Q INVESTOR PRESENTATION

Transcription

1 Q2 216 INVESTOR PRESENTATION

2 Company 3 Overview 2 Refining Industry Key 5 Financials 4 Investments

3 Refining Industry

4 1.Jul.13 1.Aug.13 1.Sep.13 1.Oct.13 1.Nov.13 1.Dec.13 1.Jan.14 1.Feb.14 1.Mar.14 1.Apr.14 1.May.14 1.Jun.14 1.Jul.14 1.Aug.14 1.Sep.14 1.Oct.14 1.Nov.14 1.Dec.14 1.Jan.15 1.Feb.15 1.Mar.15 1.Apr.15 1.May.15 1.Jun.15 1.Jul.15 1.Aug.15 1.Sep.15 1.Oct.15 1.Nov.15 1.Dec.15 1.Jan.16 1.Feb.16 1.Mar.16 1.Apr.16 1.May.16 1.Jun.16 1.Jul.16 1.Aug.16 Brent Crude Oil Prices $/Barrel , 115,3 16,1 11,2 CONS Already existing excess crude supply Cooling of Chinese economy High production from the OPEC and non-opec producers Entry of Iranian production Increase in the prices encouraged swing producers Potential decrease of Crude consumption with upcoming maintenance season 65,7 6,4 45,2 55, 94,6 84,3 55, 71,7 62, 66,7 PROS Disruptions in Venezuella, Libya & Nigeria Decreased shale production (US Rig Counts) High consumption due to the lower price environment. Upcoming increase in farming consumption and La Nina Saudi declaration for intiation of discussions with non-opec producers 26, 28,7 5,6 48,3 4

5 Thousand Barrels/Day Refinery Capacity Change China India Middle East Other Asia Other Japan North America Europe Source : Tüpraş, Reuters, Reports 5

6 Refinery Value Market Position Proportion of products sold domestically Local Competition Infrastructure Value Added Ability to upgrade Correlated to complexity Local Market Dynamics Growth trends Supply / Demand balance Cost Base Energy Efficiency Raw Material costs Scale Automation 6

7 Product Crack $/bbl 23, 21, 19, 17, 15, 13, 11, 9, 7, 5, Jet Fuel Jan Feb March April May June July Agust Sept Oct. Nov Dec F 19, 17, 15, 13, 11, 9, 7, Diesel 5, Oca Şub Mar Nis May Haz Tem Ağu Eyl Eki Kas Ara T Note: 29- August 216 Platts Data, 216 (September-December) estimation 7

8 Product Crack $/bbl 25, Gasoline 2, 15, 1, 5,, Jan Feb March April May June July Agust Sept Oct. Nov Dec F 5, Naphta 1, LPG, -5, -1, -15,, -1, -2, -3, -4, -2, Jan Feb March April May June July Agust Sept Oct. Nov Dec -5, , F Note: 29- August 216 Platts Data, 216 (September-December) estimation 8

9 Quarterly Product Crack Margins, $/bbl , 8, 13,6 9,5 15,2 Gasoline 13, 19,4 14,5 18,9 15,1 13,8 1,1 16,5 14,1 12,1 9,7 6,8 4,5 Q1 Q2 Q3 Q Diesel 16,1 16,3 15,3 15,7 15,2 14,6 13,6 17, 1,7 18, 9,2 7,9 2,9 18,9 16,7 15,8 16,4 16,4 Q1 Q2 Q3 Q ,4 12,6 16, 13,4 15,7 13, Jet Fuel 11,2 11,3 7,3 7,8 15,8 15, 1,7 9,5 18,3 17, 14,7 13,2 Q1 Q2 Q3 Q Q1 Q2 Q3 Q4-14,4-11,8-14,3-18,8-13,9-18,9-11,6-13,2-2,1-2,9-12,1-15,1-15,7-13,2-2,2-15, -15,7-2,4 Fuel Oil

10 Crude Differentials $/Barrel 1,,5, -,5-1, -1,5-2, -2,5-3, -3,5-4, 2,, -2, -4, -6, -8, -1, -12, Ural Crude Differentials $/Barrel Min/Max Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Differentials Trends Ural Iran Light (KI) Iran Heavy (KI) Kirkuk Arab. Heavy Siberian Light CPC 1,,5, -,5-1, -1,5-2, -2,5-3, -3,5-4, 1

11 Gross Margin $/bbl Med Complex Refining Margins 9, 8, 7, 6, 5, 4, 3, 2, 1,, -1, Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec -2, Max-Min Average

12 Million Vehicles Turkish Sector Outlook Primary driver of demand is growing vehicle parc Auto sales continue to massively outstrip removals Very high gasoline tax has led to LPG & Diesel substitution Gasoline car sales improving Vehicle Parc 17, 17,9 18,8 2, 2,4 16,1 13,8 14,3 15,1 4,1 4,8 6,1 7, 7,2 7,6 8, 8,4 8,7 9, 9,4 9,5 12,2 8,7 1,2 4,6 5,4 6,1 6,8 7,1 7,5 8,1 8,6 9,3 9,9 1,6 1, ,4 43,6 Air Passengers - Million 85,5 12,8 44,3 52,2 59,4 117,6 13, 149,5 65,4 35,8 41,2 5,6 58,3 64,5 73,4 8,3 165,7 181,4 83,9 76,1 85,4 97, Domestic International Jet Fuel demand growing strongly Highly competitive liberalised market Big infrastructure investments Istanbul has become a hub for Turkish Airlines Fuel Oil demand is declining Natural gas substitution Switching is dependent on price Long Term Asphalt Demand Growth Infrastructure investments Passenger Car Other *By the end of April 12

13 5 Months Turkish Consumption (Million tons) 9, 8, 7, 6, 5, 4, 3, 2, 1,, Diesel 7,69 8, ,7,6,5,4,3,2,1, Jet Fuel* +9.8% +9.9%,52, ,9,8,7,6,5,4,3,2,1, Gasoline +7.1%,78, ,4,3,2,1, Fuel Oil* +4.1%,29, Source: EMRA *bunker excluded. 13

14 Turkey s Import / Export Balance (Net) 4, 3, 2, 1,, -1, -2, -3, -4, -5, -6, -7, -8, -9, -1, -11, -12, -13, -14, -3, Export -3, Import -3,1-3,1-3, 2,1 2,5 2,4 Million Ton 2,5 3, -1, -1,8-12, -12,7-12,3 LPG Gasoline Diesel Fuel ,5 1,6 1, 1,8 1,6 14

15 Company Overview

16 Tüpraş Refining Assets Black Sea Baku İstanbul MARMARA İzmit Ankara Kırıkkale İzmir Batman Total Refining Capacity: 28.1 Million Tons 1% of Turkey s refining Capacity Current Nelson Complexity(NC): 9.5 Kirkuk İzmit 11. MT Capacity NC: 14.5 Storage Capacity : 3. Mn M 3 İzmir 11. MT Capacity NC: 7.66 Storage Capacity : 2.5 Mn M 3 Lube Oil Production 4 thousand ton Kırıkkale 5. MT Capacity NC: 6.32 Storage Capacity : 1.4 Mn m 3 Batman 1.1 MT Capacity NC: 1.83 Storage Capacity :.3 Mn m 3 16

17 OPET Tüpraş Share 4. % Stations 1.24 Opet Brand 433Sunpet Brand 1.1 Million M3 Storage Major Terminals in Marmara, Agean, Black Sea & Mediteranean International Trading London Jet Fuel Sales Turkish Airlines JV Lubricants Fuchs JV A Sector Leader 2nd Biggest Player # 1 Brand 17

18 Million Tons DİTAŞ Marine Transportation Tüpraş Share %79.98 Cumhuriyet Sevgi Gönül Leyla Suna Esra & Aylin Crude ,86 K DWT Products 28 1,98 K DWT Products 29 1,98 K DWT Products K DWT Products K DWT Bitumen 2x2 K DWT Esra 214 Aylin , 19 Tugboats 2 2,6 9, ,3 14,8 3,1 11,8 9,6 8,4 5,2 3,1 3,5 6,4 4,8 6, Crude Products Financials Million $ Net Sales 146,4 159, 13,7 11,7 113,6 Op. Profit 17,9 22,8 25,2 27,3 36,8 18

19 ,59,3, 1,43 3,11 2,39 2,57 5,47 11,54 Crude Suppliers of TÜPRAŞ (Million Tons) Crude Type % 7% In 215, Tüpraş purchased 21 different types of crude oil from 11 countries, with gravities ranging between API 63% Heavy / Sour Medium Heavy / Sour Light & Sweet ,2 9,7 5,3 5,1,6 1,5 2, 2,1 1,9 2,9 2,8 2, 2,4 2,4 2,3 2,4 3,8 3,1 5,7 6,1 1,6 1,5 1,5 1,1,2,3,3,1,1,7 1,, 2,6,6,6,3 IRAN RUSSİA S.ARABİA TURKEY IRAQ KAZAKSTAN ITALY LİBYA OTHER

20 J-6 J-6 N-6 A-7 S-7 F-8 J-8 D-8 M-9 O-9 M-1 A-1 J-11 J-11 N-11 A-12 S-12 F-13 J-13 D-13 M-14 O-14 M-15 A-15 J-16 Margin Environment Tüpraş Refining Margins ($/bbl) 9,62 5,3 5,32 5,54 Tüpraş Gross Margin Tüpraş Net Margin Mediterranean Ural Complex Margin 1,95 Annual 1,55 3,21 2,45 1,67 1,95 Med Complex 2,89 Month 1,17 4,21 11,86 6,47 4, ,67 2,1 Annual 4,83 4,77 Premium to the benchmark Mediterranean peers refining margin due to: Refined products deficit characteristic to the Turkish market (for diesel, jet fuel, LPG and specialist products such as lube oil and extract) Access to cheaper sources of crude oil Ability to use heavier and sour crudes Proximity to major suppliers Reduces transport costs Implemented cost reduction measures Energy efficiency programs Capacity to produce higher value added range of refined products Direct pipeline connections with domestic clients High export capability 2

21 Gross Refinery Margins, $/bbl J-99 A-99 J-99 O-99 J- A- J- O- J-1 A-1 J-1 O-1 J-2 A-2 J-2 O-2 J-3 A-3 J-3 O-3 J-4 A-4 J-4 O-4 J-5 A-5 J-5 O-5 J-6 A-6 J-6 O-6 J-7 A-7 J-7 O-7 J-8 A-8 J-8 O-8 J-9 A-9 J-9 O-9 J-1 A-1 J-1 O-1 J-11 A-11 J-11 O-11 J-12 A-12 J-12 O-12 J-13 A-13 J-13 O-13 J-14 A-14 J-14 O-14 J-15 A-15 J-15 O-15 J-16 Mediterranean Tüpraş USA WTI Singapore 21 21

22 6,4 69,6 74,4 71,3 78,7 76,8 86,1 91,1 9,1 98,1 95,6 Production Capacity Utilisation (%) Quarterly Production Volume (Mn Tons) ,32 7, ,2 81,6 77,1 79,1 7,5 5,5 2,9 2,4 74,9 3,6 +6,8% 12,5 1,9 4,4 94,1 5,2 4, ,59 5,6 4,55 6,93 6,75 4,63 5,41 5,51 6 8, Crude Oil Other 1 Min / Max 27/ / 1H 216 / 1H Q1 Q2 Q3 Q4 22

23 2nd Quarter Product Yields Fuel Oil 16,9% Coke,6% LPG 3,2% Other 2,3% Other 5,5% Bitumen 1,% Black Prod. 27,4% Mid. Distil. 46,1% Light Distil. 2,9% Gasoline 19,5% Naphtha 1,4% Jet 19,% Coke 2,7% LPG 3,8% Other 1,5% Fuel Oil 5,4% Other 5,4% Bitumen 12,6% Black Prod. 2,7% Mid. Distil. 51,4% Light Distil. 22,5% Gasoline 2,6% Naphtha 1,9% Jet 19,% Diesel 27,1% Diesel 32,4% White Product 71.83% Production 6.8 mn ton API:32.21 White Product 78.2% Production 6.6 mn ton API:

24 Sales By Customer 1Q 216 Customer Groups Sales to Distributors Bitumen 6% Military 2% TOTAL 4% Other 23% Export 26% Distributors 42% BP 2% TP 4% OMV POAŞ 32% Other 6% THY Opet 1% Shell 18% OPET 17% Petkim % LPG 4% Jet 4% Total: 6,9 million ton Distributors : 3,2 million tons 24

25 Refining Sales 1, 8, 6, 4, 2,, Domestic Sales, Million Tons 1,8 1,8 1,8 1,82, 8,6 7,9 8,1 6,7 9, ,8 3,33,63,9 2,8 3,2,82,9 2,9 1,9 Gasoline Diesel Jet Fuel Bitumen Sales Breakdown & Comparison Export Domestic 22,2 5,3 16,9 %+29,5 %+31,9 28,7 6,5 22, Million tons Total Sales, Million Tons 1, 8, 6, 4, 2,, 5,6 4,6 4,2 4,64,3 8,8 8, 8,2 6,8 9, ,1 3,53,7 3,9 3, 3,2,82,9 2,9 1,9 Gasoline Diesel Jet Fuel Bitumen Sales to distributors in Turkey are made at prices established by Tüpraş In accordance with a formula based on Italian "CIF" prices plus a margin below a maximum approved by EMRA Tüpraş's prices are affixed to all distributors, including Opet, on an equal basis Export sales are generally made to traders, on FOB basis 25

26 12M Trading Activities Exports, Ton* Gasoline Middle Dist. Fuel Oil Other Exports High CUR = big increases in export Finished Products High Sulfur Diesel imports decreased due to low desulphurisation arbitrage profits. ULSD imports were higher due to the trading arbitrage. Intermediates Additional HVGO + LCGO imported to increase Capacity Utilisation of conversion units Product Imports, Ton* Intermediate Imports, Ton* M M HVGO + LCGO ASR F.Oil 26

27 Investments

28 Investments, million $ RUP with Supplementary Projects Others

29 İzmit Waste Water Treatment Other Major Projects İzmir Crude Oil Revamping Kırıkkale Power Plant Project Aims To reduce the need for fresh water What the Project Entails A water treatment plant to process municipal & refinery waste water Two temporary systems were built to serve until the main system was completed Project completed in 215 Investment 22 Million USD Project Aims Eliminating low energy efficiency in the furnaces Enables sustainable full capacity utilization What the Project Entails Configuration Changes De-salter & Pre-flash column Heat recycling Heat Exchanger Replace column internals New pre-flash drum Expectations Investment: 31.9 Million USD IRR > 4% Project Aims Improving Energy Efficiency at Kırıkkale with a combined heat & power plant The other refineries are already equipped Expected completion: 216 What the Project Entails A new gas turbine New steam turbines New boilers One existing steam turbine will be utilized Total power: 6 MW Investment 84 Million USD IRR: >3% 29 29

30 Key Financials

31 Profitability Indicators, Month & 2Q nd Q 6M (%) ,92 45,57-26 Dtd.Brent Price, ($/bbl) 57,95 39,73-31,44 32,21 3,83-4,3 Processed Crude API 32,63 3,98-5,6 71,83 78,2 6,4 White Product Yield, (%) 72,7 75,59 2,89 4,88 3,2-34,4 Med. Complex Margin,($/bbl) 5,43 3,52-35,2 7,48 5,21-3,3 Tüpraş Net Margin,($/bbl) 6,23 4,3-35,3 337,95 169,7-5 Operating Profit, (mn. $) 38,2 262, ,9 189,9-49 Operating Profit for EBITDA, (mn. $) 492,6 258, ,6 216,6-43 EBITDA (mn.$)-cmb 452,7 355, ,6 99,5-68 EBITDA (mn.$)-cmb- CCS 455,9 26, ,6 236,8-43 EBITDA *(mn. $) 565,1 35, ,5 119,7-66 EBITDA* (mn. $) CCS 568,2 256, -55 (%) * In our EBITDA calculation, FX related items are not included, whereas CMB calculation method includes these in operationg profit 31

32 Q1 214 Q H 214 9M Q1 215 Q M Q H ,4,11,1, ,22,25,22,19,18, ,34,3,32,33,3,26,3,35, ,4 Financial Highlights (mn $) EBITDA R Net Income Net Debt Return on Average Equity ,45,4,35,3,25,2,15,1,5, 32

33 Balance Sheet Analysis 2,5 2, 1,5 1,,5, 1,41 2,16 Cash & Equivalents (Billion $) 1,721,69 1,3 1,641,68 1,21 1,4 1,4,82 1,641,59 2, 1,5 1,,5, 1,45 1,33 Receivables (Billion $),93,71,52,51,9,2,66 1,7,88,7,91 5, 4, 3, 2, 1,, 3,1 3,4 3,7 3,1 Financial Loans (Billion $) 3,2 3,2 3,3 3,7 3,6 3,6 3,4 3,9 4,,8 1,,5,9,3,3,3,4,5,6 1, 1,2,6 2,3 2,4 2,6 2,8 2,9 2,9 3, 3,3 3,1 3, 2,8 2,9 2,8 4, 3, 2, 1,, Payables (Billion $) 2,943,46 3,223,1 3,28 3,4 2,46 1,741,7 1,591,361,23 1,69 LT Loans ST Loans 33

34 FX Risk Exposure (3 June 216) Consolidated Assets Consolidated Liabilities Million $ Cash 9 Receivables & other assets 42 Stock 842 Forward & CFH* 2,59 Payables ST Financials 374 RUP 36 LT Financials: 2,657 RUP Loans: 1,47 Eurobond: 7 Other credits million $ *Cash flow hedge accounting : 1,568 mn $ 34

35 Future Expectations Brent Price Estimation The average Brent price in 216 is expected to be dollars per barrel band. Med Complex Margin We expect Med Complex margins to be dollars per barrel band in 216. Tüpraş Net Margin Net Tüpraş refinery margin is expected to be in the region of dollars per barrel Capacity Utilisation Expected Capacity Utilisation in 216 will be around 1 %. Production will therefore be approximately 28 million tons Imports of finished products will be minimal, as we focus on selling increased volumes of production Total sales volume will be 3. million tons Investment Total investments for 216 will be about 27 Million dollars 35

36 Income Statement Q2 Q % Diff. Million USD 6 M M 216 % Diff. 4.24, ,7-28 Net Sales 6.853,6 5.16, ,2 221,3-49 Gross Profit 634,3 387, , -78,9 1 Operating Expenses -142, -155,8 1-21,3 27,3-228 Income/Loss from other operations -112,1 3, ,9 169,7-5 Operating Profit 38,2 262, ,9 18,5 43 Income/Loss from equity investment 3,7 23, ,9 188,2-46 Operating Profit Before Fin. Income/Loss 383,9 286, ,2-16,6-235 Financial Income 192,9 45, ,5-34,8-59 Finance Expenses -311,2-161, ,6 136,8-51 Profit Before Tax & Minorities 265,7 169, ,7 113,5-58 Net Profit 384,8 14, ,6 216,6-43 EBITDA (mn.$) 452,7 355, ,6 99,5-68 EBITDA (mn.$)- CCS 455,9 26,

37 Tüpraş Balance Sheet Million USD Difference % Difference Current Assets Cash & C. Equivalents Receivables Derivatives Inventories Pre-paid expenses Other Current Assets Long Term Assets Financial Assets & Subsidiaries Fixed Assets Derivatives Pre-paid expenses Deferred Tax Other Long Term Assets Total Assets Short Term Liabilities Financial Loans Payables Derivatives Deferred Incomes Provisions Other ST Liabilities Long Term Liabilities Financial Loans Payables & Provisions Derivatives Other LT Liabilities Equity Minority Interests Total Liabilities

38 Dividends (TL) Total Payout (Million TL) , ,5 5, , , ,93 3,85 3,24 2,94 2, ,31 2,5 1,73 1, Earnings per Share Gross Dividend Total Payout /213 EPS includes the tax incentive 38

39 Disclaimer This presentation contains forward-looking statements that reflect the Company management s current views with respect to certain future events. Although it is believed that the expectations reflected in these statements are reasonable, they may be affected by a variety of variables and changes in underlying assumptions that could cause actual results to differ materially. Neither Tüpraş nor any of its directors, managers or employees nor any other person shall have any liability whatsoever for any loss arising from use of this presentation.

40 Deniz Değirmenci Investor Relations Manager The Investor Relations section of our company website has a rich content of updated information for the interested investors Investor Relations and Reporting Directors Tel. : Fax : Güney Mah. Petrol Cad. No.25 PK.4179 Körfez-Kocaeli info@tupras.com.tr

41 Supplements

42 Product Price Effect on Tüpraş in 2Q 2nd Quarter FOB Italy Prices Product Price, $/ton Tüpraş Crack Margin, $/bbl Product Yield % LPG 293,63 388,5 3,6% -19,42-27,33 Gasoline 486,65 66,19 2,1% 14,4 19,42 Naptha 379,49 56,55 1,1% -2,73-4,74 Jet Fuel 419,55 575,55 17,5% 7,8 11,28 Diesel 48,16 574,27 32,5% 9,27 15,23 Diesel 1 399, 561,47,7% 8,4 13,51 Fuel Oil 1% 213,86 335,9,2% -12,58-1,25 Fuel Oil 3,5% 198,42 323,4 18,8% -14,96-12,1 Total Crack Margin,$/bbl 3,76 7,59 Dated Brent Avg. $/Bbl 61,9 45,6 94,5% Margin Differences, $/bbl -3,8 Total Raw Materials Charge, mn Barrel 51,94 Total Effect of Product Price, mn $ -198,8 Total Effect of Price Ratio, mn TL -575,2 Impact of Med FOB Prices on Tüpraş Operations was - 575,2 million TL 42

43 Product Price Effect on Tüpraş in 1H 2nd Quarter FOB Italy Prices Product Price, $/ton Tüpraş Crack Margin, $/bbl Product Yield % LPG 289,75 386,58 3,6% -13,93-23,53 Gasoline 441,58 62,31 2,1% 14,68 16,27 Naptha 339,58 47,78 1,1% -1,39-4,8 Jet Fuel 371,69 556,16 17,5% 7,55 12,79 Diesel 359,51 546,14 32,5% 8,57 15,42 Diesel 1 349,65 53,4,7% 7,25 13,31 Fuel Oil 1% 179,4 313,1,2% -12,6-9,68 Fuel Oil 3,5% 166,24 298,88 18,8% -14,9-11,85 Total Crack Margin,$/bbl 3,92 7,46 Dated Brent Avg. $/bbl 39,7 57,9 94,5% Margin Differences, $/bbl -3,5 Total Raw Materials Charged, mn barrel 12,88 Total Effect of Product Prices, mn $ -364,5 Total Effect of Product Prices, mn TL -1.63,6 Impact of Med FOB Prices on Tüpraş Operations was 1.63,6 million TL 42

44 Inventory Effect* Analysis $ million Crude Product Total Crude Product Total 1st Quarter -35,1-35,1-7,2-9, -13,4-22,4 Apr 9,1 25,3 34,4 7,2 16,6 23,8 May 16,8 12, 28,8 26,3 43,3 69,6 Jun 2,2 1,7 3,9 13,4 1,2 23,6 2nd Quarter 28,1 38,9 67,1 46,9 7,1 117, 6 Months -7, 3,9-3,1 37,9 56,7 94,6 *FX effect Included, hedging excluded 44

45 HIGH DEMAND in 215 (12 Month Turkish Consumption (Million ton)) 25, 2, Diesel +15,8% 5, 4, Jet Fuel* +13,1% 15, 3, 1, 17,43 2,18 2, 4,1 4,64 5, 1,, , Gasoline Fuel Oil 2,5 2, +9,1%,6,5-18,5% 1,5 1, 1,92 2,9,4,3,2,54,44,5,1, , * Tüpraş sales + Distributor s Imports 45

46 5 Months Turkish Consumption (Million tons) 9, 8, 7, 6, 5, 4, 3, 2, 1,, Diesel 7,69 8, ,7,6,5,4,3,2,1, Jet Fuel* +9.8% +9.9%,52, ,9,8,7,6,5,4,3,2,1, Gasoline +7.1%,78, ,4,3,2,1, Fuel Oil* +4.1%,29, Source: EMRA *bunker excluded. 46

47 HIGH COMPLEXITY #1 (Nelson Complexity of Refinining Companies) 7,3 7,1 7,1 7,1 7,1 6,8 6,5 İzmit 16 After RUP ,5 13, 12,6 Tüpraş After RUP 11,8 11,6 11,5 11, 1,4 9,9 9,8 9,6 9,5 9,4 9,2 9,2 9, 8,8 8,7 8,4 8, Tüpraş Before RUP 8 6 5,9 5,8 5,

48 HIGH COMPLEXITY # 2 (Resid Upgrading Units Production (Thousand Tons)) Raw Materials (kton) Products (kton) Natural Gas 246 Vacuum Resid 1,214 Atm. Straight Run Fuel Oil 3,36 Total Feed 4,496 Total Production 4,25 48

49 HIGH COMPLEXITY # 3 (Tüpraş Total Production Change After RUP) Bitumen 2,9 Before RUP After Coke Fuel Oil,35,7 2,7 %-87 RUP production + 4 Refineries Capacities increase 9,1 mn tons, instead of 4,2 mn ton Others 1,4,3 %19 Diesel 5,6 5,5 Jet Fuel 3,6,9 %25 Gasoline&Na ptha 4,7 1,7 % Million ton 49 49

50 HIGH COMPLEXITY # 4 (Tüpraş Tax Incentive From RUP) Large Scale Investment Incentive Valued at 3% of project cost Realised after completion Tax rate of 1% on project earnings until total incentive is reached Strategic Investment Incentives Valued at 5% of project cost Partly realised during construction Tax rate of 2% on project earnings until total incentive is reached Total incentive is 3,66 billion TL. 344 mn TL of Investment incentive income deducted from Strategic Investment Incentive total 5

51 HIGH QUALITY (Maximum on-road diesel sulphur limits, January 214) US& Canada Latin America Europe Middle east Russia & Caspian Africa Asia& Pasific Source:Stratas Advisors Tüpraş and Turkey have the most stringent production limits on sulphur content 51 51

52 HIGH FLEXIBILITY (Tüpraş Refineries Simple Flow Diagram) 97, m3/bbl Crude Distillation (8) Naphtha Splitter (8) 43, m3/bbl Vacuum Dist. LPG Merox (6) Isomerisation (3) Kero / Diesel HDS (1) Unifiner Reformer (7) 6,4 m3/bbl 16,9 m3/bbl 37,3 m3/bbl 4,7 m3/bbl FCC(2) 17,4 m3/bbl Hydrocracker (4) FCC Gasoline HDS (2) 4 thousand ton/year Benzene Saturation (2) 215 Yield Gasoline + Naphtha %21.9 Jet Fuel + Kerosene %19. Gas Oil %3.5 Lube Oil %.5 (8) Bitumen / Lube Oil (1) 8,2 m3/day Coker Fuel Oil %21.9 Bitumen (4) Others %1.3 LPG %3.4 52

53 LOCATIONAL ADVANTAGE & HEAVIER CRUDES (Crude Suppliers of TÜPRAŞ (Million Tons)) 5,47 3,11 2,39 2,57 11,54,59,3, 1,43 Crude Type % 7% In 215, Tüpraş purchased 21 different types of crude oil from 11 countries, with gravities ranging between API 63% Heavy / Sour Medium Heavy / Sour Light & Sweet ,2 9,7 5,3 5,1,6 1,5 2, 2,1 1,9 2,9 2,8 2, 2,4 2,4 2,3 2,4 3,8 3,1 5,7 6,1 1,6 1,5 1,5 1,1,2,3,3,1,1,7 1,, 2,6,6,6,3 IRAN RUSSİA S.ARABİA TURKEY IRAQ KAZAKSTAN ITALY LİBYA OTHER

54 COVERING WHOLE COUNTRY Operations Tüpraş operates the only 4 refineries in Turkey 3 Large Refineries produce Euro V Diesel & Gasoline, plus jet fuel, fuel oils, asphalt, LPG, naphtha and others Black Sea Baku İstanbul Marmara İzmit 11. MT Capacity NC: 14,5 Storage Capacity: 2.2 Mn M 3 Sales Channels: o Pipeline, Ship, Railway & Truck İzmir İzmit Ankara Mersin Kırıkkale Batman Ceyhan Kirkuk İzmir 11. MT Capacity NC: 7.66 Storage Capacity: 1.9 Mn M 3 Only lubricant, base Oil, producer Sales Channels: o Pipeline, Ship, & Truck Kırıkkale 5. MT Capacity NC: 6.32 Storage Capacity: 1.2 Mn M 3 Sales Channels: o Pipeline, Railway & Truck 1.1 MT Capacity NC: 1.83 Batman Storage Capacity:.2 Mn M 3 Asphalt - 7% of product yield o Sales Channels: o Semi-finished products sent for further processing Pipeline, Railway & Truck

55 COMPETITION # 1 (European Pump Price Comparison) Gasoline (Krş / Lt) Tax Distr. Margin Pump No Tax Diesel (Krş / Lt) Spa. Fra. Ger. EU19 TR Eng. Gre. Ita. Nor. Spa. Gre. Ger. Fra. EU19 TR Ita. Eng. Nor. Not: Prices valid on 2 May 216. Norvey prices as of 5 May 216, Türkiye prices updated as of 27 April 216 the latest. 55

56 COMPETITION # 2 (Regional Competition) Mediterranean Black Sea 53 Refineries 7.6 mn bpd 17 Refineries 1.6 mn bpd 56

57 COMPETITION # 3 (SOCAR-STAR Refinery) Goldman Sachs has acquired a 13 percent stake in SOCAR Turkey for $1.3 billion. Goldman Sachs has the right to resell 1 percent of its stakes to Socar, and the remaining 3 percent to Sermaye Investments Limited owned by SOCAR within 6 year at the same price. STAR Refinery Production (k ton) Fuels Diesel 5. Jet Fuel 1.7 Sulphur 158 Petrocoke 698 Petrochemical feedstock LPG 26 Naptha 1.3 Mixed xylene 46 Reformate 524 1,1 Credit : 3.3 Billion $ Equity : 2.4 Billion $ Total Investment: 5.7 Billion $ 3,3 billion dollar credit aggrement. First 4 year grace period total year term. Project finance is supplied to company (US$ 1.5 billion) It is planned to be commissioned in

58 COMPETITION # 4 (Turkey consumption balance & the effect of new refinery) * Million ton Turkey Demand Tüpraş Production Turkey- Tüpraş Star SOCAR Deficit/ (Excess) Crude Oil 28,1 1, Semi product+other charge,8 Total processed 28,9 1, Products LPG 4,1 1,1-3,,3-2,7 Petrochem. charge: Naptha, Reformate/xylene 2,8,6-2,2 2,3,1 Gasoline 2,2 5,7 3,5 3,5 Jet fuel/kerosene 5,4 5,6,2 1,7 1,9 Diesel 21,9 1,2-11,7 5, -6,7 Fuel Oil 1,1,9 -,2 -,2 Asphalt 3,3 2,7 -,6 -,6 Sulphur & other 1,8,5-1,3,2-1,1 Coke 3,,8-2,2,7-1,5 Total 45,5 28,4-17,1 1,1-7, *Expected to be completed by the end of

59 CRUDE DEMAND While the demand in Asia, Middle East & Africa is still increasing, growth is less than 215 FSU Europe North America +144 Latin America Africa Middle East +95 Asia +128 Jap./Korea /Oceania -8 Global Consumption & Growth 1,33 Million barrels/day +,97 92,88 +1,85 94,74 96, Global Balance Million Barrels/day Demand Change (1) 5,71 1,85 1,33 Capacity Increase (2) -1,2-1,51 -,8 Refinery shut-downs (3) 5,95,42,15 Total (1-2-3) 1,64,76,68 Source :IEA:14 April 216 * Demand includes crude, NGL-condensate and Biofuels 59

60 7,1 7,1 6,9 6,1 4,8 5, 3,4 3,5 3,6 1,9 3,2 1,7 1,8 1,9 2,6 1,7 1,4 2,4,8 2,8 1,3 3,4 2, 1,1,5 Tüpraş HSE KPI: Loss Time Incident Frequency and Severity Frequency Ratios 8, 7, 6, Incident Frequency İncluding contractors Tüpraş Contractor Total 5, 4, 3, 2, 1, 3,6 2,5 1,7 2,2 1,5 1,1 1,6 2,5,7, Loss Time Severity Frequency Rate (215 Target 3) Tüpraş Contractor Total loss time incident freaquency rate =number of incident *1/man hours loss severity frequency rate = loss time*1/man hours 6

61 Energy Saving Projects, mn$ Energy Index 119,1 99, Total Tüpraş Energy consumption (TJ) Energy-saving(TJ) Energy Efficiency Project Savings (mn $)