Trans nsformi orming ng plasti lastic c waste e in into o - PowerPoint PPT Presentation

Trans nsformi orming ng plasti lastic c waste e in into o valuabl able e lo low-carbon arbon product oducts Pareto eto Oil & & Gas as Confe ference Septembe mber r 2019

P A R T O F T H E S O L U T I O N Quantafuel turns a global environmental problem into low-carbon products 19 September 2019 | 2

P L A S T I C – A M A N M A D E “ W O N D E R M A T E R I A L ” Plastic production grows steadily – fastest growing man-made material Million tonnes es per year ar ~650 50 (2035) 86 86 (1985) 1950 1950 1970 1970 1990 1990 2010 2010 2030 2030 2050 2050 19 September 2019 | 3 Source: Plastics Europe

250 ton onnes es of of p pla lastic tic waste te enters the ocean during this presentation (over 8 million tonnes per year) 19 September 2019 | 4 Source: UN Environmental Programme

The most difficult material to recycle mechanically 19 September 2019 | 5

P L A S T I C W A S T E I N D E N M A R K ~110,000 tonnes separated plastic waste and ~750,000 total plastic waste – ~50,000 tonnes separated for mechanical recycling Separated Plastic waste included in plastic waste other waste streams Plastic waste ~110,000 MT ~650,000 MT streams Quantafuel relevant feedstock 50 – Recycling 300 – 400,000 MT 300 – 400,000 MT 100,000 potential MT Mechanical Chemical Hard to separate recycling recycling plastic waste Source: http://mst.dk/affald-jord/affald/affaldsdatasystemet/find-affaldsdata/affaldsstatistikker/ 19 September 2019 | 6

W A S T E M A N A G E M E N T Quantafuel’s position in the waste pyramid – chemical recycling included Mechanical recycling Plastic waste made into pellets used for new plastic production. “ Currently, only 3-4 % of plastic waste in Europe is actually reused for making new plastic products. ” Chemical recycling A wider range of plastic waste reduced back into petrochemical products – some to be used towards new plastics. “ Replaces virgin oil products 1-1 .” Energy recovery Incineration of organic and in-organic (plastics) substances into heat and electricity production. “ High energy efficiency, but results in “burning oil” when plastics are used as feedstock .” 19 September 2019 | 7

H I G H G R O W T H N A S C E N T M A R K E T Need a rise of structured plastic waste management and recycling 2030: “Alternative reuse” of plastic 2030: >200 million tonnes plastic reused biggest profit growth >50 million ~25 BUSD for tonnes for pyrolysis pyrolysis Luckily it is on the way… 19 September 2019 | 8 Source: McKinsey&Company

M A R K E T M A C R O O U T L O O K Global players scrambling for developing their position Oil majors Chemical majors Recycling majors Compa pany y exampl mples es Compa pany y exampl mples es Compa pany y exampl mples es State ted d ambiti tion: State ted d ambiti tion: State ted d ambiti tion: “Neste targets to process more “BASF is working on “REMONDIS has initiated a than one million tons of plastic recovering and recycling of project to develop and operate waste annually by 2030.“ plastics through our so so-called chemical recycling ChemCycling project.“ facilities.“ Need to increase recycling – See major opportunities in Expect chemical recycling to alternative fuels become a major factor require chemical recycling 19 September 2019 | 9

E F F I C I E N T P L A S T I C R E C Y C L I N G Quantafuel is pioneering the plastic recycling industry – giving waste plastic now being incinerated a second life Capturi ring loc ocal al plast stic ic …through small plants …producing high -quali lity, waste as a resource… and proven technology… synth thetic tic prod roducts. cts. Low-carbon fuel ÷ 90 % GHG emission in Re-use plastic waste Reduce local emissions fuel production Quantafuel first company with 30 USD/boe break-even 19 September 2019 | 10

U N I Q U E C A T A L Y S T S O L U T I O N A N D P L A N T D E S I G N Quantafuel with unique and proprietary catalyst and enabling small, efficient plant design constructed with tried and tested components 1 2 3 4 5 Pl Plas astic tic Feedin ding Pl Plas astic tic pyrol olysis sis reactor actor Quan antaf afuel el reactor actor Distill stillation tion Sto torage age and offlo loadin ading 19 September 2019 | 11

B Technology T E C H N O L O G Y R E F I N E M E N T S 1 Feedstock handling system 19 September 2019 | 12

B Technology T E C H N O L O G Y R E F I N E M E N T S 2 4 Pyrolysis reactor 19 September 2019 | 13

B Technology T E C H N O L O G Y R E F I N E M E N T S 3 Unique catalyst solution 19 September 2019 | 14

B Technology T E C H N O L O G Y R E F I N E M E N T S 4 5 Distillation column and storage 19 September 2019 | 15

B Technology T E C H N O L O G Y R E F I N E M E N T S State of-the-art heat recovery and utility system 19 September 2019 | 16

S K I V E E C O N O M I C S Quantafuel Skive with 15.1 MUSD rev and 8.9 MUSD EBITDA with 60 MT and 45 MUSD and 29 MUSD with 180 MT in 2021 2021 economics with 60 MT first plant 2021 economics with 180 MT capacity MUSD 45.2 3.6 3.0 5.7 4.2 28.7 EBITDA: 63% 15.1 1.2 1.5 2.5 1.0 8.9 EBITDA: 59% 1) 1) Revenues Direct Personnel Other OPEX Service fee EBITDA Revenues Direct Personnel Other OPEX Service fee EBITDA expenses Quantafuel AS expenses Quantafuel AS 1) Revenue is based on HVO market price of USD 1 370 / MT 19 September 2019 | 17

S T R A T E G I C P A R T N E R S H I P A G R E E M E N T S I G N E D Started preparation for two large scale projects – goal of 5 Antwerpen erpen Aligned to start preparation for two • large sites Antwerpen and Bayern • 100.000 ton + capacity per location • Pre-engineering, site allocation, • permitting, feed-stock supply, location, budgets Bayern 50/50 JV structure Vitol – QF • 2 X 100 MUSD investment • 150 MUSD revenue – 100 MUSD EBITDA • potential FID right after Skive • Pre-project financed by Vitol • 19 September 2019 | 18 1) ARA is the abbreviation for the ports of Amsterdam, Rotterdam and Antwerp

Quantafuel planning to roll-out plants building high-profitability, recurring revenue Buildin ilding recu currin ing g reven enue e throu ough grow owth th in plan ant-por portf tfol olio io >100 00 MUS USD D in fuel sales in 2022 ARA 100,000 to 100,000 tonnes Skiv ive e II 60,000 tonnes es 110 000 Skiv ive e I 20,000 tonnes es plastic waste 58 000 21 500 2 150 0 2018 2019 2020 2021 2022 2023 2024 2025 19 September 2019 | 19

Future growth in naphtha ▪ European petrochemical capacity 25 millon tons ▪ Fastest growing petroleum-based consumer good 11 billon USD ▪ EU’s increasing recycling target 10 – 55% High versus ▪ Chemical vs Mechanical recycling low quality 19 September 2019 | 20

B Technology T E C H N O L O G Y R E F I N E M E N T S Changes in catalyst solution to produce naphtha 19 September 2019 | 21

Concentration (approximate Main focus distribution) Natural gas Naphtha Diesel Heavy fraction ( ~6 %) (~18 %) ( ~67 %) ( ~9 %) C1 C5 C10 C15 C20 C25 Chain length (in # of carbon atoms) 19 September 2019 | 22

O W N T H E V A L U E C R E A T I O N Quantafuel’s business model is to build, own and operate PtL plants, each established as a separate SPV Local partner • Invest capital • Plant technology and design • Local competence • Plant planning, construction and commissioning • Potentially contribute with feedstock • Operational support Dividend 3 Service fee 2 1 Plant owning SPV Plant price • Quantafuel ownership >50 % • Plant construction and operations • Plant financing • Secure feedstock and fuel sales 19 September 2019 | 23

To the beginning of a partnership