Rio de Janeiro | January, 2012
CORPORATE PRESENTATION
The material that follows is a presentation of general background information about MPX Energia S.A. and its subsidiaries (collectively, “MPX” or the “Company”) as of the date of the presentation. It is information in summary form and does not purport to be complete. No representation or warranty, express or implied, is made concerning, and no reliance should be placed on, the accuracy, fairness, or completeness of this information.
This presentation may contain certain forward-looking statements and information relating to MPX that reflect the current views and/or expectations of the Company and its management with respect to its performance, business and future events. Forward looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain words like “may”, “plan”, “believe”, “anticipate”, “expect”, “envisages”, “will likely result”, or any other words or phrases of similar meaning. Such statements are subject to a number of risks, uncertainties and assumptions. We caution you that a number of important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in this presentation. In no event, neither the Company, any of its affiliates, directors, officers, agents or employees nor any of the placement agents shall be liable before any third party (including investors) for any investment or business decision made or action taken in reliance on the information and statements contained in this presentation or for any consequential, special or similar damages.
This presentation does not constitute an offer, or invitation, or solicitation of an offer, to subscribe for or purchase any securities.
Neither this presentation nor anything contained herein shall form the basis of any contract or commitment whatsoever.
Recipients of this presentation are not to construe the contents of this summary as legal, tax or investment advice and recipients should consult their own advisors in this regard.
The market and competitive position data, including market forecasts, used throughout this presentation were obtained from internal surveys, market research, publicly available information and industry publications. Although we have no reason to believe that any of this information or these reports are inaccurate in any material respect, we have not independently verified the competitive position, market share, market size, market growth or other data provided by third parties or by industry or other publications. MPX, the placement agents and the underwriters do not make any representation as to the accuracy of such information.
This presentation and its contents are proprietary information and may not be reproduced or otherwise disseminated in whole or in part without MPX’s prior written consent.
DISCLAIMER
MPX HIGHLIGHTS
Predictable and steady cash flow from power generation plants starting in 2012
Successful closing of R$ 1.4 billion Convertible Debenture Issue, covering equity needs for the near future
Unique onshore natural gas portfolio with risked resources of over 11 Tcf, integrated to 3.7 GW licensed power generation complex
World-class coal assets in Colombia in a strategic location (150 km railway to the coast) and potential production of 35 million tons per year
Largest power project in Chile (2.1 GW), integrated to a deep water dedicated port
Largest licensed power generation portfolio in South America – 14 GW between gas and coal fired power plants
MPX: A DIVERSIFIED ENERGY COMPANY WITH THE LARGEST PORTFOLIO OF INTEGRATED PROJECTS IN SOUTH AMERICA
• Power Generation
3 GW with power agreements secured
Environmental license for >14 GW
Natural Resources
Natural Gas: >11 Tcf of risked resources in the
Parnaiba Basin
Coal: 35 Mtpa production target in a strategic
location in Colombia
CAGR: 73%
Minimum Guaranteed Gross Revenues3Installed Capacity
720 MW
1,561 MW
2,160 MW
Energia Pecém1
MPX Itaqui
MPX Pecém II
MPX Parnaíba2 (Maranhão IV+V + Free Market)
MPX Parnaíba2 (Maranhão III)
R$ 551 MM
R$ 1,461 MMCAGR: 4
0% R$ 1,520 MM
R$ 1,083 MM
STEADY AND PREDICTABLE CASH FLOWS FROM FULLY CONTRACTED POWER GENERATION PLANTS
Figures adjusted considering MPX’s stake in each project
Notes: 1. TPP Energia Pecém is a partnership between MPX (50%) and EDP (50%); 2. TPP Maranhão III, IV and V + Free market are partnerships between MPX (70%) and Petra (30%); 3.
Capacity Payments are escalated annually by the IPCA inflation index (Figures as September, 2011).
TPPs ENERGIA PECÉM AND ITAQUI WILL START-UP IN 1H2012
Itaqui TPP (360 MW)Energia Pecém TPP (720 MW)
EPC Progress EPC Progress
IN 2013, TPP PECÉM II AND THE PARNAÍBA THERMOELECTRIC COMPLEX ALSO BEGIN TO GENERATE POWER
Parnaíba TPP - Maranhão IV + V (676 MW)Pecém II TPP (365 MW)
EPC Progress EPC Progress
Energia Pecém (720MW)MPX Pecém II (365MW) Ceará
MPX Itaqui (360MW) Maranhão
AND IN 2014, THE PARNAÍBA THERMOELECTRIC COMPLEX WILL REACH A TOTAL CAPACITY OF 1.5 GW
CAPACITY
(MW)ENERGY SOLD
(AVG MW)ANNUAL CAPACITY
PAYMENT2 START UP
Parnaíba TPP
(Maranhão IV+V)1676 450 R$ 278 million 2013
Parnaíba TPP
(Free Market)1338 230 R$ 203 million 2014
Parnaíba TPP
(Maranhão III)1517 450 R$ 233 million 2014
Total 1,531 1,130 R$ 714 million
Integrated gas supply = monetization of MPX’s 23% stake in the E&P business in the Parnaíba Basin
1. The Parnaíba Thermoelectric Complex is a partnership between MPX (70%) and Petra (30%); 2. Capacity Payments, adjusted considering MPX’s stake, are escalated annually by the IPCA inflation index (Figures as September, 2011).
WITH A TOTAL LICENSED CAPACITY OF 3.7 GW, PARNAÍBA WILL BE AN IMPORTANT GROWTH PLATFORM FOR MPX IN COMING YEARS
Parnaíba Thermoelectric Power ComplexMPX (70%) + Petra (30%)
Complete integration of natural gas E&P to power generation
Total licensed capacity of 3,722 MW.
Power plants strategically located - easy access to gas supply and inexpensive connection
to the grid
MPX WILL ALSO HAVE AN ADDITIONAL CASH FLOWS FROM GAS E&P BUSINESS, INTEGRATED TO THE POWER GENERATION COMPLEX
Ownership Structure
Parnaíba Complex Declaration of commerciality of two fields (Gavião Real & Gavião Azul)
already submitted to ANP
Initial production expected in 2H12
Low capital and operating costs
— Total Capex of US$ 450 M for production of 5.7 M m³per day in 2013
— Low operating field life cost of less than US$ 0.30/1,000ft3 on average
Second seismic crew contracted to work on the southern blocks
2 rigs operating and an additional one already leased
PARNAÍBA BASIN DRILLING CAMPAIGN UPDATE
WELL BLOCK ACCUMULATION RIG NET PAY STATUS
1 OGX-16 PN-T-68 California QG-1 Devonian: Gas shows, 23m & 25m (column) Concluded
2 OGX-22 PN-T-68 Fazenda São José QG-1 Upper Devonian: 49m Lower Devonian: 47m Concluded
3 OGX-34 PN-T-68 Bom Jesus QG-1 Devonian: 23m Concluded
4 OGX-38 PN-T-68 Fazenda São José BCH-05 Devonian: 43m Concluded
5 OGX-46D PN-T-68 California – D QG-1 Devonian:15m Concluded
6 OGX-51DP PN-T-68 California – 2DP QG-1 Devonian: 8m Concluded
7 OGX-49 PN-T-68 Fazenda São José BCH-05 - Concluded
8 OGX-57 PN-T-68 Fazenda São José - 2 QG-1 - Concluded
9 OGX-59 PN-T-49 Fazenda Torrão BCH-05 Devonian:9m Concluded
10 OGX-66 PN-T-67 Angical BCH-05 - Concluded
11 GVRX-1D PN-T-68 Gavião Real QG-1 In progress since 05/09
IN COLOMBIA, MPX IS ALSO DEVELOPING A WORLD-CLASS COAL COMPANY (CCX)
• Unique and privileged geology: Large
and continuous coal package
• Potential mineable tons to support a 35
Mtpa production
• Fully-integrated logistics with more
competitive costs
Heavy-haul 150km railway: flat route, parallel to
existing road
Dedicated port: 20-meter draft 3km from the
coast
WITH AN EXTENSIVE DRILLING CAMPAIGN ONGOING TO EVALUATE UNDERGROUND POTENTIAL RESOURCES
7 large capacity drill rigs on site
Currently, 13 coal seams
identified for longwall production
with seam thickness of ≥ 1.5m
MPX IS ALSO PLANNING 2D SEISMIC IN ADDITIONAL AREAS TO GUIDE EXPANSION PLANS
2D SEISMIC Total:
390.78 Km
MPX WILL BE AN IMPORTANT PLAYER IN THE GROWING SEABORNE MARKET
The ongoing industrialization of emerging Asian economies, especially India and China, will maintain the thermal coal demand at high levels
Source: Wood Mackenzie Coal Market Service (Update December 2011)
AND WILL ALSO SUPPLY GUARANTEE RELIABLE SUPPLY TO ITS OWN POWER PLANTS IN BRAZIL AND IN CHILE
Up to 6.5 MMtpa of coal
Energia Pecém: 1.3 Mmtpa
Itaqui: 0.7 MMtpa
Pecém II: 0.7 MMtpa
Açu: 3.8 MMtpa
Up to 5.8 MMtpa
of coal
Assuming an average dispatch rate of 65% for Energia Pecém, Pecém II e Itaqui; 70% for Açu plant and 100% for Castilla plant.
MPX Castilla: license for 2,100 MW Integrated Project: Power Plant + Deep-Water Port + Desalination Plant
SIC: Central Interconnected System (90% of GDP & 92% of population)
Port concession and environmental license granted
Power plant capacity: 6 x 350 MW = 2,100 MW
Desalination plant capacity: 740 l/s
Synergy with CCX: Reliability of coal supply
MPX CASTILLA IS THE LARGEST LICENSED GREENFIELD POWER PLANT IN CHILE
STRATEGICALLY LOCATED IN A REGION WITH SIGNIFICANT PENT-UP DEMAND FOR ENERGYAND WATER
MINING PROJECT MW REGION START-UP ORE DEVELOPER
Casale 266 Atacama 2015 Au -
Relincho 230 Atacama 2017 Cu -
Xstrata el Morro 170 Atacama 2015 Cu -
Caserones 150 Atacama 2013 Cu Endesa
Pascua Lama 115 Atacama 2013 Au Guacolda
MMX 100 Atacama 2014 H -
Marte Lobo 82 Atacama 2015 Cu -
Enami Delta Pan de Azucar 7 Coquimbo 2012 Cu -
Codelco Ventanas 70 Valparaiso 2014 Cu Gener
Expansión Andina 20 Valparaiso 2014 Cu Colbun
Tres Valle 14 Valparaiso 2012 Cu Pacific Hydro
Expansión El Soldado 11 Valparaiso 2012 Cu Colbun
Los Bronces 95 Metropolitana 2012 Cu Colbun
Codelco Teniente (Nuevo Nivel) 200 O´Higgiins 2015 Cu Colbun
Potential demand from miners surpasses 1,500 MW
• Located in one of the most important port-
industrial complexes in Latin America
• Total capacity of 5,400 MW
Imported Coal: 2,100 MW
Natural Gas: 3,300 MW
Close to natural gas accumulations discovered in
the Campos Basin
The industries located within the Superport will
benefit from auto production sharing, which at
current prices represents a reduction in energy
costs by approximately 30%
MPX AÇU IS A LICENSED 5.4 GW GREENFIELD GENERATION COMPLEX IN SOUTHEASTERN BRAZIL
CLOSE TO NATURAL GAS ACCUMULATIONS DISCOVERED IN THE CAMPOS BASIN
Oil Companies:
Campos Basin
85% of Brazil’s Oil Production
Located in a region with limited hydro potential
Seival Mine:
Partnership 70/30: MPX / Copelmi
Operating License granted
152 MM tons in proven reserves
459 MM tons in total resources
MPX Sul and MPX Seival:
Capacity: 727 MW + 600 MW
Coal consumption: 1 ton/ MWh
Licenses Granted
Synergies between the two projects
IN THE SOUTH OF BRAZIL, MPX SUL AND MPX SEIVAL ADD UP TO 1.3 GW