Shale Gas:

The Opportunity for Europe

Worldwide energy landscape

March 5, 2015 - s.2

�Rising Demand�By 2030, world economy set to double

and energy demand to rise by 1/3

�Fukushima

�Political Instability

�US Shale Gas Revolution

Impact of “Shale Revolution” on Commodity Prices

March 5, 2015 - s.3

0

2

4

6

8

10

12

14

Oct-06 Feb-08 Jul-09 Nov-10 Apr-12 Aug-13 Dec-14 May-16

Henry Hub (usd/MMBTU)

NBP (usd/MMBTU)

0

20

40

60

80

100

120

140

160

Jan-04 May-05 Oct-06 Feb-08 Jul-09 Nov-10 Apr-12 Aug-13 Dec-14 May-16

Brent (usd/bbl)

WTI (usd/bbl)

LLS (usd/bbl)

0

20

40

60

80

100

120

140

Jul-09 Nov-10 Apr-12 Aug-13 Dec-14 May-16

Brent (usd/bbl)

Coal API 2 (usd/t)

0.50

0.60

0.70

0.80

0.90

1.00

1.10

1.20

1.30

1.40

1.50

Jul-98 Apr-01 Jan-04 Oct-06 Jul-09 Apr-12 Dec-14 Sep-17

Propane NW Large /Naphtha NW Ratio

LPG Trade Flows Outlook: 2013-2025

LPG Trade Flows Outlook – 2013-2025

increasing trade

falling trade

*Thickness of lines indicates relative size of trade

The impact on the European Petrochemical Industry

March 5, 2015 - s.5

US Petrochemical response

Net oil an gas import dependence by region

Security of Supply: A major challenge for Europe

March 5, 2015 - s.8

The EC regulatory landscape

2020

20%

greenhouse

gas reduction

20%

renewable

energy

20%

energy

savings

2030

40%

greenhouse

gas reduction

27%

renewable

energy

27%

energy

savings

Shale Gas provides Europe with the opportunity to:

�Reduce its carbon emissions (gas emits half as much CO2 as coal)�The production of shale gas in the US as meant CO2 emissions have fallen to

1990 levels

�Enhancing Europe’s Industry competitiveness:�Cost savings o industry – lower raw material costs for refineries and chemical

industry

�Reduced power costs to business and consumers

�Provide employment�Direct employment in the drilling and production of CBM/Shale gas and support

services

�Protecting existing industries dependent upon energy

�Security of Supply�Reducing our reliance on countries with a high geopolitical risk

Phase 1: Bring ethane from US

11

Rafnes (Norway)

• 600 ktonnes/y of ethylene capacity

• Largest worldwide seaborne ethane importer

• One of the few facilities worldwide that can import and crack LPG mixes

• New ethane tank being commissioned

* pressurised

Grangemouth (UK)

• 700 ktonnes/year of ethylene capacity

• Flexible gas steam cracker

• New ethane import terminal being built

Phase 2: Become a major on-shore UK player

14

� 100,000 net acres position in Scotland

� 80% share and operatorship in PEDL 162 (400 km2) and 51% share of shale layer

in PEDL133 (329 km2)

� Ineos will be the operator in PEDL 162 and will fund 2 vertical science wells and

100 km2 of 3D seismic

� Submitted a material bid in the 14th Onshore Licensing Round

� Secured the exclusive services in Europe of 3 of the legends of the US shale revolution, who all worked for George Mitchell in the Barnett

� Plans to give 6% of its Shale Gas revenues to homeowners, landowners & communities close to its wells. Equivalent to 2.5 Billion GBP

Key Points: Shale Gas

�An opportunity for Europe �Reduced carbon emissions, enhanced competiveness, more employment,

improved energy security of supply

�The opportunity for Ineos�Securing the long-term sustainability and competiveness of Rafnes and

Grangemouth

�Opening an exciting new growth opportunity for Ineos as an E&P company

� The opportunity for UK homeowners, landowners & communities close to the wells: 2.5 Billion GBP

� The opportunity for trading partners: Ethane