Galp Energia, Sgps S.a. Class B · EURONEXT:GALP
Galp Energia, Sgps S.a. Class B — Galp Energia — Investor Presentation (November 2019)
41 slides from Galp Energia, Sgps S.a. Class B's investor presentation, November 2019
Slide 1: Investor Presentation November 2019
Slide 2: Cautionary Statement
Cautionary Statement By attending or reading this presentation, you acknowledge and agree to beboundby the following limitations and restrictions. This presentation has been prepared by Galp Energia, SGPS, S.A. ("Galp” or the “Company”) and may be amended and supplemented, but may not be relied upon
Slide 3: Galp key takeaways
Slide 4: Unique asset base, selective growth, attractive returns
ef y iy Vi Unique Selective Attractive asset base } | growth // Returns Increase portfolio resilience and competitiveness Investment for growth along the energy value chain Focus on project returns and financial discipline Balance net investments with competitive shareholder returns Capture opportun
Slide 5: A fast growing integrated energy player
Galp A fast growing integrated energy player sh bn bow 2P + 2C resources 107.3 kboepd (+15% YoY) WI production €1,440 m > €11.9bn Market Cap. Fo tde j x x A eet Exploration & Production tO kbp A it > €2.2 bn (+24% yoy) Ebitda enining capacity y7 17.1 mton *~ Oil products sales dee €610 m Refining &
Slide 6: Upstream
Slide 7: Developing three core areas in our upstream portfolio
Developing three core areas in our upstream portfolio World class deep water portfolio Unique exposure to the Brazilian pre-salt 7 | Investor Presentation - November 2019 Santos Campos Basin ‘Basin BM-S-11 Iracema Uirapuru BMeS=114 €-M-791 A fara E = North of BM-S-24 Carcara Sépia BM-S-8 ins Carcaré
Slide 8: Top quartile upstream portfolio
Top quartile upstream portfolio | Upstream portfolio breakeven ($/bbl) 2NP QUARTILE 3RD QUARTILE | AMQUARTILE * Lowest upstream portfolio breakeven amongst integrated peers, froma unique world class asset © base c.$25/bbl * Maintain portfolio resilience and | competitiveness e e $40/bbl $47/bbl $52/
Slide 9: Increasing potential of long-term production growth
Increasing potential of long-term production growth v | WI production from existing portfolio (kboepd) CAGR >10% * Lula North + Berbigdo/Sururu + Atapu1 * Kaombo South® + Sépia East * Coral South * Greater Carcaré + Rovuma LNG + Lula West + Atapu 2 + Jupiter * Exploration Additional upside + Optimis
Slide 10: Lula & Iracema
Lula & Ilracema Delivering and improving large scale projects a BM-S-11 | Lula & Iracema * Completing initial development phase: 9 FPSOs deployed with c.1.3 mmbpd total installed capacity Lula & Iracema 3Q19 production: c.111 kboepd * Plateau periods now expected at Lula North (#9) 4.5 years on aver
Slide 11: Iara
lara The next high-quality pre-salt growth project v BM-S-11A | Greater lara a foe * BerbigGo/Sururu FPSO already = ” at final location : yy * Ongoing drilling campaign At ' Berbiaa and optimising PoD for the = 7 : erbigdo/Sururu three different accumulations : irst oil expected in 4Q19 * Supportive
Slide 12: Greater Carcará
Greater Carcara High potential to drive 2020+ growth North of Carcaré Brazi Phase II | Assessing data from appraisal campaign t Phase | First oil expected by BM S-8 — BM-S-8 | Galp 20% (Op: Equine) 2023/24 — N. of Carcard | Galp 20% (Op: Equine) 13 | Investor Presentation - November 2019 Vv BM-S-8 a
Slide 13: Sépia and Jupiter
Sépia and Jupiter Additional 2020+ pre-salt contribution Sépia Brazil East Sépia y | J | df ! Sépia First oil expected in 2021 Jupiter RSD initiatives and several technical studies Jupiter + Sépia unitised | Galp 2.41% — _BM-S-24| Galp 20%, except Sépia bik FPSO already sanctioned 13 | Investor Pres
Slide 14: Mozambique Area 4
Mozambique Area 4 Fast tracking phased LNG developments ’ Mozambique IRS * = RN Mamba ~~ Coral South _P ] Coral — Area 4| Galp 10% (Op: Eni/Exxon) 14 | Investor Presentation - November 2019 FLNG first gas expected by 2022 Rovuma LNG Phase | comprising 2x 7.6 mtpa mega tarins Vv Mozambique to become
Slide 15: Angola
Angola Contribution increasing with Kaombo ramp-up v Block 14/14k and Block 32 Angola Block 14/14k * 2 FPSOs deployed in Block 32, Broduction in mote with total installed capacity of 130 kbpd * Focused on efficiency and cost enhancements to extend Block 14 Kaombo economic limit Project ramp-up, with
Slide 16: Selectively accessing new opportunities
Selectively accessing new opportunities v . New high potential assets Regional focused exploration strategy in Eee Uirapuru in Santos Basin and C-M-791 in Campos Basin » Developing competitive advantages and synergies with current portfolio ° Leveraging presence in Brazilian pre-salt top tier acreag
Slide 17: Exploration activities
Exploration activities Brozil ' Se r — BM-S-8|Galp20%(Op: Equi Vv Vv Uirapuru Guanxuma (Brazil) (Brazil) * Targeting first * DST performed to further exploration well by YE19 appraise oil discovery 17 | Investor Presentation - November 2019 DI Petaricalp dor (on6 Vv PEL 82 & PEL 83 (Namibia) * Concl
Slide 18: Downstream
Downstream
Slide 19: Downstream focused on selected clusters
focused on selected clusters Iberian oil products and NG demand 65 59 60 62 63 6.2% Oil CAGR 6 201438 30 31 32 °° 6.4% NG CAGR 2018 2014 2015 2017 Oil products (mton) Natural gas (bem) RHS Economic recovery Present in five African Adapting supporting oil countries, downstream and natural gas leverag
Slide 20: R&M: Refining
R&M: Refining Competitive and flexible refining system Adapt refining system, increasing asset competitiveness and resilience Completing “+$1/boe” initiatives, focused on maximising energy efficiency and enhancing conversion Leveraging refineries’ location (SW Europe), namely competitiveness in the
Slide 21: IMO 2020
IMO 2020 Integrated profile providing hedge to demand specs changes Upstream (€m)! Downstream (€m)! p Production sales margin Galp crudes appreciation? Production sales margin Normalised realised Products price Raw materials — Realised margin by Pre-IMO? Post-IMO? margin pre-IMO* — appreciation appr
Slide 22: R&M: Marketing
R&M: Marketing Leading player in core regions New organizational structure to allow integrated value ~ maximisation from commercial activities High quality retail network located in Iberia and selected African clusters Enhancing efficiency of operations and strengthening regional presence Launching
Slide 23: Building a sustainable integrated business
Building a sustainable integrated business Strengthening gas and electricity commercial position in Portugal and Spain Leveraging integration with remaining downstream businesses Building new NG/LNG sourcing basket Strengthen renewable electric offering through a solar PPA of 358 GWh (10% of clients
Slide 24: Developing a sustainable portfolio of renewable power generation
Developing a sustainable portfolio of renewable power generation Preparing integration with current electrical commercial offer Developing alternative mobility services, including an electric offer Provide customer-centred solutions Leverage on digitalisation and data analytics Foster innovation age
Slide 25: Financials
Slide 26: Solid financial track record
Solid financial track record | CFFO (Em) 2,000 1504 ° 2012 2013 2014 2015 2016 2017 2018 | Dividends (€/sh) 0.75 x 0.50 ee 0.25 0.00 2012 2013 2014 2015 2016 2017 2018 2019E Ebitda' | >€2.2 bn 26 | Investor Presentation - November 2019 Expected 2019 performance. | Capex (€m) 2,000 899 1,000 eee ° 20
Slide 27: Capital allocation guidelines
Capital allocation guidelines Balanced investments supporting long-term value creation Investment strategy Investing in sustainable growth across the energy value chain Capex allocation 2020+ Renewables New businesses 10-15% Energy transition >40% Upstream breakeven’ c.$25/bbl Financial discipline A
Slide 28: Operational cash cycle to support further growth and distributions
Operational cash cycle to support further growth and distributions Net CFFO investment c.8% 1.0-1.2 | Sources and Uses 2020-22 (€bn) CXR cbnpo. 8 es @$60/b flat! * Operational resilient contribution to support growth plan Diekendeto) Guyante _ * Group Ebitda expected above €3 bn from 4 portfolio 7 D
Slide 29: Strengthening portfolio for resilience and long-term growth
Strengthening portfolio for resilience and long-term growth > Develop upstream business for value Adapt refining system, increasing asset > competitiveness and resilience > Build a sustainable and flexible NG/LNG portfolio > Maximise value from commercialisation Develop an integrated power business
Slide 30: Key data & backup info
Key data& backup info
Slide 31: Macro assumptions and sensitivities
Macro assumptions and sensitivities Galp assumptions - 2022E Brent price ($/bbl) 65-70 Galp refining margin ($/boe) 5.5-6.0 EUR:USD 115 Ebitda CFFO FCF Sensitivities (€m) 2020 — 22E 2020 - 22E 2020 — 22E Brent price $5/bbI 185 - 200 90-95 70-75 Refining margin S1/boe 100 70 - 100 70 -100 EUR:USD 0.0
Slide 32: Galp reserves and resources
Galp reserves and resources Reserves (mmboe) ' 2017 [ 2018 ' Chg. 1p 383 389 2% 2P 748 755 1% 3P 965 985 2% Contingent resources (mmboe) H 2017 2018 H Chg. 1c 296 425 43% 2c 1,352 1,658 23% 3C 3,297 3,671 1% Prospective resources (mmboe) [ 2017 2018 | Chg. Unrisked 3,835 4,303 12% Risked 566 623 10%
Slide 33: Results supported by strong operational performance
Results supported by strong operational performance | Profit & Loss (€m) yoy | 9MI9 } Yor (IFRS 16) $ (comparable) EP 850 1440 69% 1,251 4% R&M 774 610 (21%) 317 (43%) Associates 137 (8%) Financial results (34) (70) mug (97) num. Taxes (483) (726) 50% (543) (4%) Non-controlling interests (88) (151)
Slide 34: Upstream key operational indicators
Upstream Key operational indicators | Exploration & Production! Working interest production” Oil production kbpd 1% Angola kbpd Brazil kbpd 85.5 Oil and gas realisations — Dif. to Brent USD/boe (6.6) Production costs USD/boe 8.2 34 | Investor Presentation - November 2019 {Unit figures based on net e
Slide 35: Downstream key operational indicators
Downstream Key operational indicators | Refining & Marketing Galp refining margin Refining cost! USD/boe W7 2.6 Raw materials processed mmboe 114.2 100.4 Total oil products sales mton 18.3 16.8 Sales to direct clients mton 87 8.6 | Gas & Power Sales to direct clients 4,374 4,740 3,485 (2%) mse 2,974
Slide 36: Key indicators: Galp's debt
Key indicators Galp’s debt | Debt indicators Gross Debt Cash and equivalents Net debt Operating leases (IFRS 16) Net Debt to Ebitda! Available credit lines % Debt at a fixed rate | Debt Structure 36 | Investor Presentation - November 2019 31 Dec. 31 Dec. 30 Set. 2017 2018 2019 3,083 3,245 2,892 1,19
Slide 37: IFRS 16 impacts on Galp's reporting
IFRS 16 Impacts on Galp’s reporting principles Balance sheet Cash Flow All leases on balance sheet Leases subject to depreciation and interest Leased FPSOs and subsea equipment account for c.70% of operational leases Opex Vv Fixed assets Liabilities DDEA “ c.€1.2 bn c.€1.2 bn Financials “A Nw Ww Tax
Slide 38: Shareholding structure
Shareholding structure v Institutional investors account for 83% of Galp’s free float’, o.w.: © Amorim Energia, B.V. Free Float 61% Europe 34% — North America 5% Rest of the world / PARPUBLICA IMRTICIPNCOUSFURLICAS A 38 | Investor Presentation - November 2019 ‘As at 31.03.2019. galp ©
Slide 39: A committed and experienced team
A committed and experienced team Galp’s Executive Committee CEO Carlos Gomes da Silva Over 25 years of experience in Oil & Gas and a Galp Board member since 2007. Former Board executive for more than 12 years in the energy and beverage industries. ©6009 COO Upstream COO Midstream COO Commercial COO
Slide 40: Acronyms
Acronyms # Number $(or USD) Dollar % Percentage 5 And @ At € (or EUR) Euro + Plus < Below > Above 15 2C; 3C Contingent resources 1? Proved reserves 2P Proved and probable reserves 3D Three dimensional 3P Proved, probable and possible reserves bbl Barrel BBLT Benguela, Belize, Lobito and Tomboco bem
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