Orient Petroleum Resources Plc.Corporate bond

Investing in Nigeria Diaspora Symposium

London, United KingdomMarch 2014

Fuel queues

Problem & Market Need (1)

• Acute shortage of refined petroleum products in Nigeria over the years.

• The demand for refined products has grown and has exacerbated the shortage situation.

• Nigeria produces over 2 million barrels a day of crude, making it the world's eighth largest producer and Africa's largest oil producer.

• Refining infrastructure has largely crumbled. NNPC refineries have proved inadequate and have operated consistently at well below 40% of their installed capacity.

Problem & Market Need (2)

• Nigeria is a net importer, which pays high prices for its own crude that has been processed abroad.

• Over 90% of the fuel products used in Nigeria are imported from overseas.

• The Government in 2001 broke NNPC monopoly in the downstream, throwing open the refining business to private entrepreneurs.

• Orient refinery is in direct response to the invitation of the Federal Government of Nigeria.

Background• OPR was founded in 2001 to set up refinery and two oil blocks in

the Anambra basin: OPL 915 and OPL 916 were granted to OPR in 2005.

• Evacuation of crude is by pipeline to an inland refinery (both being constructed by OPR) or by river transport barging to the Atlantic coast for international sale.

• Based on evaluation of the oil blocks by Schlumberger OPR embarked on a staged development.

• Production test results established sustainable oil production from one well, Anambra River -1, which is now on test production, producing light (48º API), sweet (zero sulphur) crude oil.

• Additional tests confirmed the economic viability of Anambra River field as a source of feedstock for the planned refinery.

• 3D seismic exploration work currently progressing in 640 sq km out of total area 2,158 sq km in OPL 915 & 916

• 221 sq km of high resolution 3D seismic data have been acquired and reserves evaluated

• 4 development wells planned in 2014 in the evaluated 221 sq km• 2 land rigs mobilizing in support of this drilling effort• 2 of the 4 wells expected to be completed by end of April 2014• One well ANAR-1 producing currently• First set of refinery equipment being prepared for shipment to

Nigeria for processing the crude

Project status

Presidential inauguration

Investment Opportunity

• So far, OPR has funded its growth via internal resources and bank loans.

• In order to accelerate its plans OPR is now considering the possibility of opening its structure to outside investors.

• Part of this investment will be used to drill more development wells and complete the Orient refinery of 20,000 barrels per day capacity.

Consumption by Refined Product

CONSUMPTION BY ZONE (%)

ABUJA3

NORTH CENTRAL20

NORTH WEST6 NORTH EAST

4

SOUTH WEST31

S.E.8SOU

THSOUTH29

Solution Product & Technology (1)

• The Orient refinery is a hydro-skimming refinery, with an atmospheric distillation unit (ADU) and naphtha catalytic reformer unit (CRU). As there is hardly any residue, there is no need for a fluid catalytic cracking unit (FCCU).

• Straight run diesel (gas oil) and kerosene from the ADU will be cleaned up to meet international and Nigerian industry specifications and taken to storage. The light distillate comprising LPG and naphtha will be processed further through the CRU to produce high grade gasoline (petrol) and LPG.

Process summary

Solution Product & Technology (2)

• The modular Orient refinery will commence with 20,000 b/d. Capacity will be upgraded after a few years to 55,000 b/d.

• Support infrastructure include a 20 MW power station, electrical distribution system, effluent water treatment plant, nitrogen plant, workshops and storage tanks.

• Final products – LPG, high grade gasoline (petrol), aviation kerosene and diesel.

• US fabricated units. Shipping will commence in 3 months. • Construction and installation in Nigeria will comprise civil,

mechanical, electrical, and instrumentation works to be coordinated by the lead contractor.

• Project commissioning expected in Q4 2014

STRATEGY:Maximum Value Creation(Zero Waste Concept)

CNG PLANT - INDUSTRY & AUTOMOBILE

LPG PLANT - COOKING GAS

REFINERY - PETROL, DIESEL & KEROSINE

POWER PLANT - Public Grid

GAS PLANT

CRUDEOIL

BITUMEN - ASPHALT PLANT

NGLs - Natural Gas Liqs

Waxes & Lubes - Blend Stock

GAS SUPPLY - Industries

Orient refinery

Opportunity sizing (1)

9 existing refineries located in the West African sub-region.5 existing refineries in West Africa have a combined installed capacity of 162,200 bpd and they are:• Tema Refinery, Tema, Ghana -45,000bpd• SIR Refinery, Abidjan, Cote d’Ivoire -65,200bpd• SAR Refinery, Dakar, Senegal -27,000bpd• West African Refinery, Freetown, Sierra Leone -10,000bpd• Monrovia Refinery, Monrovia, Liberia -15,000bpdThese 5 refineries are operating at less than 50% of their installed capacities; creating a huge demand gap being filled by import of subsidized refined petroleum products from overseas.

Opportunity sizing (2)

• 4 Nigerian refineries; total installed capacity of 445,000 bpd, are:

• Warri Refinery & Petrochemical Company (WRPC) - 125,000bpd• Port Harcourt Refining Company Limited (1&2) - 210,000bpd• Kaduna Refinery & Petrochemical Company (KRPC)- 110,000bpd

• 4 Nigerian refineries operate at less than 40% of installed capacity.

• Nigerian and West African refined products market is huge.

Business model (1)

• Feedstock supply from its oil fields (OPLs 915 & 916)

• Characteristics of Anambra River Crude (API 48o)

• Alternative sources for feedstock supply (NPDC & AGIP)

• Hydroskimming – no FCCU (simple to operate & maintain)

• Modular installation – fast installation & future expansion

• Receives crude oil, refines & market products in-situ

• Located in established product markets and transportation hub

• Pricing based on import parity – enhanced refinery margin

• Private ownership – focused and efficient management

• Technical competence of promoters and management

• Co-Generated power supply – reliable and efficient

Business model (2)

• Success factors

• OPR’s success to date due to– (1) integrated business model, spanning full

spectrum from feedstock supply from own fields;

– (2) processing in its own refinery;

– (3) marketing directly to a market in Nigeria thirsty for petroleum products and

– (4) strong corporate governance ethics.

Competition & Sustainable Advantage (1)

• The major player is NNPC, which has been unable to satisfy local demand for refined products.

• An analyst described their state as “total disrepair and comprehensive paralysis in the past three decades”.

• After revamp in next 2 years, the best estimate of their capacity is some 50% of original capacity.

Competition & Sustainable Advantage (2)

New refinery projects • (1) NNPC agreement signed May 2011 with the China State Construction

Engineering Corporation Limited; 3 new greenfield refineries and a petrochemical plant in Lagos, Kogi and Bayelsa states of Nigeria under a $28.5bn provisional deal, to process around 750,000 barrels per day. Construction works not taken off to date for lack of funds.

• (2) Nigeria signed July 3, 2012 MoU with an American energy firm to build six oil refineries, in a project worth 697.5 billion N ($4.5 bn, €3.5 bn); to provide 180,000 b/d refining capacity. Deal fell through in 2013.

• (3) Dangote Lagos refinery: Largest in Africa, turning Nigeria into a petroleum exporter Projected $9 billion refinery of 400,000 barrels a day capacity was to take off by late 2016. Survey work has now begun at the Lekki Free Trade Zone in Lagos. Take off date is reported to be delayed.

Competition & Sustainable Advantage (3)

• Main competitive advantages of Orient Refinery are simple, modular design, scalable from 20,000 to 55,000 barrels per day in 3 years, affordable cost and full spectrum business integration.

• Supply/demand gap, currently filled by imported refined products, remains huge (over 700,000 barrels/day in 2015 and beyond), even with the entry of the Orient refinery in 2014.

Marketing, Sales & Partners

• Refined products are in short supply in the country. It is therefore a seller’s market.

• Major consumers in Nigeria are transporters – cars, buses, aircraft, boats, trains, etc.; also industries and households that use diesel and cooking gas.

• In 2013, Nigeria’s consumption of refined products has been about 35, 12, and 11 million litres per day of PMS (petrol), AGO (diesel) and DPK (dual purpose kerosene)

• OPR to maximize value by marketing its refined products through wholesale and retail outlets.

Community Relations:The 5-Point Strategy

n Investment Opportunities as Shareholders

n Self Ranked Project List per Community

n Board Representation

n Sustaining & Enhancing Traditional Occupation

n Regular/Continuous Communication

Risks & Challenges

REFINERY RISKS MITIGATING STRATEGYProject Completion Experienced ContractorSupply of Feedstock 2 Oil Blocks granted by FGNTechnical Operation Competent PartnerInfrastructural Deficiency Own Utilities – IPP, Water, etc Community Co-operation 5-Point Participatory StrategyPolitical Risk and Violence Minimised by Political Stability Change in Government Policy Emerging Economic ReformsIncrease in price of crude Market related product prices

Board & Executive Team

• Chief Emeka Anyaoku; BA Classics, UC Ibadan; Former Commonwealth Secretary General for 10 years; Chairman, Board of Directors

• Dr Alex Ekwueme; PhD, Glasgow UK; Former Vice President, Federal Republic of Nigeria for 4 years; Vice Chairman, Board of Directors

• Engr. Nnaemeka Nwawka; MA Engineering, Cambridge UK; Former Petroleum Engineering Manager, Technical Manager, Deputy General Manager, Shell; oil industry experience of over 30 years; Managing Director/CEO

• Engr. Sunny E. Okoye, BSc Mechanical Engineering, UNN; Former Terminal Asset Manager, Shell; oil industry experience of over 25 years; Director

• Engr. Ikemefuna E. Akuezumba, BSc Civil Engineering, ASUTECH, Enugu, Former Head Engineering, Forcados Terminal, Shell; oil industry experience of over 16 years; Director

• Chief Cletus M. Ibeto, DBA (Honoris Causa), UNN; Chairman and Chief Executive Ibeto Group of Companies, Director

• The 5 major shareholders have over 50% stake in the business

Financial Projections – 20kbd Refinery

Use of funds

How can you get involved?

• Invest– access the deal and make a commitmentHomestrings.com/VehiclePreview/a03F0000009uUXbIAM

• Promote– Your own project, fund or bond on Homestrings

• Participate

– Diaspora Investment Symposium

– Investing in East Africa, July - London

Contacts

• Eric V. Guichard – Founder and CEO eric@homestrings.comservice@homestrings.com

• Web: www.Homestrings.com

• @Homestrings & facebook.com/Homestrings