In response to the Paris Agreement goals, the Group has set a
target to reduce its GHG emissions (Scope 1 and Scope 2) to Net
Zero by 2030. The Group continues to develop its assessment of
the potential impacts of climate change and the transition to a low
carbon economy. The Group’s current climate change strategy
focuses on reducing GHG emissions, investing in low emission
technologies, supporting emission reductions in the value chain
and promoting product stewardship, managing climate-related
risk and opportunity, and working with others to enhance the
global policy and market response.
Future changes to the Group’s climate change strategy or global
decarbonisation milestones may impact the Group’s significant
judgements and key estimates and may result in material
changes to financial results and the carrying values of certain
assets and liabilities in future reporting periods. Also, the Group’s
Net Zero strategy is currently being managed on a consolidated
Group basis and therefore it is currently not monitored at the level
of individual assets. Any change to the Group’s climate change
strategy could impact its Net Zero position and the Group’s
significant judgements and key estimates.
The Group’s activities, by their nature, are less dependent on
itsown physical assets or infrastructure, and as a result, at
31 December 2021, only 19% of total assets were non-current
assets (2020: 19%) and only 7% were property, plant and
equipment (2020: 7%).
The Group’s assessment indicates that it has limited exposure to
climate-related risks. These are analysed below:
– Property, plant and equipment (note 12): consists primarily of
oil and gas assets and facilities relating to Block PM304 and
MOPU lease, land and buildings, and other small assets.
Block PM304 includes capitalised decommissioning costs of
US$50m (2020: US$41m). The oil and gas assets and facilities
have an assumed estimated useful life to 2026. The building
and leasehold assets are expected to have minimal exposure
to climate-related risks, including any specific risks associated
with their locations. Vehicles and office furniture and equipment
also have insignificant climate-related risks and have overall
useful economic lives ending before 2030.
– Goodwill is allocated to the Engineering & Construction
cash-generating unit (CGU) (US$41m) and the Asset Solutions
CGU (US$60m). The underlying businesses produce sufficient
cash flows over the next five years to support these current
carrying values.
– Intangible assets include assets related to Block PM304,
customer contracts pertaining to W&W Energy Services Inc
and Group-wide digital IT systems. Those assets will be fully
amortised by 2030 and therefore the risk related to climate
change is minimal.
– Existing deferred tax assets will be recovered from available
taxable profits prior to 2030. Where the recoverability is
expected over an extended period (such as in the UK),
appropriate sensitivities are assessed and disclosures
areincluded in the relevant notes.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
2 Summary of significant accounting
policiescontinued
Petrofac Limited 2021 Annual report and accounts150

Significant judgements associated with the preparation of
theparent and consolidated financial statements on a going
concern basis
Management is required to make a decision whether to prepare
the parent and consolidated financial statements on a going
concern basis; for details see note 2.5.
Estimation uncertainty, including continued impact of
COVID-19 pandemic
Any continued impact of the COVID-19 pandemic and the
associated economic slowdown could have an impact on the
Group’s financial performance, financial position and cash flows
in the next 12 months. The principal assumptions concerning
thefuture and other key sources of estimation uncertainty at the
end of the reporting period that have a significant risk of causing
a material adjustment to the carrying amounts of assets and
liabilities within the next reporting period are discussed below:
Fixed-price engineering, procurement and
constructioncontracts
– Recognition of assessed variation orders pending customer
approval (AVOs): an AVO is a management estimated right
ofpayment due from the customer resulting for a customer
instructed change in the contractual scope of work or for the
reimbursement of costs not included in the contract price.
The Group recognises revenues and profit from AVOs using the
expected value approach to assess/reassess AVOs at contract
inception and at each reporting date where it is considered
highly probable that a significant reversal in the amount of
cumulative revenue recognised will not occur when the
uncertainty associated with the AVO is subsequently resolved.
In performing the assessment, management considers the
likelihood of such settlement being made by reference to
thecontract, independent specialist advice, customer
communications, past experience with the customer and other
forms of documentary evidence. At 31 December 2021, AVOs
of US$338m were recognised in the consolidated balance
sheet (2020: US$305m), of which US$337m (2020: US$276m)
was included within the contract assets; and US$1m (2020:
US$29m) was included as an offset against contract liabilities;
see note 20. To the extent assessed variation orders pending
customer approval are reflected in the transaction price are not
resolved in the Group’s favour, there could be reductions in, or
reversals of, previously recognised revenue.
– Liquidated damages (LDs): LDs are contractual penalties
applied by the customer, normally relating to failure of the
contractor to meet agreed performance and progress
outcomes. The Group estimates the application of LDs using
the expected value approach and recognises an associated
amount as a reduction to contract revenue. The Group
assesses/reassesses its exposure to LD applications at each
reporting date, where the customer has the contractual right
toapply LDs and where it is highly probable that a significant
reversal in the amount of cumulative revenue recognised will
not occur when the uncertainty associated with the LDs is
subsequently resolved. This requires a deterministic probability
assessment of the monetary amount of LDs liable, which
involves a number of management judgements and estimates
(e.g. contractual position with the customer, negotiations with
the customer specifically relating to extension of time (EoT),
past experience with the customer, etc.), regarding the
amounts to recognise in contract accounting. During 2021,
liquidated damages amounting to US$6m were recognised
asa decrease to the estimate at completion revenue that
resulted in a decrease of US$6m to the Group’s revenue
recognised during the year through the application of contract
progress (2020: US$8m of liquidated damages were reversed
as an increase to the estimate at completion revenue that
resulted in an increase of US$7m to the Group’s revenue).
No liquidated damages, resulting from progress delays
associated with the COVID-19 pandemic, for Group’s fixed-
price EPC contracts, were recognised, since management
judged these to be excusable delays in accordance with the
terms and conditions of the contracts with customers.
Any unfavourable outcome compared with management’s
current expectation may affect the revenue to be recognised
infuture periods and consequently would impact the financial
performance and cash flows for future periods. This estimate
will impact revenues and contract assets or contract liabilities.
– Estimate at completion contract costs: at the end of the
reporting period the Group is required to estimate costs at
completion on fixed-price EPC contracts, based on the work
tobe performed beyond the reporting period. This involves
anobjective evaluation of project progress against the
deliveryschedule, evaluation of work to be performed and
theassociated risks and costs to fully deliver the contract to
thecustomer. On contracts where it is considered probable
thatcontract costs exceed revenues at contract completion and
thecosts of fulfilling the contract are less than the compensation
or penalties arising from a failure to fulfil it, the Group recognises
an onerous contract provision in accordance with IAS 37
‘Provisions, Contingent Liabilities and Contingent Assets’ for
future losses The COVID-19 pandemic resulted in lock down
measures being applied by governments in various jurisdictions
in which the Group operates. These lock down measures
predominantly impacted procurement and construction activities
on the Group’s fixed-price EPC contracts, which resulted in
lower than expected progress at the end of the reporting period.
At 31 December 2021, the estimate at completion contract costs
represented management’s best estimate of contract costs,
including where applicable costs associated with COVID-19
pandemic induced delays. In addition, cost reduction measures
taken by the Group in response to COVID-19 pandemic were
also included in the estimate at completion contract costs.
The continued prevalence of COVID-19 pandemic may result
inadditional estimate at completion contract costs and
consequently could negatively impact financial performance
andcash flows for future periods. This could impact revenues,
cost of sales, contract assets and contract liabilities.
The carrying amount of onerous contract provisions at
31 December 2021 was US$39m (2020: US$38m); see note 27.
Income tax and deferred tax
– Income tax: Group entities are routinely subject to tax audits
and assessments, including processes whereby tax return
filings are discussed and agreed with the relevant tax
authorities. Whilst the ultimate outcome of such tax audits and
discussions cannot be determined with certainty, management
estimates the uncertain tax treatments for jurisdictions where
there is a probable future outflow, based on the applicable
lawand regulations, historic outcomes of similar audits and
discussions, independent specialist advice and consideration
of the progress and nature of current discussions with the tax
authority concerned. Where management determines that a
greater than 50% probability exists that the tax authorities
Strategic report Governance Financial statements
151Petrofac Limited 2021 Annual report and accounts

would accept the position taken in the tax return, amounts
arerecognised in the consolidated financial statements on
thatbasis. Where the amount of tax payable or recoverable
isuncertain, the Group recognises a liability or asset based on
either management’s judgement of the most likely outcome or,
when there is a wide range of possible outcomes, a probability
weighted average approach. The ultimate outcome following
resolution of such audits and assessments may be materially
higher or lower than the amounts recognised. The Group’s
subsidiaries’ tax filings in different jurisdictions include
deductions related to intercompany recharges and the taxation
authorities may challenge those tax treatments. The Group
determined, based on its tax compliance and transfer pricing
studies, that it is probable that its tax treatments (including
those for the subsidiaries) will be accepted by taxation
authorities. The carrying amount of uncertain tax treatments
(UTTs), recognised within the income tax payable line item
ofthe consolidated balance sheet at 31 December 2021,
wasUS$101m (2020: US$131m).
– Deferred tax assets: the Group recognises deferred tax assets
on all applicable temporary differences where it is probable
that the tax assets estimated are realised and future taxable
profits will be available for utilisation. This requires management
to make estimates concerning future taxable profits and the
recoverability of recognised deferred tax asset balances.
The carrying amount of deferred tax assets at 31 December
2021 was US$18m (2020: US$61m).
Contingent and deferred consideration measured at fair
value through profit or loss
– Fair value of contingent consideration amounts receivable
('contingent consideration') arising from the disposal of
Group’soperations in Mexico in November 2020: the Group
completed the disposal of its remaining 51% ownership interest
in Petrofac Netherlands Holdings B.V. which owned the
Group’s operations in Mexico (PNHBV) to Perenco Energies
International Limited ('Perenco'). This transaction completed
the Integrated Energy Services operating segment’s disposal
ofits operations in Mexico. The carrying amount of contingent
consideration receivable from Perenco associated with
the100% disposal of the Group’s ownership interest at
31 December 2021 was US$36m (2020: US$41m associated
with remaining 51% disposal). Management considers there
tobe significant estimation uncertainty inherent in determining
the fair value of this contingent consideration recognised in
theconsolidated balance sheet. The sources of estimation
uncertainty pertained to: (i) the final determination of the
completion consideration amount; (ii) proceeds associated with
a ruling by the Tax Administration Service in Mexico; and (iii)
achieving the contingent consideration criteria in the sales and
purchase agreement (SPA) associated with the migration of the
Magallanes and Arenque Production Enhancement Contracts
to Production Sharing Contracts. Management applied risk
factors (a Level 3 measurement of the ‘fair value hierarchy’
contained within IFRS 13 ‘Fair Value Measurement’) to the
maximum contingent consideration amounts receivable to
account for this uncertainty in determining the fair value of
thecontingent consideration. Determining these risk factors
required significant judgements and assumptions concerning
the outcome of future events and negotiations. These matters
constituted a significant accounting estimate by management
to determine the fair value of the contingent consideration at
31 December 2021. A fair value gain or loss will be recognised
in the consolidated income statement, in the next reporting
period or in the longer term, if the outcome of the uncertain
future events are more or less favourable, respectively, than
thecurrent estimate (see note 17).
– Block PM304 oil and gas asset in Malaysia had a recoverable
amount of US$96m (2020: US$116m). The recoverable
amount, which was based on fair value less cost of disposal,
was lower than the asset’s carrying amount, resulting in an
impairment charge of US$15m (2020: US$64m) in the period
(note 6). The Group’s fair value less cost of disposal estimate
includes an assessment of future field performance, the
likelihood of a licence extension beyond 2026 and future oil
price assumptions. In addition, the cash outflows in respect of
the provision for decommissioning (note 27) were based on the
estimated licence period.
– Recoverable amount of deferred consideration relating to
disposal of the JSD6000 installation vessel (the ‘vessel’):
thedeferred consideration relating to disposal of the vessel,
representing a contractual right to the Group, was recognised
as a non-current asset in the consolidated balance sheet.
The deferred consideration was initially measured and
recognised at fair value and will be subsequently measured
atfair value through profit or loss. The fair value of the deferred
consideration, with management’s current involvement and
recent discussions with the Group’s partner in the construction
of the vessel, is based on the assumption that the Group’s
partner has the continued intent and the required capabilities
to complete the construction and commissioning of the vessel
within the due timeframe. The recoverable amount is also
subject to change based on changes in the market value of
similar specification deep-water vessels. At the end of each
reporting period, management reviews its estimate to assess
the ability of the Group’s partner to complete the construction
and commissioning of the vessel and in circumstances that
may impair the Group’s partner’s ability to complete these
activities, a fair value loss would be recognised in the
consolidated income statement, in the next reporting period
orin the longer term. Due to the ongoing COVID-19 pandemic,
management reviewed the carrying amount of the deferred
consideration associated with the disposal of the vessel and
concluded that there was no fair value adjustment required
inthe year (2020: US$6m recorded as a separately disclosed
item in the Engineering & Construction operating segment).
A further 10% decrease in the valuation of the vessel would
result in an additional negative fair value change of US$6m.
The continued impact of the COVID-19 pandemic on global
demand for oil and gas could have an adverse impact on the
fair valuation of the vessel, that may result in additional negative
fair value changes recognised in the consolidated income
statement in future periods.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
2 Summary of significant accounting
policiescontinued
Petrofac Limited 2021 Annual report and accounts152

2.8 Significant accounting policies
Revenue from contracts with customers
The Group’s principal activity is to design, build, manage and
maintain infrastructure for the energy industries. Revenue from
contracts with customers is recognised when control of the
goods or services are transferred to the customer at an amount
that reflects the consideration to which the Group expects to
beentitled in exchange for those goods or services. The Group
has generally concluded that it is the principal in its revenue
arrangements, because it typically controls the goods or
servicesbefore transferring them to the customer.
The Group provides warranties to customers with assurance that
the related product will function as the parties intended because
it complies with agreed-upon specifications. The Group does not
provide warranties as a service, in addition to the assurance that
the product complies with agreed-upon specifications, in its
contracts with customers. As such, the Group concluded that
such warranties are assurance-type warranties which will
continue to be accounted for under IAS 37 ‘Provisions,
Contingent Liabilities and Contingent Assets’.
Engineering & Construction
The Group provides fixed-price engineering, procurement
andconstruction project execution services and reimbursable
engineering, procurement and construction management
services to the onshore and offshore oil and gas industry as
wellas renewable energy industries. Revenue is measured based
on the consideration specified in a contract with a customer.
The Group recognises revenue when or as it transfers control
over a good or service to a customer.
The services provided under the fixed-price engineering,
procurement and construction contract are satisfied over time
rather than at a point in time, since the customer controls the
works covered by the contract at the point when it is being
built;the construction activity creates an asset that does not
presuppose an alternative use to what it was designed for
andthe Group is entitled to collect payment for services while
construction is underway and the customer simultaneously
receives and consumes the benefits provided by the Group.
For fixed-price engineering, procurement and construction
contracts, the Group measures progress and recognises revenue
using the input method. This method is based on the actual cost
of work performed, as a percentage of the estimate at completion
cost at the end of the reporting period, once the outcome of a
contract can be estimated reliably.
Fixed-price engineering, procurement and construction contracts
contain distinct goods and services, but these are not distinct in
the context of the contract and are therefore combined into a
single performance obligation. At contract inception the
management generally considers the following factors to
determine whether the contract contains a single performance
obligation or multiple performance obligations:
– It provides a significant service of integrating the goods or
services with other goods or services promised in the contract
into a bundle of goods or services that represent the combined
output or outputs for which the customer has contracted
– One or more of the goods or services significantly modifies
orcustomises, or are significantly modified or customised by,
one or more of the other goods or services promised in the
contract
– The goods or services are highly interdependent or highly
interrelated
Contract modifications are generally not distinct from the existing
contracts due to the significant integration service provided in the
context of the contract and are accounted for as a modification
ofthe existing contract and performance obligation, with a
cumulative catch-up adjustment to revenue.
Variable consideration, e.g. variation orders (including those
pending customer approval), liquidated damages and incentive
payments are assessed/reassessed using:
– The expected value approach (i.e. the sum of probability-
weighted amounts in a range of possible consideration
amounts); or
– The most likely amount method (i.e. the single most likely
outcome of the contract, which may be an appropriate
estimate of the amount of variable consideration if the contract
has only two possible outcomes for example the Group either
achieves a performance bonus or does not)
as appropriate, at contract inception and at the end of each
reporting period where it is considered highly probable that
asignificant reversal in the amount of cumulative revenue
recognised will not occur when the uncertainty associated
withthe variable consideration is subsequently resolved.
In performing the assessment, management considers the
likelihood of such variable consideration being received by
reference to the contract, anticipated performance on the
contract, independent specialist opinions, customer
communications, past experience with the customer and other
forms of documentary evidence.
Revenues from cost-plus-fee contracts and reimbursable contracts
are recognised using the input method for measuring progress
towards complete satisfaction of the performance obligation.
An onerous contract provision is recognised where the
unavoidable costs of meeting the obligations under the contract
exceed the economic benefits expected to be received under it.
Advance payments received from customers for fixed-price
engineering, procurement and construction contracts are
structured primarily for reasons other than the provision of
finance to the Group (e.g. mobilisation costs), and they do
notprovide customers with an alternative to pay in arrears.
In addition, the length of time between when the customer settles
the amount to which the Group has an unconditional right to
payment and the Group transfers goods and services to the
customer is relatively short. Therefore, the Group has concluded
that there is not a significant financing component within such
contracts. Currently, excluding normal retention payments, the
Group does not have any contracts where payments by a
customer are over several years after the Group has transferred
goods and services to the customer.
Strategic report Governance Financial statements
153Petrofac Limited 2021 Annual report and accounts

Asset Solutions
The Group’s contracts with customers for the provision
ofreimbursable engineering and production services include
distinct performance obligations based on the assessment
thatthe service is capable of being distinct both individually
andwithin the context of the contract. The services are satisfied
over time given that the customer simultaneously receives and
consumes the benefits provided by the Group and recognised
using the input method for measuring progress towards complete
satisfaction of the performance obligation.
Variable consideration, e.g. incentive payments and performance
bonuses, are estimated at contract inception and at the end of
each reporting period using the most likely amount approach,
where the outcome is expected to be binary and where it is
considered highly probable that a significant reversal in the
amount of cumulative revenue recognised will not occur when the
uncertainty associated with the variable consideration is
subsequently resolved.
Revenues from fixed-price contracts are recognised using the
input method, measured by milestones completed or earned
value once the outcome of a contract can be estimated reliably.
In the early stages of contract completion, when the outcome of
a contract cannot be estimated reliably, contract revenues are
recognised only to the extent of costs incurred that are expected
to be recoverable.
The Group does not generally receive advances from customers
for its reimbursable engineering and production services contracts.
Integrated Energy Services Equity Upstream Investments
Revenue from sale of crude oil and gas comprise the Group’s
share of sales of hydrocarbons from the Group’s equity upstream
investments. Revenue is recognised when control has been
passed to the buyer, i.e. the last outlet flange of the loading facility
from where the goods are transferred to the customer.
Separately disclosed items
Separately disclosed items are individually material or significant
irregular items of income and expense which the Directors believe
should be separately disclosed in the income statement, to assist
in understanding and fairly present the underlying financial
performance achieved by the Group, by virtue of their nature or
size. These are then summarised in note 6 of the consolidated
financial statements, where further explanations and disclosures
provide supplementary information to support the understanding
of the Group’s financial performance. Examples of items which
may give rise to disclosure as separately disclosed items
includethe contribution of impairments of assets, fair value
re-measurements, losses on acquisitions and disposals,
discontinuation of certain business activities, restructuring and
redundancy costs, significant business transformation costs,
certain Corporate reporting segment professional services fees,
loss on accelerated receipt of deferred consideration, other
significant one-off events or transactions and material deferred
tax movements arising due to foreign exchange differences in
jurisdictions where tax is computed based on the functional
currency of the country.
Property, plant and equipment
Property, plant and equipment is measured at cost less
accumulated depreciation and accumulated impairment
charges.Cost comprises the purchase price or construction cost
and any costs directly attributable to making that asset capable
of operating as intended. The purchase price or construction
costis the aggregate amount paid and the fair value of any other
consideration given to acquire the asset. Depreciation is provided
on a straight-line basis, other than on oil and gas assets.
Oil and gas assets on a field-by-field basis
(seebelow)
Oil and gas facilities 8 to 10 years
(or lease term ifshorter)
Buildings and leasehold
improvements
3 to 20 years
(or lease term ifshorter)
Plant and equipment 3 to 25 years
(or lease term ifshorter)
Office furniture and equipment 2 to 4 years
(or lease term ifshorter)
Vehicles 3 to 5 years
(or lease term ifshorter)
Oil and gas assets are depreciated, on a field-by-field basis,
using the unit-of-production method based on entitlement to
proven and probable reserves, taking account of estimated future
development expenditure relating to those reserves.
Each asset’s estimated useful life, residual value and method of
depreciation is reviewed and adjusted if appropriate at the end of
the reporting period. No depreciation is charged on land or
assets under construction.
The carrying amount of an item of property, plant and equipment
is derecognised on disposal or when no future economic benefits
are expected from its use with any gain or loss included in the
other operating income line item in the consolidated income
statement when the asset is derecognised.
In accordance with IFRS 16 ‘Leases’, the Group has elected
topresent the right-of-use assets within the property, plant
andequipment line item of the consolidated balance sheet, at
thecommencement date of the lease (i.e. the date at which the
underlying asset is available for use). The right-of-use assets are
presented within the same asset category as that within which
the underlying assets would be presented if they were owned.
The disaggregated information for right-of-use assets presented
within the property, plant and equipment line item of the
consolidated balance sheet is disclosed in note 12.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
2 Summary of significant accounting
policiescontinued
Petrofac Limited 2021 Annual report and accounts154

Leases
The Group assesses at contract inception whether a contract is,
or contains, a lease; that is, if the contract conveys the right to
control the use of an identified asset for a period of time in
exchange for consideration.
Right-of-use assets
Right-of-use assets are measured at cost, less any accumulated
depreciation and impairment losses, and adjusted for any
re-measurement of lease liabilities. The cost of right-of-use assets
includes the amount of lease liabilities recognised, initial direct
costs incurred, and lease payments made at or before the
commencement date less any lease incentives received.
Right-of-use assets are depreciated on a straight-line basis over
the shorter of the lease term and the estimated useful lives of
theassets.
Right-of-use assets are subject to the same impairment
requirements as those applicable to property, plant and
equipment; see accounting policies associated with impairment
of non-current assets.
Lease liabilities
At the commencement date of the lease, the Group recognises
lease liabilities measured at the present value of lease payments
to be made over the lease term. The lease payments include fixed
payments less any lease incentives receivable, variable lease
payments that depend on an index or a rate, and amounts
expected to be paid under residual value guarantees. The lease
payments also include the exercise price of a purchase option
reasonably certain to be exercised by the Group and payments
ofpenalties for terminating a lease, if the lease term reflects the
Group exercising the option to terminate.
In calculating the present value of lease payments, if the interest
rate implicit in the lease is not readily determinable, the Group
uses the incremental borrowing rate, defined as the rate of
interest that a lessee would have to pay to borrow over a similar
term, and with a similar security, the funds necessary to obtain
anasset of a similar value to the right-of-use asset in a similar
economic environment, at the lease commencement date.
After the commencement date, the amount of lease liabilities is
increased to reflect the accretion of interest and reduced for the
lease payments made. In addition, the carrying amount of lease
liabilities is re-measured if there is a modification, a change in the
lease term, a change in the in-substance fixed lease payments
ora change in the assessment to purchase the underlying asset.
The Group’s lease liabilities are included in other financial liabilities
line items of the consolidated balance sheet; see note 17.
The Group makes certain judgements in determining the lease
term for contracts that is or contains a lease:
– The Group determines the lease term as the non-cancellable
term of the lease, together with any periods covered by an
option to extend the lease if it is reasonably certain to be
exercised, or any periods covered by an option to terminate the
lease, if it is reasonably certain not to be exercised
– The Group has the option to renew the lease term for some of its
leases. The Group applies judgement in evaluating whether it is
reasonably certain to exercise the option to renew. That is, it
considers all relevant factors that create an economic incentive
for it to exercise the renewal. After the commencement date, the
Group reassesses the lease term if there is a significant event or
change in circumstances that affects its ability or likelihood to
exercise (or not to exercise) the option to renew (e.g. a change in
business strategy)
– The determination of whether an arrangement is or contains a
lease is based on the substance of the arrangement at the
inception date and whether the fulfilment of the arrangement is
dependent on the use of a specific asset or assets or the
arrangement conveys the right to use the asset
Short-term leases and leases of low-value assets
The Group applies the short-term lease recognition exemption to
its leases of property, plant and equipment that have a lease term
of 12 months or less. It also applies the lease of low-value assets
recognition exemption to leases of property, plant and equipment
that are considered of low value (i.e. below US$5,000).
Lease payments on short-term leases and leases of low-value
assets are recognised as an expense on a straight-line basis over
the lease term in cost of sales or selling, general and administration
expenses line items of the consolidated income statement.
If the lease contract is cancellable by both lessee and lessor with
no or insignificant penalty then the lease contract is considered
to be cancellable and recognised as a short-term lease; refer
tonote 29 for amounts recognised in the consolidated income
statement associated with the short-term and low-value
assetleases.
Oil and gas intangible assets
Expenditure directly associated with evaluation (or appraisal)
activities is capitalised as an intangible oil and gas asset.
Such costs include the costs of acquiring an interest, appraisal
well drilling costs, payments to contractors and an appropriate
share of directly attributable overheads incurred during the
evaluation phase. For such appraisal activity, which may require
drilling of further wells, costs continue to be recognised as an
asset whilst related hydrocarbons are considered capable of
commercial development. Such costs are subject to technical,
commercial and management review to confirm the continued
intent to develop, or otherwise extract value. When this is no
longer the case, an impairment of the costs capitalised as an
intangible is recognised in the consolidated income statement.
When such assets are declared part of a commercial
development, related costs are transferred to property,
plantandequipment. All intangible oil and gas assets are
assessed for any impairment prior to transfer and any impairment
charge is recognised in the consolidated income statement.
Strategic report Governance Financial statements
155Petrofac Limited 2021 Annual report and accounts

Non-oil and gas intangible assets
Intangible assets acquired in a business combination are initially
measured at cost, being their fair values at the date of acquisition,
and are recognised separately from goodwill where the asset is
separable or arises from a contractual or other legal right and its
fair value can be measured reliably. After initial recognition,
intangible assets are carried at cost less accumulated
amortisation and accumulated impairment charges.
Intangible assets with a finite life are amortised over their useful
economic life using a straight-line method unless a better method
reflecting the pattern in which the asset’s future economic
benefits are expected to be consumed can be determined.
The amortisation charge for intangible assets is included in the
cost of sales or selling, general and administration expenses line
items of the consolidated income statement. The expected useful
lives of assets are reviewed on an annual basis. Intangible assets
are tested for impairment whenever there is an indication that the
asset may be impaired.
Software-as-a-service arrangements
The Group’s current SaaS arrangements are arrangements in
which the Group does not control the underlying software used
inthe arrangement.
Software development costs incurred to configure or customise
application software provided under a cloud computing
arrangement and associated fees are recognised as operating
expenses as and when the services are received where the costs
represent a distinct service provided to the Group. When such
costs incurred do not provide a distinct service, the costs are
recognised as expenses over the duration of the SaaS contract.
The Group capitalises other software costs when the requirements
of IAS 38 ‘Intangible Assets’ are satisfied, including configuration
and customisation costs which are distinct and within the control
of the Group. Such software costs are capitalised and carried
atcost less any accumulated amortisation and impairment,
andamortised on a straight-line basis over the period
whichthedeveloped software is expected to be used.
Amortisation commences when the development is complete
andthe asset is available for use and is included in the selling,
general and administration expenses line item of the consolidated
income statement. The amortisation is reviewed at least at the
endof each reporting period and any changes are treated as
changes in accounting estimates.
Impairment of non-current assets (excluding goodwill)
At each reporting date, the Group reviews the carrying amounts
of its property, plant and equipment and intangible assets to
assess whether there is an indication that those assets may
beimpaired. If any such indication exists, the Group makes
anestimate of the asset’s recoverable amount. An asset’s
recoverable amount is the higher of its fair value less costs
ofdisposal and its value in use. In assessing value in use,
theestimated future cash flows attributable to the asset are
discounted to their present value using a pre-tax discount rate
that reflects current market assessments of the time value of
money and the risks specific to the asset. Fair value less costs
ofdisposal is based on the risk-adjusted discounted cash flow
models. A post-tax discount rate is used in such calculations.
If the recoverable amount of an asset is estimated to be less
thanits carrying amount an impairment charge is recognised
immediately in the consolidated income statement.
Where an impairment loss subsequently reverses, the carrying
amount of the asset is increased to the revised estimate of its
recoverable amount, but not exceeding the carrying amount that
would have been determined had no impairment loss been
recognised for the asset in prior reporting periods. A reversal of
an impairment loss is recognised immediately in the consolidated
income statement.
Trade receivables
A trade receivable represents the Group’s right to an amount
ofconsideration that is unconditional (i.e. only the passage of
time is required before payment of the consideration is due).
Refer to accounting policies for financial assets.
Contract assets and contract liabilities
Contract assets
A contract asset is the right to consideration in exchange for
goods or services transferred to the customer. If the Group
performs by transferring goods or services to a customer before
the customer pays consideration or before payment is due, a
contract asset is recognised for the earned consideration that
isconditional.
Fixed-price engineering, procurement and construction contracts
are presented in the consolidated balance sheet as follows:
– For each contract, the revenue recognised at the contract’s
measure of progress using the input method, after deducting
progress payments received or amounts receivable from the
customers, is presented within the contract assets line item in
the consolidated balance sheet as work in progress
– The amounts recognised as work in progress are adjusted
forany expected credit loss allowance considering the
probability of default of the counter party. The probability of
default data for the counter party is estimated with input from
athird-party provider
Contract liabilities
A contract liability is the obligation to transfer goods or services
to a customer for which the Group has received consideration
(oran amount of consideration is due) from the customer. If a
customer pays consideration before the Group transfers goods
orservices to the customer, a contract liability is recognised
when the payment is made or the payment is due (whichever
isearlier). Contract liabilities are recognised as revenue when
theGroup performs under the contract.
Fixed-price engineering, procurement and construction contracts
are presented in the consolidated balance sheet as follows:
– Where the payments received or receivable for any contract
exceed revenue recognised, the excess is presented within the
contract liabilities line item in the consolidated balance sheet as
billings in excess of cost and estimated earnings
Fair value measurement
The Group measures financial instruments, such as derivatives,
and contingent consideration receivable at fair value at each
reporting date. Fair value related disclosures for financial
instruments are disclosed in note 17.
Fair value is the price that would be received to sell an asset or
paid to transfer a liability in an orderly transaction between market
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
2 Summary of significant accounting
policiescontinued
Petrofac Limited 2021 Annual report and accounts156

participants at the measurement date. The fair value
measurement is based on the presumption that the transaction
tosell the asset or transfer the liability takes place either:
– In the principal market for the asset or liability; or
– In the absence of a principal market, in the most advantageous
market for the asset or liability
The principal or the most advantageous market must be
accessible by the Group.
The fair value of an asset or a liability is measured using the
assumptions that market participants would use when pricing
theasset or liability, assuming that market participants act in their
economic best interest.
A fair value measurement of a non-financial asset takes into
account a market participant’s ability to generate economic
benefits by using the asset in its highest and best use or by
selling it to another market participant that would use the asset
inits highest and best use.
The Group uses valuation techniques that are appropriate in
thecircumstances and for which sufficient data is available to
measure fair value, maximising the use of relevant observable
inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or
disclosed in the consolidated financial statements are
categorised within the fair value hierarchy, described as follows,
based on the lowest level input that is significant to the fair value
measurement as a whole:
– Level 1 – Unadjusted quoted prices in active markets for
identical financial assets or liabilities
– Level 2 – Inputs other than quoted prices included within
Level1 that are observable for the asset or liability, either
directly (i.e. as prices) or indirectly (i.e. derived from prices)
– Level 3 – Inputs for the asset or liability that are not based
onobservable market data (unobservable inputs)
For assets and liabilities that are re-measured in the consolidated
financial statements on a recurring basis, the Group determines
whether transfers have occurred between levels in the hierarchy
by reassessing categorisation (based on the lowest level input
that is significant to the fair value measurement as a whole) at the
end of each reporting period.
For the purpose of fair value disclosures, the Group has
determined classes of assets and liabilities on the basis of the
nature, characteristics and risks of the asset or liability and the
level of the fair value hierarchy as explained above.
Financial assets and financial liabilities
A financial instrument is any contract that gives rise to a financial
asset of one entity and a financial liability or equity instrument of
another entity.
Financial assets
Initial recognition and measurement
Financial assets are classified at initial recognition at amortised
cost and subsequently measured at fair value through profit or
loss, or as derivatives designated as hedging instruments in an
effective hedge, as appropriate.
The classification of financial assets at initial recognition depends
onthe financial asset’s contractual cash flow characteristics and the
Group’s business model for managing them. With the exception of
trade receivables that do not contain a significant financing
component, the Group initially measures a financial asset at its fair
value plus, in the case of a financial asset not at fair value through
profit or loss, transaction costs. Trade receivables that do not
contain a significant financing component are measured at the
transaction price determined under IFRS 15 ‘Revenue from
Contracts with Customers’.
The Group’s business model for managing financial assets refers
to how it manages its financial assets in order to generate cash
flows. The business model determines whether cash flows will
result from collecting contractual cash flows, selling the financial
assets, or both.
Subsequent measurement
For purposes of subsequent measurement, financial assets are
generally classified in the following categories:
– Amortised cost
– Financial assets at fair value through profit or loss
Amortised cost
This category is the most relevant to the Group and generally
applies to trade and other receivables, receivable from joint
operation partners for leases, deferred consideration receivables
and advances relating to provision for decommissioning liability.
The Group measures financial assets at amortised cost if both of
the following conditions are met:
– The financial asset is held within a business model with the
objective to hold financial assets in order to collect contractual
cash flows; and
– The contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding
Financial assets at amortised cost are subsequently measured
using the effective interest rate (EIR) method and are subject to
impairment. Gains and losses are recognised in the consolidated
income statement when the asset is derecognised, modified
orimpaired.
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss include
financial assets held for trading and financial assets designated
upon initial recognition at fair value through profit or loss, or
financial assets mandatorily required to be measured at fair
value.Financial assets are classified as held for trading if they
areacquired for the purpose of selling or repurchasing in the near
term. Derivatives, including separated embedded derivatives, are
also classified as held for trading unless they are designated as
effective hedging instruments. Financial assets at fair value
through profit or loss are carried in the consolidated balance
sheet at fair value with net changes in fair value recognised in
theconsolidated income statement.
Contingent consideration arising from disposal of the Group’s
operations in Mexico was recognised as a financial asset at fair
value through profit or loss within the other financial assets line
items of the consolidated balance sheet. Any fair value change
isrecognised in the consolidated income statement (note 17).
The fair value changes to undesignated forward currency
contracts are reported within the other operating income
andother operating expenses line item in the consolidated
income statement.
Strategic report Governance Financial statements
157Petrofac Limited 2021 Annual report and accounts

Impairment of financial assets
The Group recognises an allowance for expected credit losses
(ECLs) for all financial assets not held at fair value through profit
orloss. ECLs are based on the difference between the contractual
cash flows due in accordance with the contract and all the
cashflows that the Group expects to receive, discounted at an
approximation of the original effective interest rate. The expected
cash flows will include, if any, cash flows from the sale of
collateral held or other credit enhancements that are integral
tothe contractual terms.
For other financial assets measured at amortised cost, ECLs are
recognised in two stages. For credit exposures for which there
has not been a significant increase in credit risk since initial
recognition, ECLs are provided for credit losses that result from
default events that are possible within the next 12 months (a
12-month ECL). For those credit exposures for which there has
been a significant increase in credit risk since initial recognition,
aloss allowance is required for credit losses expected over the
remaining life of the exposure, irrespective of the timing of the
default (a lifetime ECL). There was no significant increase in the
credit risk for such financial assets since the initial recognition.
For trade receivables and contract assets, the Group applies
asimplified approach in calculating ECLs (a lifetime ECL).
Therefore, the Group does not track changes in credit risk, but
instead recognises a loss allowance based on lifetime ECLs at
each reporting date. An impairment analysis by each operating
segment is performed at each reporting date subject to the
Group’s established policies and procedures. Engineering &
Construction and Integrated Energy Services operating segments
that involve small populations of high-value receivables apply the
probability of default data relating to each individual counterparty
to calculate expected credit loss allowance at each reporting
date. The probability of default data for the counterparty is
sourced from a third-party provider.
Asset Solutions operating segment involves a large population of
low-value receivables and applies a provision matrix to measure
expected credit losses. The provision rates are based on days
past due for groupings of various customer segments with similar
loss patterns. The expected credit loss calculation reflects the
probability-weighted outcome, the time value of money and
reasonable and supportable information that is available at the
reporting date about past events, current conditions and where
possible, forecasts of future economic conditions. The amount
ofECLs are sensitive to changes in circumstances and of
forecast economic conditions. The Group’s historical credit loss
experience and forecast of economic conditions may also not be
representative of a customer’s actual default in the future.
The Group considers a financial asset to be in default when
internalor external information indicates that the Group is unlikely
to receive the outstanding contractual amounts in full. A financial
asset is written off only when there is no reasonable expectation
ofrecovering the contractual cash flows, based on the contractual
position agreed with the customer, contract close-out negotiations
or objective evidence of the customer’s inability to pay.
Financial liabilities
Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial
liabilities at fair value through profit or loss, loans and borrowings,
payables, or as derivatives designated as hedging instruments in
an effective hedge, as appropriate.
All financial liabilities are recognised initially at fair value and, in
the case of loans and borrowings and trade and other payables,
net of directly attributable transaction costs.
The Group’s financial liabilities include trade and other payables,
senior secured notes, loans and borrowings including bank
overdrafts, derivative financial instruments and lease liabilities.
Subsequent measurement
For purposes of subsequent measurement, financial liabilities are
classified in the following categories:
– Financial liabilities at fair value through profit or loss
– Financial liabilities at amortised cost (loans and borrowings)
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include
financial liabilities held for trading and financial liabilities
designated upon initial recognition as at fair value through
profitor loss.
Financial liabilities are classified as held for trading if they
areincurred for the purpose of repurchasing in the near term.
This category also includes derivative financial instruments
entered by the Group that are not designated as hedging
instruments in hedge relationships. Separated embedded
derivatives are also classified as held for trading unless they
aredesignated as effective hedging instruments.
Gains or losses on liabilities held for trading are recognised in the
consolidated income statement.
Financial liabilities designated upon initial recognition at fair
valuethrough profit or loss are designated at the initial date of
recognition only if the criteria in IFRS 9 ‘Financial Instruments’ are
satisfied. Contingent consideration payable related acquisitions is
designated as a financial liability measured at fair value through
profit or loss (see note 17).
Financial liabilities at amortised cost (loans and
borrowings)
This category generally applies to trade and other payables,
interest-bearing loans and borrowings (note 26) and lease
liabilities (note 17). After initial recognition, interest-bearing loans
and borrowings and lease liabilities are subsequently measured
at amortised cost using the EIR method.
Amortised cost is calculated by considering any discount or
premium on acquisition and fees or costs that are an integral part
of the EIR. The EIR amortisation is included as finance expense in
the consolidated income statement.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
2 Summary of significant accounting
policiescontinued
Petrofac Limited 2021 Annual report and accounts158

Derecognition of financial assets and liabilities
Financial assets
A financial asset (or, where applicable, a part of a financial asset)
is derecognised where:
– The rights to receive cash flows from the asset have expired
– The Group retains the right to receive cash flows from the
asset, but has assumed an obligation to pay them in full
without material delay to a third party under a ‘pass-through’
arrangement; or
– The Group has transferred its rights to receive cash flows from
the asset and either (a) has transferred substantially all the risks
and rewards of the asset, or (b) has neither transferred nor
retained substantially all the risks and rewards of the asset,
buthas transferred control of the asset
Financial liabilities
A financial liability is derecognised when the obligation under the
liability is discharged or cancelled or expires.
If an existing financial liability is replaced by another from the
same lender, on substantially different terms, or the terms of an
existing liability are substantially modified, such an exchange or
modification is treated as a derecognition of the original liability
and the recognition of a new liability such that the difference in
the respective carrying amounts together with any costs or fees
incurred are recognised in the consolidated income statement.
Derivative financial instruments and hedging
The Group uses derivative financial instruments such as forward
currency contracts to hedge its risks associated with foreign
currency fluctuations. Such derivative financial instruments are
initially recognised at fair value on the date on which a derivative
contract is entered into and are subsequently re-measured at fair
value. Derivatives are carried as assets when the fair value is
positive and as liabilities when the fair value is negative.
Any gains or losses arising from changes in the fair value of
derivatives that do not qualify for hedge accounting are taken to
the consolidated income statement.
The fair value of forward currency contracts is calculated by
reference to current forward exchange rates for contracts with
similar maturity profiles.
For the purposes of hedge accounting, hedges are classified as:
– Fair value hedges when hedging the exposure to changes in
the fair value of a recognised asset or liability; or
– Cash flow hedges when hedging the exposure to variability in
cash flows that is either attributable to a particular risk
associated with a recognised asset or liability or a highly
probable forecast transaction
The Group formally designates and documents the relationship
between the hedging instrument and the hedged item at the
inception of the transaction, as well as its risk management
objectives and strategy for undertaking various hedge
transactions. The documentation also includes identification
ofthe hedging instrument, the hedged item or transaction, the
nature of risk being hedged and how the Group will assess the
hedging instrument’s effectiveness in offsetting the exposure to
changes in the hedged item’s fair value or cash flows attributable
to the hedged risk. The Group also documents its assessment,
both at hedge inception and on an ongoing basis, of whether the
derivatives that are used in the hedging transactions are highly
effective in offsetting changes in fair values or cash flows of the
hedged items.
The treatment of gains and losses arising from revaluing
derivatives designated as hedging instruments depends on the
nature of the hedging relationship, as follows:
Cash flow hedges
For cash flow hedges, the effective portion of the gain or loss on
the hedging instrument is recognised directly in the consolidated
statement of other comprehensive income in net unrealised
gains/(losses) on derivatives, while the ineffective portion is
recognised in the consolidated income statement. Amounts taken
to other comprehensive income are transferred to the consolidated
income statement when the hedged transaction affects the
consolidated income statement.
If the hedging instrument expires or is sold, terminated or
exercised without replacement or rollover, or if its designation
asa hedge is revoked, any cumulative gain or loss previously
recognised in other comprehensive income remains separately
inequity until the forecast transaction occurs and affects the
consolidated income statement. When a forecast transaction is
no longer expected to occur, the cumulative gain or loss that was
reported in other comprehensive income is immediately
transferred to the consolidated income statement.
Share-based payments
Employees (including Executive Directors) of the Group receive
remuneration in the form of share-based payment, whereby
employees render services in exchange for shares or rights over
shares (‘equity-settled transactions’).
Strategic report Governance Financial statements
159Petrofac Limited 2021 Annual report and accounts

Equity-settled transactions
The cost of equity-settled transactions with employees is
measured by reference to the fair value at the date on which
theyare granted.
The cost of equity-settled transactions is recognised in the
costof sales or selling, general and administration expenses
lineitems in the consolidated income statement, together
withacorresponding increase in other reserves line item in
theconsolidated balance sheet, over the period in which the
relevantemployees become entitled to the award (the ‘vesting
period’). The cumulative expense recognised for equity-settled
transactions at the end of the reporting period until the vesting
date reflects the extent to which the vesting period has expired
and the Group’s best estimate of the number of equity
instruments that will ultimately vest. The charge or credit to
theconsolidated income statement for a period represents the
movement in cumulative expense recognised from the beginning
to the end of the reporting period.
No expense is recognised for awards that do not ultimately vest
because non-market performance and/or service conditions have
not been met. Where awards include a market or non-vesting
condition, the transactions are treated as vested irrespective of
whether the market or non-vesting condition is satisfied, provided
that all other performance and/or service conditions are satisfied.
Equity awards cancelled, such as in the case of good leavers,
aretreated as vested immediately on the date of cancellation,
andany expense not recognised for the award at that date is
immediately recognised in the consolidated income statement.
Income taxes
Income tax expense represents the sum of current income tax
and deferred tax.
Current income tax assets and liabilities for the current and prior
periods are measured at the amount expected to be recovered
from or paid to the taxation authorities. Taxable profit differs from
profit as reported in the consolidated income statement because
it excludes items of income or expense that are taxable or
deductible in other years and it further excludes items that are
never taxable or deductible. The Group’s liability for current tax
iscalculated using tax rates that have been enacted or
substantively enacted by the balance sheet date.
Deferred tax is recognised on all temporary differences at
thebalance sheet date between the carrying amounts of assets
and liabilities in the financial statements and the corresponding
tax bases used in the computation of taxable profit, with the
following exceptions:
– Where the temporary difference arises from the initial
recognition of goodwill or of an asset or liability in a transaction
that is not a business combination that at the time of the
transaction affects neither accounting nor taxable profit or loss
– In respect of taxable temporary differences associated with
investments in subsidiaries, associates and joint ventures,
where the timing of reversal of the temporary differences can
be controlled and it is probable that the temporary differences
will not reverse in the foreseeable future; and
– Deferred tax assets are recognised only to the extent that it is
probable that a taxable profit will be available against which the
deductible temporary differences and carried forward tax
credits or tax losses can be utilised
The carrying amount of deferred tax assets is reviewed at
eachbalance sheet date and reduced to the extent that it is
nolonger probable that sufficient taxable profit will be available
toallow all or part of the deferred tax assets to be utilised.
Unrecognised deferred tax assets are reassessed at each
balance sheet date and are recognised to the extent that it has
become probable that future taxable profit will allow the deferred
tax asset to be recovered.
Deferred tax assets and liabilities are measured on an
undiscounted basis at the tax rates that are expected to apply
when the asset is realised or the liability is settled, based on tax
rates and tax laws enacted or substantively enacted at the
balance sheet date.
Current and deferred tax is charged or credited directly to other
comprehensive income or equity if it relates to items that are
credited or charged to, respectively, other comprehensive income
or equity. Otherwise, income tax is recognised in the
consolidated income statement.
2.9 Change in accounting policy
In April 2021, IFRIC published an agenda decision clarifying the
accounting for implementation costs of Software-as-a-Service
arrangements. As stated in note 2.3, SaaS arrangements are
service contracts providing the Group with the right to access the
cloud provider’s application software over the contract period.
As a result of this agenda decision, the Group has changed its
accounting policy for such implementation costs and, to the
extent that these costs do not give rise to an identifiable
intangible asset, they are expensed in the consolidated income
statement (having been capitalised previously). The Group has
assessed the impact of this change in accounting policy on any
cloud computing arrangements entered into during prior years
and restated the comparative figures. As a result, an amount of
US$14m of costs previously capitalised have now been expensed
in the consolidated income statement. This restatement has
affected the consolidated income statement, statement of
cashflows, balance sheet and retained earnings, as shown
onthe following page. In accordance with IAS 1 ‘Presentation
ofFinancial Statements’, a balance sheet as at the beginning
ofthepreceding year (i.e. at 1 January 2020) has been restated
and presented.
The restatement represents a non-cash adjustment.
The revision to the accounting policy has been accounted for
retrospectively, resulting in a prior year restatement, and the
comparative financial information has been restated as presented
on the following page.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
2 Summary of significant accounting
policiescontinued
Petrofac Limited 2021 Annual report and accounts160

The affected financial statement line items are as follows:
31 Dec 2020
As reported
US$m
Restatement
US$m
31 Dec 2020
Restated
US$m
Income statement and statement of comprehensive income impact
Separately disclosed items – expense cloud configuration and customisation costs previously
capitalised (note 6) (229) (14) (243)
Selling, general and administration expenses – amortisation previously expensed (note 5b) (167) 2 (165)
Operating loss (148) (12) (160)
Loss before tax (171) (12) (183)
Net loss (189) (12) (201)
Net loss attributable to Petrofac Limited shareholders (180) (12) (192)
Foreign currency translation losses (16) (2) (18)
Comprehensive loss for the year (217) (14) (231)
Loss per share (US cents):
Loss per share – basic and diluted (note 9) (53.4) (3.6) (57.0)
Balance sheet impact
Intangible assets (note 15) 81 (30) 51
Total non-current assets 823 (30) 793
Total assets 4,201 (30) 4,171
Retained earnings 454 (28) 426
Other reserves 45 (2) 43
Total equity 440 (30) 410
Total equity and liabilities 4,201 (30) 4,171
Statement of cash flows impact
Profit before tax and separately disclosed items 58 2 60
Depreciation, amortisation, business performance impairment and write-off 125 (2) 123
Separately disclosed items paid – operating costs (19) (14) (33)
Net cash flows used in operating activities (16) (14) (30)
Payments for intangible assets (24) 14 (10)
Net cash flows used in investing activities (21) 14 (7)
Net decrease in cash and cash equivalents (279) – (279)
A third balance sheet has been presented in accordance with IAS 1 to illustrate the impact on the opening balance sheet as at
1 January 2020. The Group identified that US$16m of costs previously capitalised under cloud computing arrangements, should now
be expensed. The opening balance sheet as at 1 January 2020 has been restated to correct for these accordingly, as shown below.
The affected financial statement line items are as follows:
1 Jan 2020
As reported
US$m
Restatement
US$m
1 Jan 2020
Restated
US$m
Balance sheet impact
Intangible assets 66 (16) 50
Total non-current assets 1,028 (16) 1,012
Total assets 5,976 (16) 5,960
Retained earnings 637 (16) 621
Total equity 914 (16) 898
Total equity and liabilities 5,976 (16) 5,960
Strategic report Governance Financial statements
161Petrofac Limited 2021 Annual report and accounts

3 Revenue from contracts with customers
2021
US$m
2020
US$m
Rendering of services 3,009 4,006
Sale of crude oil and gas 48 75
3,057 4,081
Included in revenue are Engineering & Construction and Asset Solutions revenue of a 'pass-through' nature with zero or low margins
amounting to US$405m (2020: US$288m).
Set out below is the disaggregation of the Group’s revenue from contracts with customers:
Engineering &
Construction
US$m
Asset
Solutions
US$m
Integrated
Energy
Services
US$m
2021
US$m
Engineering &
Construction
US$m
Asset
Solutions
US$m
Integrated
Energy
Services
US$m
2020
US$m
Geographical markets
United Kingdom 150 592 – 742 – 534 – 534
Algeria 442 – – 442 576 – – 576
Thailand 410 18 – 428 569 14 – 583
Oman 373 16 – 389 735 13 – 748
Kuwait 193 3 – 196 326 4 – 330
Iraq 49 110 – 159 105 133 – 238
United Arab Emirates 94 39 – 133 244 52 – 296
Netherlands 84 29 – 113 231 2 – 233
Russia 108 2 – 110 182 2 – 184
Bahrain – 76 – 76 – 23 – 23
Singapore – – 48 48 – – 12 12
United States of America – 49 – 49 – 31 – 31
Kazakhstan – 37 – 37 – 13 – 13
India 22 1 – 23 93 – – 93
Malaysia 2 16 2 20 8 19 30 57
Turkey 6 6 – 12 24 4 – 28
Saudi Arabia 7 – – 7 (32) – – (32)
New Zealand – 7 – 7 – 6 – 6
Germany 6 – – 6 21 – – 21
Libya 4 1 – 5 – 15 – 15
Mexico – – – – – – 68 68
Others 17 38 – 55 – 24 – 24
Total revenue from contracts
with customers 1,967 1,040 50 3,057 3,082 889 110 4,081
Type of goods or service
Fixed price 1,760 226 – 1,986 2,882 129 – 3,011
Reimbursable 207 814 2 1,023 200 760 35 995
Sale of crude oil and gas – – 48 48 – – 75 75
Total revenue from contracts
with customers 1,967 1,040 50 3,057 3,082 889 110 4,081
Customer type
Government 1,370 236 – 1,606 2,178 184 68 2,430
Non-government 597 804 50 1,451 904 705 42 1,651
Total revenue from contracts
with customers 1,967 1,040 50 3,057 3,082 889 110 4,081
Timing of revenue recognition
Services transferred over time 1,967 1,040 2 3,009 3,082 889 35 4,006
Goods transferred at a point in time – – 48 48 – – 75 75
Total revenue from contracts
with customers 1,967 1,040 50 3,057 3,082 889 110 4,081
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
Petrofac Limited 2021 Annual report and accounts162

Revenue disclosed in the above tables is based on where the customer is located. Revenue representing greater than 10% of Group
revenue arose from one customer amounting to US$410m (2020: US$569m, one customer) in the Engineering & Construction
operating segment.
The transaction price allocated to the remaining performance obligations (unsatisfied or partially unsatisfied) as at the end of each
reporting period is as follows:
Engineering &
Construction
US$m
Asset Solutions
US$m
2021
US$m
Engineering &
Construction
US$m
Asset Solutions
US$m
2020
US$m
Within one year 1,301 908 2,209 2,151 876 3,027
More than one year 1,074 746 1,820 1,095 865 1,960
2,375 1,654 4,029 3,246 1,741 4,987
4 Segment information
The Group organisational structure comprises the following three operating segments:
– Engineering & Construction, which provides fixed-price engineering, procurement and construction project execution services and
reimbursable engineering, procurement and construction management services to the onshore and offshore oil and gas industry
– Asset Solutions, which mainly includes reimbursable engineering and production services activities to the oil and gas industry
– Integrated Energy Services, which is focused on delivering value from the existing asset portfolio
The Chief Operating Decision Makers (CODMs) have been identified as the Group’s Chief Executive Officer and Chief Financial Officer.
The CODMs regularly review the performance of the operating segments to make decisions about resource allocations and to assess
financial performance. Finance expense and income arising from borrowings and cash balances, which are not directly attributable to
individual operating segments, are allocated to Corporate. The software cost associated with configuration or customisation services
are centralised activities not monitored at the segment level, and thus have been allocated to the Corporate segment. In addition,
certain shareholder services-related costs, intra-group financing and consolidation adjustments are managed at Corporate and are
not allocated to operating segments.
The Group’s financial performance presented below also separately identifies the effect of separately disclosed items to provide users
of the consolidated financial statements with a clear and consistent presentation of the underlying business performance of the Group;
refer to notes 2, 6 and appendix A for details. Consequently, the CODMs assess the performance of the operating segments based on
a measure of business performance profit after tax, excluding the effect of separately identified items.
The following tables represent revenue and profit/(loss) information relating to the Group’s operating segments for the year ended
31 December 2021 and the restated comparative information for the year ended 31 December 2020.
Year ended 31 December 2021
Engineering &
Construction
US$m
Asset
Solutions
US$m
Integrated
Energy
Services
US$m
Corporate &
others
US$m
Consolidation
adjustments
& eliminations
US$m
Business
performance
US$m
Separately
disclosed
items
US$m
Reported
US$m
Revenue
External sales 1,967 1,040 50 – – 3,057 – 3,057
Inter-segment sales 4 71 – – (75) – – –
Total revenue 1,971 1,111 50 – (75) 3,057 – 3,057
Operating (loss)/profit (14) 67 (6) (18) – 29 (159) (130)
Finance income – – 5 1 – 6 – 6
Finance expense (1) (2) (5) (36) – (44) (28) (72)
Share of net profit of associates and joint
ventures – 7 – – – 7 – 7
(Loss)/profit before tax (15) 72 (6) (53) – (2) (187) (189)
Income tax credit/(expense) 24 16 1 (1) – 40 (43) (3)
Net profit/(loss) 9 88 (5) (54) – 38 (230) (192)
Attributable to:
Petrofac Limited shareholders 8 86 (5) (54) – 35 (230) (195)
Non-controlling interests 1 2 – – – 3 – 3
9 88 (5) (54) – 38 (230) (192)
EBITDA 10 84 21 (11) – 104 n/a n/a
Strategic report Governance Financial statements
163Petrofac Limited 2021 Annual report and accounts

Engineering &
Construction
US$m
Asset
Solutions
US$m
Integrated
Energy
Services US$m
Corporate &
others
US$m
Consolidation
adjustments &
eliminations
US$m
Total
US$m
Other segment information
Capital expenditures:
Property, plant and equipment (note 12) 2 6 51 18 – 77
Intangible assets (note 15) – – – 7 – 7
Charges:
Depreciation (note 12) 24 9 27 2 – 62
Amortisation, business performance impairment
and write off (note 5a, note 5b and note 5g) – 1 – 5 – 6
Separately disclosed items, pre-tax (note 6) 5 11 19 152 – 187
Expected credit loss credit (note 5e) (25) – – – – (25)
Other long-term employment benefits (note 27) 6 2 – 1 – 9
Share-based payments (note 24) 3 2 – 2 – 7
Year ended 31 December 2020 (restated)
(1)
Engineering
&
Construction
US$m
Asset
Solutions
US$m
Integrated
Energy
Services
US$m
Corporate &
others
US$m
Consolidation
adjustments
& eliminations
US$m
Business
performance
US$m
Separately
disclosed
items
(restated)
(1)
US$m
Reported
US$m
Revenue
External sales 3,082 889 110 – – 4,081 – 4,081
Inter-segment sales 8 44 – – (52) – – –
Total revenue 3,090 933 110 – (52) 4,081 – 4,081
Operating profit/(loss) 79 45 (30) (11) – 83 (243) (160)
Finance income – 2 5 2 – 9 – 9
Finance expense (1) (2) (7) (27) – (37) – (37)
Share of net profit of associates and joint
ventures – 5 – – – 5 – 5
Profit/(loss) before tax 78 50 (32) (36) – 60 (243) (183)
Income tax (expense)/credit (21) (10) 11 1 – (19) 1 (18)
Net profit/(loss) 57 40 (21) (35) – 41 (242) (201)
Attributable to:
Petrofac Limited shareholders 63 40 (18) (35) – 50 (242) (192)
Non-controlling interests (6) – (3) – – (9) – (9)
57 40 (21) (35) – 41 (242) (201)
EBITDA 114 60 39 (2) – 211 n/a n/a
(1) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
4 Segment information continued
Petrofac Limited 2021 Annual report and accounts164

Engineering &
Construction
US$m
Asset Solutions
US$m
Integrated
Energy Services
US$m
Corporate &
others
US$m
Consolidation
adjustments &
eliminations
US$m
Total
US$m
Other segment information
Capital expenditures:
Property, plant and equipment (note 12) 2 5 26 2 – 35
Intangible assets (restated)
(1)
(note 15) – – – 9 – 9
Charges:
Depreciation (note 12) 35 9 34 4 – 82
Amortisation, business performance impairment
and write off (restated)
(1)
(note 5a, note 5b and note
5g) – 1 35 5 – 41
Separately disclosed items, pre-tax
(restated)
(1)
(note 6) 19 – 208 16 – 243
Expected credit loss allowance/(credit) (note 5e) 8 (4) 4 1 – 9
Other long-term employment benefits (note 27) 13 3 – – – 16
Share-based payments (note 24) 9 3 – 3 – 15
(1) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
Geographical segments
The following tables present selected non-current assets by geographical segments for the years ended 31 December 2021 and
2020.
As at 31 December 2021
Malaysia
US$m
United Arab
Emirates
US$m
United
Kingdom
US$m
India
US$m
Kuwait
US$m
Oman
US$m
Other
countries
US$m
Total
US$m
Non-current assets:
Property, plant and
equipment (note 12) 203 34 24 8 1 2 11 283
Goodwill (note 14) 3 29 44 – – – 25 101
Intangible oil and gas
assets (note 15) 4 – – – – – – 4
Other intangible assets
(note 15) – – 34 – – – 5 39
As at 31 December 2020
Malaysia
US$m
United Arab
Emirates
US$m
United
Kingdom
US$m
India
US$m
Kuwait
US$m
Oman
US$m
Other
countries
US$m
Total
US$m
Non-current assets:
Property, plant and
equipment (note 12) 170 48 40 12 7 2 9 288
Goodwill (note 14) 3 29 44 – – – 25 101
Intangible oil and gas
assets (note 15) 13 – – – – – – 13
Other intangible assets
(restated)
(1)
(note 15) – – 33 – – – 5 38
(1) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
Strategic report Governance Financial statements
165Petrofac Limited 2021 Annual report and accounts

5 Expenses and income
a. Cost of sales
Included in cost of sales are staff costs of US$669m (2020: US$702m), depreciation charged on property, plant and equipment of
US$56m (2020: US$75m), amortisation charge on intangible assets of US$1m (2020: US$1m) and gain associated with ineffective
portions on derivatives designated as cash flow hedges of US$3m (2020: loss US$5m).
b. Selling, general and administration expenses
2021
US$m
2020
(restated)
(1)
US$m
Staff costs 99 102
Depreciation and amortisation (notes 12 and 15) 11 12
Other general and administration expenses 65 51
Business performance selling, general and administration expenses (before separately disclosed items) 175 165
Separately disclosed items (note 6) 159 243
334 408
(1) The prior year amortisation is restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
Other general and administration expenses consist mainly of office-related costs, travel, professional services fees and contracting
staff costs.
The increase in selling, general and administration expenses of US$10m was mainly due to an increase in other general and
administration expenses of US$14m, primarily due to increases in insurance premiums and legal and professional fees.
c. Staff costs
2021
US$m
2020
US$m
Total staff costs:
Wages and salaries 692 715
Social security costs 35 33
Defined contribution pension costs 25 25
Other long-term employee benefit costs (note 27) 9 16
Share-based payments costs (note 24) 7 15
768 804
Of the US$768m (2020: US$804m) of staff costs shown above, US$669m (2020: US$702m) is included in cost of sales and US$99m
(2020: US$102m) in selling, general and administration expenses.
The average number of staff employed by the Group during the year was 8,752 (2020: 10,645).
d. Auditor’s remuneration
The Group paid the following amounts to its auditor in respect of the audit of the financial statements and for other non-prohibited
services provided to the Group:
2021
US$m
2020
US$m
Group audit fee 3 3
Audit of subsidiaries’ accounts 1 1
Other 2 –
6 4
Other includes audit-related assurance services of US$58,000 (2020: US$19,000) and other non-audit services of US$1.5m (2020:
US$0.1m), which included the completion of an interim review for the period to 30 June 2021 and work completed as the reporting
accountant in respect of the comprehensive refinancing and capital raise, completed in the second half of the year.
e. Expected credit loss allowance
The movement in ECL allowance recognised by the Group during 2021 and 2020 was as follows:
2021
US$m
2020
US$m
ECL reversal on trade receivables (note 19) (1) –
ECL (reversal)/charge on contract assets (note 20) (24) 5
ECL (reversal)/charge on other financial assets (note 17) (1) 2
ECL charge on receivables from joint operations partners (note 19) 1 –
ECL charge on other receivables (note 19) – 2
(25) 9
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
Petrofac Limited 2021 Annual report and accounts166

f. Other operating income
2021
US$m
2020
US$m
Foreign exchange gains 3 6
Other income 5 15
8 21
Other income included US$2m of aged trade payables reversed during the year relating to the Engineering & Construction operating
segment (2020: US$7m in the Engineering & Construction operating segment) and a gain on disposal of property and equipment of
$1m in the Engineering & Construction operating segment (2020: $1m in the Engineering & Construction operating segment).
g. Other operating expenses
2021
US$m
2020
US$m
Foreign exchange losses 3 7
Other expenses 4 36
7 43
During the prior year, other operating expenses mainly comprised an impairment charge of US$34m within the Integrated Energy
Services operating segment relating to assets held for sale associated with the Group’s operations in Mexico.
6 Separately disclosed items
2021
US$m
2020
(restated)
(1)
US$m
UK Serious Fraud Office proceedings 106 –
Impairment of assets 17 146
Fair value re-measurements 8 57
Restructuring and redundancy costs 2 13
Cloud ERP software implementation costs (expensed due to change in accounting policy – note 2.9) 12 14
Other separately disclosed items 14 13
Total separately disclosed items as reported within selling, general and administrative expenses (note 5b) 159 243
Refinancing-related costs – separately disclosed items as reported within finance expense (note 7) 28 –
Foreign exchange translation loss on deferred tax balances – (1)
Deferred tax impairment 43 –
Total separately disclosed items as reported within income tax charge (note 8) 43 (1)
Consolidated income statement charge 230 242
(1) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
UK Serious Fraud Office proceedings
On 12 May 2017, the SFO announced an investigation into the activities of Petrofac, its subsidiaries, and their officers, employees and
agents for suspected bribery, corruption, and/or money laundering. In September 2021, the Company reached a plea agreement with
the SFO such that the Company entered guilty pleas in respect of seven counts of failing to prevent former Petrofac Group employees
from offering or making payments to agents in relation to projects in Iraq, Saudi Arabia and the United Arab Emirates, contrary to
Section 7 of the UK Bribery Act 2010. As a result, on 4 October 2021 the Southwark Crown Court ordered the Company to pay a
penalty of £77.0m. This comprises a confiscation order of £22.8m payable by 3 January 2022; a fine of £47.2m and SFO costs of
£7.0m, both payable on 14 February 2022. At 31 December 2021, management has recorded a liability for a full amount payable at
theyear-end exchange rate (US$104m); note 28.
Impairment of assets
At 31 December 2021, internal and external impairment indicators existed, predominantly production rates from recently drilled wells
and the likelihood of securing an extension for the Production Sharing Contract (PSC) beyond the current term, which expires in 2026.
Consequently, the Group performed an impairment review of the carrying value amount of its Block PM304 oil and gas assets on
afairvalue less cost of disposal basis (Level 3 of the ‘fair value hierarchy’ contained within IFRS 13 ‘Fair Value Measurement’) using
apost-tax discount rate of 9.5%. This assessment resulted in an impairment charge of US$15m (2020: US$64m) in the Integrated
Energy Services operating segment. This includes $14m of right of use assets (note 12). In addition, an associated impairment of
US$43m was recognised against the carrying amount of the deferred tax asset following the revised forecasts produced to complete
the assessment noted above.
These reviews involved assessing the field operational performance; robustness of the future development plans; oil price and licence
extension assumptions. As a result of this review, an impairment of US$15m was allocated proportionately to property, plant and
equipment (US$14m; note 12, oil and gas assets and facilities) and intangible oil and gas assets (US$1m; note 15).
Strategic report Governance Financial statements
167Petrofac Limited 2021 Annual report and accounts

The oil price assumptions used by management were US$70 per barrel for 2022 and 2023, US$65 per barrel for 2024 and US$60 per
barrel for the remaining period of the assessment. The oil price assumption and the likelihood of a licence extension beyond 2026
were the most sensitive inputs in determining the fair value less cost of disposal; a further 10% decrease in oil prices would result in
anadditional impairment charge of US$30m.
Fair value less costs of disposal is determined by discounting the post-tax cash flows expected to be generated from oil and gas
production net of disposal costs considering assumptions that market participants would typically use in estimating fair values.
Post-tax cash flows are derived from projected production profiles for each asset considering forward market commodity prices over
the relevant period and, where external forward prices are not available, the Group’s Board-approved business planning assumptions
were used. As each field has different reservoir characteristics and contractual terms, the post-tax cash flows for each asset are
calculated using individual economic models, which include assumptions around the amount of recoverable reserves, production
costs, life of the field/licence period and the selling price of the commodities produced.
During the current year, management identified impairment indicators for one of the Group’s subsidiaries in the United Kingdom and
as a result reviewed the carrying amount of property, plant and equipment, including right-of-use assets relating to that subsidiary,
using the value-in-use basis. The value in use was calculated using the latest approved cash flow forecasts for 2022 to 2024 and a
zero growth assumption for the period 2025 and beyond measured at present value using a discount rate of 15.2%. This review
resulted in an impairment charge of US$2m in the Asset Solutions operating segment (2020: US$3m) relating to the right-of-use
assetassociated with a facility in the UK.
In the prior year, the Group disposed of its remaining 51% ownership interest relating to the Group’s operations in Mexico.
Consequently, an impairment loss of US$79m was recognised as a separately disclosed item in the consolidated income statement
attributable to the Integrated Energy Services operating segment.
Fair value re-measurements
During 2021, management reviewed the carrying amount of the contingent consideration arising from the 2020 disposal of the Group’s
operations in Mexico and as a result of this review recognised a downward fair value adjustment of US$5m in the Integrated Energy
Services operating segment (2020: US$42m). The downward fair value adjustment resulted from reassessing the recoverable amount
of contingent consideration due from the acquirer (2020: uncertainty surrounding the Mexican Energy Reform programme and the
outcome of other contingent consideration elements); see note 17 for more details.
Additionally, during 2021, management reviewed the carrying amount of the contingent consideration payable associated with the
acquisition of W&W Energy Services Inc ('W&W'), following a change to the contingent consideration earn-out terms. This resulted in
anegative fair value adjustment of US$3m being recognised in the Asset Solutions operating segment (2020: gain of US$8m). At the
end of the year, the fair value of contingent consideration payable was calculated using an expected value pay-out approach applying
a discount rate of 15.2% (Level 3 of the ‘fair value hierarchy’ contained within IFRS 13 ‘Fair Value Measurement’). The fair value
represented management’s best estimate based on the expected financial performance targets that will be achieved by W&W,
overthe remaining evaluation period i.e. 2022 and 2023.
During 2020, management reviewed the carrying amount of the Pánuco contingent consideration and as a result of this review
recognised a downward fair value adjustment of US$8m in the Integrated Energy Services operating segment in response to a
confirmation received from the acquirer during 2020 to relinquish the Pánuco Production Enhancement Contract (PEC) to its customer.
Additionally, during 2020, management reviewed the carrying amount of the contingent consideration receivable from the GSA
acquirer and as a result of this review recognised a downward fair value adjustment of US$9m in the Integrated Energy Services
operating segment. Also, during 2020, management reviewed the carrying amount of the deferred consideration associated with the
disposal of the JSD6000 installation vessel that was recognised as a non-current asset in the consolidated balance sheet. The fair
value of the deferred consideration took into account, amongst other factors, an independent broker’s valuation of the vessel (a Level
3 measurement of the ‘fair value hierarchy’ contained within IFRS 13 ‘Fair Value Measurement’). A downward fair value adjustment
ofUS$6m was recognised as a separately disclosed item in the Engineering & Construction operating segment in that year, which
reduced the deferred consideration to US$55m at 31 December 2020.
Restructuring and redundancy costs
In response to the reduced level of new orders recorded in the year, further cost reduction measures were taken by management
which resulted in redundancy costs of US$1m recognised in the Engineering & Construction operating segment and US$1m in the
Corporate reporting segment. This was following the actions announced by management in response to COVID-19 in the prior year
toreduce costs and right size the organisation which resulted in a redundancy cost of US$8m being recognised in the Engineering
&Construction operating segment and US$5m being recognised in the Asset Solutions operating segment.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
6 Separately disclosed items continued
Petrofac Limited 2021 Annual report and accounts168

Software implementation costs
Following IFRIC’s agenda decision published in April 2021, the Group has revised its accounting policy regarding the customisation
and configuration costs incurred when implementing a SaaS arrangement (see note 2.9). The Group is currently undertaking a major
systems implementation for a new cloud computing software, resulting in costs of US$12m being recognised as an expense in the
current year (2020 restated: US$14m). The first two phases of the implementation have been successfully completed.
Due to the size, nature and incidence of these costs, they are presented as a separately disclosed item, as they are not reflective of
underlying performance. Additionally, as this is a large and complex implementation, it is expected that it will be completed over the
next two to three years, especially following the disruption caused by COVID-19.
Refinancing related costs
During 2021, a capital raise (note 22) and comprehensive refinancing were completed to extend Petrofac’s debt maturities and to
create a long-term capital structure. Costs of US$28m were incurred which were integral to the execution of the refinancing but were
not directly attributable to the secured facilities. These costs included facility fees for bridge finance, advisory fees paid on behalf of
lenders, certain legal and professional fees, and accelerated amortisation associated with debt acquisition costs for facilities which
were repaid during the year.
Other separately disclosed items
Other separately disclosed items comprised US$10m (2020: US$4m) of professional services fees relating to the Corporate reporting
segment and a loss on disposal of US$4m in the Asset Solutions operating segment that related to the disposal of the Group’s survival
and marine, health and safety, fire and major emergency management capability, and facilities in Scotland (2020: $nil).
In the prior year, charges of US$6m (note 17), were also incurred in respect to an early settlement of deferred consideration receivable
in the Integrated Energy Services operating segment; additional disposal costs associated with the disposal of the JSD6000
installation vessel of US$1m in the Engineering & Construction operating segment, whilst there was a gain of US$1m, relating to an
early settlement of a contract asset in the Asset Solutions operating segment.
There was a foreign currency translation gain of US$1m relating to the translation of deferred tax balances denominated in Malaysia
ringgits was recognised during the prior period in respect of the Group’s assets in Malaysia, relating to the Integrated Energy Services
operating segment and a foreign currency translation loss of US$3m that related to the closure of an engineering office in the
Engineering & Construction operating segment.
7 Finance income/(expense)
2021
US$m
2020
US$m
Finance income
Bank interest 1 3
Unwinding of discount on receivables (note 17) 5 6
Total finance income 6 9
Finance expense
Group borrowings (36) (27)
Lease liabilities (7) (9)
Unwinding of discount on provisions (note 27) (1) (1)
Business performance finance expense (before separately disclosed items) (44) (37)
Separately disclosed items – refinancing related costs (note 6) (28) –
Total finance expense (72) (37)
Group borrowing costs have increased during 2021 following the debt refinancing exercise completed in October 2021, and the
issuing of the senior secured notes (note 26).
Strategic report Governance Financial statements
169Petrofac Limited 2021 Annual report and accounts

8 Income tax
a. Tax on ordinary activities
The major components of income tax (credit)/expense are as follows:
Business
performance
(1)
US$m
Separately
disclosed
items
US$m
Reported
2021
US$m
Business
performance
(1)
US$m
Separately
disclosed
items
US$m
Reported
2020
US$m
Current income tax
Current income tax expense/(credit) 26 (1) 25 51 – 51
Adjustments in respect of previous years (56) – (56) (18) – (18)
Deferred tax
Relating to origination and reversal of temporary
differences (5) – (5) (18) – (18)
Changes in tax rates and legislation (4) – (4) (2) – (2)
Derecognition of deferred tax previously recognised – 44 44 3 (1) 2
Adjustments in respect of previous years (1) – (1) 3 – 3
Income tax (credit)/expense reported in the
consolidated income statement (40) 43 3 19 (1) 18
Income tax reported in equity
Deferred tax related to items charged directly to
equity – – – 1 – 1
Foreign exchange movements on translation 1 – 1 (2) – (2)
Income tax expense/(credit) reported in equity 1 – 1 (1) – (1)
(1) This measurement is shown by the Group as a means of measuring underlying business performance; see note 2 and appendix A.
The split of the Group’s income tax expense between current and deferred tax varies from year to year depending largely on:
– the variance between tax provided on the percentage of completion of contracts compared with that paid on accrued income for
fixed-price engineering, procurement and construction contracts; and
– the tax deductions available for expenditure on Production Sharing Contracts and Production Enhancement Contracts, which are
partially offset by the creation of losses.
See note 8c below for the impact on the movements in the year.
b. Reconciliation of income tax expense
A reconciliation between income tax expense and the product of accounting profit multiplied by the Company’s domestic tax rate is
asfollows:
Business
performance
(1)
US$m
Separately
disclosed
items
US$m
Reported
2021
US$m
Business
performance
(1)
US$m
Separately
disclosed items
US$m
Reported
2020
US$m
(Loss)/profit before tax (2) (187) (189) 60 (243) (183)
Applicable tax (credit)/charge at standard statutory
tax rates
(2)
(36) (13) (49) 2 (61) (59)
Expenditure not allowable for income tax purposes 25 12 37 7 37 44
Income not subject to tax (4) – (4) (2) (2) (4)
Adjustments in respect of previous years (57) – (57) (15) – (15)
Adjustments in respect of deferred tax previously
recognised/unrecognised – 44 44 3 – 3
Unrecognised deferred tax 32 – 32 27 26 53
Other permanent differences 4 – 4 (1) (1) (2)
Effect of change in tax rates
(3)
(4) – (4) (2) – (2)
At the effective income tax rate of negative 1.1%
on reported profit before tax (2020: 9.8%) (40) 43 3 19 (1) 18
(1) This measurement is shown by the Group as a means of measuring underlying business performance; see note 2 and appendix A.
(2) The weighted average statutory tax rate was 25.8% in 2021 (2020: 32.2%). Compared with 2020, the rate in 2021 was mainly due to losses incurred in jurisdictions subject to lower tax
rates, resulting in a lower weighted average statutory tax rate compared with the prior year.
(3) The 2021 balance relates to the substantive enactment of the increase in the UK corporation tax rate from 19% to 25%, effective 1 April 2023.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
Petrofac Limited 2021 Annual report and accounts170

The Group’s effective tax rate for the year ended 31 December 2021 was negative 1.1% (2020:9.8%). The Group’s effective tax rate
excluding the impact of impairments, re-measurements and other separately disclosed items for the year ended 31 December 2021
was greater than 100% (2020: 31.7%).
The change from the prior year was mainly due to the release of uncertain tax treatment items in various territories following the
successful outcomes of tax audits and assessments during 2021. The balance in the ‘adjustments in respect of previous years’
includes $5m in relation to the release of an uncertain tax treatment provision that should have been recognised in the prior year.
In theDirectors’ judgement, this amount is not considered material and therefore the prior year balances have not been restated.
The Group’s future tax charge will be sensitive to the levels and mix of profitability in different jurisdictions, tax rates imposed and any
future tax regime reforms. In 2021, the UK Government enacted legislation to increase the main rate of corporation tax to 25% with
effect from 1 April 2023. In December 2021, the OECD issued model rules for a new global minimum tax framework, setting out the
scope of and the mechanism for calculating the global minimum tax. The Group is reviewing the model rules and awaiting the OECD’s
anticipated publication of further guidance, as well as new legislation expected to be released by governments implementing this new
tax regime, to assess the potential impact of any new legislation on the Group.
c. Deferred tax
Deferred tax relates to the following:
Consolidated balance sheet Movement
2021
US$m
2020
US$m
2021
US$m
2020
(1)
US$m
Deferred tax liabilities
Accelerated depreciation for tax purposes – 22 (22) 7
Profit recognition 28 32 (4) 2
Overseas earnings 3 6 (3) 2
Other temporary differences – 2 (2) 1
Gross deferred tax liabilities 31 62 (31) 12
Deferred tax assets
Losses available for offset 15 62 47 (18)
Decelerated depreciation for tax purposes 2 7 5 (1)
Share-based payment plans – 1 1 –
Decommissioning – 4 4 2
Other temporary differences 3 11 8 (5)
Gross deferred tax assets 20 85 65 (22)
Net deferred tax (liability)/asset and income tax expense/(credit) (11) 23 34 (10)
Of which:
UK 17 18 n/a n/a
Malaysia – 43 n/a n/a
Other (outside of the UK and Malaysia) 1 – n/a n/a
Deferred tax assets 18 61 n/a n/a
Deferred tax liabilities 29 38 n/a n/a
The Group recognises deferred tax assets to the extent that it is probable that sufficient future taxable profits will arise, against which
the deductible temporary differences can be utilised. Included within the net deferred tax asset are UK tax losses of US$59m (2020:
US$58m) and other deductible temporary differences. The Group has performed an assessment of recovery of deferred tax assets
and reviewed the forecasts for all entities in the UK, and the ability of those entities to generate sufficient future taxable profits.
It should be noted that there is no time limit on the utilisation of UK tax losses and business profit forecasts indicate that these losses
will be fully recovered within eight years (2020: eight years). It is considered that these sources of profits are sufficiently predictable
tosupport this recognition period.
Assessing the availability of future taxable profits to support the recognition of deferred tax assets is considered a key judgement and
changes in Group forecasts will impact the recoverability of deferred tax assets. To the extent that there are insufficient taxable profits,
no deferred tax asset is recognised, and details of unrecognised deferred tax assets are included below.
Deferred tax liabilities of US$0.3m (2020: US$3m) are not recognised on the unremitted earnings of overseas subsidiaries, associates
and joint ventures as the Group is able to control the timing of the reversal of these temporary differences and it is probable that they
will not reverse in the foreseeable future. Unrecognised taxable temporary differences associated with undistributed retained earnings
of investments in subsidiaries, joint ventures and associates amounted to US$5m (2020: US$11m).
d. Unrecognised tax losses and tax credits
The Group did not recognise deferred income tax assets on tax losses and credits of US$1,458m (2020: US$1,327m) because it is not
probable that future taxable profits will be available against which the Group can utilise the benefits.
Strategic report Governance Financial statements
171Petrofac Limited 2021 Annual report and accounts

2021
US$m
2020
US$m
Expiration dates for tax losses
No later than 2025 3 3
No expiration date 1,444 1,313
1,447 1,316
Tax credits (no expiration date) 11 11
1,458 1,327
During 2021, no previously unrecognised losses were utilised by the Group (2020: US$nil).
9 Earnings per share
Basic earnings per share is calculated by dividing the net profit for the year attributable to Petrofac Limited shareholders by the
weighted average number of ordinary shares outstanding during the year.
Diluted earnings per share is calculated by dividing the net profit attributable for the year to Petrofac Limited shareholders, after
adjusting for any dilutive effect, by the weighted average number of ordinary shares outstanding during the year, adjusted for the
effects of ordinary shares granted under the share-based payment plans which are held in the Employee Benefit Trust.
The following reflects the net profit and share data used in calculating basic and diluted earnings per share:
2021
US$m
2020
(restated)
(3)
US$m
Business performance net profit attributable to Petrofac Limited shareholders for basic and diluted
earnings per share 35 50
Separately disclosed items attributable to Petrofac Limited shareholders for basic and diluted earnings per
share (230) (242)
Reported net profit attributable to Petrofac Limited shareholders for basic and diluted earnings per share (195) (192)
2021
Shares
million
2020
Shares
million
Weighted average number of ordinary shares for basic earnings per share
(1)
362 337
Effect of dilutive potential ordinary shares granted under share-based payment plans
(2)
– –
Adjusted weighted average number of ordinary shares for diluted earnings per share 362 337
2021
US cents
2020
(restated)
(3)
US cents
Basic earnings per share
Business performance 9.7 14.8
Separately disclosed items (63.5) (71.8)
Reported (53.8) (57.0)
Diluted earnings per share
(2)
Business performance 9.7 14.8
Separately disclosed items (63.5) (71.8)
Reported (53.8) (57.0)
(1) The weighted number of ordinary shares in issue during the year, excluding those held by the Employee Benefit Trust. The increase in the number of shares in 2021 reflects the capital
raise completed on 15 November 2021, which resulted in 173,906,085 new shares being issued.
(2) For the years ended 31 December 2020 and 2021, potentially issuable ordinary shares under the share-based payment plans are excluded from the diluted earnings per ordinary share
calculation, as their inclusion would decrease the loss per ordinary share.
(3) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
10 Dividends paid and proposed
In April 2020, the Board agreed to cancel the final 2019 ordinary share dividend payments and to cancel subsequent dividends
inresponse to the challenges presented by the COVID-19 pandemic. Dividend payments were therefore also cancelled in 2020.
The Board recognises the importance of dividends to our shareholders, but in light of current market conditions has decided that
dividend payments will remain suspended (and therefore no dividend will be paid in respect of 2021), but will seek to reinstate them
assoon as it is appropriate to do so. This will be contingent on both a market recovery and confidence that the dividend can be paid
sustainably whilst retaining a strong balance sheet and liquidity. Under the terms of the new debt facilities, the Company will be
permitted to pay dividends from 1 January 2023, subject to the satisfaction of certain covenant tests.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
8 Income tax continued
Petrofac Limited 2021 Annual report and accounts172

11 Deferred consideration
The deferred consideration associated with the disposal of the JSD6000 installation vessel (the 'vessel') was recognised as a non-
current asset in the consolidated balance sheet. The deferred consideration is measured at fair value, with any fair value gain and loss
recognised in the consolidated income statement. The fair value of the deferred consideration took into account, amongst other
factors, an independent broker’s valuation of the vessel (a Level 3 measurement of the ‘fair value hierarchy’ contained within IFRS 13
‘Fair Value Measurement’). During the prior year, a negative fair value movement of US$6m was recognised as a separately disclosed
item in the consolidated income statement at the end of the reporting period (note 6). The fair value of deferred consideration was
US$55m at 31 December 2021 (2020: US$55m). A 10% decrease in the valuation of the vessel would result in a negative fair value
change of US$6m.
12 Property, plant and equipment
Oil and gas
assets
US$m
Oil and gas
facilities
US$m
Land,
buildings and
leasehold
improvements
US$m
Plant and
equipment
US$m
Vehicles
US$m
Office furniture
and
equipment
US$m
Assets under
construction
US$m
Total
US$m
Cost
At 1 January 2020 516 180 434 38 33 176 1 1,378
Additions 26 – 7 2 1 4 – 40
Disposals – – (3) (3) – (13) – (19)
Transfer to intangible assets
(note15) – – – – – (2) – (2)
Write-off (4) – (1) – – – – (5)
Translation difference – – 1 – – (2) – (1)
At 1 January 2021 538 180 438 37 34 163 1 1,391
Additions 41 25 3 1 2 4 1 77
Disposals – – (12) (7) (1) (3) (1) (24)
Transfer from intangible assets
(note15) 8 – – – – – – 8
Translation difference – – (1) – – (1) – (2)
At 31 December 2021 587 205 428 31 35 163 1 1,450
Depreciation and impairment
At 1 January 2020 (373) (86) (304) (30) (26) (161) – (980)
Depreciation charge
(note5aand5b) (19) (12) (35) (2) (4) (10) – (82)
Impairment charge (note 6) (37) (22) (3) (1) – – – (63)
Disposals – – 3 3 – 13 – 19
Write-off 3 – 1 – – – – 4
Translation difference – – (1) – – – – (1)
At 1 January 2021 (426) (120) (339) (30) (30) (158) – (1,103)
Depreciation charge
(note5aand5b) (15) (11) (24) (1) (3) (8) – (62)
Impairment charge (note 6) (10) (4) (2) – – – – (16)
Disposals – – 5 5 1 2 – 13
Translation difference – – – – – 1 – 1
At 31 December 2021 (451) (135) (360) (26) (32) (163) – (1,167)
Net carrying amount
At 31 December 2021 136 70 68 5 3 – 1 283
At 31 December 2020 112 60 99 7 4 5 1 288
Strategic report Governance Financial statements
173Petrofac Limited 2021 Annual report and accounts

Additions
Additions to oil and gas assets and facilities in the Integrated Energy Services operating segment mainly comprised US$50m relating
to Block PM304 in Malaysia (2020: US$26m). Additions to land, buildings and leasehold improvements of US$3m (2020: US$7m)
mainly comprised right-of-use asset additions of US$1m associated with the Asset Solutions operating segment. Additions to office
furniture and equipment of US$4m (2020: US$4m) mainly related to new office furniture and equipment in the Asset Solutions
operating segment.
Depreciation
The depreciation charge in the consolidated income statement is split between US$56m (2020: US$75m) in cost of sales and US$6m
(2020: US$7m) in selling, general and administration expenses.
Disposals
The disposal in predominantly land, buildings and leasehold improvements and plant and equipment, having a net carrying amount of
US$11m (2020: US$nil), related to the sale of the Group’s subsidiary Petrofac Training Holdings Limited and office renovation in the
Asset Solutions operating segment.
Right-of-use assets
The table below provides details of right-of-use assets recognised within various categories of property, plant and equipment line item:
Oil and gas
facilities
US$m
Land, buildings
and leasehold
improvements
US$m
Plant and
equipment
US$m
Vehicles
US$m
Total
US$m
At 1 January 2020 90 50 1 4 145
Additions – 5 – – 5
Depreciation charge (12) (10) (1) (3) (26)
Impairment charge (note 6) (22) (3) – – (25)
At 1 January 2021 56 42 – 1 99
Additions 25 2 – 1 28
Depreciation charge (11) (7) – (1) (19)
Disposals – (2) – – (2)
Impairment charge (note 6) (11) (2) – – (13)
At 31 December 2021 59 33 – 1 93
13 Non-controlling interests
Movement of non-controlling interest in Petrofac Emirates LLC, Petrofac Netherland Holdings B.V. and Petro Oil and Gas Limited
2021
US$m
2020
US$m
At 1 January 7 281
Profit/(loss) for the year 3 (9)
Disposal of the Group’s operations in Mexico – (265)
At 31 December 10 7
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
12 Property, plant and equipment continued
Petrofac Limited 2021 Annual report and accounts174

The proportion of the nominal value of issued shares controlled by the Group is disclosed in note 34. Summarised financial information
for subsidiaries having non-controlling interests that are considered material to the Group is shown below:
Petrofac Netherlands Holdings B.V.
and Petro Oil and Gas Limited Petrofac Emirates LLC
Summarised income statement
2021
US$m
2020
US$m
2021
US$m
2020
US$m
Revenue – 68 298 403
Cost of sales – (36) (291) (412)
Gross profit – 32 7 (9)
Selling, general and administration expenses – (2) (3) (6)
Other income – 1 10 –
Other expense – (39) – –
Net finance expense – – (3) (4)
Income tax expense – 1 – –
Net (loss)/profit for the year – (7) 11 (19)
Attributable to non-controlling interest – (4) 3 (5)
Summarised balance sheet
Non-current assets – – – 2
Current assets – – 350 267
Total assets – – 350 269
Non-current liabilities – – 4 7
Current liabilities – – 303 232
Total liabilities – – 307 239
Total equity – – 43 30
Attributable to non-controlling interest – – 10 7
Petrofac Netherlands Holdings B.V. and Petro Oil and Gas Limited were disposed of during 2020.
Petrofac Netherlands Holdings B.V.
and Petro Oil and Gas Limited Petrofac Emirates LLC
Summarised cash flow statement
2021
US$m
2020
US$m
2021
US$m
2020
US$m
Operating – 38 (73) 55
Investing – (10) 51 –
Financing – (2) 11 (82)
– 26 (11) (27)
No dividends were declared by Petrofac Emirates LLC during 2021 (2020: US$nil).
14 Goodwill
A summary of the movements in goodwill is presented below:
2021
US$m
2020
US$m
At 1 January 101 99
Translation difference – 2
At 31 December 101 101
Goodwill resulting from business combinations has been allocated to two groups of cash-generating units (CGUs) for impairment
testing as follows:
– Engineering & Construction
– Asset Solutions
These groups of CGUs represent the lowest level within the Group at which goodwill is monitored for internal management purposes.
The Group considers CGUs to be individually significant where they represent greater than 25% of the total goodwill balance.
Strategic report Governance Financial statements
175Petrofac Limited 2021 Annual report and accounts

14 Goodwill continued
Carrying amount of goodwill allocated to each group of cash-generating units
2021
US$m
2020
US$m
Engineering & Construction 41 41
Asset Solutions 60 60
101 101
Goodwill is tested for impairment at least annually. The recoverable amount of a CGU is determined based on value-in-use
calculations. These calculations use pre-tax cash flow projections based on future financial business plans approved by the Board,
based on past performance and its expectation of market developments. The key assumptions within these budgets relate to market
share, revenue and the future profit margin achievable, in line with the Group’s strategy and targets as set out in the Strategic report.
Future budgeted revenue is based on management’s knowledge of actual results from prior years and latest forecasts for the current
year, along with the existing secured works and management’s expectation of the future level of work available within the market
sector. In establishing future profit margins, the margins currently being achieved are considered in conjunction with expected inflation
rates in each cost category.
Cash is monitored on a regular basis for the purposes of managing both treasury and the business as a whole. The assumptions used
are reviewed regularly and differences between forecast and actual results are closely monitored, with variances being investigated
fully. The knowledge gained from this past experience is used to ensure that the future assumptions used are consistent with past
actual outcomes and are management’s best estimate of the future cash flows of each business unit.
Cash flows beyond the business plan three-year period are extrapolated using an estimated growth rate within each segment.
The growth rate used is the Group’s estimate of the average long-term growth rate for the market sectors in which the CGU operates.
Furthermore, sensitivity analysis has been undertaken on each goodwill impairment review, by changing the discount rates, profit
margins, growth rates and other variables applicable to each CGU.
The pre-tax discount rates for each CGU are noted below.
Any continuing impact of COVID-19 has been reflected in the Group’s approved business plans for the next three years, with budgeted
operating margins updated on a contract by contract basis reflecting ongoing standard operating procedures and costs to reflect
Government and industry health and safety guidelines.
Engineering & Construction CGU
A pre-tax discount rate of 15.2% (2020: 14.0%) in Engineering & Construction has been applied to the future cash flows, based on an
estimate of the weighted average cost of capital (WACC) of that division.
The value in use is based on the business plan cash flows of three years (reflecting the Board-approved business plan operating
margins and working capital cash flows) and assume no growth in cash flows beyond the three-year period for the subsequent two
years and these assumptions result in the recoverable value of this CGU being significantly greater than the carrying value of the
CGUasset.
The Engineering & Construction CGU is not sensitive to changes in key assumptions and management does not consider that any
reasonable possible change in any single assumption would give rise to an impairment of the carrying value of goodwill and intangibles.
Asset Solutions CGU
A pre-tax discount rate of 15.2% (2020: 14.0%) in Asset Solutions has been applied to the future cash flows, based on an estimate of
the WACC of that division.
The value in use is based on the business plan cash flows of three years (reflecting the Board-approved business plan operating
margins and working capital cash flows) and assume a subsequent growth rate of 1.0% in cash flows beyond the three-year period
forthe subsequent two years, and these assumptions result in the recoverable value of this CGU being significantly greater than the
carrying value of the CGU asset.
The Asset Solutions CGU is not sensitive to changes in key assumptions and management does not consider that any reasonable
possible change in any single assumption would give rise to an impairment of the carrying value of goodwill and intangibles.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
Petrofac Limited 2021 Annual report and accounts176

15 Intangible assets
2021
US$m
2020
(restated)
(1)
US$m
Intangible oil and gas assets
Carrying value:
At 1 January 13 17
Transferred to property, plant and equipment (note 12) (8) –
Impairment charge (note 6) (1) (4)
At 31 December 4 13
Other intangible assets
Cost:
At 1 January 60 49
Additions 7 9
Transfer from property, plant and equipment (note 12) – 2
At 31 December 67 60
Accumulated amortisation:
At 1 January (22) (16)
Amortisation (note 5a and 5b) (6) (5)
Translation difference – (1)
At 31 December (28) (22)
Carrying amount of other intangible assets at 31 December 39 38
Total intangible assets 43 51
(1) The prior year balances are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9 and below.
Intangible oil and gas assets
Intangible oil and gas assets represent expenditure directly associated with evaluation or appraisal activities related to Block PM304
inMalaysia.
Other intangible assets
Other intangible assets mainly comprised customer contracts and digital systems. Such intangible assets are amortised over their
estimated economic useful life on a straight-line basis and the related amortisation charges included in cost of sales and selling,
general and administration expense line items of the consolidated income statement (note 5a and 5b). The additions of US$7m (2020
restated: US$9m) related to investment in the development and implementation of Group-wide digital systems.
Prior year restatement
In April 2021, IFRIC published an agenda decision on the clarification of accounting in relation to the configuration and customisation
costs incurred in implementing SaaS. Due to the nature of this agenda decision and the level of spend incurred by the Group on such
an implementation, the Group’s accounting policy in relation to such customisation and configuration costs has been reviewed and
changed to align with the IFRIC guidance issued in relation to SaaS costs previously capitalised (note 2.3). The Group has assessed
the impact of this change in accounting policy on any cloud computing arrangements entered into during prior years and restated the
comparative figures shown above. The Group identified US$14m additions incurred in the year ended 31 December 2020 and
US$16m cumulatively as at 31 December 2019, in relation to software and development costs that should be expensed after the
consideration of the IFRIC guidance. Further details are disclosed in note 2.9.
Strategic report Governance Financial statements
177Petrofac Limited 2021 Annual report and accounts

16 Investments in associates and joint ventures
Associates
US$m
Joint ventures
US$m
Total
US$m
As at 1 January 2020 25 13 38
Loans made to joint ventures – 2 2
Share of net profit/(loss) 6 (1) 5
Dividends received (10) – (10)
As at 1 January 2021 21 14 35
Share of net profit/(loss) 8 (1) 7
Dividends received (8) – (8)
As at 31 December 2021 21 13 34
Dividends received during the year include US$7m received from PetroFirst Infrastructure Limited and US$1m received from PetroFirst
Infrastructure 2 Limited (2020: US$8m received from PetroFirst Infrastructure Limited and US$2m received from PetroFirst
Infrastructure 2 Limited).
Investment in associates
2021
US$m
2020
US$m
PetroFirst Infrastructure Limited 20 18
PetroFirst Infrastructure 2 Limited 1 3
21 21
Interest in associates
Summarised financial information on associates, based on their IFRS financial statements, and a reconciliation with the carrying
amount of the investment in associates in the consolidated balance sheet, are set out below:
2021
US$m
2020
US$m
Revenue 77 75
Cost of sales (33) (35)
Gross profit 44 40
Net finance expense (2) (5)
Profit before tax 42 35
Income tax (1) –
Net profit 41 35
Group’s share of net profit for the year 8 6
Non-current assets 137 157
Current assets 22 13
Total assets 159 170
Non-current liabilities 26 29
Current liabilities 19 21
Total liabilities 45 50
Net assets 114 120
Group’s share of net assets 21 21
Carrying amount of the investment in associates 21 21
A list of all associates is disclosed in note 34.
No associates had contingent liabilities or capital commitments as at 31 December 2021 and 2020.
Investment in joint ventures
2021
US$m
2020
US$m
Takatuf Petrofac Oman LLC 12 13
Socar – Petrofac LLC 1 1
13 14
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
Petrofac Limited 2021 Annual report and accounts178

Interest in joint ventures
Summarised financial information on the joint ventures, based on their IFRS financial statements, and a reconciliation with the carrying
amount of the investment in joint ventures in the consolidated balance sheet, are set out below:
2021
US$m
2020
US$m
Revenue 37 16
Cost of sales (35) (16)
Gross profit 2 –
Selling, general and administration expenses (4) (2)
Loss before tax and net loss (2) (2)
Group’s share of net loss (1) (1)
Non-current assets 27 29
Current assets 19 15
Total assets 46 44
Non-current liabilities (3) (2)
Current liabilities (12) (8)
Total liabilities (15) (10)
Net assets 31 34
Group’s share of net assets 13 14
Carrying amount of the investment in joint ventures 13 14
A list of all joint ventures is disclosed in note 34.
No joint ventures had contingent liabilities or capital commitments at 31 December 2021 and 2020. The joint ventures cannot
distribute their distributable reserves until they obtain consent from the joint venture partners.
Strategic report Governance Financial statements
179Petrofac Limited 2021 Annual report and accounts

17 Other financial assets and other financial liabilities
Other financial assets
2021
US$m
2020
US$m
Non-current
Receivable from joint operation partners for leases 93 80
Deferred consideration receivable from Ithaca Energy UK Ltd 5 48
Advances relating to decommissioning provision 32 28
Receivable from Shanghai Zhenhua Heavy Industries Co Ltd – 5
Restricted cash 79 –
Contingent consideration arising from the disposal of Group’s operations in Mexico – 41
209 202
Current
Receivable from joint operation partners for leases 34 97
Deferred consideration receivable from Ithaca Energy UK Ltd 49 –
Contingent consideration arising from the disposal of Group’s operations in Mexico 36 –
Receivable from Shanghai Zhenhua Heavy Industries Co Ltd 5 –
Restricted cash 58 44
Derivative contracts not designated as hedges (note 33) 1 3
Derivative contracts designated as cash flow hedges (note 33) – 4
183 148
Other financial liabilities
Non-current
Lease liabilities (note 29) 190 163
Contingent consideration payable arising from acquisition of W&W Energy Services Inc 5 3
195 166
Current
Lease liabilities (note 29) 61 150
Contingent consideration payable arising from acquisition of W&W Energy Services Inc 2 1
Interest payable 9 2
Derivative contracts not designated as hedges (note 33) 5 17
Derivative contracts designated as cash flow hedges (note 33) – 9
Embedded derivative in respect of the revolving credit facility (note 26) 4 –
81 179
Receivable from joint operation partners for leases
The current and non-current receivable from joint operation partners represented 70% of the lease liability in respect of oil and gas
facilities, office building, vehicles and transport vessels in Malaysia except for the MOPU vessel, for which it represented 64.7% of the
lease liability. These lease liabilities are recognised at 100% in the consolidated balance sheet. This treatment is necessary to reflect
the legal position of the Group as the contracting counterparty for such leases. The Group’s 30% share of this liability (and 35.3% for
the liability relating to the MOPU vessel) at 31 December 2021 was US$59m (2020: US$76m). At 31 December 2021, management
concluded that no expected credit loss allowance against the receivable from joint operation partners for leases was necessary, since
under the joint operating agreement any default by the joint arrangement partners is fully recoverable through a recourse available to
the non-defaulting partner through a transfer or an assignment of the defaulting partner’s equity interest.
Deferred consideration receivable from Ithaca Energy UK Ltd
The deferred consideration receivable from Ithaca Energy UK Ltd relating to the disposal of Petrofac GSA Holdings Limited is
measured at amortised cost using a discount rate of 8.4%. Unwinding of the discount on the deferred consideration of US$5m (2020:
US$5m) was recognised during the year, within the finance income line item of the consolidated income statement. A decrease in the
credit risk for this financial asset resulted in the reversal in the expected credit loss allowance of US$1m being recognised for the year
(2020: charge of US$2m).
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
Petrofac Limited 2021 Annual report and accounts180

During the prior year, an early settlement was agreed with Ithaca Energy UK Ltd for amounts expected to mature in October 2020.
Upon early settlement, the Group recognised a loss of US$6m, which was recognised as a separately disclosed item in the Integrated
Energy Services operating segment (note 6) in that year.
2021
US$m
2020
US$m
Opening balance (non-current and current) 48 64
Unwinding of discount 5 5
Expected credit loss reversal/(charge) (note 5e) 1 (2)
Loss on early settlement (note 6) – (6)
Receipts – (13)
As at the end of the reporting period 54 48
Subsequent to the year ended 31 December 2021, the Group collected US$11m of the deferred consideration from Ithaca Energy UK Ltd
and also sold the remaining receivable, with a carrying value of US$43m. The consideration of US$11m received from Ithaca Energy
UK Ltd was treated as an adjusting post balance sheet event in accordance with IAS 10 'Events After the Reporting Period' to adjust
the effective interest rate and reclassify the consideration received as a current receivable, whilst the second transaction was treated
as a non-adjusted post balance sheet event. Upon sale of the receivable, the Group will recognise a loss of US$3m in the Integrated
Energy Services operating segment in the year ended 31 December 2022.
Advances relating to decommissioning provision
Advances relating to decommissioning provision represents advance payments to a regulator for future decommissioning liabilities,
relating to the Group’s assets in Malaysia. An advance of US$4m (2020: US$5m) made during the year was presented in the
consolidated statement of cash flows as a cash outflow within investing activity.
Contingent consideration arising from the disposal of the Group’s operations in Mexico
On 30 July 2018, the Group signed an SPA with Perenco to dispose of a 49% non-controlling interest in PNHBV. The disposal was
completed on 18 October 2018 and represented a transaction between the equity holders under IFRS 10 ‘Consolidated Financial
Statements’. The fair value of consideration received was recognised within equity as a non-controlling interest of US$266m.
The fair value of consideration included contingent consideration of US$36m (2020: US$41m). The contingent consideration was
measured at fair value with any fair value gain or loss recognised in the consolidated income statement and was recognised as a
current financial asset in the consolidated balance sheet. This was reclassified from non-current to current in the year as the
consideration is now expected to be received during 2022.
At 31 December 2021, the fair value of contingent consideration receivable arising from the disposal of the Group’s operations
inMexico was US$36m (2020: US$41m) following a fair value reduction of US$5m (2020: US$42m) which was recognised during
theperiod (note 6). The downward fair value adjustment was as a result of reassessing the recoverable amount of contingent
consideration due from the acquirer. The estimation of the fair value of the contingent consideration reflects management’s
expectations of (i) the final determination of the completion consideration amount; (ii) proceeds associated with a ruling by the Tax
Administration Service in Mexico; and (iii) achieving the contingent consideration criteria in the SPA associated with the migration of
Magallanes and Arenque Production Enhancement Contracts to Production Sharing Contracts. To determine the fair value of the
contingent consideration, management applied risk factors (a Level 3 measurement of the ‘fair value hierarchy’ contained within IFRS
13 ‘Fair Value Measurement’) to the maximum contingent consideration amounts receivable.
The table below provides a sensitivity analysis of possible changes to the risk factors selected (a Level 3 input in the ‘fair value
hierarchy’ contained within IFRS 13 ‘Fair Value Measurement’) on the fair value of the contingent consideration:
10% increase
in risk factor
US$m
20% increase
in risk factor
US$m
Risk factor associated with the determination of the completion CIEP consideration amount (5) (10)
Risk factor relating to proceeds associated with a ruling by the Tax Administration Service in Mexico (5) (9)
Total (10) (19)
During the prior year, an impairment charge of US$34m was recognised within the other operating expenses line item of the
consolidated income statement such that the carrying amount of the net assets did not exceed the fair value less cost of disposal.
A reconciliation of the fair value movement of contingent consideration arising from the disposal of the Group’s operations in Mexico is
presented below:
2021
US$m
2020
US$m
Opening balance 41 42
Initial recognition on disposal of remaining 51% interest in Group’s operations in Mexico – 41
Fair value loss (note 6) (5) (42)
As at the end of the reporting period 36 41
Strategic report Governance Financial statements
181Petrofac Limited 2021 Annual report and accounts

Pánuco contingent consideration
A reconciliation of the fair value movement of the Pánuco contingent consideration is presented below:
2021
US$m
2020
US$m
Opening balance – 8
Fair value loss (note 6) – (8)
As at the end of the reporting period – –
Restricted cash
The Group had outstanding letters of guarantee, including performance, advance payments and bid bonds against which the Group
had pledged or restricted cash balances.
Contingent consideration receivable from Ithaca Energy UK Ltd
A reconciliation of the fair value movement of contingent consideration arising from the disposal of Petrofac GSA Holdings Limited is
presented below:
2021
US$m
2020
US$m
Opening balance – 9
Fair value loss (note 6) – (9)
As at the end of the reporting period – –
Contingent consideration payable arising from acquisition of W&W Energy Services Inc
A reconciliation of the fair value movement of contingent consideration payable arising from acquisition of W&W Energy Services Inc is
presented below:
2021
US$m
2020
US$m
Opening balance 4 15
Fair value loss/(gain) (note 6) 3 (8)
Payments – (3)
As at the end of the reporting period 7 4
During 2021, management reviewed the carrying amount of the contingent consideration payable associated with the acquisition of
W&W Energy Services Inc, following a change to the contingent consideration pay-out terms during the year. This resulted in a
negative fair value adjustment (i.e. loss) of US$3m, which was recognised as a separately disclosed item (note 6) in the Asset Solutions
operating segment (2020: gain of US$8m). At the end of the year, the fair value of contingent consideration payable was calculated
using the expected value pay-out approach using a discount rate of 15.2% (Level 3 of the ‘fair value hierarchy’ contained within IFRS
13 ‘Fair Value Measurement’). The fair value represented management’s best estimate based on the expected financial performance
targets that will be achieved by W&W, over the remaining evaluation period i.e. 2022 and 2023. A 10% reduction in performance
targets would result in an additional fair value gain of US$0.7m.
Changes in liabilities arising from financing activities
Year ended 31 December 2021
1 January
2021
US$m
Cash inflows
US$m
Cash outflows
US$m
Additions
US$m
Cash outflows
paid by joint
operation
partners
US$m
Others
(2)
US$m
31 December
2021
US$m
Senior secured notes – 580 – – – – 580
Other interest-bearing loans and
borrowings
(1)
755 904 (1,470) – – (5) 184
Lease liabilities 313 - (40) 35 (59) 2 251
At 31 December 2021 1,068 1,484 (1,510) 35 (59) (3) 1,015
Year ended 31 December 2020
1 January
2020
US$m
Cash inflows
US$m
Cash outflows
US$m
Additions
US$m
Cash outflows
paid by joint
operation
partners
US$m
Others
(2)
US$m
31 December
2020
US$m
Other interest-bearing loans and
borrowings
(1)
900 870 (1,015) – – – 755
Lease liabilities 438 – (50) 5 (82) 2 313
At 31 December 2020 1,338 870 (1,065) 5 (82) 2 1,068
(1) Other interest-bearing loans and borrowings excludes overdrafts since these are included within cash and equivalents.
(2) Represents the movement in debt acquisition costs for senior notes and other interest-bearing loans and borrowings.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
17 Other financial assets and other financial liabilities continued
Petrofac Limited 2021 Annual report and accounts182

Fair value measurement
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value
hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
Level 1: Unadjusted quoted prices in active markets for identical financial assets or liabilities
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e.
as prices) or indirectly (i.e. derived from prices)
Level 3: Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable
Set out below is a comparison of the carrying amounts and fair values of financial instruments as at 31 December:
Level Carrying amount Fair value
2021
US$m
2020
US$m
2021
US$m
2020
US$m
Financial assets
Measured at amortised cost
Restricted cash Level 2 137 44 137 44
Receivable from joint operation partners for leases Level 2 127 177 127 177
Deferred consideration receivable from Ithaca Energy UK Ltd Level 2 54 48 54 48
Receivable from Shanghai Zhenhua Heavy Industries Co Ltd Level 2 5 5 5 5
Advances relating to provision for decommissioning liability Level 2 32 28 32 28
Measured at fair value through profit and loss
Contingent consideration arising from the disposal of the Group’s
operations in Mexico Level 3 36 41 36 41
Contingent consideration arising from the disposal of the
JSD6000 installation vessel Level 3 55 55 55 55
Derivative contracts – undesignated Level 2 1 3 1 3
Designated as cash flow hedges
Derivative contracts Level 2 – 4 – 4
Financial liabilities
Measured at amortised cost
Senior secured notes (note 26) Level 1 580 – 595 –
Term loans Level 2 99 250 99 250
Revolving credit facility Level 2 85 505 85 505
Bank overdrafts Level 2 – 45 – 45
Interest payable Level 2 9 2 9 2
Measured at fair value through profit and loss
Contingent consideration payable Level 3 7 4 7 4
Derivative contracts – undesignated Level 2 5 17 5 17
Embedded derivative in respect of the revolving credit facility Level 3 4 – 4 –
Designated as cash flow hedges
Derivative contracts Level 2 – 9 – 9
When the fair values of financial assets and financial liabilities recognised in the consolidated balance sheet cannot be measured
based on quoted prices in active markets, their fair value is measured using valuation techniques, including discounted cash flow
models. The inputs to these models are taken from observable sources where possible, but where such information is not available,
adegree of judgement is required in establishing fair values. Judgements include considerations of inputs such as liquidity risk, credit
risk and volatility. Changes in assumptions relating to these factors could affect the recognised fair value of financial instruments and
are discussed further below.
– The fair value of the contingent consideration arising from the disposal of the Group’s operations in Mexico at 31 December 2021
amounted to US$36m. The estimation of the fair value of the contingent consideration reflected management’s expectation of (i) the
final determination of the completion consideration amount; (ii) proceeds associated with a ruling by the Tax Administration Service
in Mexico; and (iii) achieving the contingent consideration criteria in the SPA associated with the migration of Magallanes and
Arenque Production Enhancement Contracts to Production Sharing Contracts. Management applied risk factors (a Level
3 measurement of the ‘fair value hierarchy’ contained within IFRS 13 ‘Fair Value Measurement’) to the maximum contingent
consideration amounts receivable to estimate the fair value of the contingent consideration.
Strategic report Governance Financial statements
183Petrofac Limited 2021 Annual report and accounts

The following methods and assumptions were used to estimate the fair values for material financial instruments:
– The fair value of deferred consideration receivable from Ithaca Energy UK Ltd is equivalent to its amortised cost determined as the
present value of discounted future cash flows using the discount rate of 8.4%.
– The fair value of long-term interest-bearing loans and borrowings (excluding senior secured notes) and receivable from joint
operation partners for leases are equivalent to their amortised costs determined as the present value of discounted future cash
flows using the effective interest rate.
– The contingent consideration payable of US$7m arising from acquisition of W&W Energy Services Inc, calculated using expected
value pay-out approach using a discount rate of 15.2% (Level 3 of the ‘fair value hierarchy’ contained within IFRS 13 ‘Fair Value
Measurement’), represented management’s best estimate based on the expected financial performance targets that will be
achieved by W&W, over the remaining evaluation period.
18 Inventories
2021
US$m
2020
US$m
Project materials 16 4
Crude oil 6 3
Stores and raw materials 1 1
23 8
Project materials of US$nil were written off during the year (2020: US$5m, relating to the Engineering & Construction operating
segment) within cost of sales in the consolidated income statement. Inventories expensed of US$46m (2020: US$47m) were included
within cost of sales in the consolidated income statement.
19 Trade and other receivables
2021
US$m
2020
US$m
Trade receivables 405 550
Advances to vendors and subcontractors 147 197
Prepayments and deposits 21 32
Receivables from joint operation partners 47 44
Related party receivables (note 31) 1 1
Other receivables 47 53
668 877
The decrease in trade receivables is mainly due to a net collection of US$102m from three customers in the Engineering &
Construction operating segment. At 31 December 2021, the Group had an ECL allowance of US$23m (2020: US$24m) against
anoutstanding trade receivable balance of US$428m (2020: US$574m).
Trade receivables are non-interest bearing and credit terms are generally granted to customers on 30-60 days' basis.
Trade receivables are reported net of ECL allowance in accordance with IFRS 9 ‘Financial Instruments’.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
17 Other financial assets and other financial liabilities continued
Petrofac Limited 2021 Annual report and accounts184

The movement in the ECL allowance during 2021 and 2020 against trade receivables was as follows:
2021
US$m
2020
US$m
At 1 January 24 26
Reversal of ECL allowance (note 5e) (1) –
Write-off – (2)
At 31 December 23 24
At 31 December 2021, the analysis of trade receivables is as follows:
Number of days past due
< 30 days
US$m
31 – 60 days
US$m
61 – 90 days
US$m
91 – 120 days
US$m
121 – 360 days
US$m
> 360 days
US$m
Total
US$m
ECL rate 0.9% 0.7% 0.5% 3.1% 19.5% 74.5%
Gross trade receivables 297 42 16 26 29 18 428
Less: ECL allowance (3) – – (1) (6) (13) (23)
Net trade receivables at
31 December 2021 294 42 16 25 23 5 405
At 31 December 2020, the analysis of trade receivables is as follows:
Number of days past due
< 30 days
US$m
31 – 60 days
US$m
61 – 90 days
US$m
91 – 120 days
US$m
121 – 360 days
US$m
> 360 days
US$m
Total
US$m
ECL rate 0.1% 0.2% 0.1% 1.4% 13.8% 92.1%
Gross trade receivables 372 92 48 15 26 21 574
Less: ECL allowance – – – – (4) (20) (24)
Net trade receivables at
31 December 2020 372 92 48 15 22 1 550
Advances provided to vendors and subcontractors represent payments made to certain vendors and subcontractors for projects
inprogress, that will be adjusted against the future progress billings by the vendors and subcontractors. The decrease in advances
provided to vendors and subcontractors of US$50m was mainly due to settlement of advances and accrued contract expenses in
theordinary course of business with subcontractors in the Engineering & Construction operating segment.
Receivables from joint operation partners are recoverable amounts from partners on Block PM304 and on consortium contracts in the
Engineering & Construction operating segment. An ECL allowance of US$1m (note 5e) was recognised in respect of receivables from
joint operations partners (2020: US$nil).
Other receivables mainly consist of Value Added Tax recoverable of US$30m (2020: US$35m).
An ECL allowance of US$nil (note 5e) was recognised against other receivables (2020: ECL charge of US$2m)
All trade and other receivables except ‘advances provided to vendors and subcontractors’ are expected to be settled in cash.
Certain trade and other receivables will be settled in cash using currencies other than the reporting currency of the Group, and will
belargely paid in sterling, euros and Kuwaiti dinars.
Strategic report Governance Financial statements
185Petrofac Limited 2021 Annual report and accounts

20 Contract assets and contract liabilities
a. Contract assets
2021
US$m
2020
US$m
Work in progress 1,325 1,414
Retention receivables 211 215
Accrued income 44 23
1,580 1,652
At 31 December 2021, work in progress included assessed variation orders pending customer approval of US$337m (2020: US$276m).
b. Contract liabilities
2021
US$m
2020
US$m
Billings in excess of costs and estimated earnings 40 74
Advances received from customers 18 46
58 120
At 31 December 2021, billings in excess of costs and estimated earnings included an offset for assessed variation orders pending
customer approval of US$1m (2020: US$29m).
Revenue of US$102m (2020: US$202m) was recognised during the year from amounts included in contract liabilities at the beginning
of the year.
c. Expected credit loss allowance on contract assets
The below table provides information on ECL allowance for each contract asset category at the end of reporting periods:
As at 31 December 2021
Work in
progress
US$m
Retention
receivables
US$m
Accrued
income
US$m
Total current
contract
assets
US$m
ECL rate 0.3% 7.2% 4.3% n/a
Gross carrying amount 1,330 227 46 1,603
Less: ECL allowance (5) (16) (2) (23)
Net contract assets at 31 December 2021 1,325 211 44 1,580
As at 31 December 2020
Work in
progress
US$m
Retention
receivables
US$m
Accrued
income
US$m
Total current
contract assets
US$m
ECL rate 0.6% 14.1% 12.3% n/a
Gross carrying amount 1,423 250 26 1,699
Less: ECL allowance (9) (35) (3) (47)
Net contract assets at 31 December 2020 1,414 215 23 1,652
The movement in ECL allowance during 2021 and 2020 against each contract asset category is as follows:
Year ended 31 December 2021
Work in
progress
US$m
Retention
receivables
US$m
Accrued
income
US$m
Total current
contract assets
US$m
At 1 January 2020 6 33 5 44
Charge for the year (note 5e) 3 2 – 5
Write-off – – (2) (2)
At 1 January 2021 9 35 3 47
Reversal of ECL provision (note 5e) (4) (19) (1) (24)
At 31 December 2021 5 16 2 23
The reversal of the ECL provision in respect of retention receivables in the year is predominantly attributable to one customer which
had been assessed as impaired in prior years. The ECL provision was reassessed following the collection of certain overdue balances
during the year.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
Petrofac Limited 2021 Annual report and accounts186

d. Contract balances arising from contracts with customers
The Group’s contract balances at 31 December are as follows:
2021
US$m
2020
US$m
Trade receivables (note 19) 405 550
Contract assets 1,580 1,652
Contract liabilities 58 120
Trade receivables are non-interest bearing and credit terms are generally between 30 and 60 days. Trade receivables represent the
Group’s right to consideration that is unconditional (i.e. only the passage of time is required before payment of the consideration
isdue).
The Group recognised a write-back in ECL allowance on trade receivables and contract assets arising from contracts with customers,
included within the expected credit loss allowance line item of the consolidated income statement, amounting to US$25m for the year
ended 31 December 2021 (2020: charge of US$5m).
Revenue recognised during the year from performance obligations satisfied in previous years, resulting from a change in transaction
price, amounted to US$168m (2020: US$118m).
21 Cash and short-term deposits
2021
US$m
2020
US$m
Cash at bank and in hand 498 556
Short-term deposits 123 129
ECL allowance (1) (1)
Cash and short-term deposits 620 684
Short-term deposits are made for varying periods of between one day and three months depending on the immediate cash
requirements of the Group and earn interest at respective short-term deposit rates. The fair value of cash and bank balances is
US$620m (2020: US$684m).
For the purposes of the consolidated statement of cash flows, cash and cash equivalents comprise the following:
2021
US$m
2020
US$m
Cash and short-term deposits 620 684
Bank overdrafts (note 26) – (45)
620 639
Cash and cash equivalents included amounts totalling US$37m (2020: US$43m) held by the Group undertakings in certain countries
whose exchange controls significantly restrict or delay the remittance of these amounts to foreign jurisdictions. Cash and cash
equivalents also included US$305m (2020: US$378m) in joint operation bank accounts which are generally available to meet the
working capital requirements of those joint operations but which can only be made available to the Group for its general corporate
usewith the agreement of the joint operation partners.
Strategic report Governance Financial statements
187Petrofac Limited 2021 Annual report and accounts

22 Share capital
The share capital of the Company as at 31 December was as follows:
Number of shares
Share capital
US$m
Share premium
US$m
At 1 January 2020 and 31 December 2020 345,912,747 7 4
Issue of shares from capital raise 173,906,085 3 247
At 31 December 2021 519,818,832 10 251
The number of shares refers to US$0.02 ordinary shares, which are issued and fully paid. In total, there are 750,000,000 ordinary
shares of US$0.02 authorised.
All the allotted and issued shares, including those held by the Employee Benefit Trust, were fully paid. The share capital comprises
only one class of ordinary shares. The ordinary shares carry a voting right and the right to a dividend.
On 26 October 2021, the Company announced a proposed issuance of equity by way of a Firm Placing, Placing and Open Offer
(together, the 'capital raise') to raise US$275m. The basis of the Open Offer was one new ordinary share for every four existing
ordinary shares. On completion of the capital raise on 15 November 2021, the Company issued 173,597,412 ordinary shares, including
a Firm Placing of 87,119,226 ordinary shares and a Placing and Open Offer of 86,478,186 ordinary shares. All of the above shares were
issued at £1.15 per share, generating gross proceeds of approximately £200m (US$268m) before issue and associated costs
ofUS$18m.
Concurrently with the capital raise, the Directors (other than Mr Asfari) subscribed for 308,673 additional shares at the issue price of
£1.15. This resulted in a total number of new shares of 173,906,085 that were admitted to the premium listing segment of the Official
List of the FCA and to trading on the main market for listed securities of the London Stock Exchange on 15 November 2021.
All new shares issued by way of the capital raise were each issued, fully paid and rank pari passu in all respects with each other and
the ordinary shares of the Company in issue prior to the capital raise, including the right to receive all dividends and other distributions
declared, made or paid after the date of issue.
Share premium: The balance on the share premium account represents the amount received in excess of the nominal value of the
ordinary shares adjusted for any associated issuance costs.
Capital redemption reserve: The balance on the capital redemption reserve represents the aggregated nominal value of the
ordinary shares repurchased and cancelled.
23 Employee Benefit Trust (EBT) shares
The Petrofac Employee Benefit Trust (the 'Trust') was established to facilitate the Group’s discretionary share scheme awards made
tothe employees of the Group. For the purpose of making awards under the Group’s share-based payment plans, shares in the
Company are purchased and held by the Trust. The Trust issues these shares to the Group employees subject to the satisfaction of
any service and performance conditions of each scheme. The Trust is consolidated in the Group’s consolidated financial statements
inaccordance with IFRS 10 ‘Consolidated Financial Statements’.
These shares have been classified in the consolidated balance sheet as EBT shares within equity. Shares vested during the year are
satisfied with these shares.
The movements in total EBT shares are shown below:
2021 2020
Number US$m Number US$m
At 1 January 8,703,208 88 10,055,467 110
Purchase of Company’s shares by EBT
(1)
1,206,470 2 3,973,332 11
Issue of Company’s shares by EBT (4,677,573) (21) (5,325,591) (33)
At 31 December 5,232,105 69 8,703,208 88
(1) All shares purchased via the Open Offer (note 22).
Shares vested during the year include dividend shares of 278,089 shares (2020: 509,329 shares).
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
Petrofac Limited 2021 Annual report and accounts188

24 Share-based payment plans
Performance Share Plan (PSP)
Under the PSP, share awards are granted to Executive Directors and a restricted number of other senior executives of the Group.
The shares vest at the end of three years, subject to continued employment and the achievement of certain pre-defined and
independent market and non-market-based performance conditions. The market performance-based element of PSP awards is
50%(2020: 70%) dependent on the TSR of the Group compared with an index composed of selected relevant companies. The fair
value ofthe shares vesting under this portion of the award is determined by an independent valuer using a Monte Carlo simulation
model taking into account the terms and conditions of the plan rules and using the following assumptions at the date of grant:
Executive
Directors 2021
awards
(1)
Other
participants
2021 awards
Executive
Directors 2020
awards
Other
participants
2020 awards
All participants
2019 awards
All participants
2018 awards
Expected share price volatility (based on median
of comparator group’s three-year volatilities) 69.9%/71.2% 71.2% 51.4% 51.4% 36.2% 37.7%
Share price correlation with comparator group 31.8%/31.3% 31.3% 13.5% 13.5% 15.8% 22.3%
Risk-free interest rate 0.2% 0.2% 0.2% 0.2% 0.9% 0.9%
Expected life of share award 3 years 3 years 3 years 3 years 3 years 3 years
Fair value of TSR portion 46.7p/58.7p 78.5p 145p 168p 264p 356p
(1) There were two separate grants in 2021.
The non-market-based condition governing the vesting of the remaining 50% (2020: 30%) of the PSP awards is subject to achieving
certain strategic targets, including Engineering & Construction operating segment net margin, new order intake, return on capital
employed, cash conversion, etc. over a three-year period. The fair value of the equity-settled award relating to the non-market-based
condition is estimated, based on the quoted closing market price of the Company’s ordinary shares at the date of grant with an
assumed annual vesting rate built into the calculation over the three-year vesting period of the plan and the estimated vesting rate
forthe achievement of strategic targets.
Deferred Bonus Share Plan (DBSP)
Under the DBSP, selected employees are required to defer a proportion of their annual cash bonus into Company shares ('Invested
Shares'). Following such an award, the Company will generally grant the participant an additional award of shares ('Matching Shares')
bearing a specified ratio to the number of Invested Shares, typically a 1:1 ratio. Subject to a participant’s continued employment,
Invested and Matching Share awards vest one-third on the first anniversary of the grant, one-third on the second anniversary and
thefinal proportion on the third anniversary of the grant date.
At the end of the reporting period, the value of bonuses to be settled by shares cannot be determined until the Remuneration
Committee has approved the portion of the employee bonuses to be settled in shares. Once the portion of the bonus to be settled
inshares is determined, the final bonus liability to be settled in shares is transferred to the share-based payments reserve. The costs
relating to Matching Shares are recognised over the corresponding vesting period and the fair values of the equity-settled Matching
Shares granted to employees is based on the quoted closing market price at the date of grant with the charge to the consolidated
income statement adjusted to reflect the expected vesting rate of the plan.
Share Incentive Plan (SIP)
All UK employees, including UK Executive Directors, are eligible to participate in the SIP. Employees may invest up to £1,800 per
taxyear of gross salary (or, if lower, 10% of salary) to purchase ordinary shares in the Company. There is no holding period for
theseshares.
Restricted Share Plan (RSP)
Selected employees are allocated grants of shares on an ad hoc basis. The RSP is primarily, but not exclusively, used to make awards
to individuals who join the Group part way through the year, having left accrued benefits with a previous employer. The fair values of
the awards granted under the RSP at various grant dates during the year are based on the quoted market price at the date of grant
adjusted for an assumed vesting rate over the relevant vesting period.
Strategic report Governance Financial statements
189Petrofac Limited 2021 Annual report and accounts

Share-based payment plans information
The details of the fair values and assumed vesting rates of the share-based payment plans are below:
PSP (non-market based condition) DBSP RSP
Executive Directors Other participants
Fair value per
share
Assumed
vesting rate
Fair value per
share
Assumed
vesting rate
Fair value per
share
Assumed
vesting rate
Fair value per
share
Assumed
vesting rate
2021 awards 101p/116p 45.2% 134p 45.2% – – 128p 95.0%
2020 awards 250p 31.5% 271p 31.5% 271p 90.3% 126p 90.3%
2019 awards 364p 20.0% 455p 20.0% 455p 85.7% 394p 85.7%
2018 awards 412p 50.0% 515p 50.0% 466p 81.5% 560p 81.5%
The following table shows the movements in the number of shares held under the share-based payment plans outstanding but not
exercisable:
PSP DBSP RSP Total
2021
Number
2020
Number
2021
Number
(1)
2020
Number
(1)
2021
Number
2020
Number
2021
Number
2020
Number
Outstanding at
1January 4,640,163 3,906,880 4,967,652 7,289,952 2,479,550 1,725,387 12,087,365 12,922,219
Granted during the year 5,190,614 2,656,318 – 2,292,388 1,057,472 1,588,645 6,248,086 6,537,351
New share issue
(2)
399,569 – 101,392 – 42,027 – 542,988 –
Vested during the year (272,975) (160,305) (2,956,599) (3,994,631) (1,169,910) (661,331) (4,399,484) (4,816,267)
Forfeited during the year (2,675,172) (1,762,730) (303,821) (620,057) (91,883) (173,151) (3,070,876) (2,555,938)
Outstanding at
31December 7,282,199 4,640,163 1,808,624 4,967,652 2,317,256 2,479,550 11,408,079 12,087,365
(1) Includes Invested and Matching Shares.
(2) Shares issued in the year to ensure that participants in the various employee share schemes were not adversely impacted by the capital raise.
The number of shares still outstanding but not exercisable at 31 December for each award is as follows:
PSP DBSP RSP Total
2021
Number
2020
Number
2021
Number
(1)
2020
Number
(1)
2021
Number
2020
Number
2021
Number
2020
Number
2021 awards 4,686,841 – – – 966,625 – 5,653,466 –
2020 awards 1,535,864 2,087,754 1,049,737 1,974,586 1,061,661 1,588,645 3,647,262 5,650,985
2019 awards 1,059,494 1,445,556 758,887 1,990,416 288,970 707,821 2,107,351 4,143,793
2018 awards – 1,106,853 – 1,002,650 – 183,084 – 2,292,587
Total awards 7,282,199 4,640,163 1,808,624 4,967,652 2,317,256 2,479,550 11,408,079 12,087,365
(1) Includes Invested and Matching Shares.
The average share price of the Company’s shares during 2021 was US$1.69, sterling equivalent of £1.23 (2020: US$2.54, sterling
equivalent of £1.99).
The number of outstanding shares excludes the dividend shares shown below:
PSP DBSP RSP Total
2021
Number
2020
Number
2021
Number
(1)
2020
Number
(1)
2021
Number
2020
Number
2021
Number
2020
Number
Dividend shares outstanding
at31 December 55,103 186,316 50,146 261,178 74,007 22,792 179,256 470,286
(1) Includes Invested and Matching Shares.
The charge in respect of share-based payment plans recognised in the consolidated income statement is as follows:
PSP DBSP RSP Total
2021
US$m
2020
US$m
2021
US$m
(2)
2020
US$m
(2)
2021
US$m
2020
US$m
2021
US$m
2020
US$m
Share-based payment charge 2 4 2 7 3 4 7 15
(2) Represents the charge on Matching Shares only.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
24 Share-based payment plans continued
Petrofac Limited 2021 Annual report and accounts190

The Group recognised a share-based payment charge of US$7m (2020: US$15m) in the consolidated income statement relating to the
employee share-based payment plans (note 5c) which was transferred to the share-based payments reserve together with US$nil of
the accrued bonus liability for the year ended 31 December 2020 (2020: 2019 bonus of US$4m).
For further details on the above employee share-based payment plans, refer to pages 120, 121, 123, 124 and 126 of the Directors’
remuneration report.
25 Other reserves
Net unrealised
gains/(losses) on
derivatives
US$m
Foreign currency
translation
US$m
Share-based
payments
reserve
US$m
Total
US$m
At 1 January 2020 11 (14) 87 84
Net changes in fair value of derivatives and financial assets designated as cash
flow hedges (15) – – (15)
Foreign currency translation (restated)
(1)
– (18) – (18)
Foreign currency translation losses reclassified to the consolidated income
statement – 3 – 3
Issue of Company’s shares by Employee Benefit Trust – – (30) (30)
Transfer to share-based payments reserve for Deferred Bonus Share Plan
Invested Shares (note 24) – – 4 4
Credit to equity for share-based payments charge (note 24) – – 15 15
At 31 December 2020 (restated)
(1)
(4) (29) 76 43
Attributable to:
Petrofac Limited shareholders (restated)
(1)
(4) (29) 76 43
Non-controlling interests – – – –
At 31 December 2020 (restated)
(1)
(4) (29) 76 43
At 1 January 2021 (4) (29) 76 43
Net changes in fair value of derivatives and financial assets designated as cash
flow hedges 1 – – 1
Foreign currency translation – 3 – 3
Foreign currency translation losses reclassified to the consolidated income
statement – 8 – 8
Issue of Company’s shares by Employee Benefit Trust – – (20) (20)
Credit to equity for share-based payments charge (note 24) – – 7 7
At 31 December 2021 (3) (18) 63 42
Attributable to:
Petrofac Limited shareholders (3) (18) 63 42
Non-controlling interests – – – –
At 31 December 2021 (3) (18) 63 42
(1) The prior year balances are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
Net unrealised gains/(losses) on derivatives
The portion of gains or losses on cash flow hedging instruments that are determined to be effective hedges is included within this
reserve net of related deferred tax effects. During 2021 a fair value gain of US$1m (2020: fair value loss of US$15m) was recognised
within equity. When the hedged transaction occurs or is no longer forecast to occur, the gain or loss is transferred from equity to
theconsolidated income statement. Net losses of US$692,000 (2020: US$130,000) relating to foreign currency forward contracts and
financial instruments designated as cash flow hedges were recognised in cost of sales line item in the consolidated income statement.
The forward currency points element and ineffective portion of derivative financial instruments relating to forward currency contracts
designated as cash flow hedges amounting to US$3m gain (2020: US$5m loss) were recognised in the cost of sales line item in the
consolidated income statement.
Foreign currency translation reserve
The assets and liabilities of entities which have a non-United States dollar functional currency are translated into the Group’s reporting
currency, United States dollar, at the exchange rate prevailing at the end of the reporting period. The foreign currency differences
arising on the translation are recognised in other reserves in equity.
Strategic report Governance Financial statements
191Petrofac Limited 2021 Annual report and accounts

Share-based payments reserve
The share-based payments reserve is used to recognise the value of equity-settled share-based payments awarded to employees and
transfers out of this reserve are made upon vesting of the original share awards.
In the prior year, the transfer of US$4m into the share-based payments reserve reflected the transfer from accrued bonus liability
within trade and other payables in the consolidated balance sheet which had been voluntarily elected or mandatorily obliged to be
settled in shares as part of the Deferred Bonus Share Plan.
26 Interest-bearing loans and borrowings
2021
US$m
2020
US$m
Non-current
Senior secured notes 580 –
Revolving credit facility 85 –
Term loans 99 50
764 50
Current
Revolving credit facility – 505
Term loans – 200
Bank overdrafts – 45
– 750
Total interest-bearing loans and borrowings 764 800
In addition to the capital raise (note 22), a comprehensive refinancing was completed in October and November 2021 to extend
Petrofac’s debt maturities and to create a long-term capital structure.
The refinancing plan comprised the issuance of US$600m 9.75% senior secured notes (due 2026), a US$180m new revolving credit
facility, a US$50m (denominated as AED185m) new bilateral facility and an amended existing US$50m bilateral loan facility. All facilities
were for general corporate purposes.
The proceeds of the refinancing, in combination with the proceeds from the capital raise and available cash reserves, were used
torepay some of the previous credit facilities during the year (including the Company issued £300m (US$ equivalent of US$405m
asat30 November 2021, when it was repaid) in commercial paper with a maturity of 12 months under the UK Government’s COVID
Corporate Financing Facility (CCFF), the previous revolving credit facility and one of the previous bilateral term loans) in addition to
thepenalties imposed by the Court in relation to the SFO investigation (note 6), which were settled in January and February 2022.
Details of the Group’s interest-bearing loans and borrowings are as follows:
Senior secured notes
In November 2021, the Group issued US$600m of 9.75% senior secured notes, due November 2026. These are listed on The
International Stock Exchange and were issued at a 0.97% discount to the nominal value, resulting in a total 10.0% yield to maturity
forthe purchasers of the notes. The notes were issued with a rating of BB- from both S&P and Fitch.
The interest coupon is payable semi-annually in arrears and the Company has a call option to redeem the notes with a first call date of
November 2023, with a make-whole premium of 4.88%/2.44% of the remaining coupon from November 2023 and 2024 respectively.
Revolving credit facility
The Group has a US$180m committed revolving credit facility (2020: US$1,000m) with a syndicate of international banks, which is
available for general corporate purposes. The facility is due to mature in October 2023 with options to extend
(1)
. At 31 December 2021,
US$95m was drawn under this facility (31 December 2020: US$505m). Interest is payable on the drawn balance of the facility and in
addition, utilisation fees are payable depending on the level of utilisation.
The facility agreement provides for the Group to pay a certain proportion of any up-front fee incurred by the lender to facilitate
anytransfer of its commitment under the facility, to another lender. This has been classified as an embedded derivative on initial
recognition and re-measured at fair value through profit or loss. The fair value on initial recognition in October 2021 was estimated
atUS$4m (Level 3 of the ‘fair value hierarchy’ contained within IFRS 13 ‘Fair Value Measurement’) and there has been no change
infair value in the period to 31 December 2021.
Subsequent to the previous year-end, extended credit facilities of US$700m (RCF of US$610m and bilateral term facility of US$90m)
were secured in April 2021 and these were drawn and subsequently repaid during the year.
(1) The option to extend the revolving credit facility, by an incremental six months to April 2024 and October 2024, is subject to the approval of lenders.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
25 Other reserves continued
Petrofac Limited 2021 Annual report and accounts192

Term loans
At 31 December 2021, the Group had in place two bilateral term loans with a combined total of US$99m (2020: three bilateral term
loans with a combined total of US$250m). At 31 December 2021, US$99m was drawn under these facilities, of which US$50m is
scheduled to mature in October 2023 and US$49m in November 2023 (2020: US$250m, with US$50m maturing in February 2021,
US$150m in March 2021 and US$50m in November 2023).
Bank overdrafts
Bank overdrafts are utilised to meet the Group’s working capital requirements. These are repayable on demand.
Compliance with covenants
The revolving credit facility and the term loans (together, the 'Senior Loans') are subject to two financial covenants relating to leverage
and interest cover. These covenants are tested at 30 June and 31 December (and additionally on any quarter end date falling on
31 March or 30 September on which the revolving credit facility is more than 33% drawn). The leverage financial covenant is defined
as the ratio of net debt (including net leases but excluding cash over which there are exchange control restrictions), at the end of the
reporting period to the previous 12 months’ EBITDA. The interest cover financial covenant is defined as the ratio of the previous
12 months’ EBITDA to the previous 12 months’ net finance expense (excluding debt acquisition cost amortisation).
The Group was compliant with its covenants throughout the year. However, as noted in the going concern disclosure (note 2.5), the
extended impact of COVID-19 resulted in a deterioration in EBITDA in Q4 2021 and due to the carryover effect of this result on the
subsequent financial covenants (calculated on a rolling 12-month basis), Senior Loan lenders granted an amendment to both of the
financial covenants for 2022 and thereafter. These amendments were as follows:
– Leverage financial covenant: shall not exceed a ratio of 4.5:1 throughout 2022, falling to 3.5:1 thereafter (previously 4.1:1 at 31 March
2022, if tested at this date and 3.5:1 thereafter).
– Interest cover financial covenant: shall not be less than a ratio of 1.75:1 at 31 March 2022, if tested at this date (previously 2.25:1),
1.50:1 at 30 June 2022 (previously 2.25:1), 1.0:1 at 30 September 2022, if tested at this date (previously 2.0:1) and 1.75:1 thereafter
(previously 2.25:1).
The Senior Loans are senior unsecured obligations of the Company and will rank equally in right of payment with each other and with
the Company’s other existing and future unsecured and unsubordinated indebtedness.
27 Provisions
Non-current provisions
Other long-term
employment
benefits provision
US$m
Provision for
decommissioning
US$m
Other provisions
US$m Total US$m
At 1 January 2020 131 40 18 189
Additions during the year 16 – 4 20
Paid during the year (34) – (3) (37)
Transfer to current provisions – – (3) (3)
Unwinding of discount – 1 – 1
Exchange difference – – 1 1
At 1 January 2021 113 41 17 171
Additions during the year 9 8 1 18
Paid during the year (39) – – (39)
Transfer to current provisions – – (8) (8)
Unwinding of discount (note 7) – 1 – 1
At 31 December 2021 83 50 10 143
Other long-term employment benefits provision
Labour laws in the Middle East require employers to provide for other long-term employment benefits. These benefits are payable to
employees on being transferred to another jurisdiction or on cessation of employment based on their final salary and number of years’
service. All amounts are unfunded. The long-term employment benefits provision is based on an independent specialist’s valuation
model, with the key underlying assumptions being as follows:
Senior
employees
Other
employees
Average annual % salary increases 2% 2%
Discount factor 2% 2%
Discount factor used represents the yield on US high-quality corporate bonds, with a duration corresponding to that of the liability
atthe end of the reporting period. The weighted average duration of the long-term employment benefit obligations is five years (2020:
fiveyears).
Strategic report Governance Financial statements
193Petrofac Limited 2021 Annual report and accounts

Provision for decommissioning
The decommissioning provision at the end of the reporting period relates to the Group’s obligation for the removal of facilities and
restoration of Block PM304 in Malaysia.
The liability is discounted at a rate of 1.3% on Block PM304 (2020: 3.7%).
The unwinding of the discount is recognised in the finance expense (note 7) line item of the consolidated income statement. The Group
estimates that the cash outflows associated with this provision will take place in 2026.
Other provisions
The other provisions carrying amount at 31 December 2021 mainly represents technical insurance provisions and IBNR reserves of
US$9m (2020: US$8m) in respect of the Group’s captive insurance company, Jermyn Insurance Company Limited. As at 31 December
2020, other provisions included US$2m of disposal costs associated with the disposal of the JSD6000 installation vessel.
Current provisions
Onerous
contract
provisions
US$m
Other
provisions
US$m
Total
US$m
At 1 January 2020 6 41 47
Amounts provided during the year 150 18 168
Transfer from non-current provisions – 3 3
Utilised during the year (118) (26) (144)
Translation difference – 1 1
At 1 January 2021 38 37 75
Amounts provided during the year 62 6 68
Transfer from non-current provisions – 8 8
Utilised during the year (61) (20) (81)
At 31 December 2021 39 31 70
Onerous contract provisions
Where it is determined that the unavoidable costs under a contract exceed the economic benefits expected to be received under it,
the Group recognises a provision to represent the lower of the expected future losses from fulfilling the contract and any
compensation or penalties arising from a failure to fulfil it. The amount of US$62m provided during the year related to projects in the
Engineering & Construction operating segment (2020: US$150m).
Other provisions
The other provisions carrying amount as at 31 December 2021 includes provisions for dilapidations costs, litigations against the Group
and disposal costs associated with the disposal of the JSD6000 installation vessel. Of the US$6m provided during the year, US$1m
(2020: US$2m) related to projects in the Asset Solutions operating segment and US$1m related to a VAT penalty provision in the Asset
Solutions segment (2020: US$11m related to a VAT penalty provision in the Engineering & Construction operating segment).
28 Trade and other payables
2021
US$m
2020
US$m
Trade payables 561 443
SFO court penalty (note 6) 104 –
Accrued expenses 267 293
Other taxes payable 18 20
Other payables 140 131
1,090 887
The increase in trade payables of US$118m is mainly due to an increase of US$88m in the Engineering & Construction operating
segment, primarily due to an equivalent reduction in accrued contract expenses.
Accrued expenses primarily represent contract cost accruals relating to the Engineering & Construction operating segment and the
Asset Solutions operating segment.
Other payables mainly consist of retentions held against vendors and subcontractors of US$102m (2020: US$110m).
Certain trade and other payables will be settled in currencies other than the reporting currency of the Group, mainly in sterling, euros
and Kuwaiti dinars.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
27 Provisions continued
Petrofac Limited 2021 Annual report and accounts194

29 Leases
The Group has lease contracts for various items of property, plant and equipment. The Group’s obligations under its leases are
secured by the lessor’s title to the leased assets. Generally, the Group is restricted from assigning and subleasing the leased assets.
The Group also has certain leases of office buildings with lease terms of 12 months or less and leases of office equipment with low
value. The Group applies the ‘short-term lease’ and ‘lease of low-value assets’ recognition exemptions for these leases.
a. Right-of-use assets
The Group recognises right-of-use assets, within the property, plant and equipment line item of the consolidated balance sheet, at the
commencement date of the lease (i.e. the date at which the underlying asset is available for use). The carrying amounts of right-of-use
assets recognised and the movements during the period are disclosed in note 12.
b. Lease liabilities
The table below provides details of lease liabilities recognised within the other financial liabilities line item of the consolidated balance sheet:
2021
US$m
2020
US$m
Lease liabilities at 1 January 313 438
Additions 35 5
Interest 7 9
Principal payments made by the Group (40) (50)
Interest paid by the Group (5) (9)
Principal payments made by joint operation partners (59) (82)
Derecognised – (1)
Translation difference – 3
At 31 December 251 313
The above lease liabilities included US$186m (2020: US$253m) of lease liabilities relating to Block PM304 in Malaysia that are
presented at 100%, which is necessary to reflect the legal position of the Group as the contracting entity for these leases. The leases
relating to Block PM304 in Malaysia associated with oil and gas facilities include a renewal option of up to two years and a purchase
option at the end of the lease term.
c. Amounts recognised in the consolidated income statement in respect of leases
2021
US$m
2020
US$m
Depreciation charge in respect of right-of-use assets (note 12) 19 26
Finance expense recognised associated with lease liabilities (note 7) 7 9
Lease expense recognised for short-term leases and leases for low-value assets 4 8
d. Future lease payments
Set out below are the future lease payments in respect of leases for property, plant and equipment. These have remaining non-
cancellable lease terms of between one and eight years. The discounted and undiscounted future minimum lease commitments as at
31 December 2021 are as follows:
Present
value
US$m
Finance
expense
US$m
Future
minimum lease
payments
US$m
The commitments are as follows:
Within one year 61 13 74
After one year but not more than five years 188 19 207
More than five years 2 – 2
251 32 283
In April 2021, a lease in respect of a MOPU vessel that was due to expire on 30 April 2021 relating to Block PM304 in Malaysia was
extended to 30 September 2026 (notes 13 and 21 of the Company financial statements).
The discounted and undiscounted future minimum lease commitments as at 31 December 2020 are as follows:
Present value
US$m
Finance
expense
US$m
Future minimum
lease payments
US$m
The commitments are as follows:
Within one year 150 14 164
After one year but not more than five years 142 21 163
More than five years 21 3 24
313 38 351
Strategic report Governance Financial statements
195Petrofac Limited 2021 Annual report and accounts

30 Commitments and contingent liabilities
Commitments
In the normal course of business, the Group obtains surety bonds, letters of credit and guarantees, which are contractually required
tosecure performance, advance payment or in lieu of retentions being withheld. Some of these facilities are secured by issue of
corporate guarantees by the Company and its subsidiaries in favour of the issuing banks.
At 31 December 2021, the Group had outstanding letters of credit, letters of guarantee, including performance, advance payments
and bid bonds of US$3,194m (2020: US$3,543m) against which the Group had pledged or restricted cash balances of US$137m
(2020: US$44m).
At 31 December 2021, the Group had outstanding forward exchange contracts amounting to US$849m (2020: US$1,910m).
These commitments consist of future gross obligations either to acquire or to sell designated amounts of foreign currency at agreed
rates and value dates (note 33).
Capital commitments
At 31 December 2021, the Group had capital commitments of US$12m (2020 restated
(1)
: US$8m) excluding lease commitments
(note29):
2021
US$m
2020
(restated)
(1)
US$m
Block PM304 in Malaysia 11 3
Commitments in respect of development of the Group’s digital systems and other information technology
equipment 1 5
12 8
(1) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
Contingent liabilities
A Group subsidiary is subject to challenges by HMRC on the historical application of National Insurance Contributions (NICs) to
workers in the UK Continental Shelf. In October 2020, a decision was issued by HMRC against Petrofac Facilities Management Limited
(PFML) in respect of the historic application of NICs. PFML has appealed against the decision and no payment has been made to
HMRC pending the outcome of the First-tier Tribunal (Tax). Management, taking into consideration advice from independent legal and
tax specialists, believes that it is not probable that an outflow of resources embodying economic benefits will be required to settle the
obligation, and accordingly, no provision has been recognised. The maximum potential exposure to PFML in relation to NICs and
interest should it be unsuccessful in defending its position is approximately £127m, equivalent to US$172m.
The Group also has a recourse available, in accordance with the contractual indemnity contained in some customer contracts,
whereit can possibly recover a portion of NICs and interest from its customers in the event the Group is unsuccessful in its appeal.
The possible recoverability of the amounts receivable from the customers, should the Group be unsuccessful in defending its position,
may be subject to further negotiations with the customers. The Group is in the process of estimating the possible recoverable amount
if it is unsuccessful in defending its position.
31 Related party transactions
The consolidated financial statements include the financial statements of Petrofac Limited and the subsidiaries listed in note 34.
Petrofac Limited is the ultimate parent entity of the Group.
The following table provides the total amount of transactions entered with related parties:
Related party receivables
2021
US$m
2020
US$m
Joint ventures 1 –
Associates – 1
1 1
All sales to and purchases from related parties are conducted on an arm’s length basis and are approved by the operating segment’s
management. All related party balances will be settled in cash.
In May 2017, the Board of Directors approved a donation of up to US$5m over the course of five years to the American University
ofBeirut (AUB) to establish the Petrofac Fund for Engineers endowment fund, which will provide scholarships and internships to
engineering students in memory of Mr Maroun Semaan, Petrofac’s co-founder and AUB alumnus, who was also a significant personal
benefactor to AUB.
However, in response to the COVID-19 pandemic and the change in economic circumstances, it has been agreed that the Group will
pay for up to 100 Group employees to attend an AUB full-time course instead of making future donations for engineering scholarships.
As part of its new commitment, the Group will pay the cost of the course to AUB and an educational stipend to all attendees. For the
year ended 31 December 2021, US$0.4m was paid to the AUB (2020: US$nil). One oftheGroup’s Non-executive Directors who is also
a significant shareholder of the Company is a trustee of the AUB.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
Petrofac Limited 2021 Annual report and accounts196

Compensation of key management personnel
The following details remuneration of key management personnel of the Group, comprising Executive and Non-executive Directors of
the Company and other senior personnel. Further information relating to individual Directors of the Company is provided in the
Directors’ remuneration report on pages 116 to 127.
2021
US$m
2020
US$m
Short-term employee benefits 8 8
Share-based payments charge 3 5
Fees paid to Non-executive Directors 1 1
12 14
32 Accrued contract expenses
Accrued contract expenses represent contract cost accruals associated with the Group’s fixed-price engineering, procurement and
construction contracts. This is typically in respect of vendors and subcontractors for these projects, whereas similar costs in respect
of the Group’s other projects (such as cost reimbursable projects, predominantly in Asset Solutions) are classified as accrued
expenses within trade and other payables (note 28). The decrease in accrued contract expenses of US$354m was mainly due to
higher payment milestones relating to vendors and subcontractors achieved during the year in the Engineering & Construction
operating segment and overall lower volumes.
33 Risk management and financial instruments
Risk management objectives and policies
The Group’s principal financial assets and liabilities, other than derivatives, comprise trade and other receivables, other financial
assets, cash and short-term deposits, interest-bearing loans and borrowings, trade and other payables and other financial liabilities.
The Group’s activities expose it to various financial risks particularly associated with interest rate risk on its variable rate cash and
short-term deposits, interest-bearing loans and borrowings and foreign currency risk on conducting business in currencies other than
the functional currency, as well as translation of the assets and liabilities of foreign operations to the reporting currency. These risks are
managed from time to time by using a combination of various derivative instruments, principally forward currency contracts in
accordance with the Group’s hedging policies. The Group has a policy not to enter into speculative trading of financial derivatives.
The Board of Directors of the Company has established an Audit Committee which performs, amongst other roles, reviews on the
effectiveness of the risk management and internal control systems to mitigate a range of risks, including financial risks, faced by the
Group, which is discussed in detail on page 109.
The other main risks besides interest rate and foreign currency risk arising from the Group’s financial instruments are credit risk,
liquidity risk and commodity price risk; the policies relating to these risks are discussed in detail below:
Interest rate risk
Interest rate risk arises from the possibility that changes in interest rates will affect the value of the Group’s interest-bearing financial
liabilities and assets.
The Group’s exposure to market risk arising from changes in interest rates relates primarily to the Group’s long-term variable rate debt
obligations and its cash and short-term deposits. The Group’s policy is to manage its interest cost using a mix of fixed and variable
rate debt. The Group’s cash and bank balances are at floating rates of interest.
The Group’s interest-bearing loans and borrowings is primarily in United States dollars, linked to United States dollar LIBOR (London
Interbank Offered Rate). The Group uses derivatives to swap between fixed and floating rates. At 31 December 2021, the proportion of
floating rate debt was 24% of the total financial debt outstanding (2020: 100%).
Interest rate sensitivity analysis
The impact on the Group’s profit before tax and equity due to a reasonably possible change in interest rates on interest-bearing loans and
borrowings at the reporting date is demonstrated in the table below. The analysis assumes that all other variables remain constant.
Profit before tax Equity
100 basis point
increase
US$m
100 basis point
decrease
US$m
100 basis point
increase
US$m
100 basis point
decrease
US$m
31 December 2021 (4) 4 – –
31 December 2020 (5) 5 – –
Foreign currency risk
The Group is exposed to foreign currency risk on sales, purchases, and translation of assets and liabilities that are in a currency other
than the functional currency of its operating units. The Group is also exposed to the translation of the functional currencies of its units
to the United States dollar reporting currency of the Group.
Strategic report Governance Financial statements
197Petrofac Limited 2021 Annual report and accounts

The following table summarises the percentage of foreign currencies i.e. not denominated in the Group’s reporting currency expressed
in United States dollar amounts.
2021 % of
foreign
currency
denominated
items
2020 % of
foreign
currency
denominated
items
Revenues 54.5% 41.8%
Costs 66.7% 44.9%
Non-current financial assets 15.7% 14.7%
Current financial assets 43.3% 50.2%
Non-current financial liabilities 6.7% 22.8%
Current financial liabilities 42.7% 34.4%
The Group uses forward currency contracts to manage the currency exposure on transactions significant to its operations. It is the
Group’s policy not to enter into forward contracts until a highly probable forecast transaction is in place and to negotiate the terms
ofthe derivative instruments used for hedging to match the terms of the hedged item to maximise hedge effectiveness.
Foreign currency sensitivity analysis
The income statements of subsidiaries with non-USD functional currencies are translated into the Group’s reporting currency using
aweighted average exchange rate. Foreign currency monetary items are translated using the closing rate at the reporting date.
Revenues and costs in currencies other than the functional currency of an operating unit are recorded at the prevailing rate at the
dateof the transaction. The following significant exchange rates applied during the year in relation to United States dollars:
2021 2020
Average rate Closing rate Average rate Closing rate
Sterling 1.38 1.35 1.28 1.36
Kuwaiti dinar 3.31 3.31 3.26 3.29
Euro 1.18 1.14 1.13 1.23
The following table summarises the impact on the Group’s profit before tax and equity (due to a change in the fair value of monetary
assets, liabilities and derivative instruments) of a reasonably possible change in United States dollar exchange rates with respect to
different currencies:
Profit before tax Equity
+10% US dollar
rate increase
US$m
(1)
−10% US dollar
rate decrease
US$m
(1)
+10% US dollar
rate increase
US$m
−10% US dollar
rate decrease
US$m
31 December 2021 15 (15) 14 (14)
31 December 2020 6 (6) (4) 4
(1) Includes impact on pegged currencies.
Derivative instruments
At 31 December, the Group had foreign exchange forward contracts as follows:
Contract value Fair value (undesignated) Fair value (designated) Net unrealised gain/(loss)
(1)
2021
US$m
2020
US$m
2021
US$m
2020
US$m
2021
US$m
2020
US$m
2021
US$m
2020
US$m
Euro (sales)/purchases (45) (71) – 1 – (3) (1) (2)
Sterling sales (224) (230) (4) (15) – 1 – 1
Kuwaiti dinar sales (254) (343) – – – (3) (2) (3)
Arab Emirates dirham purchases 50 150 – – – – – –
Others (6) – – – – – – –
n/a n/a (4) (14) – (5) (3) (4)
(1) Attributable to Petrofac Limited shareholders.
The above foreign exchange contracts mature and will affect profit before tax between January 2022 and November 2023 (2020:
between January 2021 and May 2022).
During 2021, net changes in fair value resulting in a loss of US$1m (2020: US$17m) relating to these derivative instruments and
financial assets were taken to equity and losses of US$692,000 (2020: US$130,000) were recycled from equity into cost of sales
intheconsolidated income statement. The forward points and ineffective portions of the above foreign exchange forward contracts
and loss on undesignated derivatives of US$3m (2020: US$5m) were recognised in the consolidated income statement.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
33 Risk management and financial instruments continued
Petrofac Limited 2021 Annual report and accounts198

Commodity price risk – oil prices
The Group is exposed to the impact of changes in oil and gas prices on its revenues and net profit generated from sales of crude oil
and gas. The Group’s policy is to manage its exposure to the impact of changes in oil and gas prices using derivative instruments.
Hedging is only undertaken once sufficiently reliable and regular long-term forecast production data is available. No crude oil
derivatives were entered by the Group during 2021 to hedge oil production.
Credit risk
The Group trades only with recognised, creditworthy third parties. Business Unit Risk Review Committees (BURRC) evaluate the credit
worthiness of each individual third party at the time of entering into new contracts. Limits have been placed on the approval authority
of the BURRC above which the approval of the Board of Directors of the Company is required. Receivable balances are monitored on
an ongoing basis with appropriate follow-up action taken where necessary. At 31 December 2021, the Group’s five largest customers
accounted for 49% of outstanding trade receivables and contract assets (2020: 49%).
With respect to credit risk arising from the other financial assets of the Group, which comprise cash and cash equivalents, current and
non-current receivables from joint operation partners for leases and certain derivative instruments, the Group’s exposure to credit risk
arises from default of the counterparty, with a maximum exposure equal to the carrying amount of these instruments.
Liquidity risk
The Group’s objective is to ensure sufficient liquidity to support operations and future growth is available. The provision of financial
capital and the potential impact on the Group’s capital structure is reviewed regularly. The maturity profiles of the Group’s financial
liabilities at 31 December are as follows:
Year ended 31 December 2021
6 months
or less
US$m
6 – 12 months
US$m
1 – 2 years
US$m
2 – 5 years
US$m
More than
5 years
US$m
Contractual
undiscounted
cash flows
US$m
Carrying
amount
US$m
Financial liabilities
Interest-bearing loans and borrowings – – 195 600 – 795 764
Lease liabilities 42 32 64 143 2 283 251
Trade and other payables (excluding
other taxes payable and retention
payable) 890 80 – – – 970 970
Derivative instruments 5 – – – – 5 5
Embedded derivative in respect of the
revolving credit facility 4 – – – – 4 4
Interest payments 34 34 66 175 – 309 n/a
975 146 325 918 2 2,366 1,994
Year ended 31 December 2020
6 months
or less
US$m
6 – 12 months
US$m
1 – 2 years
US$m
2 – 5 years
US$m
More than
5 years
US$m
Contractual
undiscounted
cash flows
US$m
Carrying
amount
US$m
Financial liabilities
Interest-bearing loans and borrowings 750 – – 50 – 800 800
Lease liabilities 129 35 51 112 24 351 313
Trade and other payables (excluding
other taxes payable and retention
payable) 672 85 – – – 757 757
Derivative instruments 23 3 – – – 26 26
Interest payments 9 1 2 2 – 14 n/a
1,583 124 53 164 24 1,948 1,896
The Group uses various committed facilities provided by banks and its own financial assets to fund the above-mentioned financial
liabilities.
Strategic report Governance Financial statements
199Petrofac Limited 2021 Annual report and accounts

Capital management
The Group’s policy is to maintain a robust capital base to support future operations, growth and maximise shareholder value.
The Group seeks to optimise shareholder returns by maintaining a balance between debt and equity attributable to Petrofac Limited
shareholders and monitors the efficiency of its capital structure on a regular basis. The gearing ratio and return on shareholders’ equity
is as follows:
2021
US$m
2020
(restated)
(1)
US$m
Cash and short-term deposits 620 684
Interest-bearing loans and borrowings (A) (764) (800)
Net debt (B) (144) (116)
Equity attributable to Petrofac Limited shareholders (C) 475 403
Reported net loss for the year attributable to Petrofac Limited shareholders (D) (195) (192)
Gross gearing ratio (A/C) 160.8% 198.5%
Net gearing ratio (B/C) 30.3% 28.8%
Shareholders’ return on investment (D/C) (41.1%) (47.6%)
1) The prior year balances are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
34 Subsidiaries, associates and joint arrangements
At 31 December 2021, the Group had investments in the following active subsidiaries, associates and joint arrangements:
Proportion of nominal value
ofissued shares controlled
bytheGroup
Name of entity Country of incorporation 2021 2020
Active subsidiaries
Petrofac Algeria EURL Algeria 100 100
Petrofac International (Bahrain) W.L.L Bahrain 100 100
Petrofac South East Asia (B) Sdn. Bhd. Brunei 100 100
Petrofac (Cyprus) Limited Cyprus 100 100
Caltec Limited England 100 100
K W Limited England 100 100
Oilennium Limited England 100 100
Petrofac (Malaysia-PM304) Limited England 100 100
Petrofac Contracting Limited England 100 100
Petrofac Engineering Limited England 100 100
Petrofac Services Limited England 100
(1)
100
(1)
Petrofac Treasury UK Limited England 100
(1)
100
(1)
Petrofac UK Holdings Limited England 100
(1)
100
(1)
PetroHealth Limited England 100 100
Petrofac Deutschland GmbH Germany 100 100
Jermyn Insurance Company Limited Guernsey 100
(1)
100
(1)
Petrofac Engineering India Private Limited India 100 100
Petrofac Engineering Services India Private Limited India 100 100
Petrofac Projects and Services Private Limited (formerly Petrofac
Information Services Private Limited) India 100 100
Petrofac (JSD6000) Limited Jersey 100 100
Petrofac Energy Developments International Limited Jersey 100
(1)
100
(1)
Petrofac Facilities Management International Limited Jersey 100
(1)
100
(1)
Petrofac Integrated Energy Services Limited Jersey 100
(1)
100
(1)
Petrofac International Ltd. Jersey 100
(1)
100
(1)
Petrofac Offshore Management Limited Jersey 100 100
Petrofac Platform Management Services Limited Jersey 100 100
Petrofac Training International Limited Jersey 100
(1)
100
(1)
Petroleum Facilities E & C Limited Jersey 100
(1)
100
(1)
Petrofac E&C Sdn. Bhd. Malaysia 100 100
Petrofac Energy Developments Sdn. Bhd. Malaysia 100 100
Petrofac Engineering Services (Malaysia) Sdn. Bhd. Malaysia 70 70
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
33 Risk management and financial instruments continued
Petrofac Limited 2021 Annual report and accounts200

Proportion of nominal value
ofissued shares controlled
bytheGroup
Name of entity Country of incorporation 2021 2020
PFMAP Sdn. Bhd. Malaysia 100 100
Petrofac EPS Sdn. Bhd. Malaysia 49
(2)
49
(2)
Petrofac International (Mozambique), Lda Mozambique 100 100
Petrofac Kazakhstan B.V. Netherlands 100 100
Petrofac Netherlands Coöperatief U.A. Netherlands 100 100
Petrofac Nigeria B.V. Netherlands 100 100
Petrofac Norge B.V. Netherlands 100 100
PTS B.V. Netherlands 100 100
Petrofac Energy Services Nigeria Limited Nigeria 100 100
Petrofac International (Nigeria) Limited Nigeria 100 100
Petrofac Norge AS Norway 100 100
Petrofac E&C Oman LLC Oman 100 100
PKT Training Services Limited Russia 100 100
Sakhalin Technical Training Centre Russia 100 100
Petrofac Saudi Arabia Company Limited Saudi Arabia 100 100
Atlantic Resourcing Limited Scotland 100 100
Petrofac Facilities Management Group Limited Scotland 100 100
Petrofac Facilities Management Limited Scotland 100 100
Petrofac Training Group Limited Scotland 100 100
Petrofac Training Holdings Limited Scotland – 100
Petrofac Training Limited Scotland 100 100
Scotvalve Services Limited Scotland 100 100
SPD Limited Scotland 100 100
Global Mobility Company Pte Limited Singapore 100
(1)
–
Petrofac South East Asia Pte Ltd Singapore 100
(1)
100
(1)
Petrofac E&C International Limited United Arab Emirates 100 100
Petrofac Emirates LLC (note 13) United Arab Emirates 75 75
Petrofac FZE United Arab Emirates 100 100
Petrofac International (UAE) LLC United Arab Emirates 100 100
Petrofac Inc. United States 100 100
Petrofac Training Inc. United States 100 100
Petrofac US Holdings Limited United States 100 100
W&W Energy Services Inc. United States 100 100
SPD Group Limited British Virgin Islands 100 100
Strategic report Governance Financial statements
201Petrofac Limited 2021 Annual report and accounts

34 Subsidiaries, associates and joint arrangements continued
Associates
Proportion of nominal value
ofissued shares controlled
bytheGroup
Name of associate Principal activities Country of incorporation 2021 2020
PetroFirst Infrastructure Limited Leasing of floating platforms to oil
andgasindustry
Jersey 20 20
PetroFirst Infrastructure 2 Limited Leasing of floating platforms to oil
andgasindustry
Jersey 10 10
Joint arrangements
Joint ventures
Socar – Petrofac LLC Training services Azerbaijan 49 49
Petrofac Kazakhstan Engineering
ServicesLLP
Engineering services Kazakhstan 50 50
Petrofac – ISKER LLP Engineering and construction services Kazakhstan 50 50
China Petroleum Petrofac Engineering
Services Cooperatief U.A.
Consultancy for petroleum and chemical
engineering
Netherlands 49 49
Takatuf Petrofac Oman LLC Construction, operation and
managementof a training centre
Oman 40 40
Joint operations
Petrofac – CPECC JV Operations and maintenance contract
inIraq
Iraq 65
(4)
65
(4)
PSS Netherlands B.V. Engineering, procurement, supply of
equipment and materials and related
services to execute the Company’s scope
of work for a project in Thailand
Netherlands 36
(3)
36
(3)
Bechtel Petrofac JV Engineering, procurement and
construction management of a project
inUAE
Unincorporated 35
(4)
35
(4)
Petrofac/Bonatti JV EPC for a project in Algeria Unincorporated 70
(4)
70
(4)
Petrofac/Daelim JV EPC for a project in Oman Unincorporated 50
(4)
50
(4)
PM304 JV Oil and gas exploration and production
inMalaysia
Unincorporated 30
(4)
30
(4)
Petrofac/Samsung/CB&I CFP EPC for a project in Kuwait Unincorporated 47
(4)
47
(4)
Petrofac/Samsung EPC for a project in Oman Unincorporated 50
(4)
50
(4)
Petrofac/Saipem/Samsung Offshore works for a project in Thailand Unincorporated 36
(4)
36
(4)
Please note that only active entities are shown in the above tables. All dormant entities have been omitted.
1 Directly held by Petrofac Limited.
2 Entities consolidated as subsidiaries on the basis of control.
3 The joint arrangement is classified as a joint operation as, contractually, the joint operation partners have rights to the joint operation’s assets and obligation for the joint operation’s
liabilities.
4 The unincorporated arrangement between the venturers is a joint arrangement as, contractually, all the decisions about the relevant activities require unanimous consent by the
venturers. Unincorporated joint arrangements are recognised in the Group’s financial statements as joint operations.
The Group’s ownership interest in associates and joint ventures is disclosed in note 16.
Notes to the consolidated financial statements continued
For the year ended 31 December 2021
Petrofac Limited 2021 Annual report and accounts202

Appendix A
The Group references Alternative Performance Measures (APMs) when evaluating the Group’s reported financial performance, financial
position and cash flows that are not defined or specified under International Financial Reporting Standards (IFRS). The Group considers
that these APMs, which are not a substitute for or superior to IFRS measures, provide stakeholders with additional useful information
byadjusting for certain reported items which impact upon IFRS measures or, by defining new measures, aid the understanding of the
Group’s financial performance, financial position and cash flows. These are aligned to measures which are used internally to assess
business performance in the Group’s processes when determining compensation.
APM Description Closest equivalent IFRS measure
Adjustments to reconcile to
primary statements Rationale for adjustments
Group’s business
performance net profit
attributable to Petrofac
Limited shareholders
(note A1)
Measures net profitability Group’s net profit/(loss) Petrofac presents
business performance
APM in the consolidated
income statement as a
means of measuring
underlying business
performance.
The business
performance net profit
measure excludes
Separately Disclosed
Items (SDI) (note 2.8).
Business performance
diluted earnings per share
is calculated only when
the reported result is
aprofit.
The intention of this
measure is to provide
users of the consolidated
financial statements with
a clear and consistent
presentation of underlying
business performance
and it excludes the
impact of certain items
toaid comparability
Business performance
basic and diluted
earnings per share
attributable to Petrofac
Limited shareholders
(note A2)
Measures net profitability Basic and diluted
earnings per share
Business performance
earnings before interest,
tax, depreciation and
amortisation (EBITDA)
(note A3)
Measures operating
profitability
Operating profit/(loss) Excludes SDI (note 2.8),
depreciation and
amortisation and
includesshare of net
profits from associates
and joint ventures
The intention of this
measure is to provide
users of the consolidated
financial statements with
a clear and consistent
presentation of underlying
operating performance
Business performance
earnings before interest
and tax (EBIT) (note A4)
Measures operating
profitability
Operating profit/(loss) Excludes SDI (note 2.8)
and includes share of net
profits from associates
and joint ventures
The intention of this
measure is to provide
users of the consolidated
financial statements with
a clear and consistent
presentation of underlying
operating performance
Business performance
effective tax rate (ETR)
(note A5)
Measures tax charge Income tax expense Excludes income tax
credit related to SDI
The intention of this
measure is to provide
users of the consolidated
financial statements
witha clear and
consistent presentation
ofunderlying business
performance ETR
Capital expenditure
(noteA6)
Measures net cash cost
of capital investment
Net cash flows generated
from/(used in) investing
activities
Excludes dividends
received from associates
and joint ventures, net
loans repaid by/(paid to)
associates and joint
ventures, proceeds
fromdisposal of property,
plant and equipment,
proceeds from disposal
of subsidiaries and
interestreceived
Excludes items not
considered relevant to
capital investment
Appendices
Strategic report Governance Financial statements
203Petrofac Limited 2021 Annual report and accounts

APM Description Closest equivalent IFRS measure
Adjustments to reconcile to
primary statements Rationale for adjustments
Free cash flow (note A7) Measures net cash
generated after operating
and investing activities to
finance returns to
shareholders
Net cash flows generated
from/(used in) operating
activities plus net cash
flows (used in)/generated
from investing activities
less interest paid and the
repayment of finance
lease principal plus
amounts received from
non-controlling interest
n/a n/a
Working capital, balance
sheet measure (note A8)
Measures the investment
in working capital
No direct equivalent.
Calculated as inventories
plus trade and other
receivables plus contract
assets less trade and
other payables less
contract liabilities less
accrued contract
expenses
n/a n/a
Return on capital
employed (ROCE) (note
A9)
Measures the efficiency
of generating operating
profits from capital
employed
No direct equivalent.
Calculated as business
performance earnings
before interest, tax and
amortisation (EBITA)
divided by capital
employed (average total
assets less average
current liabilities after
adjusting for certain
leases)
n/a n/a
Cash conversion (note
A10)
Measures the conversion
of EBITDA into cash
No direct equivalent.
Calculated as cash
generated from
operations divided by
business performance
EBITDA
n/a n/a
Net lease liabilities (note
A11)
Measures net lease
liabilities
No direct equivalent.
Calculated as gross lease
liabilities less 70% of
leases in respect of
right-of-use assets
relating to Block PM304
in Malaysia
n/a n/a
Net debt/net cash (note
A12)
Measures indebtedness No direct equivalent.
Calculated as interest-
bearing loans and
borrowings less cash and
short-term deposits
n/a n/a
New order intake (note
A13)
Provides visibility of future
revenue
No direct equivalent.
Calculated as net awards
and net variation orders
n/a n/a
Appendices continued
Petrofac Limited 2021 Annual report and accounts204

A1. Business performance net profit attributable to Petrofac Limited shareholders
2021
US$m
2020
(restated)
(1)
US$m
Reported net loss (A) (192) (201)
Adjustments – separately disclosed items (note 6):
UK Serious Fraud Office proceedings 106 –
Impairment of assets 17 146
Fair value re-measurements 8 57
Group reorganisation and redundancy costs 2 13
Cloud ERP implementation costs 12 14
Other separately disclosed items 14 13
Operating profit separately disclosed items (B) 159 243
Refinancing related costs – finance expense separately disclosed items (C) 28 –
Foreign exchange translation gains on deferred tax balances – (1)
Deferred tax impairment 43 –
Tax credit on separately disclosed items (D) 43 (1)
Post-tax separately disclosed items (E = B + C + D) 230 242
Group’s business performance net profit (A + E) 38 41
(Gain)/loss attributable to non-controlling interest (3) 9
Business performance net profit attributable to Petrofac Limited shareholders 35 50
(1) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
A2. Business performance basic earnings per share attributable to Petrofac Limited shareholders
2021
US$m
2020
(restated)
(1)
US$m
Reported net profit attributable to Petrofac Limited shareholders (E) (195) (192)
Add: post-tax separately disclosed items (appendix A, note A1) 230 242
Business performance net profit attributable to Petrofac Limited shareholders (E1) 35 50
2021
Shares
million
2020
Shares
million
Weighted average number of ordinary shares for basic earnings per share
(2)
(F) (note 9) 362 337
Weighted average number of ordinary shares for diluted earnings per share
(3)
(F1) (note 9) 362 337
2021
US cents
2020
(restated)
(1)
US cents
Basic earnings per share
Business performance (E1/F x 100) 9.7 14.8
Reported (E/F x 100) (53.8) (57.0)
Diluted earnings per share
Business performance (E1/F1 x 100) 9.7 14.8
Reported (E/F1 x 100) (53.8) (57.0)
(1) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
(2) The weighted number of ordinary shares in issue during the year, excluding those held by the Employee Benefit trust.
(3) For the year ended 31 December 2021 and 2020, potentially issuable ordinary shares under the share-based payment plans are excluded from both the business performance and
reported diluted earnings per ordinary share calculation, as their inclusion would decrease any loss per ordinary share.
Strategic report Governance Financial statements
205Petrofac Limited 2021 Annual report and accounts

A3. Business performance EBITDA
2021
US$m
2020
(restated)
(1)
US$m
Reported operating (loss)/profit (130) (160)
Adjustments:
Operating profit separately disclosed items (appendix A, note A1) 159 243
Share of net profits from associates and joint ventures (note 16) 7 5
Depreciation (note 12) 62 82
Amortisation, business performance impairment and write-off (note 5a, note 5b and 5g) 6 41
Business performance EBITDA 104 211
(1) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
A4. Business performance EBIT
2021
US$m
2020
(restated)
(1)
US$m
Reported operating (loss)/profit (130) (160)
Adjustments:
Operating profit separately disclosed items (appendix A, note A1) 159 243
Share of net profits from associates and joint ventures (note 16) 7 5
Business performance EBIT 36 88
A5. Business performance ETR
2021
US$m
2020
(restated)
(1)
US$m
Reported income tax expense 3 18
Add: Tax (charge)/credit on separately disclosed items (appendix A, note A1) (43) 1
Business performance income tax (credit)/expense (G) (40) 19
Group’s business performance net profit (appendix A, note A1) 38 41
Group’s business performance net (loss)/profit before tax (H) (2) 60
Business performance ETR (G/H x 100) >100% 31.7%
(1) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
A6. Capital expenditure
2021
US$m
2020
US$m
Net cash flows used in investing activities 30 7
Adjustments:
Contingent consideration paid – (3)
Dividends received from associates and joint ventures 8 9
Loans paid to associates and joint ventures – (2)
Disposal costs paid – (3)
Net proceeds from disposal of subsidiaries, including receipt against contingent consideration 9 31
Proceeds from disposal of property, plant and equipment 5 1
Interest received 1 3
Capital expenditure 53 43
A7. Free cash flow
2021
US$m
2020
(restated)
(1),(2)
US$m
Net cash flows used in operating activities (161) (30)
Net cash flows used in investing activities (30) (7)
Interest paid (27) (36)
Separately disclosed items – refinancing related costs (23) –
Repayment of lease liabilities (40) (50)
Free cash flow (281) (123)
(1) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
(2) The definition of free cash flow has been amended to include the repayment of lease liabilities.
Appendices continued
Petrofac Limited 2021 Annual report and accounts206

A8. Working capital
2021
US$m
2020
US$m
Inventories (note 18) 23 8
Trade and other receivables (note 19) 668 877
Contract assets (note 20) 1,580 1,652
Current Assets (I) 2,271 2,537
Trade and other payables (note 28) 1,090 887
Contract liabilities (note 20) 58 120
Accrued contract expenses 780 1,134
Current Liabilities (J) 1,928 2,141
Working capital (I – J) 343 396
A9. Return on capital employed
2021
US$m
2020
(restated)
(1)
US$m
Reported operating loss (130) (160)
Adjustments:
Operating profit separately disclosed items (appendix A, note A1) 159 243
Share of profits from associates and joint ventures (note 16) 7 5
Amortisation (note 5a and 5b) 6 5
Business performance EBITA (K) 42 93
Total assets opening balance 4,171 5,960
Less: 70% on leases in respect of right-of-use assets relating to Block PM304 in Malaysia (177) (259)
Adjusted total assets opening balance (L) 3,994 5,701
Total assets closing balance 3,837 4,171
Less: 70% on leases in respect of right-of-use assets relating to Block PM304 in Malaysia (note A11) (127) (177)
Adjusted total assets closing balance (M) 3,710 3,994
Average total assets (N = (L + M)/2) 3,852 4,848
Current liabilities opening balance 3,336 3,922
Less: 70% on leases in respect of right-of-use assets relating to Block PM304 in Malaysia (note A11) (97) (89)
Adjusted current liabilities opening balance (O) 3,239 3,833
Current liabilities closing balance 2,221 3,336
Less: 70% on leases in respect of right-of-use assets relating to Block PM304 in Malaysia (note A11) (34) (97)
Adjusted current liabilities closing balance (P) 2,187 3,239
Average current liabilities (Q = (O + P)/2) 2,713 3,536
Capital employed (R = N – Q) 1,139 1,312
Return on capital employed (K/R x 100) 3.7% 7.1%
(1) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
A10. Cash conversion
2021
US$m
2020
(restated)
(1)
US$m
Cash (used in)/generated from operations (S) (91) 77
Business performance EBITDA (T) 104 213
Cash conversion (S/T x 100) <0.0% 36.2%
(1) The prior year numbers are restated in relation to the adoption of the IFRIC decision on cloud configuration and customisation costs in April 2021; see note 2.9.
Strategic report Governance Financial statements
207Petrofac Limited 2021 Annual report and accounts

A11. Net lease liabilities
2021
US$m
2020
US$m
Non-current liability for lease liabilities (note 17) 190 163
Current liability for lease liabilities (note 17) 61 150
Total gross liability for lease liabilities 251 313
Gross-up on non-current liability for leases in respect of right-of-use assets relating to Block PM304 in
Malaysia (note 17) 93 80
Gross-up on current liability for leases in respect of right-of-use assets relating to Block PM304 in Malaysia
(note 17) 34 97
Total 70% on leases in respect of right-of-use assets relating to Block PM304 in Malaysia 127 177
Net non-current liability for leases 97 83
Net current liability for leases 27 53
Net lease liabilities 124 136
A12. Net debt
2021
US$m
2020
US$m
Interest-bearing loans and borrowings (U) (note 26) 764 800
Less: Cash and short-term deposits (V) (note 21) (620) (684)
Net debt (U – V) 144 116
A13. New order intake
2021
US$m
2020
US$m
Engineering & Construction operating segment
Net awards 857 314
Net variation orders 350 396
1,207 710
Asset Solutions operating segment
Net awards 993 1,177
Net variation orders 39 (255)
1,032 922
New order intake 2,239 1,632
Appendices continued
Petrofac Limited 2021 Annual report and accounts208

Financial statements
Company financial
statements
Pages
Company income statement 210
Company statement of comprehensive income 210
Company balance sheet 211
Company statement of cash flows 212
Company statement of changes in equity 213
Notes to the Company financial statements
Note 1 Corporate information 214
Note 2 Summary of significant accounting policies 214
Note 3 SFO fines, penalties and associated costs 216
Note 4 Income 216
Note 5 General and administration expenses 216
Note 6 Expected credit loss allowance (ECL) 216
Note 7 Impairment of investments in subsidiaries 216
Note 8 Other operating income 216
Note 9 Other operating expenses 216
Note 10 Finance income/(expense) 217
Note 11 Dividends paid and proposed 217
Note 12 Investments in subsidiaries 217
Note 13 Property, plant and equipment 217
Note 14 Amounts due from/due to Group entities 218
Note 15 Cash and short-term deposits 218
Note 16 Employee Benefit Trust (EBT) shares 218
Note 17 Share-based payments reserve 219
Note 18 Interest-bearing loans and borrowings 219
Note 19 Other financial assets and other financial liabilities 220
Note 20 Trade and other payables 222
Note 21 Leases 222
Note 22 Commitments and contingent liabilities 223
Note 23 Risk management and financial instruments 223
Note 24 Related party transactions 226
Note 25 Share capital 226
Glossary 227
Shareholder information 229
Strategic report Governance Financial statements
209Petrofac Limited 2021 Annual report and accounts

Notes
2021
US$m
2020
US$m
Income 4 128 239
General and administration expenses
5 (16) (14)
SFO fines, penalties and associated costs
3 (116) –
Expected credit loss allowance
6 (13) (200)
Impairment of investments in subsidiaries
7 – (348)
Other operating income
8 8 9
Other operating expenses
9 (6) (26)
Operating loss (15) (340)
Finance income
10 34 60
Finance expense
10 (65) (34)
Loss before tax and net loss (46) (314)
Company statement of comprehensive income
For the year ended 31 December 2021
2021
US$m
2020
US$m
Net loss (46) (314)
Fair value gain on derivatives – 2
Total comprehensive loss (46) (312)
Company income statement
For the year ended 31 December 2021
Petrofac Limited 2021 Annual report and accounts210

Notes
2021
US$m
2020
US$m
Assets
Non-current assets
Investments in subsidiaries
12 218 218
Investments in associates 7 7
Property, plant and equipment
13 16 –
Other financial assets
19 61 48
302 273
Current assets
Trade and other receivables 1 1
Amounts due from Group entities
14 1,380 1,027
Other financial assets
19 55 7
Cash and short-term deposits
15 135 87
1,571 1,122
Total assets 1,873 1,395
Equity and liabilities
Equity attributable to Petrofac Limited shareholders
Share capital
25 10 7
Share premium
25 251 4
Capital redemption reserve
25 11 11
Employee Benefit Trust shares
16 (69) (88)
Share-based payments reserve
17 59 72
Retained earnings 190 237
Total equity 452 243
Non-current liabilities
Interest-bearing loans and borrowings
18 764 50
Other financial liabilities
19 17 –
781 50
Current liabilities
Trade and other payables
20 116 1
Amounts due to Group entities
14 507 369
Interest-bearing loans and borrowings
18 – 705
Other financial liabilities
19 17 27
640 1,102
Total liabilities 1,421 1,152
Total equity and liabilities 1,873 1,395
The financial statements on pages 210 to 226 were approved by the Board of Directors on 23 March 2022 and signed on its behalf by
Afonso Reis e Sousa – Chief Financial Officer.
Company balance sheet
At 31 December 2021
Strategic report Governance Financial statements
211Petrofac Limited 2021 Annual report and accounts

Notes
2021
US$m
2020
US$m
Operating activities
Loss before tax (46) (314)
Adjustments to reconcile profit before tax:
Expected credit loss allowance
6 13 200
Impairment of investments in subsidiaries
7 – 348
Net finance expense/(income)
10 31 (26)
Loss on early settlement of deferred consideration
19 – 6
Negative fair value change associated with contingent consideration
19 – 9
Other non-recurring expenses
3 116 –
Net other non-cash items (2) (4)
112 219
Working capital adjustments:
Amounts due from Group entities (338) 1,089
Other financial assets and liabilities (74) 13
Trade and other payables 2 (1)
Amounts due to Group entities 127 (1,038)
Net working capital adjustments (283) 63
Cash (used in)/generated from operations and net cash flows (used in)/generated
from operating activities (171) 282
Investing activities
Proceeds from disposal of a subsidiary including receipt against contingent consideration
19 – 13
Net cash flows generated from investing activities – 13
Financing activities
Issue of shares net of associated transaction costs
25 250 –
Proceeds from interest-bearing loans and borrowings, net of debt acquisition cost
18 1,484 870
Repayment of interest-bearing loans and borrowings
18 (1,470) (1,015)
Interest paid
10 (20) (25)
Refinancing related costs paid
10 (23) –
Purchase of Company’s shares by Employee Benefit Trust
16 (2) (11)
Net cash flows generated from/(used in) financing activities 219 (181)
Net increase in cash and cash equivalents 48 114
Cash and cash equivalents at 1 January 87 (27)
Cash and cash equivalents at 31 December
15 135 87
Company statement of cash flows
For the year ended 31 December 2021
Petrofac Limited 2021 Annual report and accounts212

Issued share
capital
US$m
(note 25)
Share
premium
US$m
Capital
redemption
reserve
US$m
Employee
Benefit Trust
shares
(1)
US$m
(note 16)
Share-based
payments
reserve
US$m
(note 17)
Unrealised
losses on
derivatives
US$m
Retained
earnings
US$m
Total
equity
US$m
Balance at 1 January 2020 7 4 11 (110) 83 (2) 554 547
Net loss – – – – – – (314) (314)
Other comprehensive income – – – – – 2 – 2
Total comprehensive loss – – – – – 2 (314) (312)
Purchase of Company’s shares by
Employee Benefit Trust – – – (11) – – – (11)
Issue of Company’s shares by
Employee Benefit Trust – – – 33 (30) – (3) –
Credit to equity for share-based
payments charge invoiced to Group
entities – – – – 19 – – 19
Balance at 31 December 2020 and
1 January 2021 7 4 11 (88) 72 – 237 243
Net loss and total comprehensive
loss – – – – – – (46) (46)
Issue of own shares (note 25) 3 247 – – – – – 250
Purchase of Company’s shares by
Employee Benefit Trust – – – (2) – – – (2)
Issue of Company’s shares by
Employee Benefit Trust – – – 21 (20) – (1) –
Credit to equity for share-based
payments charge invoiced to Group
entities – – – – 7 – – 7
Balance at 31 December 2021 10 251 11 (69) 59 – 190 452
(1) Shares held by Petrofac Employee Benefit Trust.
Company statement of changes in equity
For the year ended 31 December 2021
Strategic report Governance Financial statements
213Petrofac Limited 2021 Annual report and accounts

1 Corporate information
Petrofac Limited (the ‘Company’) is a limited liability company
registered and domiciled in Jersey under the Companies (Jersey)
Law 1991 and is the holding company for the international group
of Petrofac subsidiaries. Petrofac Limited and its subsidiaries at
31 December 2021 comprise the Petrofac Group (the ‘Group’).
The Group’s principal activity is to design, build, manage and
maintain infrastructure for the energy industries.
The financial statements of the Company for the year ended
31 December 2021 were authorised for issue in accordance with
a resolution of the Board of Directors on 23 March 2022.
2 Summary of significant accounting policies
Basis of preparation
The separate financial statements have been prepared in
accordance with International Financial Reporting Standards
(IFRS) as issued by the International Accounting Standards Board
(IASB) and applicable requirements of Jersey law.
The separate financial statements of the Company have been
prepared on a historical cost basis, except for derivative financial
instruments and contingent consideration that have been
measured at fair value. The functional and presentation currency
of these separate financial statements is United States dollars
and all values in the separate financial statements are rounded
tothe nearest million (US$m) unless otherwise stated.
Adoption of new financial reporting standards,
amendments and interpretations
Effective new financial reporting amendments
The Company applied for the first-time certain amendments,
which are effective for annual periods beginning on or after
1 January 2021. The Company has not early adopted any other
standard, interpretation or amendment that has been issued but
is not yet effective.
The following amendments apply for the first time in 2021, but do
not have an impact on the consolidated financial statements of
the Group:
– Amendment to IFRS 16 – COVID-19-Related Rent Concessions
(effective 1 June 2020)
– Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16
Interest Rate Benchmark Reform – Phase 2 (effective 1 January
2021)
Significant accounting policies
Investments in subsidiaries
Investment in subsidiaries are stated at cost less any
accumulated impairment.
Investments in associates
Investment in associates are stated at cost less any accumulated
impairment.
Financial assets
Initial recognition and measurement
Financial assets are classified at initial recognition, as
subsequently measured at amortised cost, fair value through
other comprehensive income, and fair value through profit or loss.
The Company initially measures a financial asset at its fair value
plus, in the case of a financial asset not at fair value through profit
or loss, transaction costs.
Subsequent measurement
For purposes of subsequent measurement, financial assets are
classified into the following categories:
– Amortised cost
– Fair value through profit or loss
Amortised cost
The Company generally applies this category to trade and other
receivables, amounts due from Group entities and deferred
consideration receivable. The Company measures financial
assets at amortised cost if both of the following conditions
aremet:
– The financial asset is held within a business model with the
objective to hold financial assets in order to collect contractual
cash flows; and
– The contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding
Financial assets at amortised cost are subsequently measured
using the effective interest rate (EIR) method and are subject to
impairment. Gains and losses are recognised in the Company’s
income statement when the asset is derecognised, modified or
impaired.
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss include
financial assets held for trading and financial assets designated
upon initial recognition at fair value through profit or loss, or
financial assets mandatorily required to be measured at fair value.
Derivatives are classified as held for trading unless they are
designated as effective hedging instruments. Financial assets at
fair value through profit or loss are carried in the Company’s
balance sheet at fair value with net changes in fair value
recognised in the income statement.
The fair value changes to undesignated forward currency
contracts are recognised within the other operating income or
expenses line item in the Company’s income statement.
Impairment of financial assets
The Company recognises an allowance for expected credit
losses (ECLs) for all financial assets not held at fair value through
profit or loss. ECLs are based on the difference between the
contractual cash flows due in accordance with the contract and
all the cash flows that the Company expects to receive,
discounted at an approximation of the original effective interest
rate. The expected cash flows will include, if any, cash flows from
the sale of collateral held or other credit enhancements that are
integral to the contractual terms.
Notes to the Company financial statements
For the year ended 31 December 2021
Petrofac Limited 2021 Annual report and accounts214

2 Summary of significant accounting policies
continued
For financial assets measured at amortised cost, ECLs are
recognised in two stages. For credit exposures for which there
has not been a significant increase in credit risk since initial
recognition, ECLs are provided for credit losses that result from
default events that are possible within the next 12 months (a
12-month ECL). For those credit exposures for which there has
been a significant increase in credit risk since initial recognition,
aloss allowance is required for credit losses expected over the
remaining life of the exposure, irrespective of the timing of the
default (a lifetime ECL). During the year, there was a significant
increase in the credit risk for such financial assets since the initial
recognition. This resulted in a lifetime ECL being recognised for
these financial assets.
The Company considers a financial asset to be in default when
available information indicates that the Company is unlikely to
receive the outstanding contractual amounts in full.
Financial liabilities
Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as interest-
bearing loans and borrowings, trade and other payables, or
derivative financial instruments.
All financial liabilities are recognised initially at fair value and, in
the case of interest-bearing loans and borrowings and trade and
other payables, net of directly attributable transaction costs.
The Company’s financial liabilities include trade and other payables,
loans and borrowings including bank overdrafts, derivative financial
instruments, and amounts due to Group entities.
Subsequent measurement
For purposes of subsequent measurement, financial liabilities are
classified in the following categories:
– Financial liabilities at fair value through profit or loss
– Loans and borrowings
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include
financial liabilities held for trading and financial liabilities
designated upon initial recognition as at fair value through profit
or loss.
Financial liabilities include derivative financial instruments entered
in to by the Company that are not designated as hedging
instruments in hedge relationships.
Gains or losses on liabilities held for trading are recognised in the
income statement.
Loans and borrowings
This category generally applies to interest-bearing loans and
borrowings (note 18). After initial recognition, interest-bearing
loans and borrowings are subsequently measured at amortised
cost using the EIR method. The EIR amortisation charge and the
gains and losses, upon derecognition, are recognised in the
otheroperating income or expenses line item in the Company
income statement.
Amortised cost is calculated by considering any discount or
premium on acquisition and fees or costs that are an integral part
of the EIR.
Share-based payments
Certain employees of Group entities receive remuneration in
theform of share-based payments, whereby employees render
services in exchange for Company shares or rights over shares
(‘equity-settled transactions’); see note 24 of the consolidated
financial statements.
Taxation
Profits arising in the Company for the 2021 year of assessment
will be subject to Jersey tax at the standard corporate income tax
rate of 0% (2020: 0%).
Significant accounting judgements and estimates
Judgements
In the process of applying the Company’s accounting policies,
management has made the following judgements, apart from
those involving estimations, which have the most significant effect
on the amounts recognised in the financial statements:
Significant judgements associated with contingent
liabilities and provisions
Management applies significant judgements in determining
whether it has a present or a possible obligation to disclose
acontingent liability or a probable obligation to recognise a
provision in the financial statements. Management, in certain
instances, takes into consideration legal advice from its legal
counsel and external legal advisors as well as independent
specialist advice, to determine the probability of an outflow of
resources embodying economic benefits that will be required
tosettle the obligation, if determined. Typically, the contingent
liabilities include pending legal cases with regulatory authorities
and/or third parties.
Estimation uncertainty
The key assumptions concerning the future and other key
sources of estimation uncertainty at the end of the reporting
period that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities
withinthe next financial year are discussed below:
– Recoverable amount of investments in subsidiaries and ECL
allowance on amounts due from Group entities: the Company
recognises an allowance for ECLs for amounts due from Group
entities based on the difference between the contractual cash
flows due in accordance with the contract and all the cash
flows that the Company expects to receive. The expected cash
flows will include, if any, cash flows from the sale of collateral
held or other credit enhancements that are integral to the
contractual terms. For determining the recoverable amount of
investments in subsidiaries; the Company determines at the
end of each reporting period whether there is any evidence of
indicators of impairment in the carrying amount of its
investments in subsidiaries. Where indicators exist, an
impairment test is undertaken which requires management to
estimate the recoverable amount of its assets, which is based
on value in use. The value-in-use estimation is based on output
of management’s business planning process which involves
assumptions relating to, but not limited to, future cash flows,
discount rate and inflation. The carrying amount of investments
in and amounts due from Group entities was US$218m and
US$1,380m respectively (2020: US$218m and US$1,027m
respectively) and amounts due to Group entities was US$507m
(2020: US$369m).
Strategic report Governance Financial statements
215Petrofac Limited 2021 Annual report and accounts

Notes to the Company financial statements continued
For the year ended 31 December 2021
3 SFO fines, penalties and associated costs
2021
US$m
2020
US$m
UK Serious Fraud Office proceedings 106 –
Legal and professional fees in respect of the SFO proceedings 10 –
Company income statement charge 116 –
On 12 May 2017, the SFO announced an investigation into the activities of Petrofac, its subsidiaries, and their officers, employees
andagents for suspected bribery, corruption, and/or money laundering. In September 2021, the Company reached a plea agreement
with the SFO such that the Company entered guilty pleas in respect of seven counts of failing to prevent former Petrofac Group
employees from offering or making payments to agents in relation to projects in Iraq, Saudi Arabia and the United Arab Emirates,
contrary to Section 7 of the UK Bribery Act 2010. As a result, on 4 October 2021 the Southwark Crown Court ordered the Company
to ay apenalty of £77.0m. This comprises a confiscation order of £22.8m payable by 3 January 2022; a fine of £47.2m, and SFO costs
of£7.0m, both payable on 14 February 2022. At 31 December 2021, management has recorded a liability for a full amount payable
attheyear-end exchange rate (US$104m); note 20.
The Company has also incurred US$10m of legal and professional fees associated with the SFO investigation during the year.
4 Income
Dividends from subsidiaries and associates are recognised when the right to receive payment is established.
2021
US$m
2020
US$m
Dividend income from subsidiaries 120 229
Dividend income from associates 8 10
128 239
5 General and administration expenses
General and administration expenses relate to costs directly incurred by the Company. This also includes the recharged portion of the
corporate personnel cost, travelling, entertainment and professional cost by one of its subsidiaries of US$14m (2020: US$13m)
recognised within the general and administration expenses line item in the Company’s income statement.
Included in general and administration expenses is the auditor’s remuneration of US$41,000 (2020: US$40,000) related to the fee for
the audit of the Company’s financial statements.
6 Expected credit loss allowance
The ECL allowance recognised by the Company during 2021 and 2020 was as follows:
2021
US$m
2020
US$m
ECL on amounts due from Group entities (note 14) 14 198
ECL (reversal)/allowance on other financial assets (note 19) (1) 2
13 200
7 Impairment of investments in subsidiaries
Impairment of investments in subsidiaries during the year was $nil (2020: US$348m). In the prior year, of the total impairment charge
US$284m related to Petrofac Energy Developments International Limited, US$52m related to Petrofac UK Holdings Limited and
US$12m related to Petrofac Treasury UK Limited.
8 Other operating income
2021
US$m
2020
US$m
Exchange gain and forward points on undesignated foreign currency contracts 2 4
Recharges to Group entities 6 5
8 9
9 Other operating expenses
2021
US$m
2020
US$m
Effective interest rate amortisation and losses resulting from changes in interest-bearing loans and
borrowings repayment terms – 1
Negative fair value change on contingent consideration receivable from Ithaca Energy UK Ltd (note 19) – 9
Loss on early settlement of deferred consideration receivable from Ithaca Energy UK Ltd (note 19) – 6
Costs incurred on behalf of Group entities 6 5
Others – 5
6 26
Petrofac Limited 2021 Annual report and accounts216

10 Finance income/(expense)
2021
US$m
2020
US$m
Finance income
Unwinding of discount (note 19) 5 5
On amounts due from Group entities 29 55
Total finance income 34 60
Finance expense
Borrowings (35) (25)
Interest expense on finance leases (1) –
On amounts due to Group entities (1) (9)
Refinancing related costs (28) –
Total finance expense (65) (34)
Refinancing related costs
During 2021, a capital raise (note 25) and a comprehensive refinancing were completed to extend Petrofac’s debt maturities and
tocreate a long-term capital structure for the Group. Costs of US$28m were incurred which were integral to the execution of the
refinancing but were not directly attributable to the secured facilities. These costs included facility fees for bridge finance, advisory
feespaid on behalf of lenders, certain legal and professional fees, and accelerated amortisation associated with debt acquisition costs for
facilities which were repaid during the year.
11 Dividends paid and proposed
In April 2020, the Board agreed to cancel the final 2019 ordinary share dividend payments and to cancel subsequent dividends in
response to the challenges presented by the COVID-19 pandemic. Dividend payments were therefore also cancelled in 2020.
The Board recognises the importance of dividends to our shareholders, but in light of current market conditions has decided that
dividend payments will remain suspended (and therefore no dividend will be paid in respect of 2021), but will seek to reinstate them
assoon as it is appropriate to do so. This will be contingent on both a market recovery and confidence that the dividend can be paid
sustainably whilst retaining a strong balance sheet and liquidity. Under the terms of the new debt facilities, the company will be
permitted to pay dividends from 1 January 2023, subject to the satisfaction of certain covenant tests.
12 Investments in subsidiaries
At 31 December, the Company had investments in the following active subsidiaries:
Proportion of nominal value
ofissued shares controlled
bytheCompany
Name of company Country of incorporation 2021 2020
Trading subsidiaries
Petrofac Services Limited England 100 100
Petrofac UK Holdings Limited England 100 100
Jermyn Insurance Company Limited Guernsey 100 100
Petrofac International Limited Jersey 100 100
Petrofac Energy Developments International Limited Jersey 100 100
Petrofac Facilities Management International Limited Jersey 100 100
Petrofac Integrated Energy Services Limited Jersey 100 100
Petrofac Training International Limited Jersey 100 100
Petroleum Facilities E & C Limited Jersey 100 100
Petrofac South East Asia Pte Limited Singapore 99 99
Petrofac Treasury UK Limited UK 100 100
13 Property, plant and equipment
The increase in property, plant and equipment of US$16m was mainly due to the addition of a right-of-use asset in respect of the
WestDesaru mobile offshore production unit (MOPU) for which a put option on the Company exists. In 2014, the Company entered
into a sale and purchase agreement (SPA) with the buyer to dispose of 80% of the shares in PetroFirst Infrastructure Limited (formerly
Petrofac FPSO Holdings Limited) that owned the floating platform assets. In accordance with the terms of the SPA, the buyer had an
option to put the West Desaru MOPU to the Company; the put options terminate on 31 December 2030. During the year, a lease in
respect of the MOPU that was due to expire on 30 April 2021 relating to Block PM304 in Malaysia was extended to 30 September
2026. Management expects that the put option associated with the MOPU (with a value of US$20m) will be payable on the lease
expiry i.e. on 30 September 2026. Accordingly, the Company has recognised a right-of-use asset and a corresponding lease liability
associated with the MOPU (note 21).
Strategic report Governance Financial statements
217Petrofac Limited 2021 Annual report and accounts

Notes to the Company financial statements continued
For the year ended 31 December 2021
14 Amounts due from/due to Group entities
Amounts due from/due to Group entities comprise both interest- and non-interest-bearing short-term loans provided to/received from
Group entities listed in note 34 of the Group’s consolidated financial statements.
The increase in amounts due from Group entities of US$353m was mainly due to additional funding to certain Group entities from the
Company, partially offset by dividends receivable from the Company’s subsidiary of US$120m, declared in December 2021.
The increase in amounts due to Group entities of US$137m related to balances payable to Petrofac Treasury UK Limited.
At the end of each reporting period, the amounts due from Group entities are reported net of ECL allowance in accordance with IFRS
9 ‘Financial Instruments’.
The movement in the ECL allowance against amounts due from Group entities at the end of each reporting period was as follows:
2021
US$m
2020
US$m
At 1 January 62 137
ECL allowance (note 6) 14 198
Write-off arising from loan waivers – (273)
At 31 December 76 62
The outbreak of the COVID-19 pandemic and the associated economic slowdown had an impact on the ability of a subsidiary of the
Company to provide financial guarantees in respect of the amounts owed by other Group entities to the Company. As a result, at
31 December 2021, the Company has not recognised any ECL allowance against amounts due from Petrofac UK Holdings Limited
(PUKH). However, at 31 December 2021, a partial guarantee of US$91m was provided to PUKH in respect of the amounts owed by
these entities to the Company (2020: a partial guarantee of $100m was provided to PUKH).
During the prior year, the Company waived the amounts due from Petrofac Facilities Management Limited (PFML) of US$273m
andamounts due from Petrofac Energy Developments International Limited (PEDIL) of US$284m. The balance due from PEDIL was
transferred to an investment in PEDIL of US$284m and consequently an impairment charge associated with the overall investment
insubsidiaries of US$284m was recognised within the ‘impairment of investment in subsidiaries’ line item in the income statement.
Additionally, the Company recognised a reversal of the ECL allowance of US$87m in respect of this previous loan balance.
At 31 December 2021, the analysis of amounts due from Group entities is as follows:
2021
US$m
2020
US$m
ECL rate 5.2% 5.7%
Gross carrying amount 1,456 1,089
Less: ECL allowance (76) (62)
ECL adjusted amounts due from Group entities at 31 December 1,380 1,027
15 Cash and short-term deposits
2021
US$m
2020
US$m
Cash at bank and in hand 135 87
The fair value of cash and bank short-term deposit balances was US$135m (2020: US$87m). This balance represents cash and cash
equivalents for the purpose of the Company statement of cash flows.
16 Employee Benefit Trust (EBT) shares
The Petrofac Employee Benefit Trust (the ‘Trust’) has been established to administer the Group’s discretionary share scheme awards
made to the employees of the Group. The Trust issues Company shares to the Group’s employees on their respective vesting dates
subject to satisfying any service and performance conditions of each scheme. The Trust continues to be included in the Company’s
financial statements in accordance with IFRS 10 ‘Consolidated Financial Statements’.
For the purpose of making awards under the Group’s share-based payment plans, shares in the Company are purchased and held by the Trust.
These shares have been classified in the balance sheet as EBT shares within equity. Shares vested during the year are satisfied with these shares.
The movements in total EBT shares are shown below:
2021 2020
Number US$m Number US$m
At 1 January 8,703,208 88 10,055,467 110
Purchase of Company’s shares by Employee Benefit Trust
(1)
1,206,470 2 3,973,332 11
Issue of Company’s shares by Employee Benefit Trust (4,677,573) (21) (5,325,591) (33)
At 31 December 5,232,105 69 8,703,208 88
(1) All shares purchased via the Open Offer (note 25).
Shares vested during the year include dividend shares of 278,089 shares (2020: 509,329 shares).
Petrofac Limited 2021 Annual report and accounts218

17 Share-based payments reserve
The share-based payments reserve is used to recognise the value of equity-settled share-based payments awarded to employees of
the Group entities, and transfers out of this reserve are made upon vesting of the original share awards.
18 Interest-bearing loans and borrowings
The Company had the following interest-bearing loans and borrowings outstanding:
2021
US$m
2020
US$m
Non-current
Senior secured notes 580 –
Revolving credit facility 85 –
Term loans 99 50
764 50
Current
Revolving credit facility – 505
Term loans – 200
Bank overdrafts – –
– 705
Total interest-bearing loans and borrowings 764 755
Interest-bearing loans and borrowings as at 31 December 2021 is presented net of debt acquisition costs of $28m (2020: $0.5m)
In addition to the capital raise (note 25), a comprehensive refinancing was completed in October and November 2021 to extend the
Company’s debt maturities and to create a long-term capital structure.
The refinancing plan comprised the issuance of US$600m 9.75% senior secured notes (due 2026), a US$180m new revolving credit
facility, a US$50m (denominated as AED185m) new bilateral facility and an amended existing US$50m bilateral loan facility. All facilities
were for general corporate purposes.
The proceeds of the refinancing, in combination with the proceeds from the capital raise and available cash reserves, were used
torepay some of the previous credit facilities during the year (including the Company issued £300m (US$ equivalent of US$405m
asat 0 November 2021, when it was repaid) in commercial paper with a maturity of 12 months under the UK Government’s COVID
Corporate Financing Facility (CCFF), the previous revolving credit facility and one of the previous bilateral term loans) in addition to
thepenalties imposed by the Court in relation to the SFO investigation (note 3), which were settled in January and February 2022.
Details of the Company’s interest-bearing loans and borrowings are as follows:
Senior secured notes
In November 2021, the Company issued US$600m of 9.75% senior secured notes, due November 2026. These are listed on The
International Stock Exchange and were issued at a 0.97% discount to the nominal value, resulting in a total 10.0% yield to maturity
forthe purchasers of the notes. The notes were issued with a rating of BB- from both S&P and Fitch.
The interest coupon is payable semi-annually and the Company has a call option to redeem the notes with a first call date of
November 2023, with a make-whole premium of 4.88%/2.44% of the remaining coupon from November 2023 and 2024 respectively.
Revolving credit facility
The Company has a US$180m committed revolving credit facility (2020: US$1,000m) with a syndicate of international banks, which is
available for general corporate purposes. The facility is due to mature in October 2023 with options to extend
(1)
. At 31 December 2021,
US$95m was drawn under this facility (31 December 2020: US$505m). Interest is payable on the drawn balance of the facility and in
addition utilisation fees are payable depending on the level of utilisation.
The facility agreement provides for the Company to pay a certain proportion of any up-front fee incurred by the lender to facilitate
anytransfer of its commitment under the facility, to another lender. This has been classified as an embedded derivative on initial
recognition and re-measured at fair value through profit or loss. The fair value on initial recognition in October 2021 was estimated at
US$4m (Level 3 of the ‘fair value hierarchy’ contained within IFRS 13 ‘Fair Value Measurement’) and there has been no change in fair
value in the period to 31 December 2021.
Subsequent to the previous year-end, extended credit facilities of US$700m (RCF of US$610m and bilateral term facility of US$90m)
were secured and these were drawn and subsequently repaid during the year.
(1) The option to extend the revolving credit facility, by an incremental six months to April 2024 and October 2024, is subject to the approval of lenders.
Strategic report Governance Financial statements
219Petrofac Limited 2021 Annual report and accounts

Notes to the Company financial statements continued
For the year ended 31 December 2021
18 Interest-bearing loans and borrowings continued
Term loans
At 31 December 2021, the Company had in place two bilateral term loans with a combined total of US$100m (2020: three bilateral
term loans with a combined total of US$250m). At 31 December 2021, US$100m was drawn under these facilities, of which US$50m
is scheduled to mature in October 2023 and US$50m in November 2023 (2020: US$250m, with US$50m maturing in February 2021,
US$150m in March 2021 and US$50m in November 2023).
Compliance with covenants
The revolving credit facility and the term loans (together, the ‘Senior Loans’) are subject to two financial covenants relating to leverage
and interest cover for the Group (see note 26 of the Group’s consolidated financial statements). These covenants are tested at 30 June
and 31 December (and additionally on any quarter-end date falling on 31 March or 30 September on which the revolving credit facility
is more than 33% drawn). The leverage financial covenant is defined as the ratio of net debt (including net leases but excluding cash
over which there are exchange control restrictions), at the end of the reporting period to the previous 12 months’ EBITDA. The interest
cover financial covenant is defined as the ratio of the previous 12 months’ EBITDA to the previous 12 months’ net interest expense
(excluding debt acquisition cost amortisation).
The Group was compliant with these covenants at 31 December 2021. However, as noted in the going concern disclosure (note 2.5),
the extended impact of COVID-19 resulted in a deterioration in EBITDA in Q4 2021 and due to the carryover effect of this result on the
subsequent financial covenants (calculated on a rolling 12-month basis), Senior Loan lenders granted an amendment to both of the
financial covenants. These amendments were as follows:
– Leverage financial covenant: shall not exceed a ratio of 4.5:1 throughout 2022, falling to 3.5:1 thereafter (previously 4.1:1 at
31 March2022, if tested at this date and 3.5:1 thereafter).
– Interest cover financial covenant: shall not be less than a ratio of 1.75:1 at 31 March 2022, if tested at this date (previously 2.25:1),
1.50:1 at 30 June 2022 (previusly 2.25:1), 1.0:1 at 30 September 2022, if tested at this date (previously 2.0:1) and 1.75:1 thereafter
(previously 2.25:1).
The Senior Loans are senior unsecured obligations of the Company and will rank equally in right of payment with each other and with
the Company’s other existing and future unsecured and unsubordinated indebtedness.
19 Other financial assets and other financial liabilities
2021
US$m
2020
US$m
Other financial assets
Non-current
Deferred consideration receivable from Ithaca Energy UK Ltd 5 48
Restricted cash 56 –
61 48
Current
Deferred consideration receivable from Ithaca Energy UK Ltd 49 –
Restricted cash 5 –
Derivative contracts on behalf of Group entities – 4
Derivative contracts undesignated 1 3
55 7
Other financial liabilities
Non-current
Lease liability 17 –
Current
Derivative contracts on behalf of Group entities – 9
Derivative contracts undesignated 5 17
Embedded derivative in respect of the revolving credit facility 4 –
Interest payable 8 1
17 27
Petrofac Limited 2021 Annual report and accounts220

19 Other financial assets and other financial liabilities continued
Deferred consideration receivable from Ithaca Energy UK Ltd
The deferred consideration receivable from Ithaca Energy UK Ltd relating to the disposal of Petrofac GSA Holdings Limited, is
measured at amortised cost using a discount rate of 8.4%. Unwinding of the discount on the deferred consideration of US$4m (2020:
US$5m) was recognised during the year, within the finance income line item of the income statement. A decrease in the credit risk for
this financial asset resulted in the reversal in the expected credit loss allowance of US$1m being recognised for the year (2020: charge
of US$2m).
2021
US$m
2020
US$m
Opening balance (non-current and current) 48 64
Unwinding of discount (note 10) 5 5
Expected credit loss allowance reversal/(charge) 1 (2)
Loss on early settlement (note 9) – (6)
Receipts – (13)
As at the end of the reporting period 54 48
Contingent consideration receivable from Ithaca Energy UK Ltd
A reconciliation of the fair value movement of contingent consideration arising from the disposal of Petrofac GSA Holdings Limited is
presented below:
2021
US$m
2020
US$m
Opening balance – 9
Fair value loss – (9)
As at the end of the reporting period – –
Fair value measurement
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value
hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
Level 1: Unadjusted quoted prices in active markets for identical financial assets or liabilities
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly
(i.e. as prices) or indirectly (i.e. derived from prices)
Level 3: Valuation techniques for which the lowest level input that is significant to the fair value measurement is
unobservable
Set out below is a comparison of the carrying amounts and fair values of financial instruments as at 31 December:
Carrying amount Fair value
Level
2021
US$m
2020
US$m
2021
US$m
2020
US$m
Financial assets
Measured at amortised cost
Cash and short-term deposits (note 15) Level 2 135 87 135 87
Deferred consideration receivable from Ithaca Energy UK Ltd Level 2 54 48 54 48
Measured at fair value through profit and loss
Derivative contracts on behalf of Group entities Level 2 – 4 – 4
Derivative contracts undesignated Level 2 1 3 1 3
Financial liabilities
Measured at amortised cost
Interest-bearing loans and borrowings
Senior secured notes Level 1 580 – 595 –
Revolving credit facility Level 2 85 505 85 505
Term loans Level 2 99 250 99 250
Interest payable Level 2 8 1 8 1
Measured at fair value through profit and loss
Derivative contracts on behalf of Group entities Level 2 – 9 – 9
Derivative contracts undesignated Level 2 5 17 5 17
Embedded derivative in respect of the revolving credit facility Level 3 4 – 4 –
Management assessed the carrying amounts of trade and other receivables, amounts due from/due to Group entities and trade and
other payables to approximate their fair values and are therefore excluded from the above table.
Strategic report Governance Financial statements
221Petrofac Limited 2021 Annual report and accounts

Notes to the Company financial statements continued
For the year ended 31 December 2021
19 Other financial assets and other financial liabilities continued
When the fair values of financial assets and financial liabilities recognised in the Company balance sheet cannot be measured based
on quoted prices in active markets, their fair value is measured using valuation techniques including discounted cash flow models.
The inputs to these models are taken from observable markets where possible, but where such information is not available, a degree
of judgement is required in establishing fair values. Judgements include considerations of inputs such as liquidity risk, credit risk and
volatility. Changes in assumptions relating to these factors could affect the recognised fair value of financial instruments and are
discussed further below.
The following methods and assumptions were used to estimate the fair values for material financial instruments:
– The Company enters into derivative financial instruments with various counterparties, principally financial institutions with investment
grade credit ratings. Foreign exchange forward contracts are valued using valuation techniques, which employ the use of market
observable inputs. The most frequently applied valuation techniques include forward pricing using present value calculations.
The models incorporate various inputs including the credit quality of counterparties, foreign exchange spot and forward rates,
yieldcurves of the respective currencies, currency basis spreads between the respective currencies, interest rate curves and
forward rate curves of the underlying commodity.
– The fair value of deferred consideration receivable from Ithaca Energy UK Ltd is equivalent to its amortised cost determined as the
present value of discounted future cash flows using the discount rate of 8.4%.
– The fair values of long-term interest-bearing loans and borrowings (excluding senior secured notes) are equivalent to their amortised
costs determined as the present value of discounted future cash flows using the effective interest rate.
Changes in liabilities arising from financing activities
1 January
US$m
Cash inflows
US$m
Cash outflows
US$m
Other
(2)
US$m
31 December
US$m
Interest-bearing loans and borrowings
(1)
At 31 December 2021 755 1,484 (1,470) (5) 764
At 31 December 2020 900 870 (1,015) – 755
(1) Interest-bearing loans and borrowings excludes overdrafts, since these are included within cash and equivalents. At 31 December 2021 there were no overdrafts (2020: US$nil).
(2) Represents the movement in debt acquisition costs for senior notes and other interest-bearing loans and borrowings.
20 Trade and other payables
2021
US$m
2020
US$m
Trade payables – 1
Other payables and accruals 116 –
116 1
Other payables as at 31 December 2021 consist primarily of the Court penalty of US$104m (note 3).
21 Lease
A right-of-use asset and a corresponding lease liability was recognised in the year in respect of the West Desaru mobile offshore
production unit (MOPU) for which a put option on the Company exists (note 13).
a. Right-of-use asset
The Company recognises right-of-use assets, within the property, plant and equipment line item of the balance sheet, at the
commencement date of the lease (the date at which the underlying asset is available for use). The carrying amount of the right-of-use
asset recognised and the movement during the year is disclosed in note 13.
b. Lease liability
The table below provides details of lease liability recognised within the other financial liabilities line item of the balance sheet:
2021
US$m
2020
US$m
Lease liability at 1 January – –
Additions 16 –
Interest 1 –
At 31 December 17 –
c. Amounts recognised in the income statement in respect of lease
2021
US$m
2020
US$m
Finance expense recognised associated with lease liability 1 –
Petrofac Limited 2021 Annual report and accounts222

21 Lease continued
d. Future lease payments
Set out below are the future lease payments in respect of the lease for property, plant and equipment. These have remaining non-
cancellable lease terms of between one and eight years. The discounted and undiscounted future minimum lease commitments as
at31 December 2021 are as follows:
Present
value
US$m
Finance
expense
US$m
Future
minimum lease
payments
US$m
The commitments are as follows:
After one year but not more than five years 17 3 20
17 3 20
22 Commitments and contingent liabilities
Commitments
In the normal course of business, the Company will obtain surety bonds, letters of credit and guarantees, which are contractually
required to secure performance, advance payment or in lieu of retentions being withheld. Some of these facilities are secured by issue
of corporate guarantees on behalf of Group entities by the Company in favour of the issuing banks.
At 31 December 2021, the Company had outstanding letters of guarantee, including performance and advance payments of US$673m
(2020: US$702m).
At 31 December 2021, the Company had outstanding forward exchange contracts amounting to US$849m (2020: US$1,910m).
These commitments consist of future obligations either to acquire or to sell designated amounts of foreign currency at agreed rates
and value dates.
23 Risk management and financial instruments
Risk management objectives and policies
The Company’s principal financial assets and liabilities are amounts due from and due to Group entities, forward currency contracts,
cash and short-term deposits and interest-bearing loans and borrowings.
The Company’s activities expose it to various financial risks particularly associated with interest rate risks on its external variable rate
loans and borrowings. The Company has a policy not to enter speculative trading of financial derivatives.
The other main risks besides interest rate are foreign currency risk, credit risk and liquidity risk; the policies relating to these risks are
discussed in detail below:
Interest rate risk
Interest rate risk arises from the possibility that changes in interest rates will affect the value of the Company’s interest-bearing financial
liabilities and assets. The Company does not hedge its exposure on its interest-bearing funding to/from Group entities.
Interest rate sensitivity analysis
The impact on the Company’s before tax profit and equity due to a reasonably possible change in interest rates is demonstrated in the
table below.
The analysis assumes that all other variables remain constant.
Before tax profit Equity
100 basis point
increase
US$m
100 basis point
decrease
US$m
100 basis point
increase
US$m
100 basis point
decrease
US$m
31 December 2021 (4) 4 – –
31 December 2020 1 (1) – –
Strategic report Governance Financial statements
223Petrofac Limited 2021 Annual report and accounts

Notes to the Company financial statements continued
For the year ended 31 December 2021
23 Risk management and financial instruments continued
The following table reflects the maturity profile of interest-bearing financial assets and liabilities that are subject to interest rate risk:
Year ended 31 December 2021
Within 1 year
US$m
1 - 2 years
US$m
2 - 3 years
US$m
3 - 4 years
US$m
4 - 5 years
US$m
More than
5 years
US$m
Total
US$m
Financial liabilities – floating rates
Revolving credit facility – 95 – – – – 95
Term loans – 100 – – – – 100
Lease liabilities – – – – 17 – 17
Amount due to Group entities
(interest-bearing) 507 – – – – – 507
507 195 – – 17 – 719
Financial assets – floating rates
Cash and short-term deposits
(note15) 135 – – – – – 135
Amount due from Group entities
(interest-bearing) 1,380 – – – – – 1,380
1,515 – – – – – 1,515
Year ended 31 December 2020
Within 1 year
US$m
1 - 2 years
US$m
2 - 3 years
US$m
3 - 4 years
US$m
4 - 5 years
US$m
More than
5 years
US$m
Total
US$m
Financial liabilities – floating rates
Revolving credit facility 505 – – – – – 505
Term loans 200 50 – – – – 250
Amount due to Group entities
(interest-bearing) 355 – – – – – 355
1,060 50 – – – – 1,110
Financial assets – floating rates
Cash and short-term deposits
(note15) 87 – – – – – 87
Amount due from Group entities
(interest-bearing) 897 – – – – – 897
984 – – – – – 984
Interest on financial instruments classified as floating rate is repriced at intervals of less than one year.
Foreign currency risk
The Company is exposed to foreign currency risk on translation of assets and liabilities that are in a currency other than the United
States dollar reporting currency of the Company.
The Company uses forward currency contracts to manage the foreign currency exposure on all amounts due from and due to
Groupentities.
The Company is only exposed to foreign currency exposure relating to cash and bank balances and an amount of £12m (2020: £13m)
payable to a subsidiary at the end of the reporting period.
The following table summarises the impact on the Company’s profit before tax and equity (due to change in the fair value of monetary
assets and liabilities) of a reasonably possible change in US dollar exchange rates with respect to different currencies:
Profit before tax Equity
+10% US dollar
rate increase
US$m
(1)
–10% US dollar
rate decrease
US$m
(1)
+10% US dollar
rate increase
US$m
–10% US dollar
rate decrease
US$m
31 December 2021 (4) 4 – –
31 December 2020 (11) 11 – –
(1) Includes impact on pegged currencies mainly relating to interest-bearing loans and borrowings denominated in Arab Emirates dirham.
Petrofac Limited 2021 Annual report and accounts224

23 Risk management and financial instruments continued
At 31 December 2021, the Company had foreign exchange forward contracts as follows:
Contract value Fair value
2021
US$m
2020
US$m
2021
US$m
2020
US$m
Euro (sales)/purchases (45) (71) – (2)
Sterling sales (224) (230) (4) (14)
Kuwaiti dinar sales (254) (343) – (3)
Arab Emirates dirham purchases 50 150 – –
Others (6) – – –
n/a n/a (4) (19)
The above foreign exchange contracts mature and will affect income between January 2022 and November 2023 (2020: between
January 2021 and May 2022).
Credit risk
The Company’s principal financial assets are cash and short-term deposits and amounts due from Group entities.
The Company manages its credit risk in relation to cash and short-term deposits by only depositing cash with financial institutions that
have high credit ratings provided by international credit rating agencies.
Liquidity risk
The Company’s objective is to maintain a balance between continuity of funding and flexibility through the use of revolving credit
facility and term loans, to reduce its exposure to liquidity risk.
The maturity profiles of the Company’s financial liabilities at 31 December 2021 are as follows:
Year ended 31 December 2021
6 months
or less
US$m
6 - 12 months
US$m
1 - 2 years
US$m
2 - 5 years
US$m
More than
5 years
US$m
Contractual
undiscounted
cash flows
US$m
Carrying
amount
US$m
Financial liabilities
Interest-bearing loans and borrowings – – 195 600 – 795 764
Trade and other payables 116 – – – – 116 116
Amounts due to Group entities 507 – – – – 507 507
Derivative instruments 5 – – – – 5 5
Embedded derivative in respect of the
revolving credit facility 4 – – – – 4 4
Lease liability – – – 20 – 20 17
Interest payments 34 34 66 175 – 309 n/a
666 34 261 795 – 1,756 1,413
Year ended 31 December 2020
6 months
or less
US$m
6–12 months
US$m
1–2 years
US$m
2–5 years
US$m
More than
5 years
US$m
Contractual
undiscounted
cash flows
US$m
Carrying
amount
US$m
Financial liabilities
Interest-bearing loans and borrowings 705 – – 50 – 755 755
Trade and other payables 2 – – – – 2 2
Amounts due to Group entities – 369 – – – 369 369
Derivative instruments 23 3 – – – 26 26
Interest payments 9 1 2 2 – 14 n/a
739 373 2 52 – 1,166 1,152
The Company uses various funded facilities provided by banks and its own financial assets to fund the above-mentioned financial liabilities.
Strategic report Governance Financial statements
225Petrofac Limited 2021 Annual report and accounts

23 Risk management and financial instruments continued
Capital management
The Company’s policy is to maintain a robust capital base using a combination of external and internal financing to support its
activities as the holding company for the Group.
The Company’s gearing ratio is as follows:
2021
US$m
2020
US$m
Cash and short-term deposits (note 15) 135 87
Interest-bearing loans and borrowings (A) (note 18) (764) (755)
Net debt (B) (629) (668)
Total equity (C) 452 243
Gross gearing ratio (A/C) 169% 311%
Net gearing ratio (B/C) 139% 275%
24 Related party transactions
The Company’s related parties consist of the Group entities, and the transactions and amounts due to/due from them are either of
funding or investing nature. The Company recharged share-based payment costs of US$7m (2020: US$19m) to the Group entities
inrelation to the Group’s share-based payment plans for the Group’s employees. In addition, the Company also obtained letters of
guarantees on behalf of the Group entities and the cost of US$6m (2020: US$5m) incurred on such guarantees was recharged by
theCompany to the Group entities. The Company also received dividends from its subsidiaries and associates of US$128m (2020:
US$239m), note 4.
The remuneration paid by the Company to its Non-executive Directors was US$1m (2020: US$1m). The Company was also recharged
a portion of the key management personnel cost by one of its subsidiaries. The amount recharged during the year was US$14m
(2020: US$13m), of which key management personnel cost was US$2m (2020: US$2m). For further details of the full amount of key
management personnel costs, refer to note 31 of the consolidated financial statements.
25 Share capital
The share capital of the Company as at 31 December was as follows:
Number of shares
Share capital
US$m
Share premium
US$m
At 1 January 2020 and 31 December 2020 345,912,747 7 4
Issue of shares from capital raise 173,906,085 3 247
At 31 December 2021 519,818,832 10 251
Number of shares refers to US$0.02 ordinary shares, which are issued and fully paid. In total, there are 750,000,000 ordinary shares of
US$0.02 that are authorised.
All the allotted and issued shares, including those held by the Employee Benefit Trust, were fully paid. The share capital comprises
only one class of ordinary shares. The ordinary shares carry a voting right and the right to a dividend.
On 26 October 2021, the Company announced a proposed issuance of equity by way of a Firm Placing, Placing and Open Offer
(together, the ‘capital raise’) to raise US$275m. The basis of the Open Offer was one new ordinary share for every four existing
ordinary shares. On completion of the capital raise on 15 November 2021, the Company issued 173,597,412 ordinary shares,
includinga Firm Placing of 87,119,226 ordinary shares and a Placing and Open Offer of 86,478,186 ordinary shares. All of the above
shares were issued at £1.15 per share, generating gross proceeds of approximately £200m (US$268m) before issue and associated
costs of US$18m.
Concurrently with the capital raise, the Directors (other than Mr Asfari) subscribed for 308,673 additional shares at the issue price of
£1.15. This resulted in a total number of new shares of 173,906,085 that were admitted to the premium listing segment of the Official
List of the FCA and to trading on the main market for listed securities of the London Stock Exchange on 15 November 2021.
All new shares issued by way of the capital raise were each issued, fully paid and rank pari passu in all respects with each other and
the ordinary shares of the Company in issue prior to the capital raise, including the right to receive all dividends and other distributions
declared, made or paid after the date of issue.
Share premium: The balance on the share premium account represents the amount received in excess of the nominal value of the
ordinary shares adjusted for associated issuance costs.
Capital redemption reserve: The balance on the capital redemption reserve represents the aggregated nominal value of the
ordinary shares repurchased and cancelled.
Notes to the Company financial statements continued
For the year ended 31 December 2021
Petrofac Limited 2021 Annual report and accounts226

A
ADNOC
The Abu Dhabi National Oil Company is
the state-owned oil company of the United
Arab Emirates
AGM
Annual General Meeting
APM
Alternative performance measure
Appraisal Well
A well drilled into a discovered
accumulation to provide data necessary
to define a Field Development Plan for the
accumulation
AS
Asset Solutions
B
Backlog
Backlog consists of the estimated
revenue attributable to the uncompleted
portion of fixed-price engineering,
procurement and construction contracts
and variation orders plus, with regard to
engineering, operations, maintenance
and IES contracts, the estimated
revenue attributable to the lesser of
the remaining term of the contract and
five years. Backlog will not be booked
on IES contracts where the Group has
entitlement to reserves. The Group uses
this key performance indicator as a
measure ofthevisibility of future earnings.
Backlog is not an audited measure
BAME
Black, Asian and minority ethnic
Barrel
A unit of volume measurement used for
petroleum
bbl
One barrel of oil
BEIS
The Department for Business, Energy and
Industrial Strategy, which is a department
of the United Kingdom government
Bio-CCS
Bio energy Carbon Capture and Storage
Block
A subdivision of an underground
petroleum reservoir, by a resource
owner, for the purposes of licensing and
administering exploration, appraisal and
production of resources, by oil and gas
companies
boe
Barrel of oil equivalent
bpd
Barrel per day
Brownfield Development
Further investment in a mature field, to
enhance its production capacity, thereby
increasing recovery and extending field life
C
CAGR
Compound annual growth rate
Capex
Capital expenditure
Carbon capture
The process of capturing waste
carbondioxide
CCUS
Carbon capture, utilisation and storage
CDP
Carbon Disclosure Project
CGU
Cash generating unit
CIS
Commonwealth of Independent States
CO
2
Carbon dioxide
Condensate
The liquid produced by the condensation
of steam or any other gas
COP26
The 2021 United Nations Climate Change
Conference. This was the 26th UN
Climate Change conference held Glasgow
from 31 October to 13 November 2021
Cost plus KPIs
A reimbursable contract which includes an
incentive income linked to the successful
delivery of key performance indicators
D
DBSP
Deferred Bonus Share Plan
Decommissioning
The re-use, recycling and disposal of
redundant oil and gas facilities
Downstream
The downstream sector commonly refers
to the refining of petroleum crude oil
and the processing and purifying of raw
natural gas, as well as the marketing and
distribution of products derived from
crude oil and natural gas
Duty Holder
A contracting model under which Petrofac
provides a complete managed service,
covering production and maintenance
work, both offshore and onshore, to
reduce the costs of operating and to
extend the life of the facilities
E
EBITDA
Calculated as profit before tax and net
finance costs and income, but after our
share of profits/losses from associates
and joint ventures (as per the consolidated
income statement), adjusted to add back
charges for depreciation and amortisation
(as per note 4 to the consolidated financial
statements)
EBT
Employee Benefit Trust
EBIT
Earnings before interest, taxation and
amortisation
ECL
Expected credit loss
E&C
Engineering & Construction
EPC
Engineering, Procurement and
Construction
EPCC
Engineering, Procurement, Construction
and Commissioning
EPCIC
Engineering, Procurement, Construction,
Installation and Commissioning
EPS
Earnings per share
ESG
Environmental, Social and Governance
ETR
Effective Tax Rate
F
FCA
Financial Conduct Authority
FCPA
Foreign Corrupt Practices Act
FEED
Front-End Engineering and Design
Fixed-price turnkey project
An agreement in which a contractor
designs, constructs, and manages a
project until it is ready to be handed
overto the customer and operation
canbegin immediately
227Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements
Glossary

FPF
Floating Production Facility
FPSO
Floating Production, Storage and
Offloading vessel
FRC
Financial Reporting Council
G
Gas field
A field containing natural gas but no oil
GHG
Greenhouse Gas
Greenfield development
Development of a new field
H
HSE
Health & Safety Executive (UK)
HVAC
High-voltage alternating current
HVDC
High-voltage direct current
Hydrocarbon
A compound containing only the elements
hydrogen and carbon – can be solid, liquid
or gas
I
IAS
International Accounting Standards
IASB
International Accounting Standards Board
ICV
In-country Value
IEA
International Energy Agency
IES
Integrated Energy Services. The IES
division harnesses Petrofac’s existing
service capabilities and delivers them
on an integrated basis to resource
holders with the aim of supporting the
development of their oil and gas resources
IFRS
International Financial Reporting
Standards
IFRIC
IFRS Interpretations Committee
IOC
International oil company
K
KPI
Key performance indicator
L
LNG
Liquefied natural gas
LPG
Liquefied petroleum gas
LTI
Lost time injury
M
mboe
Million barrels of oil equivalents
MENA
Middle East and North Africa region
MMscfd
Million standard cubic feet per day
MOPU
Mobile offshore production unit
MOU
Memorandum of understanding
N
New Energies
Area focusing on opportunities presented
by the energy transition
NGO
Non-governmental organisation
NOC
National oil company
O
OECD
Organisation for Economic Co-operation
and Development
Oil field
A geographic area under which an oil
reservoir lies
OPEC
Organisation of Petroleum Exporting
Countries
P
PARIS agreement
A legal binding international treaty on
climate change, which was adopted
by196 parties at COP 21 in Paris in 2015.
Its goal is to limit global warming to below
2, preferably to1.5 degrees celsius,
compared with pre-industrial levels.
PEC
Production Enhancement Contract is
where Petrofac is paid a tariff per barrel for
oil and gas production and therefore has
no commodity price exposure.
PMC
Project Management Contractor
PSC
Production Sharing Contract
PSP
Performance Share Plan
R
RCF
Revolving credit facility
Reimbursable services
Where the cost of Petrofac’s services
are reimbursed by the customer plus an
agreed margin
RI
Recordable injury
ROCE
Return on capital employed
RSP
Restricted Share Plan
S
SaaS
Software as a Service
SDI
Separately disclosed items
SFO
Serious Fraud Office
SIP
Share Incentive Plan
SMEs
Small and medium-sized enterprises
SPA
Sale and purchase agreement
T
TCFD
Task Force on Climate-related Financial
Disclosures
TSR
Total shareholder return
U
UKCS
United Kingdom Continental Shelf
UNGC
United Nations Global Compact
Upstream
The segment of the petroleum industry
relating to exploration, development and
production of oil and gas resources
W
W2V
Waste-to-value
228 Petrofac Limited 2021 Annual report and accounts
Glossary continued

Registrar
Equiniti (Jersey) Limited
26 New Street
St Helier
Jersey JE2 3RA
Auditors
Ernst & Young LLP
1 More London Place
London SE1 2AF
Corporate brokers
Goldman Sachs
Peterborough Court
133 Fleet Street
London EC4A 2BB
JP Morgan Cazenove
25 Bank Street
Canary Wharf
London E14 5JP
Legal advisors to the Company
Linklaters LLP
One Silk Street
London EC2Y 8HQ
Corporate and financial PR
Tulchan Communications Group
85 Fleet Street
London EC4Y 1AE
Company Secretary and Registered Office
Ocorian Secretaries (Jersey) Limited
26 New Street
St Helier
Jersey JE2 3RA
Stock Exchange listing
Petrofac shares are listed on the London Stock Exchange
usingcode ‘PFC.L’.
Annual General Meeting
26 May 2022
Announcements
Copies of all announcements are available on the Company’s
website at www.petrofac.com following release.
Shareholder warning
Shareholders should be very wary of any unsolicited advice,
offers to buy shares at a discount or offers of free company
reports on the Company. Fraudsters use persuasive and high-
pressure tactics to lure investors into scams and they may offer to
sell shares that often turn out to be worthless, overpriced or even
non-existent. Whilst high returns are promised, those who invest
usually end up losing their money.
Please keep in mind that firms authorised by the Financial
Conduct Authority (FCA) are unlikely to contact you out of the
blue. If you receive any unsolicited investment advice:
– Make sure you get the correct name of the person and
organisation and make a record of any other information they
give you, e.g. telephone number, address, and ask for their
‘firm reference number’ (FRN)
– Check that they are properly authorised by FCA before getting
involved. You can check the FCA register at https://register.fca.
org.uk or call +44800 111 6768
– Report approaches to the FCA – a list of unauthorised
overseas firms who are targeting, or have targeted, UK
investors is maintained. Reporting such organisations means
the list can be kept up to date and appropriate action be
considered
– Inform Equniti (Jersey) Limited, our Registrars. They are not
able to investigate such incidents themselves, but will record
the details and pass them on to the Company and liaise with
the FCA on your behalf
– Consider that if you deal with an unauthorised firm, you would
not be eligible to receive payment under the Financial Services
Compensation Scheme
If you suspect you have been approached by fraudsters, please
contact the FCA using the share fraud reporting form at
fca.org.uk/scams.
You can also call the FCA Helpline on:
0800 111 6768 (UK freephone) or 0300 500 8082 (UK), or
+44 207 066 1000 (outside UK)
If you have already paid money to share fraudsters, you should
contact ActionFraud on 0300 123 2040 or online at
www.actionfraud.police.uk.
Consultancy, design and production
www.luminous.co.uk
Design and production
www.luminous.co.uk
This is report printed on FSC certified papers that have been carbon balanced. The paper is
made at a mill with EMAS and ISO 14001 environmental management system accreditation.
This report has been printed using inks made from non-hazardous vegetable oil derived from
renewable sources. More than 90% of solvents are recycled for further use and recycling
initiatives are in place for all other waste associated with this production. The printer is FSC
and ISO 14001 certified, the internationally recognised standard for best practice on the
environment. The energy used in the production has been carbon offset.
229Petrofac Limited 2021 Annual report and accounts
Strategic report Governance Financial statements
Shareholder information as at March 2022

Petrofac Services Limited
117 Jermyn Street
London SW1Y 6HH
United Kingdom
Tel: +44 20 7811 4900
www.petrofac.com