Lois Zabrocky Senior Vice President Overseas Shipholding Group

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Lois ZabrockySenior Vice PresidentOverseas
Shipholding Group

WISTA Conference Panel October 17, 2008
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About OSG

• Market leader in multiple sectors
• Strategic focus on four market segments crude
  oil, products, Jones Act and gas
• 119 operating vessels 37 newbuilds
• One of the highest-rated independent diversified
  tanker companies
• Dow Jones Transportation Index company
• Founded in 1948
• Public since 1970
• 3,300 seafarers and 475 shoreside staff
• Seasoned management team
• 10 offices located in North America, Europe and
  Asia-Pacific
• Superior in-house technical and commercial
  management
• One global Gold Standard
• Flexible, quality, global SQE
• Strong corporate governance and transparency
• Fully engaged independent board
• Enhanced centralized internal audit in New York
  reports directly to audit committee
• Sarbanes Oxley compliant since 2004

Crude Oil
Products
U.S. Flag
Gas
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Acta and Verba

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All Hands on Deck to Elevate OSG Profile
Extended Platform for Communications
Shareholders / Media
Customers

• Starts at the top A CEO who believes in the
  benefits of communication
• Dedicated Corporate IR
• Active media relations builds OSGs corporate
  profile in the mainstream and business press
• Websites
• Field trips
• Investor day

• Focused commercial strategy
• KPIs
• Customer events
• Quarterly global TMM review
• Shore side vettings and communication
• Bottom line integrity reliability performance

Morten Arntzen and his group of experienced
executives form one of the most accessible teams
in the publicly traded shipping sector. Scott
Burk, Oppenheimer, Oct-2008
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All Hands on Deck to Elevate OSG Profile
Extended Platform for Communications
Employees
Policymakers

• Opportunities for rewarding career with
  competitive pay
• Opportunities to work abroad and migrate from
  the sea to shore side
• Quarterly town hall connects all offices
• Breakfast with the CEO
• Family day and Family Center in Manila
• Office and facility upgrades

• Dedicated C-level effort
• 100 meetings on Capitol Hill with senior policy
  makers and staff in past two years
• Protection of 2004 Jobs Creation Act and Jones
  Act vital to OSG
• Increased spending on lobbying and advertising
  efforts
• Direct economic impact of OSGs U.S. Flag
  investment gross output 10B
• Labor compensation 2B
• 2400 jobs per year
• Tax payments 830M

Every employee represents OSG with pride and
professionalism
Source PriceWaterHouseCoopers statistics for
National and Philadelphia 2005-2020, September
2007
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Sharing Employee Pride
Connecting Our Worldwide Team OSG Signal

• 8,500 copies distributed quarterly
• Sent to every home of every seafarer to connect
  families
• Sent to ships, offices, customers and partners
• Customers can read about the OSG family
• Onshore and Offshore profiles A Day in the Life
  
• Reinforce and introduce important company
  messages, initiatives and have a little fun!

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330 Members Working to Enhance the Image of
Shipping
INTERTANKO (International Association of
Independent Tanker Owners)

• Intertanko fosters an awareness of a
  responsible, sustainable, respected tanker
  industry, committed to continuous improvement and
  constructively influencing its future.
• OSGs Jennifer Schlueter, VP Investor Relations
  and Corporate Communications is chair of
  INTERTANKOs Communications and Public Relations
  advisory committee
• Captain Robert Johnston and 10 additional top
  commercial and technical shoreside staff are
  members
• Ongoing work includes
• Studying the human element
• Environmental agenda
• Self regulation and imposed regulations

We are constantly under the spotlight, being
watched by regulators, politicians and the
public surveyed and inspected by flag states,
class societies and insurers, monitored by
charterers, coastal states and port states and
scrutinized by the media. Nike Fistes, Chairman
INTERTANKO
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Environmental and Quality Platform On Board our
Vessels
Our desire to run the cleanest, safest and most
reliable fleet in the industry remains the single
most important strategic imperative of OSG

• Going beyond compliance with international and
  local legislations
• Improving waste management practices
• Improving company resources
• Enhanced environmental equipment on vessels
• Increasing awareness and natural resources
  conservation

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Getting It Done At Sea

• Working with Universities, Classification
  Societies and Research Institutes to find
  solutions to a number of technical,
  environmental and operational issues giving OSG
  a competitive advantage in the shipping industry
• Monitoring air emissions generated by vessels
• Performing Energy Efficient surveys
• Creating a Gold Standard Seafarer Training
  Program
• TAG system on all company vessels
• Replacement of cleaning chemicals with
  environmentally friendly products
• Recycling all waste material and garbage
  produced onboard our vessels
• Investigating new technologies for ballast
  water management treatment methods

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Environmental Initiatives

• Reduce emission exhaust gases
• Advocate of cleaner distillate fuels
• Hull coatings
• 8 vessels coated with proven results in fuel
  savings
• Propeller coatings planned for VLCC fleet
• Emission calculations
• Pollution prevention equipment
• OWS, ODME, Envirologger
• Recycling programs
• Zero Solid Waste to Sea
• PC recycling program

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Continuous Improvements

• Operations Integrity Group
• An 11-person team of shoreside and senior sea
  staff who conduct vessel audits of fleet and
  investigations to ensure compliance with Company
  vessel operating policies
• A critical element of our assurance program
• Drives consistency and sharing of fleet-wide
  best practices
• More than 200 vessel audits in 2006 and 2007
• Operations Compliance Officer
• Reports jointly to OSGs CEO and Board
• Audits all fleet and shoreside technical
  operations
• Ensures training programs are best-in-class
• External Audit Group
• Responsible for separate, independent audit of
  the fleet and offices
• Quarterly Technical Management Meetings
• Sea-to-Shore Communication Programs
• Fleet visits generated 300 improvement ideas
• Independent action encouraged to avoid
  incidents to ships, crew and the environment

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Safety and Quality
Q1 U.S. Fleet Near Miss Report

• Risk Assessment
• Identify and mitigate hazards
• Tool Box meetings
• Near Miss Reporting
• Trend analysis
• Root Cause Analysis
• Trend analysis
• Open Reporting
• 218 reports received in 2007
• Unvarnished feedback to senior management
• Top issues crew relief, missing spare parts,
  equipment repairs, safety issues and
  environmental concerns.
• Performance Reporting
• KPIs and Operations Dashboard

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Getting It Done Where the Sea Meets the Shore!

• Global offices participated in 2ND Annual Coastal
  Clean Up on September 20, 2008

NEW YORK
MANILA
MANILA
ATHENS
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Getting It Done Shoreside

• OSG headquarters in New York City has an 82
  waste diversion rate. Through technologies,
  diligence of post consumer source recycling
  separation, and our building cooperation with
  our recycling program, we have been able to have
  over 83 tons of paper and other recyclables from
  going into landfills
• Recycling costs 3 times less than dumping trash
  into landfills
• OSG has helped to save
• 1,360 trees 560,000 gallons
  of water 6,320 gallons of oil
• Global Environmental Quality workgroup (SQE)
• Xerox printers reconfigured to print on double
  sides
• Toner cartridges returned to manufacturer for
  recycling
• Light/energy saving program
• Staff bring batteries from home for proper
  recycling

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Getting It Done Shoreside

• Seamens Church Institute
• The Seamen's Church Institute advocates for the
  personal, professional, and spiritual well being
  of merchant mariners around the world.
• The staff and volunteers at the Seamens Church
  in Port Newark welcome over 57,000 seafarers,
  port workers, and truckers each year
• OSG members of 2008 Supporting Sponsor Society -
  50,000 annual sponsorship
• Morten Arntzen member of Board of Trustees
• Local Disaster Relief
• Calamity Fund for victims of Typhoon Frank OSG
  distributed 55,000 in cash and kind out from
  employee donations to our Filipino seafaring
  families
• Athens Wild Fires OSG donated 20,000 to
  rebuild the village of Miloi with OSG employees
  also donating 3,765 to the cause

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Getting It Done Shoreside

• 2008 Campaign raised 74,000 in employee
  contributions and achieved an 84 participation
  rate
• OSG corporate donation of an additional 50,000
• Employees prepared and delivered over 900 PBJ
  sandwiches to a local food pantry
• Employees participated in local Holiday giving
  events
• Plans in the works for our 2009 Campaign

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Getting It Done Shoreside

• 24 Peaks Challenge 2008
• Nominated Charity Seafarers UK
• 24 of the highest Peaks in the Lake District, all
  above 2,400 feet each
• Total climb of 13,133 feet, AND the descents
  between peaks (fact Mt Everest is only 26,000
  feet)
• Total walking time approx 24 hours. 33.3 miles
  in total over two very hard days
• Sleeping time less than 4 hours with 6 in a
  room
• 10,000 for Seafarers UK

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Acta and Verba Our Work is Never Done
I drove to the garden centre for a tree to offset
my carbon footprint so now Ive got to go back
for another one