GDP DRIVES US TOWARD FURTHER SUCCESS 3Q18 Highlight Performance - - PowerPoint PPT Presentation

GDP

DRIVES US TOWARD FURTHER SUCCESS

Performance by Business Financial Performance Strategic Direction 3Q18 Highlight

2

Projects Update

Financial Highlight: 3Q18 & 9M18 performance

Hyvahl & RDCC planned SD and lower product spreads vs lower crude premium

27% 61% 12%

52,355 65,367 68,831 139,151 194,686

QoQ 5% YoY 31%

Overview of Business

Net Sales

(net excise tax)

Dubai (Avg.)

Unit: $/bbl

Net Income

Unit: MB Unit: MB YoY 21% QoQ 37%

EBITDA

Unit: MB

6,635 7,162 5,258 13,890 17,809

QoQ 27% YoY 21% Petroleum Petrochemical Utilities and Others

Net Sales

(net excise tax)

EBITDA Net income

9M18

40% 51% 9% 71% 28% 1%

194,686 MB 17,809 MB

3,248 4,050 2,560 6,841 9,362 3Q17 2Q18 3Q18 9M17 9M18

9,362 MB Market GIM ($/bbl) 15.05 13.86 12.37

51 72 74 51 70

Crude run KBD 201 210 203

• Acct. GIM ($/bbl)

16.09 17.47 14.10

3

3Q18

35% 55% 10% 71% 28% 1%

68,831 MB 5,258 MB

15% 71% 14%

2,560 MB Net Stock G/(L)($/bbl) 1.04 3.61 1.73

YoY 37% YoY 28% YoY 40%

170 209

TA in 1Q17

14.57 15.34 1.90 13.44 14.85 0.28

Awards & Achievement in 3Q18

received outstanding plant management

“Best SET Sustainability Awards 2018 And Thailand Sustainability Investment”

4

IRPC’s Achievement Social Contribution Marketing

By The Stock Exchange

• f Thailand (SET)

“Thailand Energy Awards 2018” For Plant Management By Department of Alternative Energy Development and Efficiency, Ministry of Energy “Excellent CG Scoring Company” Corporate Governance Report : CGR By Thai Institute of Directors (IOD) and The Stock Exchange

• f Thailand (SET)

“Dow Jones Sustainability Indices (DJSI) Member”

In Oil and Gas Refining & Marketing Industry

The 5th consecutive year, with the highest score By RobecoSAM “IRPC Join Guangzhao Saiju Performance Polymer Ltd.” Investment in plastic product E-Commerce business in The PRC and incorporation a subsidiary under the laws of Thailand “Top Community Care Companies in Asia 2018” By Asia Corporate Excellence & Sustainability Awards

5

IRPC’s DJSI Achievements

DJSI member for the 5th consecutive year

2018

2014 2015 2016 2017 Listed in “The Sustainability Year Book 2014” 1st year DJSI Member Listed 2nd year DJSI Member Listed 3rd year DJSI Member Listed 4th year DJSI Member Listed 2013 5th year DJSI Member Listed And ranked as Industry Leader

IRPC received the highest scores from Dow Jones Sustainability Indices (DJSI):

Oil and Gas Refining and Marketing Industry Leader and being DJSI member for the 5th consecutive year

Expecting RobecoSAM Sustainability Award Gold Class 2019

2019

Performance by Business Financial Performance Strategic Direction 3Q18 Highlight

6

Projects Update

Petroleum Spread

7 + Higher demand from Europe and Persian Gulf + Lower export volume from Iran 11.8 11.4 13.9 13.0 14.8 14.6 14.4

1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18

• Soften Demand
• High inventories level in USA and Europe
• Higher export volume from China and South

Korea

14.8 14.2 16.1 14.4 13.7 12.1 11.6

1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18

(3.1) (1.8) (1.4) (3.1) (4.9) (4.4) (2.5)

1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18

500SN – FO 180 3.5%S Spread 150 BS – FO 180 3.5%S Spread Asphalt – FO 180 3.5%S Spread $/bbl $/bbl $/bbl

Lube Base Spread Refinery Spread

Gas oil - Dubai ULG 95 - Dubai HSFO - Dubai

(13) (38) (28) (44) (55) (68) (41)

1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18

635 658 579 536 588 544 471

1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18

451 556 528 458 513 481 417

1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18

QoQ  13% QoQ  43% QoQ  13% QoQ  1% QoQ  40%

• Higher export volume from China

+ Higher demand from N.Asia, Australia and South Africa QoQ  4% + Tight supply + unplanned shutdown of Malaysian Refinery QoQ QoQ QoQ QoQ QoQ $/TON $/TON $/TON

• Lower import from China as

Yuan depreciation against USD

13% 11% 11% 13% 11% 7% 6% 6% 7% 7% 5% 6% 5% 5% 6% 9% 9% 8% 8% 8% 21% 21% 1% 9% 32% 29% 9% 30% 2% 2% 2% 18% 18% 17% 18% 18% 4% 3% 4% 3% 4% 15% 13% 14% 16% 13% 3Q17 2Q18 3Q18 . 9M17 9M18

LPG Ethylene Propylene Benzene Rich Gasoline HCN Diesel Fuel oil Fuel Gas Internal use&Fuel Loss

0.9 0.8 0.8 2.2 2.5 0.9 0.9 0.9 2.3 2.7 1.8 1.7 1.7 4.5 5.2 3Q17 2Q18 3Q18 9M17 9M18

Lube Asphalt

66% 68% 59% 66% 65% 34% 32% 41% 34% 35% 3Q17 2Q18 3Q18 9M17 9M18

Sweet Crude Sour Crude

201 210 203 170 209

Petroleum Production

Lower U-Rate in 3Q18 due to Hyvahl & RDCC planned Shutdown

1.9 3.4 2.8 1.5 3.2 93% 98% 94% 79% 97% % U-Rate

Unit : Mbbl

Unit : Mbbl

LPG & Others Naphtha Gasoline Diesel Fuel oil

Remark: Excluding internal use quantity Premium over Dubai ($/bbl)

95% 104% 75% 72% 95% % U-Rate

Crude Intake RDCC Refinery Lube Base oil & Asphalt

87% 84% 82% 73% 85% % U-Rate 0.3 0.5 0.5 1.7 1.4 8.6 8.8 8.5 21.1 26.0 1.7 2.6 2.3 4.2 7.3 0.6 0.5 1.0 2.2 2.0

0.1 0.2 0.2 0.3 0.7

11.3 12.6 12.6 29.5 37.4

3Q17 2Q18 3Q18 9M17 9M18

8

66% 66% 57% 66% 63% 15% 14% 21% 19% 16% 5% 6% 9% 6% 8% 14% 14% 13% 9% 14%

Others Domestic Far East Middle East

Crude Run (KBD)

Petroleum Group : Sales & GRM

Lower Mkt. GRM : Lower petroleum spread & Hyvahl and RDCC planned shutdown

3.8 3.4 2.9 2.8 3.2 2.1 1.8 1.5 2.3 1.7

5.9 5.2 4.3 5.1 5.0

3Q17 2Q18 3Q18 9M17 9M18 Refinery Lube Base 4,327 4,688 4,915 11,706 14,248 14.3 15.0 15.3 37.3 45.4 1.8 1.8 1.7 4.6 5.3 16.1 16.8 17.0 42.0 50.7 3Q17 2Q18 3Q18 9M17 9M18

Lube Base Refinery

31,053 41,246 43,998 82,772 122,800 Refinery 35,380 45,934 48,913 94,478 137,048

Sales Volume & Revenue 18.5 19.1 18.7 46.5 57.0 Crude intake (M.bbl)

Unit : $/bbl

Sales Distribution

Top 3 Export Destinations in 3Q18 : Singapore, Malaysia, Cambodia

YoY  6% QoQ  1%

YoY  38% QoQ  6%

Sales volume (M.bbl) Revenue (MB) ❑ 9M18 : Petroleum revenue was Bt 137 bn

▪ YoY : 45% increase from 24% price increase & 21% volume increase due mainly to major TA in 1Q17

❑ 9M18 Market GRM was $5.0/bbl

▪ YoY : $0.1/bbl decrease as lower Lube Base Oil spread vs higher diesel spread 3Q17 2Q18 3Q18 9M17 9M18

Market GRM ❑ 3Q18 Petroleum revenue was Bt 49 bn

▪ QoQ : 6% increase from 5% price increase & 1% volume increase ▪ YoY : 38% increase from 32% price increase & 6% volume increase

❑ 3Q18 Market GRM was $4.3/bbl

▪ QoQ: $0.9/bbl decrease due to lower petroleum spread, Hyvahl & RDCC planned shutdown vs lower crude premium over Dubai ▪ YoY: $1.6/bbl decrease due to lower Lube Base Oil spread, Hyvahl & RDCC planned shutdown and higher crude premium over Dubai

9

YoY  21%

YoY  45%

Petroleum Lube Base

Local 58% Export 42%

2Q18

Local 54% Export 46%

3Q18

10

Petrochemical Spread

200 170 159 109 137 115 121

1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18

591 544 622 626 659 581 550 171 286 201 284 367 427 267

762 830 823 910 1,026 1,008 817

1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 Ethylene-NP HDPE-Ethylene

192 202 182 114 182 164 217

1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18

1,029 878 977 905 998 945 898

1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18

435 296 323 258 406 362 361 228 365 356 363 287 298 256

663 661 679 621 693 660 617

1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 Propylene-NP PP-Propylene

HDPE-Ethylene –Naphtha Spread PP-Propylene –Naphtha Spread MX – Naphtha Spread Toluene – Naphtha Spread PS –Naphtha Spread ABS –Naphtha Spread

Olefins Styrenics Aromatics

1,382 1,226 1,377 1,353 1,428 1,379 1,248

1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18

• Lower demand from Monsoon

QoQ  19% QoQ  7% QoQ  5% QoQ  5% QoQ  9% QoQ  32%

• Higher utilization rate
• Soften demand from China
• Lower Chinese demand due to

weaken Yuan + Tight supply from turnaround QoQ QoQ QoQ QoQ QoQ QoQ + Increasing demand $/TON $/TON $/TON $/TON $/TON $/TON + Higher PX demand + Tight supply from turnaround in N.E.A.

• High production volume in China
• Weaken demand

109 106 87 253 297 4 4 6 9 14 81 87 86 229 250

194 197 179 490 561

100 75 61 192 209 162 196 202 401 592

261 271 263 592 801

Polyolefins

Petrochemical Group : Production

QoQ: Better Olefins’ U-Rate but lower Aromatics’ U-rate due to maintenance SD

3Q17 2Q18 3Q18 9M17 9M18

97% 93% 95% 82% 92%

% U-Rate

**

98% 88% 90% 86% 88% Polyolefins 97% 100% 101% 78% 99% Olefins

Aromatics & Styrenics Olefins

3Q17 2Q18 3Q18 9M17 9M18

104% 104% 97% 87% 100%

% U-Rate

**

92%

95% 94% 86% 91%

Polystyrenics

113%

109% 112% 96% 110%

Styrenics 110%

108% 92% 84% 103%

Aromatics

Olefins

Unit : KMT

Remark : * Production volume excluded internal use ** Utilization rate calculated based on main products

❑ 3Q18: 95% Olefins U-Rate (263 KMT)

▪ 2% higher U-rate (1 month HDPE planned SD in 2Q18)

Polystyrenics Styrenics Aromatics

❑3Q18: 97% Aromatics & Styrenics U-Rate (179 KMT)

▪ Aromatics: Lower U-rate from 1 wk Aromatics’ plant SD

Unit : KMT

11

Production Volume* Production Volume*

Petrochemical Group : Sales & PTF

Lower products spread caused lower PTF

185 194 176 459 552 270 281 275 676 829

455 475 451 1,135 1,381

3Q17 2Q18 3Q18 9M17 9M18

Olefins & Polyolefins Aromatics & Styrenics

2.9 2.6 2.7 3.2 2.7 5.3 5.0 4.3 5.3 4.7 8.2 7.6 7.0 8.5 7.4

3Q17 2Q18 3Q18 9M17 9M18 Unit : $/bbl Aromatics & Styrenics Olefins & Polyolefins

Sales Volume and Revenue Sales Distribution

Top 3 Export Destinations in 3Q18: Hong Kong, Singapore , Vietnam

QoQ  5% QoQ  2%

Revenue (MB) 3Q17 2Q18 3Q18 9M17 9M18

YoY  1% YoY  17%

Market PTF ($/bbl)

16,251 18,649 19,058 42,674 55,265 9,543 11,081 11,495 24,702 33,165 6,708 7,568 7,563 17,972 22,100

12 YoY  22% YoY  30%

Petrochem Olefins

Aromaitcs& Styrenics

❑ 9M18 : Petrochemical revenue was Bt 55 bn ▪ YoY : 30% increase from 8% price increase & 22% volume increase (major TA in 1Q17) ❑ 9M18 Market PTF was $7.4/bbl: ▪ YoY : $1.1/bbl decrease as lower products spread ❑ 3Q18 : Petrochemical revenue was Bt 19 bn

▪ QoQ : 2% increase from 7% price increase vs 5% vol. decrease ▪ YoY : 17% increase from 18% price increase vs 1% volume decrease

❑ 3Q18 Market PTF was $7.0/bbl:

▪ Lower petrochemical spread ➔ lower PTF ▪ QoQ : $0.6/bbl decrease & YoY : $1.2/bbl decrease

Local 53% Export 47%

3Q18

Local 50% Export 50%

2Q18 18.5 19.1 18.7 46.5 57.0 Crude intake (M.bbl)

Market GIM

❑ 3Q18 Market GIM was $12.4/bbl, ➢QoQ: $1.5/bbl due to Hyvahl & RDCC planned SD and lower product spreads vs lower crude premium ➢YoY:  $2.7/bbl due to Hyvahl & RDCC planned SD, lower product spreads and higher crude premium ❑ 9M18 Market GIM was $13.4/bbl:  $1.2/bbl from 9M17 ➢Higher crude premium over Dubai while projects completion support margin

3.9 3.4 2.9 2.8 3.2 2.1 1.8 1.5 2.3 1.7

5.9 5.2 4.3 5.1 5.0

3Q17 2Q18 3Q18 9M17 9M18 Refinery Lube Base 5.3 5.0 4.3 5.3 4.7 2.9 2.6 2.7 3.2 2.7

8.2 7.6 7.0 8.5 7.4

Olefins Aromatics&Styrenics 5.9 5.2 4.3 5.1 5.0 8.2 7.6 7.0 8.5 7.4 0.9 1.1 1.1 1.0 1.1

15.1 13.9 12.4 14.6 13.4

Petroleum Petrochem Power & Utility 3,662 3,184 2,681 8,171 9,126 5,107 4,661 4,312 13,531 13,617 562 648 674 1,631 1,986

9,331 8,493 7,667 23,333 24,729 3Q17 2Q18 3Q18 9M17 9M18

9,331 8,493 7,667 23,333 24,729 1,098 2,171 1,017 1,661 3,382 (455) 44 54 (1,221) 108

9,974 10,708 8,738 23,773 28,219 3Q17 2Q18 3Q18 9M17 9M18

15.1 13.9 12.4 14.6 13.4 1.8 3.5 1.6 1.0 1.8 (0.7) 0.1 0.1 (0.8) 0.1

16.1 17.5 14.1 14.9 15.3

Market GIM Stk G/(L) & LCM Hedging

Market GIM

Unit: $/bbl

Accounting GIM

Unit: $/bbl Unit: MB

Market GIM by business

Unit: $/bbl

Petrochemical Petroleum

Unit: MB 13

Gross Integrated Margin (GIM)

Shutdown result in lower Mkt GIM & lower net stock gain affected lower Acct. GIM

YoY  18% QoQ 11%  YoY  8% YoY  12% YoY  3% QoQ  19%

Accounting GIM

❑ 3Q18 Acct GIM was $14.1/bbl ▪ QoQ:  $3.4/bbl due to $1.9/bbl lower stock gain and $1.5/bbl lower of market GIM ▪ YoY:  $2.0/bbl due to $2.7/bbl lower market GIM VS $0.7/bbl higher stock gain ❑ 9M18 Acct GIM was $15.3/bbl:  $0.4/bbl from 9M17 due to $1.6/bbl higher stock gain vs $1.2/bbl lower of market GIM

Performance by Business Financial Performance Strategic Direction 3Q18 Highlight

14

Projects Update

QoQ YoY 3Q17 2Q18 3Q18 Net Sales 52,355 65,367 68,831 5% 31% 84.44 106.65 111.15 Market GIM 9,331 8,493 7,667 (10)% (18)% 15.05 13.86 12.37 Stock Gain/(Loss) 1,098 2,177 1,017 (53)% (7)% 1.77 3.55 1.64 LCM (0) (6)

• 100%

100% (0.00) (0.01)

• Oil Hedging Gain/(Loss)

(455) 44 54 22% 112% (0.73) 0.07 0.09 Net Stock Gain/(Loss) 643 2,215 1,070 (52)% 67% 1.04 3.61 1.73 Accounting GIM 9,974 10,708 8,738 (18)% (12)% 16.09 17.47 14.10 OPEX + Selling Exp. (3,715) (3,942) (3,851) 2% (4)% (5.99) (6.43) (6.22) Other Incomes 376 396 371 (6)% (1)% 0.61 0.65 0.60 EBITDA 6,635 7,162 5,258 (27)% (21)% 10.71 11.69 8.48 Depreciation (2,029) (2,047) (2,046) 0% (1)% (3.27) (3.34) (3.30) Cost of Finance (710) (437) (500) (14)% 30% (1.15) (0.71) (0.81) FX Gain/(Loss) 90 (73) 57 179% (36)% 0.15 (0.12) 0.09 Impairment Gain/(Loss)

• 51 (5)
• -
• 0.08 (0.01)

Investment Gain/(Loss) 109 202 203 1% 87% 0.17 0.33 0.33 Other Expenses

• (0) (2)
• -
• -

(0.00) Income Tax (846) (795) (395) 50% 53% (1.36) (1.30) (0.64) Net Profit 3,248 4,050 2,560 (37)% (21)% 5.25 6.62 4.12 Unit: $/bbl 3Q17 2Q18 3Q18 % Change

15

Financial Highlight: 3Q18 performance

Net Sales

(net excise tax)

EBITDA Net income

3Q18

35% 55% 10% 71% 28% 1%

68,831 MB 5,258 MB

15% 71% 14%

2,560 MB

Petroleum Petrochemical Utilities and Others

9M17 9M18 Net Sales 139,151 194,686 40% 86.91 105.79 Market GIM 23,333 24,729 6% 14.57 13.44 Stock Gain/(Loss) 1,662 3,389 104% 1.04 1.84 LCM (1) (7) (569)% (0.00) (0.00) Oil Hedging Gain/(Loss) (1,221) 108 109% (0.76) 0.06 Net Stock Gain/(Loss) 440 3,490 693% 0.27 1.90 Accounting GIM 23,773 28,219 19% 14.85 15.34 OPEX + Selling Exp. (11,003) (11,555) (5)% (6.87) (6.28) Other Incomes 1,120 1,145 2% 0.70 0.62 EBITDA 13,890 17,809 28% 8.68 9.68 Depreciation (5,038) (6,132) (22)% (3.15) (3.33) Cost of Finance (1,789) (1,409) 21% (1.12) (0.77) FX Gain/(Loss) 677 82 (88)% 0.42 0.04 Impairment Gain/(Loss) 238 46 (81)% 0.15 0.02 Investment Gain/(Loss) 322 575 79% 0.19 0.31 Other Expenses (9) (2) 76% (0.01)

• Income Tax

(1,445) (1,581) (9)% (0.90) (0.86) Net Profit 6,841 9,362 37% 4.26 5.08 Unit: $/bbl % Change 9M17 9M18

16

Financial Highlight: 9M18 performance

27% 61% 12%

9M18

40% 51% 9% 71% 28% 1%

194,686 MB 17,809 MB 9,362 MB

Net Sales

(net excise tax)

EBITDA Net income

Petroleum Petrochemical Utilities and Others

699 3,734 6,358 6,438 17,416 1,936 4,516 3,363 6,887 699 7,098 8,294 13,325 21,932

2018 2019 2020 2021 >2021

THB Bond USD Loan THB Loan

128,324 126,970 8,637 9,220 45,438 52,753 2,145 2,336 87,650 88,996 2,378 2,537 55,812 51,347 38,704 48,399

Financial Position

Increase ST loans to support crude payment due to high crude oil price

Maturity of Long-term Debt

Debt Profile Statements of Financial Position Cash Flow

Unit : MB Remark: Long-term debt as at 30 Sep 2018

Unit: MB

PP&E Other Non-C/A Cash

184,544

Other Current Liabilities LT Liabilities

• incl. current port.

Shareholders’ Equity

• Sep. 2018

191,279

• Dec. 2017

Other CA Other Non- Current Liabilities

Beginning Cash 1 Jan 2018 Ending Cash 30 Sep 2018

Cash Flow from Operating

Unit: MB

Cash Flow from Investing Cash Flow from Financing

Net Debt = 61,412 MB

• Ex. Rate = 32.58 Baht/$

Financial Ratios

< 1.0x

Net D/E CA/CL

17

0.74 0.61 0.69

3Q17 2Q18 3Q18

0.85 0.90 1.00

3Q17 2Q18 3Q18

ST Loan 20% LT Loan (USD) 10% LT Loan (THB) 54% Bond (THB) 16%

Float 84 THB 66 Fixed 16 USD 34 Currency (%) Interest Rate (%)

Performance by Business Financial Performance Strategic Direction 3Q18 Highlight

18

Projects Update

19

UHV project : Major CAPEX

Improve product yield and earnings

IRPC’s refined Production Yield Upstream project for Hygiene & Value-added Products Objective : Upgrade low value to high valued-added products Investment : $ 1.1 bn COD : Jul. 2016 Benefit : GIM 1.5-2.0 $/ bbl

Assumption : Spread propylene to FO ~ 500-600 $/ton RDCC unit

➢ Feed Cut-in @ Jun 16 ➢ COD @ Jul 16

HYVAHL unit

➢ Feed Cut-in HS-ATB @ Jul 16 ➢ COD @ Jul 16

Performance Guarantee Test

➢ RDCC run 100% @ Oct 2016

Plant Acceptance (PAC) Jan 2017

43% 78% 95%

2016A 2017A 2018F

Upgrade to High Valued-Added products

131 123 163 367 220 326 74

HS-ATB LPG Ethylene

HYVAHL Propylene

Naphtha FO/FG

Middle Distillates

RDCC

C4 Raffinate III

Internal use & Loss

Unit : KTA 16% 5%

23%

9% 9% 26% 12%

Flow Diagram

LS-ATB

UHV

Designed Yield

23% 8% 11% 4% 4% 14% 10% 15% 12% 10% 40% 38% 45% 47% 48% 5% 10% 8% 9% 12% 16% 21% 16% 18% 16% 2% 5% 3% 5% 5% 6% 1% 4% 4% 2% 1% 1% IRPC IRPC+UHV IRPC 2015A IRPC 2017A IRPC 2018F Ethylene Propylene LPG Naphtha Gasoline Diesel/Jet Fuel Lube Oil Fuel Oil

Designed Yield

20

Project Update

Gasoline Max. : Better than target, Cat. Cooler construction on schedule

Gasoline Maximization Project UHV Catalyst Cooler in RDCC plant CAPEX : ~ 800 MB IRR : ~ 80% Benefit :  GIM: 0.4$/bbl COD : Nov.2017 Results: ➢ Gasoline volume increase 35 mn liters per month, higher than target of 25 mn liters

Demin

RDCC Plant ERU PRU Unit PNU Unit Prime G Unit

New column

Gasoline Blending Pool

~ 25 M.Litres/month

C2’s C3’s C4’s Naphtha

Modification Modification

Poly-gasoline (C8’s) 20 t/hr. to gasoline pool Heavy Oligomerate (C12+’s) 5 t/hr. to RDCC HCN (benzene <0.5 volume%) 27 t/h Gasoline pool Benzene rich cut 8 t/h LCN ERU – Ethylene Recovery Unit PRU – Propane-Propylene Splitting Unit PNU – Naphtha Oligomer Unit Prime G – Naphtha Hydro-treating Unit

CAPEX : ~ 1,320 MB IRR : ~ 35% Benefit :  GIM: 0.3$/bbl Construction Progress : 68% ➢ 1st Tie-in be completed in Sept. 2018 ➢ 2nd Tie-in and shutdown for main equipment installation by Feb. 2019 for ~ 28 days ➢ COD: ~ 1Q19 Project Objective : ▪ Crude selection ➔ more heavy crude ▪ More electricity & steam

21

PPE&PPC Benefit Enhancement

Fulfill UHV benefits thru higher margin on PPE & PPC

Random PP

• Pipe grade
• Hygiene

Super Clear PP

• Container box
• Medical Device

Block-CO PP

• Household Material
• Heavy-duty

HOMO PP

• Film application
• Fiber grade

PP Specialty

• Frozen food packaging
• Lamination
• Health care

PP Compound

• Automotive:

pumper, instrument panel, etc

PPE 160 KTA

PPC140 KTA

Total PP 775 KTA in 2017

PP Existing 475 KTA PP Expansion and PP Compound Project

Compounding House PP inline compound

Lower cost : PPC production by Inline process technology

Note: Cost Saving

• No Packing & Logistic
• No 2nd Extruder Process

PP Marketing Strategy : Sales Plan Y2017 Volume: 600 Ktons Y2022 Volume: 760 Ktons

PP Expansion Project (PPE)

❖ Licensor : Novolen ❖ Capacity : 160 KTA ❖ PMC : Foster Wheeler, ❖ EPC : Sinopec

• CAPEX : $ 236 mn
• GIM 0.8-1.0 $/bbl
• COD : 4Q17

Top polypropylene producers in south-east Asia

2014 2015 2016 2017 2018

ExxonMobil Singapore 860 860 860 860 860 HMC Polymers Thailand 755 755 810 810 810 IRPC Thailand 475 475 475 775 775 TPP Thailand 720 720 720 720 720 TPC Singapore 625 625 625 625 625 Chandra Asri PC Indonesia 480 480 480 480 480 Polytama Indonesia 386 386 386 386 386 Lotte Chem. (M) Malaysia 373 373 373 373 373 Nghi Son Viet Nam

• 185

370 JG Summit PC Philippines 185 185 185 185 185

Unit : KTA

Source : IHS

Random PP 4% Homo PP 75% Block-CO PP 21% PP Compound 11% Random PP 10% Homo PP 58% Block-CO PP 21%

PP Compound & Specialties (PPC)

❖ Licensor : JPP ❖ Capacity : 140 KTA ❖ PMC : Foster Wheeler ❖ EPC : Sinopec

22

Refinery Regulation Concern

IMO regulations to start in 2020 which benefit to LS refinery as IRPC

Source : PIRA SPS 2017

1.5% 1.0% 4.5% 3.5% 0.5%

Jan-20

0.1% IMO implements new Sulfur spec Timeline of changes in Sulfur Emission Regulation

IMO to cut global SF limits from marine fuels : 3.5%➔ 0.5%

Global Bunker Demand, MMBD

Source: FGE’s Flash Alert 2 Feb’ 18

Consequence effects ▪ Demand of gasoil for marine bunker blending support gasoil spread, ▪ It is expected gasoil-FO spread will increase from 15-18$/bbl to 35-40$/bbl ▪ Though, lower fuel oil price bring back power generation demand ▪ Higher gasoil price and lower fuel oil price support light crude demand and push Dated/Dubai spread from 2$/bbl to 7$/bbl

3.54 1.25 1.30 2.56 1.00

1 2 3 4 5 6

2019 2020

HSFO Gasoil 0.5% Fuel

Global Bunker Demand, MMBD

23

E4E : Initiatives project

Capture more benefit thru LSFO project

❑ CAPEX : ~1MUSD (modify pipeline) ❑ Production : ~ 40-60 mn liters per month ❑ Margin improved : ~ 0.45$/bbl or ~40 MUSD per year ❑ Targeted Year : Y2020 & Y2021

Price Assumption to Study IMO effect.

Low Sulfur Fuel Oil Project

ADU VDU RDCC Hyvahl

in UHV

DCC

SEU/ PDU DAU/ ABU Asphalt Extract VR Asphaltene LCO + DO LCO ETP PGO LS-FO LCO Sell

G

24

Petroleum and Petrochemical Value Chain

Optimized Configuration & Product Diversification

Olefins Plant Propylene

Ethylene Acetylene Butadiene 180 KTA 360 KTA 6 KTA 56 KTA Vacuum Gas Oil (VGO)

PP

PS ABS/SAN EPS CCM Acetylene Black HDPE

Ethylene Acetylene Propylene Benzene Toluene Mixed Xylene Butadiene

CD1

Ethylene

EBSM Long Residue

4 KTA 140 KTA 775 KTA Ethylene Rich Gas

DCC

Propylene 132 KTA

ADU (1,2)

215 KBD Naphtha Reformate UHV

Ethylene Propylene 320 KTA 73 KTA

Lube Base

Lube Base Oil Asphalt 320 KTA 600 KTA

BTX

Benzene Toluene Mixed Xylene 114 KTA 132 KTA 121 KTA 31 KTA 57 KTA 179 KTA 125 KTA 48 KTA 260 KTA Styrene Monomer Acrylonitrile

Feed (Crude Oil / Condensate)

Transportation Fuel

Gasoline, Jet Diesel

PRP

HS ATB Propylene 100 KTA Pyrolysis Gasoline Raffinate Styrene Monomer LS ATB 65% 18% 7% 10%

Crude/Condensate Portfolio

Middle east Far east Domestic Others For sale

16% 22% 31% 34% 35% 39% 43% 45% 50% 55% 60%

0.1 0.2 0.3 0.4 0.5 0.6 0.7

100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

25

Specialty Petrochemical Products

Specialty & Commodity Plus Products to reach 50% in 2018

IRPC 50% PPC Rokita 50%

IRPC A&L

IRPC 60% Nippon A&L 37%

Sumithai 3%

Joint Venture Polyol Sale Volume (SP+CP) Unit: MT PPE PPC

160 KTA 140 KTA COD Dec. 2017 COD Sept. 2017

30% volume growth mainly from PPE&PPC

Performance by Business Financial Performance Strategic Direction 3Q18 Highlight

26

Projects Update

27

IRPC Strategic Roadmap to 2020

Power of Growth, Power of Digital & Power of People: “GDP”

Capaci city Before Afte ter

Propylene (UHV) 412 KTA 732 KTA

2010 2014

Margin Improvement

• Operational Excellence
• Commercial Excellence
• Procurement & HR

Excellence

Benefit +135 MUSD

INDIVIDUAL OWNERSHIP SYNERGY PERFORMANCE EXCELLENCE INNOVATION RESPONSIBILITY FOR SOCIETY INTEGRITY & ETHICS TRUST & RESPECT

Projects Completion

• Operational Efficiency Improvement
• Asset Utilization Enhancement
• Product and Service Improvement
• Capacity and Products Expansion

Incremental Margin and Organization Health

• Capability Building
• Owner mindset & Performance

Orientation

• Cultural Changes

Fully Integrated PP Revenue Growth of 5% EBITDA Growth of 10% 1st Quartile ROIC in Petroleum and Petrochemical Industry

STRONG

Member of DJSI Emerging Markets Universe

Capacity Before After PP (PPE&PPC) 475 KTA 775 KTA

2017

2016

Capacity Before After CHP I

• Electricity
• Steam

PRP EBSM 108 MW 200 T/hr 312 KTA 200 KTA 328 MW 620 T/hr 412 KTA 260 KTA

BIG LONG

Leading Integrated Petrochemical Complex in Asia by 2020

Power of Growth

G

Power of Digital

D

Power of People

P

28

GDP: From Aspiration to Execution

Power Three : 3 Pillars for achieve Top Quartile in 2020

Power of Dig Digital Power of People

Truly embed and live the IRPC DNA Develop next generation of Top 30 leaders Continue to establish lean, fit-for-purpose

• rganization

P

Power of Gr Growth

Maximum aromatics for competitiveness Growth by M&A Everest forever for sustainable growth Drive R&D excellence

G

100

MUSD

100

MUSD

OPS 4.0 Smart Operation (AI) ISC 4.0 Integrated Supply Chain CCM 4.0 Customer Centric Digital ERP 4.0 ERP Transformation PRO 4.0 Lean procurement

100

MUSD

D

MARS - Maximum Aromatics

Reformer Benzene 300-500 KTA Paraxylene 1,000-1,300 KTA Naphtha PX Project: Aromatic Complex

Internal use & Export Export

Naphtha Treating unit HCN Toluene, Xylene, HA

Internal use & Export Other Products:

LPG, Raffinate, Raw Hydrogen, Fuel Gas

200 KTA

CAPEX: $1.0 bn - $1.1 bn IRR 14%-16% Petrochemical Yield 17%

Existing + UHV

Petrochemical Yield 27%

>>

Key Rational

• Utilize excess Naphtha /Toluene/Xylene

as feedstock to maximize PX and BZ products

• Cost competitiveness

thru new technology

• Affirmed PX demand growth:

CAGR: 4% - 5%

G

Maximum Aromatic Project : MARS

Utilize IRPC owned feed and increase Petrochemical Yield

COD: 1Q23 Feasibility study and Technology selection Basic Engineer Design Package/FEED Construction

2023 2019 2017 2020 2018

EPC BOD approval

• n CAPEX

Early 2019 BOD final approval on EPC Bidding by mid 2019

29

30

Strategic Initiative – Everest Forever (E4E)

To reach 100 MUSD benefit within 2020

1,870 1,870 1,870 2,456 2,456 2,456 4,736 4,736 4,736 1,160 2,440 3,300

491 498 491

288

2018

498 491

2019

288 498 288

2020+ E4E ISC OPS CCM Corp-Non HR PROC Corp-HR

OHI: Organization Health Index >>

86

1st Quartile OHI

xx

1st Quartile OHI (EBIT) (EBIT) (EBIT)

‘Maintain top quartile OHI’

Unit: MTHB EBIT 10,300 EBIT 10,300 EBIT 10,300

Target

(100 MS)

G

31

M&A under “Galaxy” project

Focus in Petrochemical Industry

▪ Petrochemical and/ or related petrochemical business with synergy value ▪ Why Galaxy :

• Align with aspiration: “Leading Integrated Petrochemical Complex in Asia by 2020”
• Growth Ambition: Invest to deliver targeted EBITDA of $100-200 Million
• Expeditious success

G

32

Newest investment thru “Galaxy”

Polymers e-commerce platform: “IPLAS”

Investment Profile

▪ Company: Guangzhao Saiju Performance Polymer Ltd, China ▪ Business: E-commerce platform for variety of plastic products under “IPLAS” platform ▪ Website: www.isuwang.com & www.suwen8.com ▪ Investment size: ~ 650 MB ▪ Exit strategy: IPO by 2021-2023 Shareholding Structure

• Founders

46%

• IRPC (new shares) 15%
• Others

39%

Investment Profile

New market and distribution

Benefit :

Big data analytic Leverage know-how

IPLAS : provide market place for supplier and buyer focusing in SME IPLAS : serve logistic as option for buyer and be included in prices IPLAS : service buyers for credit term thru interest charged in prices

IPLAS’s PLATFORM : one stop service provider

33

IRPC 4.0 Target

2.1 4.8 10.0 5.9 15.0 6.1 10.4 24.4 29.4 58.2 2020 3.5 > 100 2018 2019 11.5 50.3 OPS 4.0 CCM 4.0 PRO 4.0 ISC 4.0 ERP 4.0

24

Digital passive

81

Digital leader

DAI: Digital Assessment Index >> ‘Improve DAI to be digital leader’

Unit: MUSD

19 initiatives will be launched in Y2018

34

IRPC 4.0

Developing implementation plan through IRPC supply chain

O3 - Utility demand forecasting O2 - Mass balance reconciliation system E1 - SAP revisit I3 - Control tower decision making O4-O5 Rotating Machine PM O1 - EKON$ P1 - Spend cube analytics / SRM I1 - Crude selection

Supply Production/

• peration

Distribution Customer Market/ Competitor

Digital Organization Data Lake Robust ERP Backbone Secured Technology Agile Way of Work

Collaboration platform with cross function team

P2 - Advance material mgmt. C4 - End-to-end CRM C1 - Advanced pricing algorithm C6 - Market & competitors intelligence C3 - Big data analytics to predict demand E2 - Tech function E3a - Data governance / Reporting & big data analytics I2 - Collaborative asset tech. platform P3 - Demand planning (non-HC) C5 - B2B portal P4 - Process workflow re-design C2 - Customer industry platform O6 - Catalyst lifecycle prediction O10 - Maintenance advanced scheduler O8 - Crude blending

• ptimization

O12 - Smart operator app & wearable safety device

35

People – IRPC Capability building

2 major capability building programs; for soft and hard skills

1 3 Soft skills Hard skills Everest Academy LEAD program for managers

▪

Problem Solving

▪

Team Management

▪

Communication for impact

▪

GREAT Leader

▪

Operation: Model plant

▪

PSM: e3 operating model

▪

Commer- cial: 8+4 M&S Academy 4 Digital Academy

▪

Digital Leadership: Agile leadership, Digital trends, Industry 4.0, Innovation mgt.

▪

Digital Business Capabilities: Digital OPS, MKT 4.0, Design thinking, Advance analytics 2 AGILE change the way of working

▪

Agile way of working

▪

Scrum master

Thank You

This presentation material has been prepared solely for informational purposes only. IRPC is furnishing it solely for use by prospective investors / analysts in the proposed event. IRPC makes no representations or warranties as to the accuracy or completeness of such information. By accepting this material each recipient agrees that IRPC shall not have any liability for any representations (express or implied) contained in, or for any omissions from this presentation. The information contained herein does not purport to be all-inclusive or to contain all of the Information that may be material to the recipient’s decision. Each recipient of the information and data contained herein should perform its own independent investigation and analysis of the transaction and the creditworthiness of IRPC . Reference in this Disclaimer to this shall include references to the Appendices (if any) hereto.

Investor Relations Contact: ir@irpc.co.th

• Tel. +662-765-7380, Fax. +662-765-7379