While all Performance Standards are applicable to this investment, IFC’s environmental and social due diligence indicates that the investment will have impacts which must be managed in a manner consistent with the following Performance Standards: PS1 -- Social and Environmental Assessment and Management System; PS2 – Labor and Working Conditions; and PS3 – Pollution Prevention and Abatement There is no land acquisition and involuntary resettlement, and no impact on indigenous people or cultural property under the project, nor is it expected to impact natural habitats, forests, or protected or sensitive areas.

IFC’s ongoing review and supervision of its existing investments in OSL has shown that the company continues to meet its environmental, health and safety, and social (EHSS) compliance obligations, including the relevant IFC Performance Standards and guidelines, and its EHSS performance has been satisfactory. Similar to the categorization of the earlier investments, this is also a Category B project because a limited number of specific environmental and social impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. Mitigation measures can be readily designed and any adverse impacts are not likely to be diverse; are not likely to be irreversible; and most likely will be limited to project site. The key social, environmental, health and safety impacts associated with the project will include: Environmental, Health and Safety Management Systems; Labor working conditions, including occupational health and safety; Vessel safety and pollution control; and Oil spill containment and recovery.

OSL proposes to implement its existing SEHSMS in SPSL operations. Accordingly, OSL has presented plans to address impacts of relevance to SPSL operations and to ensure that the proposed Project will, upon implementation of the specific agreed measures, comply with applicable environmental, health and safety and social requirements, including: international maritime standards under MARPOL, SOLAS, and IMO; Indian Merchant Shipping Rules and environmental, health and safety laws; and the IFC Social and Environmental Performance Standards. The information about how these potential impacts will be addressed by OSL and SPSL is summarized in the paragraphs that follow. Environmental, Health and Safety Management Systems: SPSL will implement OSL’s integrated safety and quality management system (IMS), which is certified to ISO 9001:2008 and ISO 14001:2004 standards and is compliant with International Safety Management (ISM) Code. The safety and quality system addresses besides quality, occupational health, safety and environment (HSE) aspects. The IMS supports Safety of Life at Sea (SOLAS) and Marine Pollution Prevention (MARPOL) standards. Under the IMS a well defined organizational structure and processes are in place, qualified professionals have been appointed in OSL and the same will be implemented in SPSL. OSL implements: internal on-board safety committees for all its vessels (including representatives from shore based staff) and management representatives also participate in port-level safety committees; processes for quarterly internal HSEQ audits and bi-annual third party surveillance audits; and procedures for periodic reporting of HSE information to Senior Management. Further, SPSL will, prior to commencement of its operations, adapt and implement OSL’s environment management system (EMS) conforming to ISO 14001 standards and will also implement a health and safety management system (HSMS) conforming to OHSAS 18001 standards. OSL will ensure that the ISO 14001 and OHSAS 18001 certification is extended to cover SPSL Kochi site for the EMS and HSMS by September 2012. Labor and Working Conditions: The Company will suitably adapt and implement OSL’s Human Resource (HR) Policies, Procedures and Practices. OSL has a documented Human Resource (HR) Policy and Manual, which is linked to the safety and quality management system (IMS). The HR manual includes policies and procedures including for: recruitment; training and development; remuneration and benefits; leaves; performance appraisal; employee relations and communication; separation; health, safety & environment; disciplinary procedures and employee grievance redress. Conditions of employment as also wages and benefits are communicated to employees/contract workers/pilots/masters and crews in the appointment letter or contracts, as the case may be. OSL’s standing orders (conditions of work) are displayed in local language at its various operating facilities. OSL is committed to equal opportunity and procedures are designed to encourage equal opportunity and non discrimination. SPSL will ensure that accommodation provided to staff meets IFC guidelines on worker accommodation. SPSL will implement OSL’s employee health and safety program, much of which is detailed in stringent written work procedures. Personal protective equipment is provided, as are instructions in its use. Seafarers and shore staff undergo periodic medical examinations. OSL crew complete basic safety training, and officers undertake advance courses in fire fighting, life saving and medical first aid. Regular mock drills for fire, spill response, and medical evacuation are conducted on vessels. In addition, OSL employees participate in many port-sponsored safety training programs. While OSL operates a large fleet of vessels, there have been no significant accidents in the past years except one in early 2010. However, accidents/incidents/near misses events are documented analyses of causes are conducted, and corrective action implemented to prevent reoccurrence in the future. Vessel Safety and Pollution Control: The Company will, prior to commencement of operation of each vessel/tug and marine craft, ensure that all its vessels / ships have certificates issued by regulatory authorities appropriate to their tonnage indicating compliance with Indian and international safety and pollution prevention requirements. Tugs / Ships are regularly inspected, and all inspections are required to be up to date. SPSL’s tugs and marine craft will be fuelled at designated Kochi port bunkering facilities according to port/terminal procedures. OSL has implemented appropriate procedures for waste, garbage and oily waste management. Wastes are segregated, stored appropriately, records are maintained, disposal is through authorized entities and in accordance with port procedures. Similarly, SPSL’s Tug and marine craft generated solid waste (kitchen waste, engine maintenance wastes, plastics, glass, etc.) and waste oil will be segregated and periodically brought ashore to be disposed at authorized port reception facilities or through authorized disposal entities, in a manner consistent with Indian and MARPOL requirements. SPSL will put in place facilities and procedures for management of hazardous materials and wastes including provision of secondary containment in areas where these are stored. Oil Spill Containment and Recovery: OSL has a Disaster Management Plan (DMP) that covers the procedures for responding to collision, grounding, fire, oil spill events and appropriate spill management material are held on board its vessels. Further, OSL’s vessels participate in joint spill prevention and control drills carried out by stakeholders like coast guards, port authorities and clients. Kochi Port has in place oil spill contingency and disaster management plans and procedures. Petronet will also have a disaster management plan/procedure including oil spill contingency management plan/procedure. SPSL will actively participate in each of these respective emergency response activities. In addition, the Company will adopt and implement OSL’s Disaster Management Plan (DMP). SPSL’s tugs and marine craft will be suitably equipped with spill clean-up and firefighting equipment consistent with the emergency response requirements of the Kochi port and Petronet terminal. SPSL will implement OSL’s Quality Manual, which contains the company’s Emergency Response Plan and provides for shipboard as also shore side response in the event of a spill resulting from OSL operations. On-board equipment will be periodically tested, and SPSL’s crew trained in emergency response by the Company as also responsible port and terminal authorities.

Owing to the nature of SPSL’s marine-based port services activities, no local communities are affected by risks or impacts from this project. Notwithstanding, and as part of the ISO 14001 EMS, SPSL will be establishing methods for communication of the environmental aspects to external interested parties. In addition, the Company will establish and maintain procedures for receiving, documenting and responding to concerns from any external interested parties relating to the Project.

Company will locally disclose, at its Kochi Branch Office at 24/448, 1st Floor, Indian Chamber Building, G.V.Iyyer Road, Willingdon Island, Kochi-3 and at its corporate office (location details provided below) as also on its website (www.oceansparkle.com), a document summarizing the measures SPSL proposes to implement to manage social and environmental risks associated with its operations. Any queries and/or comments about the Project may be directed to: Capt. S.V. Subhedar Ocean Sparkle LimitedPlot No. 128, 1st Floor, Srinagar Colony, Hyderabad, Andhra PradeshINDIA - 500 073. Tel :040 - 23741138 / 23743507 / 23754600 Fax: 040 - 23748752 E-mail: oslhyd@oceansparkle.com