The Rompetrol Group Corporate Presentation The Rompetrol Group: A solid investment and a long term commitment Our Strategy Romania, the bridge for the Kazakhstan resources to Western Markets Kazakhstan and Romania: A long term partnership The energetic bridge between Asia and Europe Rompetrol acquisition is the first step of the expansion strategy into the European refining and distribution segment and a critical strategic move to build the energy bridge between Kazakhstan and Europe. This requires a long term commitment to Romania and a clear partnership relationship. The Rompetrol Group HQ Representative Offices Crude Refining & Services Products Storage & Distribution Our Strategy Romania, the bridge for the Kazakhstan resources to Western Markets Kazakhstan facts 5,300 million tones reserves of crude oil (representing 3% of the world total); 80 million tones production in 2012; 130 million tones production by 2020 (75% for export); 12 million tones/year refining capacity of existing three Kazakhstan refineries; KazMunayGas is pursuing Capitalize on Romania as a geo-strategic location to bridge Eastern resources and Western markets; Logistical outlets to sell crude oil and products outside land-locked Central Asia closer to final consumers; Black Sea Region: A getaway to Europe Romania – A strategic position Black Sea region counts 160 million people; Bosporus has become bottleneck for access to Western Europe for sea transport. However, pipeline projects north of Bosporus are in progress, supported by central and western European countries and EU leadership; Emerging economies, like those surrounding Black Sea, are growing at fastest rate in Europe. Oil consumptio n million tones Austria Belgium Bulgaria Czech Rep. France Germany Greece Hungary Italy Kazakhstan Netherlands Poland Portugal Romania Slovakia Spain Switzerland Turkey Ukraine 2006 2007 2008 2009 2010 2011 14.1 33.4 4.7 9.8 93.0 123.6 22.1 7.8 86.7 10.3 52.0 23.3 14.4 10.3 3.4 79.4 12.6 32.7 14.2 13.4 33.7 4.6 9.7 91.4 112.5 21.7 7.7 84.0 11.3 53.5 24.2 14.4 10.3 3.6 80.4 11.3 33.5 15.6 13.3 36.8 4.6 9.9 90.8 118.9 21.3 7.5 80.4 11.1 51.1 25.3 13.6 10.4 3.9 78.0 12.1 31.9 14.9 12.8 32.2 4.2 9.7 87.5 113.9 20.1 7.1 75.1 9.0 49.4 25.3 12.8 9.2 3.7 73.6 12.3 31.6 13.4 12.9 33.5 3.8 9.1 84.4 115.4 18.7 6.7 73.1 9.5 49.9 26.7 12.5 8.7 3.9 72.1 11.4 30.2 13.0 12.5 33.7 3.5 9.1 82.9 111.5 17.2 6.5 71.1 10.2 50.1 26.3 11.6 9.0 3.7 69.5 11.0 32.0 12.9 Rompetrol: The right expertise in the right place The energetic bridge between Asia and Europe Rompetrol is the entry point for Western and Central Europe Educated and cost competitive labor Vast experience in oil and gas industry Over 150 years of crude production and refining operations Higher technical standards compared to capacities in neighboring countries, e.g. Turkey and Ukraine lacking Euro5 standards, preventing access to European market; Excess capacity in Romania allows better quality/price ratio at acquisition; Actively pursuing partnerships to diversify its oil and gas supply sources from Russian predominance; Good political relations between Romania and Kazakhstan. Romania was the first to recognize independent Kazakhstan; The Rompetrol Group: General Presentation The Rompetrol Group – Management Team Zhanat Tussupbekov CEO, The Rompetrol Group, NV Mariana Durleșteanu Chief Financial Officer, The Rompetrol Group, NV Alexandru Nicolcioiu Vice-President, The Rompetrol Group, NV Felix Lunev Senior Vice-President, The Rompetrol Group, NV Azamat Zhangulov Senior Vice-President, The Rompetrol Group, NV About Us General information on The Rompetrol Group Operations in 12 countries worldwide: Romania, Republic of Moldova, Georgia, Bulgaria, Spain, France, Kazakhstan, Ukraine, Libya, The Netherlands , Switzerland; and Turkey; Activities in almost every field of the oil & gas industry and a European retail network of over 1,100 fuel distribution points; Over 7,000 employees in the whole Group; A turnover of 10,8 mld USD in 2012. BU’s Presentation Refining & Petrochemicals The biggest refinery capacity in Romania 5 million tons, Petromidia. Trading & Retail Total storage capacity of 1.3 million cubic meters in Europe. 1,100 fuel distribution points spread in the whole Europe. Upstream & Industrial services Expansion in existing markets through capital investments, partnerships and acquisitions. The Rompetrol Group: Refining & Petrochemicals Division Refining & Petrochemicals Products and Capasity 100,000 barrels per day (5 million tons per year). Based on market price conditions for crude oil and oil products and on the analysis of financial indicators, the refinery is run at 3.8 – 4.2 million tons per year. Products: automotive gasoline, diesel fuel, Jet fuel, LPG, coke, sulfur. Unique location Petromidia Refinery is he only Romanian refinery located on the Black Sea shore, thus having the advantage of direct raw material supply from the oil terminal in Midia port. Petromidia Refinery Crude oil processing dynamics in 2005-2012 and planned processing for 2012-2015 period Crude oil processing, tons Technological losses, % Since 2005 the company is systematically working on improving the efficiency of its production activity being supported by the consultancy company Solomon Associates. As a result of this actions the operating activity was optimized, including the reduction of technological losses down to minimal historical values. PEM workflow after modernization Petrochemicals Petrochemical complex The only in Romania manufacturer of polypropylene, high (HDPE) and low (LDPE) polyethylene. Integration with Petromida Refinery: Rompetrol Petrochemicals products are sold both on the internal market and on the regional markets (Black and Mediterranean seas areas, Central and Eastern Europe) Possibilities Location on the Black Sea shore, free access towards road and railroad infrastructure Ethylene supplies through Berth 9A Capacities for storage of ethylene in the sea terminal Possibility of dispatching finished products in big-bags and containers Strategy Increasing of local and regional market share by means of increasing the productivity of the existing HDPE and LDPE units and construction of new facilities Development of new grades showing high demand on the market The Rompetrol Group: Trading & Retail Retail Business Unit Over 1,100 fuel distribution points (Romania, Bulgaria, Republic of Moldova, Georgia, Ukraine, France and Spain). Innovative products and services: Efix, Efix S, Fill&Go, Litro, Hei. Strategic priorities are to consolidate and expand the distribution network (locally and internationally), launch ergonomic distribution concepts and constantly improve the quality of services and products. Retail Network in Romania COCO* Network Network: Coverage: DODO** Network 131 locations all counties Network: 156 locations Coverage: 36 counties + Bucharest SM BN SJ BH SV CJ HR MS AR AB HD TM CS BC CV SB VN BV VL GJ IS NT AG BZ PH DB OT DJ GR TR BH TM CJ CS Gas Network HR MS BV SB GJ MH CT NT AB HD TL SV BN SJ AR GL IL I F CL MH MM SM VS BR Network: Coverage: 123 locations 26 counties BT High concentration Medium concentration Low coverage BT MM Express Network DJ VL VN BZ PH DB OT TR IF GR BH BR TL CS IL CL MS CT AB HD TM GJ SB VL IS NT CJ AR GL SV BN SJ VS BC CV AG IS BT MM SM BV AG MH OT DJ TR GL CV VN PH DB VS BC HR IF BZ IL CL GR RBI & “Cuve” Network – business solutions 240 own locations 90 third parties Coverage: 35 counties + Bucharest Network: MM BH SJ CJ AR TM SV BN HR MS AB CS GJ MH BV SB HD DJ VL IS NT AG OT CV DB VN BZ PH IF TR VS BC GR 343 locations all counties 236 customers High concentration Medium concentration Low coverage BT SM Network: Coverage: Customers: *COCO station – company owned, company operated GL BR TL IL CL CT TL BR **DODO station – dealer owned, dealer operated CT Dyneff France and Spain Other European retail activities Rompetrol Bulgaria, Moldova and Georgia Established in 2002, Rompetrol Bulgaria operates at this time a retail network of 60 gas-stations, spread all over the country. Focused on wholesale and retail activities, Rompetrol Georgia has in its portfolio 71 gasstations and a fuel storage capacity of 9,500 cubic meters. The third national fuel retailer, Rompetrol Moldova focused in the last years on a fast network expansion, reaching 47 stations. General Presentation of Trading • Trading BU is in charge with optimizing the entire distribution chain (from raw materials supply, to sale of the final products) of The Rompetrol Group; • Operations that span from the Caspian Sea to the Mediterranean • Fuel depots with a total storage capacity of 1.3 million cubic meters (France, Spain, Romania, Bulgaria, Georgia and Ukraine) • Trading managed to reach a net result of 12 million USD in 2012 Division of the Trading Business Unit KazMunayGas Trading AG Midia Marine Terminal • The trading division, has completed the integration of all crude marketing operations within KazMunayGas In Romania, the Group has already invested about 350 million USD for the development of logistic infrastructure. It consists of building a marine terminal with a capacity of 24 million tons / year, extending Berth 9 with 3 terminals for tripling the amount of finished products, dredging the 5 Berths (Berth 9 and Berths 1-4), allowing mooring of ships with greater capacity, and construction of a terminal for liquefied petroleum gas (LPG), all assets in Midia Port. • This approach supports the shareholder’s strategy, KMG, to unify all its abroad assets around Rompetrol Group. • The company aims to become the sole national operator for the export trade of crude oil produced by Kazakhstan. The Rompetrol Group: Upstream and Industrial Services Upstream Rompetrol has over 35 years of experience in many traditional markets including the Middle East and Caspian Sea regions and focuses on exploration and production, well services, drilling and workover in Romania, Kazakhstan, Russia, Middle East and North Africa. In Romania, the company has five exploration block Focsani, Satu Mare, Zegujani, Gresu and Nereju. Upstream units in The Rompetrol Group: • Exploration & Production division (included in Rompetrol SA) • Drilling & work over division (included in Rompetrol SA) • Rompetrol Well Services Company • Rompetrol Well Services – Kazakhstan Branch • Libyan branch of Rompetrol SA • Rompetrol SA branch in Iraq • Benon Rompetrol SA JV Industrial Services Rominserv: The general contractor of the Group, integrates industrial maintenance services, project management, technical and technological development services; Rominserv Valves Iaifo: The biggest Romanian manufacturer of a wide range of industrial cast iron, steel fittings and safety valves. Palplast: Manufacturer of high-density polyethylene pipes and fittings with a wide range of applications, as well as sprinkler and drip irrigation systems. Rompetrol Quality Control: has 6 modern laboratories that offer specialized quality and environmental testing services. Ecomaster: integrated provider of industrial ecological services; with over 12 years experience on the local market, the company has accumulated the expertise that make it one of the innovators in the field. Going Forward: our Vision, our Plan, our Partnership Going Forward Our Vision, our Plan, our Partnership Consolidate KMG trading activities KMG has a unique opportunity to expand in the Black Sea markets, for: Strategic positioning close to consumers in the refinery’s natural markets Synergic effects on increased vertical integration for improved financial performance TRG expansion strategy is capitalizing on: Strategic location of Petromidia at Black Sea for easy access to those markets TRG blended experience in both developed (France) and growing (Romania) markets Multi-layer approach, structured on : Developing a strong wholesale distribution network for faster and lower cost expansion Building high efficiency retail networks to secure long term access to consumers Rompetrol will intensify the exploration and production activities on the blocked owned in concession in Romania, and expand the well services in Libya and Kazakhstan. Diversify the service range through technological development and strategic alliances and expand in other countries. Refinery Investments for continuous operation improvements at high European standards and energy efficiency for optimum refinery performance. A strong, long term partnership between Romania and Kazakhstan is essential to leverage the role of both countries in creating the energetic bridge. Rompetrol is the key asset in realizing this partnership. Thank you!