INVESTOR PRESENTATION. November, 2017

Transcription

1 INVESTOR PRESENTATION November, 217

2 CONTENTS 1 REFINING INDUSTRY 2 COMPANY OVERVIEW 3 KEY FINANCIALS 4 INVESTMENTS

3 1 REFINING INDUSTRY

4 Brent Crude Oil Prices ($/bbl) PROS OPEC & Non OPEC Supply Cut Political Instabilities Healthy PMI data in US and Europe Expectation of high global GDP Inventory levels 56,3 53,4 64, 62,6 59,3 52,4 55,3 5 5, ,2 47,5 44, , 4,3 25 Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 Source: Platts *As of November 22th, 217 CONS Increase in number of rigs & production in US Concerns about the impact of OPEC & Non OPEC production cuts Increase in Libya, Brazil, Nigeria & Canada prod. High crude exports of OPEC 4

5 Refinery Capacity Change Thousand Barrels/Day Thousands 3. China India Middle East Other Asia Other Japan North America Europe Gross Capacity Additions Source: Tüpraş, Reuters, Reports 5

6 Turkish Economy Strengths Population (mn) 1.4% growth in last 5 yrs -4 yrs >65% ,2 8,8 4,2 GDP (%) 3, 4, % % 2,9 5, 5, , Q1 217Q Diesel Consumption 3.5% 8.7% average growth in last 5 yrs annual growth Car ownership per thousand people 67% Source: EMRA, TSI

7 Competitive Advantages of Tüpraş Added Value Created by Tüpraş Local Market Dynamics Cost Base of Tüpraş Best Fit for the Market with high diesel yield High Growth Energy Efficient High Complexity of Tüpraş Short on Diesel Crude Oil & Feedstock Cost Advantage Presence in all over Turkey through refineries and terminals Import Parity Pricing (Freight advantage of Tüpraş) Economies of Scale 7

8 Middle Distillate Cracks ($/bbl) Diesel ,1 14,8 1,4 7,2 11,1 1, 7,8 8,6 11,2 7,3 1,6 1,4 12,4 12,9 9,7 8,9 8,7 14,1 9,4 13,5 12,5 14,5 12, 11,5 1, 7,6 Jan Feb Mar Apr May Jun Jul Agu Sep Oct Nov* Dec 2 Jet Fuel ,3 15,1 9,5 1,1 8,9 7,6 6,6 7,7 1,2 9,5 1,1 7,7 6,7 9,1 11,7 12,7 12,6 12,8 11,7 14,8 1,5 1,9 9,1 8,2 7,6 8,1 8, Jan Feb Mar Apr May Jun Jul Agu Sep Oct Nov* Dec Source: Platts *As of November 22th, 217 8

9 Light Distillate Cracks ($/bbl) 24 Gasoline ,6 13,5 9,8 15,9 14,1 13,7 13,4 12,2 11,7 12,8 14,3 9,1 15,9 14,8 11,4 13,4 11,7 11,7 15,7 11,9 Jan Feb Mar Apr May Jun Jul Agu Sep Oct Nov* Dec ,4 Naphta -,7-2,2 -,5-3,2-3, -2,2-2, -1,2 -,7,3-1,3-4, -7,3-7,9-7,3-11,7 Jan Feb Mar Apr May Jun Jul Agu Sep Oct Nov* Dec -2, ,2-17, ,2-19,5-14,9-19,8-21,9-31, LPG -46, -2,5-15,4-13,8-1,9-15,4 Jan Feb Mar Apr May Jun July Agu Sep Oct Nov* Dec -4,7 Source: Platts *As of November 22th, 217 9

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

11 Crude Price Differentials (USD/bbl) Ural Differentials Differental Range Brent -1,23-1,46-1,73-1,12-1,37 -,96 -,67 -,28-1,11 -,63 -, Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov* Dec Price Differentials Ural Iran Heavy Kirkuk Kuwait Basra Heavy Arab Heavy Brent Source: Platts *As of November 22th,

12 Turkish Consumption (Million tons) Diesel Jet Fuel , % 216 4,4-4% 215 2, , , % 214 4,1 +12 % Gasoline, 1, 2, 3, 4, 5, Fuel Oil* 216 2, % 216,58-3.5% 215 2, % 215,6-14.6% 214 1,92 214,71 Source: EMRA *bunker excluded.,8 1, 1,2 1,4 1,6 1,8 2, 2,2,,2,4,6,8 12

13 8 Months Turkish Consumption (Million tons) Diesel Jet Fuel , ,1 +8.4% +2.5% , , ,,5 1, 1,5 2, 2,5 3, 3,5 Gasoline Fuel Oil* 217 1,55 217, % -15.9% 216 1,49 216,37,,4,8 1,2 1,6,,1,2,3,4 Source: EMRA *bunker excluded. 13

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

15 2 COMPANY OVERVIEW

16 Tüpraş Refining Assets & Distribution Network Baku OPET Marmara Terminal 721, m3 İstanbul İzmit OPET Giresun Terminal 43,13 m3 Turkey Storage Capacity İzmir Ankara Kırıkkale Batman Tüpraş 7.2, 58% OPET 1.1, 9% Other Companies 4.1, 33% OPET Antalya Terminal OPET Mersin Terminal 19,392 m3 24, m3 Total Capacity: 28.1 mn. ton Nelson Complexity: 9.5 Tüpraş Storage Cap.: 7.2 mn. mᶟ OPET Storage Cap.: 1.1 mn. mᶟ Crude Pipeline Terminal Kirkuk Refinery İzmit 11. MT Capacity NC: 14.5 Storage Capacity: 3.3 mn m 3 İzmir 11. MT Capacity NC: 7.66 Storage Capacity:2.51 mn m 3 Base oil 4 k tons Kırıkkale 5. MT Capacity NC: 6.32 Storage Capacity: 1.41 mn m 3 Batman 1.1 MT Capacity NC: 1.83 Storage Capacity:.25 mn m 3 16

17 OPET Tüpraş Share 4.% Stations Market positions: 17.9% in White product; 16.6% in black product 1.1 Million M3 Storage Marmara, Aegean, Black Sea & Mediterranean 2nd Biggest Distribution Company by Volume # 1 Brand Royalty Award Jet Fuel Sales Turkish Airlines JV 66% Market Share Lubricants Fuchs JV International Trading London 17

18 Million Tons DİTAŞ, Marine Transport Tüpraş Share 79.98% Semahat Sadberk Cumhuriyet Leyla Esra & Aylin Caroline Nevbahar Gönül&Sevgi Suna Crude ,5 K DWT Crude ,5 K DWT Crude ,9 K DWT Products 211 6,3 K DWT Bitumen 2x2 K DWT Esra 214 Aylin 215 Products 29 1,9 K DWT Products 29 11,5 K DWT Products Sevgi 28 Gönül 29 2x11 K DWT Products ,5 K DWT One of the biggest Turkish marine transportation companies of crude oil and petroleum products Carries mainly Tüpraş crude oil purchases and makes the transfer operations of product and semiproducts. 13 tugboats 1 mooring boats 2 service boats 1 pilot boat DİTAŞ Financials 216 (mn $) Net Sales 151,3 Op. Profit 4, ,9 2,6 18, 3,1 19,3 14,8 Crude Oil Product 9,6 8,4 3,1 3,5 11,8 5,2 6,4 4,8 6,6 15,2 5,9 9,

19 ,59,6,3,3,, 1,43 2,39 2,26 3,11 3,24 2,57 2,58 2,8 5,47 6,98 9,25 11,54 Crude Suppliers of TÜPRAŞ (Million Tons) Crude Type ,% 6,3% In 216, Tüpraş purchased 18 different types of crude oil from 1 countries, with gravities ranging between API 41,7% > > , ,3 5,1 7,2,6 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 I RAN RUSSIA S.ARABIA TURKEY I RAQ K A Z A K STAN I TALY L İ BYA OTHER

20 J-8 M-8 M-8 J-8 S-8 N-8 J-9 M-9 M-9 J-9 S-9 N-9 J-1 M-1 M-1 J-1 S-1 N-1 J-11 M-11 M-11 J-11 S-11 N-11 J-12 M-12 M-12 J-12 S-12 N-12 J-13 M-13 M-13 J-13 S-13 N-13 J-14 M-14 M-14 J-14 S-14 N-14 J-15 M-15 M-15 J-15 S-15 N-15 J-16 M-16 M-16 J-16 S-16 N-16 J-17 M-17 M-17 J-17 S-17 Margin Environment ($/bbl) 9,5 Med Complex Month Annual 7,5 5,5 3,5 1,5 -, ,54 5,7 4,83 4,21 3,97 2,89 1,95 1,95 1,67 1,17 Tüpraş Gross Margin Tüpraş Net Margin Med Margin 13, 11,9 11,2 1,6 9,6 8,5 6,47 6,3 5,8 4,83 3,97 3,21 2,45 1,67 1,95 Premium to the benchmark Mediterranean peers refining margin due to: Refined products deficit characteristic to the Turkish market 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 M 2

21 Production ,7 4,3 Capacity Utilisation* (%) 11,3 19, 4,6 4,3 114,8 7,6 15,7 14,7 17,2 76,4 Crude Oil Other Total 214 Q3 215 Q3 216 Q3 217 Q Quarterly Production Volume (Mil. Tons) 7,1 6,6 5,6 4, ,8 6,9 6,7 4,6 7,7 7,3 7,2 5,4 7,4 7,4 5,5 Q1 Q2 Q3 Q4 MAINTENANCE SHUTDOWN Izmir Refinery Crude Unit (Capacity: 6,5 mtons/year) The maintenance shutdown in Q4 is expected to be completed in January 218. The effect of this maintenance shutdown has been included in our year-end estimations. *Nameplate capacity calculated by standard 33 days of operations. 21

22 9M Product Yields Coke 2% ASRFO+Vac 1% Other 6% Fuel Oil 8% Other 5,5% Bitumen 12% Black Prod. 22,7% Light Distil. 22,2% Gasoline 21% Naphtha 1%, ASRFO+Vac % Bitumen 11% -,8 -,8 Coke 3% Other 6% Fuel Oil 8% Other 5,6% Black Prod. 21,9% Light Distil. 21,3% Gasoline 2% Naphtha 1% Mid. Distil. 49,5% Jet 17% Mid. Distil. 51,2% Jet 17% ULSD 32% White Product %76,2 Production : 2,32 mn tons API: 3,81 % +1 ULSD 34% 1,7 White Product %76,98 Production : 22,43 mn tons API: 3,32 22

23 Tüpraş Sales (Million Tons) Jet Fuel Bitumen Gasoline Diesel Domestic sales of selected products 5,8 6, 5,4 5,4 4,6 3,2 4,1 4,3 3,9 2,6 2,9 3,3 3,5 2,8 2,8 2,9 2,2 1,8 2,3,6,7 2,3,6 1,7 1,7,5,6 1,5,6,5 1,1 1,3,5,5,6,9,9 1,2,8,4,4,2,3,4,4,3,4,8,9 1,,8 1, 1,3 1,2 1,1 1,2 1,5 1,3 1,5 6,7 3,6 5,1 5,3 2,6 2,9 1,7,5,5,4,9,9,5,9 1,1 1, ,7 1,1 Domestic 5,6 1,7 3,6 3,9 Q1 Q2 Q3 Q4 6,9 7,2 1,8 2,3 5,1 5, 4,7,9 4,1 7,3 1,9 5,4 7,7 Total Sales Export 8,9 1,3 8,1 1,4 6,4 6,6 6,4 1,5 4,9 7,9 8,1 1,2 1,2 6,8 6,9 1,2 7,7 6,1 1,8 4,3 All Time High Domestic Sales 7,9 7,6 1,7 1,3 6,2 6, Q1 Q2 Q3 Q4 23

24 Investments (mn $) RUP Total Investment: $ 3,2 Billion Total Incentive: TL 3,78 Billion Remaining: TL 3,18 Billion Avg 278 mn $ Nelson complexity High white product yield Process more heavier and sour crudes Run all refineries with 1% capacity utilization Avg 943 mn $ Avg. 279 mn $ * Ongoing Projects New Power Plant Revamp of Crude Unit FCC Modernization New Sulphur Units Energy Saving Projects Optimization of conversion units M 24

25 3 KEY FINANCIALS

26 ,4,11, ,24,3,26,22,32,35,45,55,49 Financial Highlights (mn $) , EBITDA 1st Q 2nd Q 3rd Q 4th Q Total Net Debt 2,4 3,5 3, , ,8 3,3 Net Debt/*R. EBITDA 1,7 2, 1, ,5 1, ,, ,6,5,4,3,2,1, Net Income 1st Q 2nd Q 3rd Q 4th Q Total Return on Average Equity For P&L, USD/TL rates: 216 Q3 2,96; 9M 2,93; 12M 3,2 and 217 Q3 3,51; 9M 3,59. For Balance Sheet, USD/TL rates: 216 Q3 3,; 9M 216: 3,; 12M 216: 3,52 and 217 Q3 3,55; 9M 3,55 USD/TL Net Debt/Rolling EBITDA was calculated with USD figures. 26

27 Balance Sheet Analysis 3,22 3,1 3,28 3,4 2,46 1,74 1,7 1,59 1,36 1,23 1,69 1,98 2,2 2,62 2,19 2, ,721,69 1,3 Cash & Equivalents (Billion $) 1,641,68 1,21 1,4 1,4,82 1,641,59 2,45 2,2 1,72 1,58 2,19 2, 1,6 1,2,8,4,,93,71,52,51 Receivables (Billion $),9,2 1,7 1,9 1,15,88,91,91,66,7,75 1,57 Financial Loans (Billion $) Payables (Billion $) ,1,5 3,7 3,9 4, 4,2 3,45 3,57 3,3 3,4 3,2 3,2 3,3 3,7 3,6 3,6 3,4,9,3,3,3,4,5,6 1, 1,2 1,1,6,56,63 1,1 1, ,6 2,8 2,9 2,9 3, 3,3 3,1 3, 2,8 2,9 2,8 3,1 2,892,95 2,1 2,1 1 1 LT Loans ST Loans For P&L, USD/TL rates: 216 Q3 2,96; 9M 2,93; 12M 3,2 and 217 Q3 3,51; 9M 3,59. For Balance Sheet, USD/TL rates: 216 Q3 3,; 9M 216: 3,; 12M 216: 3,52 and 217 Q3 3,55; 9M 3,55 USD/TL 27

28 Tüpraş Balance Sheet Million USD Diff. % Diff. 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 For P&L, USD/TL rates: 216 Q3 2,96; 9M 2,93; 12M 3,2 and 217 Q3 3,51; 9M 3,59. For Balance Sheet, USD/TL rates: 216 Q3 3,; 9M 216: 3,; 12M 216: 3,52 and 217 Q3 3,55; 9M 3,55 USD/TL 28

29 Dividend 12 Earnings per Share Gross Dividend Total Payout Total Payout (Mn. TL) One of the highest dividend yield in BIST 1, , , ,31 2,5 2, ,98 4, ,83 3,93 3, In principle; as far as the related regulations, investment needs and financial situation allow, the entire amount of the net distributable profit for the period, calculated within the frame of the Capital Markets Regulations, is distributed in cash taking into consideration the market expectations, long term company strategies, investment and financing policies, profitability and cash position as long as it is covered from the existing resources in our legal records. 212/213 EPS includes the tax incentive 29 4, ,58 6,5 7,16 6,

30 Creating Competitive & Sustainable Shareholder Value Foreign Currency Long Term Tüpraş BBB-(IG) Ba1 (Pos.) Turkey BB+ (stable) Ba1 (Neg.) BB Koç Holding Baa3- (IG) BBB (IG) Analyst Recommendations CORPORATE GOVERNANCE RATING O V ERALL 94,67 HOLD; 33% S H A R EHOLDERS T R A N S P A R ENCY S T A K EHOLDERS 95,51 94, 98,59 BUY 67% B O A R D 92,86 Tüpraş has one of the highest Corporate Governance Ratings 3

31 FX Risk Exposure (3 Sept. 217) Consolidated Assets Cash 96 Receivables & other assets 24 Stock 1,211 Forward & CFH 2,459 *Cash flow hedge accounting : 1,212 mn $ Million $ -113 million $ Consolidated Liabilities Payables 1,688 ST Financials RUP 296 Eurobond 7 LT Financials: 1,935 RUP Loans: 1,111 Other credits 825 A significant portion of the Group's crude oil and refined product purchases are denominated in US Dollars. In addition, the Group finances its capital expenditures mostly through borrowings denominated in US Dollars. Natural Hedge: The Group is able to mitigate some of the impact of volatility in exchange rates through natural hedges: crude oil and refined product inventories are US Dollar denominated assets. Cash flow Hedge: RUP Facility financing loans designated as hedging instruments of highly probable export revenues. As a general Koç Holding financial policy, Group companies are allowed to keep foreign exchange positions within certain limits. 31

32 Future Expectations Brent Price Estimation Med Complex Margin Tüpraş Net Margin Operations Investment The average Brent price in 217 is expected to be 5-55 dollars per barrel. We expect Med Complex margins to be between 5,25-5,75 dollars per barrel band in 217. Net Tüpraş refinery margin is expected to be in the region of 7,5-8, dollars per barrel Expectations for 217; Full Capacity Utilization on average even after taking Izmir Maintenance shut down into consideration Production: approximately 29.2 million tons Imports of finished products will be minimal, as we focus on selling increased volumes of production Total sales: 3.6 million tons Refining investments is expected to be around 2 Million dollars. Additionally, around 125 million dollars investment is planned for increasing the marine tanker fleet capacity. 32

33 4 INVESTMENTS

34 14'Q1 14'Q2 14'Q3 14'Q4 15'Q1 15'Q2 15'Q3 15'Q4 16'Q1 16'Q2 16'Q3 16'Q4 17'Q1 17'Q2 17'Q3 217 Expectations vs 9 Months Results ,7 55,1 51,6 Brent Price ($/bbl) 56, 57,4 52,5 51,6 5,4 48,6 46, ,9 Capacity Utilization (%) 12,5 15,3 112,6 114, J-17 F-17 M-17 A-17 M-17 J-17 J-17 A-17 S-17 O-17 N-17 D-17 The average Brent in 217 is expected to be in 5-55 $/bbl In 1M, the average was 52.4 $/bbl Expected Capacity Utilization in above 1 % In 9M, 112.6% capacity utilization was achieved. Tupras Net Refinery Margin Med Margin Mil. $ 4 Tüpraş Ditaş ,7 8,2 5, 8,9 5,4 6,5 17 Q1 17 Q2 17 Q3 17 Q , , M Net Tüpraş refinery margin for 9M: 8,5 $/bbl (Target is 7,5-8, $/bbl) Planned Tüpraş investments for Million dollars 34

35 Q3 Product Yields Bitumen 14% Gasoline 21% ASRFO+Vac % Bitumen 15% Gasoline 19% Coke 3% Other 5% Fuel Oil 5% Other 5,4% Black Prod. 2,7% Light Distil. 22,5% Naphtha % Fuel Oil 5% Coke 3% Other 5% Other 5,1% Black Prod. 23,2% Light Distil. 2,8% Naphtha 2% Mid. Distil. 51,4% Jet 18% Mid. Distil. 5,8% Jet 19% ULSD 34% ULSD 32% White Product %77,32 Production : 7,2 mn tons API: 3,48 % -2 White Product %75,7 Production : 7,6 mn tons API: 29,57 35

36 9M Product Yields Coke 2% ASRFO+Vac 1% Other 6% Fuel Oil 8% Other 5,5% Bitumen 12% Black Prod. 22,7% Light Distil. 22,2% Gasoline 21% Naphtha 1%, ASRFO+Vac % Bitumen 11% -,8 -,8 Coke 3% Other 6% Fuel Oil 8% Other 5,6% Black Prod. 21,9% Light Distil. 21,3% Gasoline 2% Naphtha 1% Mid. Distil. 49,5% Jet 17% Mid. Distil. 51,2% Jet 17% ULSD 32% White Product %76,2 Production : 2,32 mn tons API: 3,81 % +1 ULSD 34% 1,7 White Product %76,98 Production : 22,43 mn tons API: 3,32 36

37 Sales By Customer (216) Customer Groups Sales to Distributors Total: 3.3 mn tons Distributors: 15.2 mn tons 37

38 Income Statement (In USD) Q3 Q % Diff. Million USD 216 9M 217 9M % Diff Net Sales Gross Profit Operating Expenses Income/Loss from other operations Operating Profit Income/Loss from equity investment Operating Profit Before Fin. Income/Loss Financial Income Finance Expenses Profit Before Tax & Minorities Net Profit ,12 434,67 47,79 EBITDA *(mn. $) 644, ,28 1,45 278,92 366,75 31,49 EBITDA* (mn. $) CCS 534, ,6 123,14 25,7 48,1 62,8 EBITDA (mn.$)-cmb 65, ,9 17, 235,5 34,2 44,4 EBITDA (mn.$)-cmb- CCS 496, 1.155,2 132,9 In our EBITDA calculation, FX related items are not included, whereas CMB rules is that these should be included in operating profit. For P&L, USD/TL rates: 216 Q3 2,96; 9M 2,93; 12M 3,2 and 217 Q3 3,51; 9M 3,59. For Balance Sheet, USD/TL rates: 216 Q3 3,; 9M 216: 3,; 12M 216: 3,52 and 217 Q3 3,55; 9M 3,55 38

39 Product Price Effect on Tüpraş in Q3 (FOB Italy Prices) Product Price, $/ton Tüpraş Crack Margin, $/bbl Production Yield % LPG 399, 291,5 3,4% -16,6-19,9 Gasoline 544,5 461, 2,2% 15, 11, Naphtha 447,4 366,1,4% -1,6-4,5 Jet Fuel 56,7 423,3 16,7% 12,4 8, Diesel 485,4 48,1 31,4% 13,1 9, Diesel 1 467,2 397,8 1,1% 1,7 7,6 Fuel Oil 1% 3,1 247,,4% -5,8-7,8 Fuel Oil 3,5% 292,7 228,5 3,9% -6,9-1,6 Others 272,9 22,7 18,7% -6,8-9,3 Total Crack Margin,$/bbl 7,2 3,6 Dated Brent Avg. $/bbl 52,1 45,9 Margin Differences, $/bbl 3,6 Total Raw Materials Charge, mn bbl 57,3 Total Effect of Product Price, mn $ 26,3 Total Effect of Price Ratio, mn TL 724,3 39

40 High Complexity #1 (Nelson Complexity of Refinining Companies) İzmit 16 After RUP 14, , 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, Tüpraş Before RUP 8 8,8 8,7 8,4 8, 7,3 7,1 7,1 7,1 7,1 6,8 6,5 6 5,9 5,8 5,

41 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 41

42 High Complexity # 3 (Tüpraş Total Production Change After RUP) Before RUP After Bitumen Coke,7 2,9 RUP production + 4 Refineries Capacities increase 9,1 mn tons, instead of 4,2 mn ton Fuel Oil,35 2,7 %-87 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 42

43 MHC 2 VACUUM Flexibility & Reliability; Multiple routes to maksimum capacity Key units Number of units Capacity (m3/d) CRUDE OIL 8 97 LPG MEROX Flow Diagram LPG Yields (%) 3.5% VACUUM HYDROCRACKER NAFTA SPLITTER ISOMER. UNIFINER REFORMER Benzen Saturation GASOLINE NAPHTHA 22.% ISOMERISATION 3 64 UNIFINER REFORMER KERO/DIES EL (HDS) CRUDE OIL VACUMM DİST. KERO / DIESEL HDS FCC FCC Benzin HDS JET FUELOİL DIESEL 16.5% 33.9% FCC 2 47 COKER 1 82 NAPHTHA SPLITTER 8 More than one distillation and production units HYDROC. COKER Lube Oil Bitumen LUBE OIL BITUMEN & FUEL OİL.5% 19.9% LPG MEROX 6 OTHER 3.8% Increased conversion capacity Strong integration among refineries 43

44 Competition # 1 (European Pump Price Comparison) Gasoline (Krş / Lt) Tax Distr. Marg. Pump No Tax Diesel 1 (Krş / Lt) Vergi TR Spa. UK Ger Eu19 Fra. Gre. Ita. TR Spa. Ger. EU19 Fra. Gre. UK Ita. Not: Prices valid on 2 Nov 217-Turkey Gasoline pirice as of 22nd of November 44

45 Competition # 2 (Regional Competition) Tüpraş is competing with 71 refineries in the Mediterranean and Black Sea markets. Mediterranean regional product balance is also affected from Middle East, North West Europe and Asia. Mediterranean Black Sea Moldova Ukraine France Croatia Romania Russia Spain Portugal Italy Albania Greece Turkey Tunisia Syria Bulgaria Georgia Morocco Algeria Israel Turkey Libya Egypt 54 Refineries 7.8mn bpd 17 Refineries 1.8mn bpd 45

46 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. Credit : 3.3 Billion $ Equity : 2.4 Billion $ Total Investment : 5.7 Billion $ STAR Refinery (Total Cap. 1 mn ton) 219, mn ton Production Tüpraş Star Total Turkish Demand Balance LPG 1,2,3 1,5 4,2-2,8 Petchem Feeds,3 2,6 2,9 Gasoline 5,8 5,8 2,4 3,4 Jet Fuel 5,4 1,6 7, 5, 2, Diesel 1,2 4, ,5-9,5 Coke,8,7 1,5 4,6-3,1 Fuel Oil 1,5 1,5 1,3,2 Bitumen 3,1 3,1 3,3 -,2 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 218. 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

47 Mn b/d Marine Bunker Specification Changes and Its Effects IMO, at the meeting held in October 216, lowered the sulphur emission cap from marine bunkers from 3.5% to.5% (5ppm): effective from 1 January 22. 2,1 1,8 8% of global trade is done via marine transportation. 5. vessels are in operation. Bunker fuels account for; ~5% of global oil demand 4% of oil related sulphur emissions. HS Fuel Oil Diesel LS FO HS FO Scrubbed Source: IEA, Oil Sector Report, 217 LS Fuel Gap %5 switch to LNG %2 Other Requirements of spec change can be achieved through; Use of lower sulphur blendstocks like ULSD (Diesel) Low Sulfur Fuel Oil production with light crudes Sulphur Fuel Reduction Systems (Scrubber) %19 Install Scrubber %74 Buy Low Sulphur Fuel LNG Source: UBS, 217 Ship Owners Intention Survey 47

48 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, 3,1,9 Tüpraş HSE KPI: Loss Time Incident Frequency and Severity Frequency Ratios 8, 7, 6, Incident Frequency 7,1 İncluding contractors Tüpraş Contractor Total 5, 4, 3, 2, 3,6 2,5 1,7 2,2 1,5 1,1 1,6 2,5 1,9 1,, Loss Time Severity Frequency Rate Tüpraş Contractor Total loss time incident freaquency rate =number of incident *1/man hours loss severity frequency rate = loss time*1/man hours 48

49 Energy Saving Projects, mn$ Energy Index 116,1 11, Total Tüpraş Energy consumption (TJ) Energy-saving(TJ) Energy Efficiency Project Savings (mn $)

50 Updated information can be found in the Investor Relations section of the company website DISCLAIMER Investor Relations and Reporting Department Tel. : Fax : Güney Mah. Petrol Cad. No.25 PK.4179 Körfez-Kocaeli info@tupras.com.tr 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.