Empresa Nacional del Petróleo 2017 FY Results Presentation February 2018

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1 Empresa Nacional del Petróleo 2017 FY Results Presentation February 2018

Disclaimer Forward looking statements are based on the beliefs and assumptions of ENAP s management and on information currently available to the Company.

2 Disclaimer Forward looking statements are based on the beliefs and assumptions of ENAP s management and on information currently available to the Company. They involve risks, uncertainties and assumptions because they relate to future events and therefore depend on circumstances that may or may not occur in the future. Investors should understand that general economic conditions, industry conditions and other operating factors could also affect the future results of ENAP and could cause results to differ materially from those expressed in such forward looking statements. This presentation contains certain performance measures that do not represent Chilean GAAP and IFRS definitions, such as EBITDA and Net financial debt. These measures cannot be compared with the same previously used by ENAP and the same used by other companies. Disclaimer 2

3 1. ENAP at a Glance

ENAP at a Glance Empresa Nacional del Petróleo, only refiner in Chile Fully owned by the

Company ) has a strategic role in fuel supply in Chile (~60% Market Share of Chilean Demand

employees Downstream Upstream Refining and Marketing (R&M) Refining Capacity: ~230 kbbl / day

production: ~33 kbbl / day Gas production:~23kboe/day Solid & Stable Credit Ratings CHILE Aa3

4 ENAP at a Glance Empresa Nacional del Petróleo, only refiner in Chile Fully owned by the Republic of Chile ( Chile or the Republic ), Empresa Nacional del Petróleo ( ENAP or the Company ) has a strategic role in fuel supply in Chile (~60% Market Share of Chilean Demand for Refined Products) Support, Control & Supervision 100% ownership Since 1950 ~3,700 employees Downstream Upstream Refining and Marketing (R&M) Refining Capacity: ~230 kbbl / day Exploration and Production (E&P) Proved O&G Reserves:~149MM boe as of December 2017 Oil production: ~33 kbbl / day Gas production:~23kboe/day Solid & Stable Credit Ratings CHILE Aa3 (Negative) A+ (Stable) A (Stable) ENAP Baa3 (Stable) BBB (Stable) A (Stable) Gas and Energy (G&E) ENAP at a Glance 4

ENAP and the owner Corporate Governance A new Corporate Governance Law was promulgated in order to give more stability to ENAP in terms of long term plans, following best practices of the private

5 ENAP and the owner Corporate Governance A new Corporate Governance Law was promulgated in order to give more stability to ENAP in terms of long term plans, following best practices of the private sector Reduction in number of Board Members from eight to seven New Shareholder figure falls on the President of the Republic. The President can delegate its functions as Shareholder in Minister of Finance and Minister of Energy Board of Directors will present to shareholders a five year Business Plan each year before March 30 th. Shareholders also will approve Budget and long term debt issuance Board Seven Members: o Two appointed directly by the President of the Republic o Four coming from proposals of the High Public Management System (ADP 1 ) o One to be elected by the company's employees Chairman of the board selected by the President of the Republic among all members Requirements: o All members to comply with strict technical qualifications o Members should declare that they are not affected to any impossibility nor inability for the position Board Members will have four year terms and will be eligible for reelection only once Members will be changed partially, not all at the same time Support Capital injections o US$250 MM capital increase in 2008 o US$400 MM capital increase approved in 2017 to be received during 2018 in conjunction with the new Corporate Governance Law for ENAP. Capitalization of Retained Earnings (Subsidiaries) : o Yearly basis approved o The Republic has waived its right to receive any dividends for the past eight years Gas sales subsidy in Magallanes (Chile): o Approved on a yearly basis as part of the Chilean General Budget Law o Up to CLP $58,521 million (~US$90 million) approved for ENAP at a Glance (1) Sistema de Alta Dirección Pública or ADP : an autonomous agency in charge of the selection process for high positions at governmental agencies and state owned entercprises.

Geography Leading position in refining capacity Extensive oil & gas wholesale distribution network in Chile Unmatched asset base of critical importance to Chile including country s only 3 refining

6 Geography Leading position in refining capacity Extensive oil & gas wholesale distribution network in Chile Unmatched asset base of critical importance to Chile including country s only 3 refining facilities ENAP produces a full range of refined petroleum products, mainly distributed domestically ENAP s refineries process crude oil, substantially all of which is purchased from foreign third parties Refining Capacity: ~230 kbbl / day Downstream 1 Concón: Aconcagua Refinery Aconcagua Cogeneration Power plant 2 Santiago: ENAP Headquarters Linares: Terminal Hualpén: Bío Bío Refinery Santiago: ENAP Sipetrol S.A. (HQ) Maipú: Fuel Storage Terminal San Fernando: Terminal Chillán: Pumping Station Upstream Projects under development 3 Punta Arenas: Gregorio Refinery Wind farm project Cabo Negro Egypt East Ras Qattara (50.5%) Field expertise and relationships with E&P partners and crude oil suppliers worldwide Ecuador PBH (100%) MDC (100%) PBHI (100%) Block 28 (42%) Chile Magallanes Chile (100%) Argentina Área Magallanes (50%) CAM 2/A Sur (50%) E2 (33%) * Camp. Central (50%) * Pampa del Castillo (100%) (%) Ownership * Blocks where ENAP is not an operator Fields in Chile, Argentina, Ecuador and Egypt E&P s goal: to increase oil and gas reserves in Chile and abroad ENAP has total proved (1) oil & gas reserves of 149 MM boe as of December 2017 E&P s production: 33 kbbl / day and 23 kboe / day of crude and gas respectively ENAP at a Glance 6

7 2. Highlights

8 Highlights SMA (1) approved US$36 million program of ENAP Refinerias S.A. in environmental solutions Feb Compliance Program related to the audit process and subsequent formulation of charges that the environmental authority had against the company in 2017 Charges were mainly related to emission levels of carbon monoxide, nitrogen dioxide and sulfur dioxide General Comptroller approved construction of the 10 MW wind farm in Magallanes, Chile Investments of US$22 24 million Located in the industrial complex Cabo Negro of Laredo Bay in Punta Arenas commune Renewable energy contribution will scale up to 18% from 2% PIAM project in final stage Development reached ~90%: Project will be fully operative during 1st quarter 2018 Gas production reached ~4 MMm3 per day Jan Dec Jan ENAP Sipetrol Argentina acquired a new offshore area Area called Octans Pegaso: Located off the coast of the trans Andean province of Santa Cruz Concession is valid until September 2031 Dec New Corporate Governance Law entered into effect New Board of Directors established composed of seven members: Two appointed directly by the President of the Republic, four coming from proposals of the High Public Management System (Alta Dirección Pública), and one to be elected by the company's employees Up to US$400 million capital injection: Law authorizes the Ministry of Finance, from the entry into force of the law and up to the following 12 months, to make the up to US$400 million capital injection 8 Highlights (1) Superintendencia de Medio Ambiente or SMA : a decentralized public Chilean agency, under the supervision of the President of the Republic via the Ministry of Environment

9 Highlights Dec Chilean Argentine Chamber awarded ENAP for its role in the process of integration between Chile and Argentina ENAP had a key role on the first shipment of natural gas from Chile to Argentina in 2016, leading the negotiations with the Argentine state owned company ENARSA ENAP contributed with its own gas in 2016 and in 2017 for shipments Meanwhile, between September 27, and September 29, Chile and Argentina successfully made the first energy swap in history, by exchanging 4 million cubic meters (m3) ENAP s first 30 year bond offering Issuance of US$600 million 4.500% Notes due 2047 Priced at % to yield 4.679% (T+195bps) Oversubscription of ~11.2x 45 bps compression from IPTs ENAP Sipetrol Argentina was awarded a new exploration block in Argentina Concession area called El Turbio Este: Located in the south of the province of Santa Cruz. This area is adjacent to the Coirón block, developed by ENAP and ConocoPhillips US$50 million investments over the next three years Sep Sep Dec ENAP reached record fuel sales in 2017 Sales of 11,705 million cubic meters (MMm3) of oil based products which represents an increase of 4.3% compared to 2016 For the fourth consecutive year, ENAP increased its sales of fuels This increase was influenced by the constant growth in the sales of valuable products (gasoline, diesel, and kerosene) Sep ENAP and ENEL inaugurated Cerro Pabellón Installed capacity of 48 MW: Two units of 24 MW each. In full operation, it will be able to produce 340 GWh per year. Inauguration took place after the second 24 MW unit began operations First geothermal plant in South America: Located in Atacama Desert at 4,500 meters above sea level, in Ollagüe, Antofagasta Region Highlights 9

10 3. Financial Metrics

11 2017 Results Adj. EBITDA (1) & Adj. EBITDA Margin Investments (2) (US$ in million) (US$ in million) Breakdown (By Business Unit) 678 6% 621 6% % % 10% G&E 6% R&M 33% 57 6% E&P 61% Adj. EBITDA Adj. EBITDA Margin New projects Initiatives Revenues Equity (US$ in million) (US$ in million) 11,211 9, ,351 5,217 6, Financial Metrics (1) Adjusted EBITDA is defined as the sum of: (i) gross margin, (ii) other income, per function, (iii) depreciation and depletion quota, (iv) abandonment of exploratory wells, (v) geological studies and non absorbed costs, (vi) deterioration and other non operational provisions and (vii) exploration costs, less (i) distribution costs, (ii) administrative expenses and (iii) other expenses, per function. (2) Initiatives include maintenance and other expenses that are not part of PP&E

12 EBITDA & Investments analysis Adj. EBITDA (1) (Breakdown) (US$ in million) Investments (Breakdown) (US$ in million) E&P R&M G&E E&P R&M G&E Others 2017 New Projects Initiatives E&P s contribution for EBITDA increased in 2017 in US$34 million EBITDA from 2016 explained by its operations in Magallanes (Chile), Ecuador and Egypt The decrease in EBTIDA in R&M division (US$64 million) is mainly explained by an increase in non crude cost EBITDA from G&E division improved mainly due to an increase in Gas exports to Argentina Investments in E&P reached US$400 million, mainly focused in operations in Argentina (US$196 million) and Magallanes, Chile (US$143 million) In R&M, investments reached US$238 million, mainly focused in initiatives and maintance (US$55 million and US$139 million respetively) Investments in G&E were destinated to the construction of the Aconcagua Cogeneration power plant Financial Metrics 12

13 Income Statement Summary Income Statement (US$ million) Dec 12 Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Sales 11,612 11,211 9,837 6,351 5,217 6,420 % growth 7% (3%) (12%) (35%) (18%) 23% COGS (11,778) (10,638) (9,358) (5,708) (4,670) (5,913) Gross profit (166) % margin (1%) 5% 5% 10% 10% 8% SG&A and Distribution cost (88) (270) (247) (292) (307) (341) Other income (expense) (44) (34) (3) (77) (39) (67) Operational Result (298) % margin (3%) 2% 2% 4% 4% 2% D&A Others* EBITDA % margin 0% 6% 6% 12% 13% 10% EBITDA (LTM) Interest expense (195) (192) (172) (185) (180) (202) Net income (319) % margin (0) % 13 Financial Metrics (*)Dry exploration and abandonment wells, Exploration Costs, Geological Studies and Others

14 Key Financial Ratios Key Financial Ratios (US$ MM) Dec 12 Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Total debt 4,155 3,902 3,831 3,802 4,007 4,519 Total net debt 3,974 3,433 3,678 3,688 3,941 4,427 EBITDA (LTM) Equity Interest expense (net) (195) (192) (172) (185) (180) (202) Net Profit (319) Total net debt / EBITDA (LTM) 64.7x 5.1x 5.9x 5.0x 5.8x 6.7x Total net debt / Equity 48.1x 14.9x 6.7x 5.3x 4.9x 5.3x EBITDA / Interest expense 0.3x 3.5x 3.6x 4.0x 3.8x 3.3x Total net debt / EBITDA (LTM) Total net debt / Equity EBITDA / Interest expense 69.7 x 48.1 x 3.5 x 3.6 x 4.0 x 3.8 x 3.3 x 14.9 x 5.1 x 5.9 x 5.0 x 5.8 x 6.7 x 6.7 x 5.3 x 4.9 x 5.3x 0.3 x Dec 12 Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Dec 12 Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Dec 12 Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Financial Metrics 14

15 Debt Statistics & Maturity Profile Financial Debt & Supplier Credit (US$ in million) Debt Breakdown as of December 2017 Supplier's Credit Total Financial Debt 4, , ,119 3,802 4, , % Bank debt Bond 4,155 3,902 3,832 3,802 4,007 4,527 83% Dec 12 Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Debt Maturity Profile as of December 2017 (US$ in million) 837 International Bonds Local Bonds ST Bank Debt LT Bank Debt Financial Metrics 15

16 4. Results by Business Unit: Refining and Marketing

17 Refining and Marketing EBITDA ( ) (US$ in million) Investments ( changes) (US$ In million) ENAP's Production Imported Products Petropower New Projects Initiatives Maintenance 2017 R&M s EBITDA in 2017 decreased in US$64 million compared to 2016 mainly explained by: Increase in non crude cost (mainly fuel oil) Hedge impact Increase in other costs (insurance, services, others) Investments in R&M were mainly destinated to maintenance and initiatives (US$139 million and US$55 million respectively) Between March and May and during October and November the Biobio refinery executed the first and second stages of scheduled preventive maintenance respectively New projects investments reached US$44 million, mainly destinated to: Deasphalted unit Sulfur recovery unit Refining and Marketing 17

18 Refining and Marketing ENAP s Utilization Rates (1) (%) 2017 Sales by client (m3) 75% 74% 75% 74% 76% 17% 43% Main Customers 71% 24% 16% Copec Esmax (Ex Petrobras) Enex Others 2017 Sales by refined product (m 3 ) Market Share (2) 8% 3% 2% 9% 37% Gasoline Diesel Fuel Oil 44% 51% 100% 96% 99% 97% 65% 76% 62% 68% 60% 59% 41% Kerosene LPG Others 15% 14% Diesel Gasoline LPG Fuel Oil Kerosene Other Average Dec 16 Oct Refining and Marketing (1) Utilization rate is defined as crude oil refinery runs (in thousands of average barrels per day for the period) divided by atmospheric distillation refining capacity (in thousands of barrels per day as of the period end). (2) Information as of October, 2017.

19 Refining and Marketing Crude Oil Supply by Country (Mm 3 ) Crude Oil Volume Processed (Mm 3 ) UK 1% Argentina 1% Brazil 60% Ecuador 38% Total Crude Oil Purchases: 62,948,000 bbl in (Jan Dec 2017) from 11 different suppliers 5,591 5,761 3,879 3,803 1,674 1, Light Medium Heavy Other gross inputs Dec 16 Dec 17 ENAP s Refining Margin ( Margen Primo ) (1) Refined Products Production (Mm 3 ) US$/bbl Dec 13 Mar 14 Jun 14 Sep 14 Dec 14 Mar 15 Jun 15 Sep 15 Dec 15 Mar 16 Jun 16 Sep 16 Dec 16 Mar 17 Jun 17 Sep 17 Dec 17 ENAP's Refining Margin ENAP's Product Prices ENAP's Oil Cost Brent US$/bbl 3,460 3,658 3,949 4,078 1,284 1, ,243 1, Diesel Gasoline LPG Fuel Oil Kerosene Others Dec 16 Dec Refining and Marketing (1) It represents the difference between ENAP s product prices and their direct cost (Oil), excluding others like energy and G&A costs.

160 140 120 100 80 60 40 20 0 Basket 7:3:3:1 vs. ICE Brent (US$/bbl) Basket 7:3:3:1 (US$/bbl) ICE Brent (US$/bbl) 25 20 15 10 5 0 5 35 US$/bbl 25 15 5 5 15 25 ULSD USGC(US$/bbl) vs.

20 Basket 7:3:3:1 vs. ICE Brent (US$/bbl) Basket 7:3:3:1 (US$/bbl) ICE Brent (US$/bbl) US$/bbl ULSD USGC(US$/bbl) vs. ICE Brent (US$/bbl) Refining and Marketing (1) Source: Company information. 20 Unl87 USGC (US$/bbl) vs. ICE Brent (US$/bbl) F.O N 6 3% S. USGC (US$/bbl) vs. ICE Brent (US$/bbl) US$/bbl US$/bbl Refining and Marketing

21 5. Results by Business Unit: Exploration and Production

22 Exploration and Production EBITDA (by country) (US$ in million) Investments (by country) (US$ In million) Chile Argentina Ecuador Egypt Chile Argentina Ecuador Egypt 2017 E&P s EBITDA increased from US$209 million in 2016 to US$243 million in 2017 EBITDA from Magallanes (Chile) increased US$27 million (from US$71 million in 2016 to US$98 million in 2017) mainly due to an increase in sales volume Argentina s contribution to E&P s EBITDA decreased US$18 million mainly due to an increase in lifting cost explained by weather conditions Investments in Chile were focused mainly in glauconitic zone (Arenal). Investments in this zone reached US$102 million In Argentina, investments were destinated mainly to Area Magallanes (PIAM Project) In Ecuador and Egypt investments were focused in MDC PBHI blocks and East Ras Qattara respectively In Ecuador and Egypt EBITDA increased US$23 million and US$2 million respectively. The increase in Ecuador is mainly explained by an increase in production and in Egypt due to a decrease in cost Exploration and Production 22

Exploration and Production Oil Production (in 000 barrels per day) Gas Production (in 000 barrels per day) Proved Oil & Gas Reserves (1) Oil 33 35 37 37 34 3 3 33 2 2 3 2 7 11 12 9 10 8 14 13 12 13

Argentina Chile 29% Chile Proved reserves as of December 2017: 149 Mmboe Oil production in Argentina in 2017 decreased compared to production in 2016 and gas production remained in the same level

23 Exploration and Production Oil Production (in 000 barrels per day) Gas Production (in 000 barrels per day) Proved Oil & Gas Reserves (1) Oil % 28% 37% Argentina Ecuador Egypt Argentina Ecuador Egypt Chile Argentina Chile 29% Chile Proved reserves as of December 2017: 149 Mmboe Oil production in Argentina in 2017 decreased compared to production in 2016 and gas production remained in the same level that reach in 2016 due to weather conditions Oil production in Ecuador increased due to successful results in drilling activities 46% Crude 54% Gas Oil production in Egypt decreased due to natural depletion in fields Crude: 80 Mmboe Gas: 69 Mmboe 23 Exploration and Production (1) Developed and Undeveloped reserves.

24 6. Results by Business Unit: Gas and Energy

Gas and Energy Revenues by client (US$ in million) EBITDA (US$ in million) Investments (US$ in million) 1 30% 45% 17 84 25% 46 Power Generators Distributors Others

gas volumen exported to Argentina and the new contract among ENAP and Colbun Investments were focused in Aconcagua Cogeneration power plan which is in it final

25 Gas and Energy Revenues by client (US$ in million) EBITDA (US$ in million) Investments (US$ in million) 1 30% 45% % 46 Power Generators Distributors Others Revenues added a total of US$267 million Gas exports to Argentina are included in others (US$77 million) EBITDA increased due to an increase in gas volumen exported to Argentina and the new contract among ENAP and Colbun Investments were focused in Aconcagua Cogeneration power plan which is in it final stage. It should be fully operative during 2Q 2018 During 2018, investments will be concentrated in Wind Farm Project in Magallanes (10 MW of capacity) Gas and Energy 25

Gas and Energy assets and projects First geothermal generation

pipeline Cerro Pabellón: ENAP developed the geothermal plant Cerro

of 48 MW and expected annual generation of 340 GWh.

Refinery: ENAP developed a 77 MW cogeneration plant that will

the refinery and selling the surplus to the Chilean main power

condition: ENAP presented a requirement to the Independent power

as self producers, giving them more autonomy and reducing some

535 km Physical pipeline: The LNG that ENAP receives from GNL

injected as NG to the Electrogas gas pipeline and transported to

regasification capacity to thermoelectric plants Unique virtual

regasification capacity (2018 2030): LNG Sell: 3 vessel (2018

65 MMm3/d (2018 2030) and additional capacity of 125 MMm3/y (2018

Virtual pipeline (trucks): 25 trucks fleet, with a capacity of 21

to Pemuco (535 km) Small Scale Regasification Project

increasing the supply of Natural Gas to the VIII region, ENAP is

Magallanes: ENAP is developing a wind power generation project in

This project is expected to generate 18% of the energy demand in

Important LNG supplier for the south of Chile Satellite

(transported using trucks) is regasified and then distributed

26 Gas and Energy assets and projects First geothermal generation plant in South America Significant interest in LNG terminal and pipeline Cerro Pabellón: ENAP developed the geothermal plant Cerro Pabellón in a joint venture with ENEL, with an installed capacity of 48 MW and expected annual generation of 340 GWh. Aconcagua Cogeneration Power Plant Cogeneration in Aconcagua Refinery: ENAP developed a 77 MW cogeneration plant that will operate with NG, offering a permanent supply of steam and power to the refinery and selling the surplus to the Chilean main power grid. Self producer condition for ENAP refineries Self producer condition: ENAP presented a requirement to the Independent power system operator to declare both Aconcagua and Bío Bío refineries as self producers, giving them more autonomy and reducing some electricity payments. 535 km Physical pipeline: The LNG that ENAP receives from GNL Quintero (which has regasification capacity of 15MM m 3 /day) is injected as NG to the Electrogas gas pipeline and transported to the Aconcagua Refinery and to other customers Sell LNG and regasification capacity to thermoelectric plants Unique virtual pipeline Colbún and Enap subscribed an Agreement of sell LNG and regasification capacity ( ): LNG Sell: 3 vessel ( )/ 2 vessel ( ) Regasification Capacity: 1.65 MMm3/d ( ) and additional capacity of 125 MMm3/y ( ). Virtual pipeline (trucks): 25 trucks fleet, with a capacity of 21 tons each, ENAP can transport daily LNG from GNL Quintero Terminal to Pemuco (535 km) Small Scale Regasification Project IncreasethesupplycapacityofLNGinVIIIRegion:With the objective of increasing the supply of Natural Gas to the VIII region, ENAP is studying the feasibility of to develop Small Scale Regasification Project. Wind farm in Chilean southern region Wind Farm Project in Magallanes: ENAP is developing a wind power generation project in Magallanes, with 3 aerogenerators of 3.3 MW of installed capacity. This project is expected to generate 18% of the energy demand in Punta Arenas system. Important LNG supplier for the south of Chile Satellite Regasification Plant in Pemuco (VIII Region): where the LNG (transported using trucks) is regasified and then distributed mainly to the Biobío Refinery and also to other customers in the area through the gas pipeline Gasoducto del Pacífico Further development in NCRE energy in Chile Further development in NCRE: ENAP is continuously studying the feasibility of different NCRE projects and energy storage solutions, in order to contribute to the sustainable and safe development of Chile an power systems. Gas and Energy 26

27 Contact us at 27

Empresa Nacional del Petróleo Q Investor Presentation

Empresa Nacional del Petróleo Q2 2017 Investor Presentation Santiago, August 2017 Disclaimer Forward-looking statements are based on the beliefs and assumptions of ENAP s management and on information