uncategorized ยท 2/20/2014

Neste Oil to outsource its ship management functions to OSM Group AS of Norway

Neste Oil Corporation

Stock Exchange Release

20 February 2014 at 2 p.m. (EET)

Neste Oil to outsource its ship management functions to OSM Group AS of Norway

Neste Oil and Norwegian-based OSM Group AS have today, 20 February 2014, agreed on a business transfer under which Neste Oil will transfer the ship management functions of Neste Shipping to OSM. OSM is a global provider of offshore and ship management services. The outsourcing of ship management functions is part of Neste Oil's plan to exit the shipping business announced on 19 September 2013.

Under the agreement, OSM will set up a subsidiary in Finland responsible for the crewing and maintenance of vessels previously under the management by Neste Shipping that continue to be used by Neste Oil. The intention is to transfer the shore and seagoing personnel currently employed by Neste Shipping's ship management functions to OSM's new Finnish subsidiary during spring 2014. Neste Shipping's ship management functions currently employ around 300 people at sea and 17 people on shore. Neste Shipping's chartering functions will be retained and integrated to the Neste Oil organization.

"Norwegian-based OSM was chosen after a careful review of a number of possible partners," says Arvo Ruotsalainen, Neste Shipping's Managing Director. "OSM's good reputation and safety record, and capabilities in terms of developing ship management functions and leveraging the specialist expertise of our personnel, all contributed to our choice. We also believe that OSM will be able to offer our fleet personnel a wider range of opportunities than Neste Shipping would have been able to, as a much smaller company in the ship management field."

Statutory employer-employee negotiations covering all of Neste Shipping's shore and seagoing personnel were held during October and November last year as part of the plan to outsource the company's ship management functions. All personnel currently employed in these functions will be able to transfer to OSM's Finnish subsidiary as existing employees.

Background to the restructuring

The restructuring of Neste Shipping's operations is based on Neste Oil's desire to reinforce its focus on developing its core business based on cleaner traffic solutions. In addition to outsourcing ship management functions, Neste Oil will sell its key vessels to companies jointly owned by Finland's National Emergency Supply Agency and the Ilmarinen Mutual Pension Insurance Company, from which it will charter them back on long-term agreements. As part of the restructuring, Neste Oil will set up an asset management company to manage and administer the vessel assets, together with the Ilmarinen Mutual Pension Insurance Company and the National Emergency Supply Agency. In addition, Neste Oil plans to sell its other vessels later. The decision to restructure the shipping business was announced in detail in a Stock Exchange Release issued on 19 September 2013.

Neste Oil Corporation

Kaisa Lipponen

Director, Corporate Communications

Further information:

Arvo Ruotsalainen, Managing Director, Neste Shipping, tel. +358 (0)50 458 8205

Neste Oil in brief

Neste Oil Corporation is a refining and marketing company concentrating on low-emission, high-quality traffic fuels. The company produces a comprehensive range of major petroleum products and is the world's leading supplier of renewable diesel. Neste Oil had net sales of EUR 17.5 billion in 2013 and employs around 5,000 people, and is listed on NASDAQ OMX Helsinki.

Neste Oil is included in the Dow Jones Sustainability World Index and the Ethibel Pioneer Investment Register, and has featured in The Global 100 list of the world's most sustainable corporations for many years. Forest Footprint Disclosure (FFD) has ranked Neste Oil as one of the best performers in the oil & gas sector. Further information:

OSM in brief

OSM Maritime Group is a provider of high-quality offshore and ship and crew management services with operations worldwide. Today, OSM has a fleet of more than 430 vessels under its management, and operates from 26 offices around the world. The company employs more than 10,000 employees with around 30 nationalities.