Our purchasing philosophy is to obtain goods and services that provide maximum total value. While purchase price is obviously critical, other factors include whole-of-life cost, quality, delivery, method of payment, assured supply, cost reduction opportunities, safety, environmental, engineering and process considerations. 

Our purchasing activities are decentralised. Head office provides co-ordination and leadership and each business unit has staff with the authority and responsibility to fulfil its own procurement needs. Where appropriate, supply agreements can be made on a corporate, regional, lead port or other basis. This local approach to sourcing enables our operations to maintain a close working relationship with suppliers.

Our dealings with suppliers and sub-contractors are conducted to ensure the:

• Advance agreement of a set of reasonable terms of trade
• Establishment of a fair and transparent relationship based on mutual trust
• Settlement of amounts due in line with agreed terms
• Respect of the sensitive nature of commercial agreements between us and our suppliers and sub-contractors
• Absolute prohibition of any corruption or bribery in our commercial dealings with suppliers or customers
• Compliance with all appropriate environmental standards and regulations and health and safety regulations.

During 2006, we intend to review our existing procurement policy to ensure that it continues to reflect current best practice, particularly as regards the management of social, environmental and health and safety matters by our suppliers.