Investor Presentation March 2018
Disclaimer 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 Tüpra ş 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. Investor Presentation www.tupras.com.tr
REFINING MARKET
www.tupras.com.tr Investor Presentation Brent Crude Oil Prices ($/bbl) As of March 27th Source:Platts 25 35 45 55 65 75 4.01.2016 13.01.2016 22.01.2016 26,0 2.02.2016 11.02.2016 22.02.2016 2.03.2016 11.03.2016 22.03.2016 4.04.2016 13.04.2016 REFINING INDUSTRY 22.04.2016 4.05.2016 13.05.2016 24.05.2016 3.06.2016 14.06.2016 23.06.2016 4.07.2016 13.07.2016 22.07.2016 2.08.2016 11.08.2016 22.08.2016 1.09.2016 12.09.2016 21.09.2016 30.09.2016 11.10.2016 20.10.2016 31.10.2016 9.11.2016 18.11.2016 29.11.2016 8.12.2016 19.12.2016 30.12.2016 11.01.2017 20.01.2017 31.01.2017 9.02.2017 20.02.2017 1.03.2017 10.03.2017 21.03.2017 30.03.2017 10.04.2017 19.04.2017 27.04.2017 9.05.2017 9.05.2017 18.05.2017 29.05.2017 7.06.2017 16.06.2017 27.06.2017 6.07.2017 17.07.2017 26.07.2017 4.08.2017 15.08.2017 24.08.2017 5.09.2017 14.09.2017 25.09.2017 4.10.2017 13.10.2017 24.10.2017 2.11.2017 13.11.2017 22.11.2017 1.12.2017 12.12.2017 21.12.2017 4.01.2018 15.01.2018 70,7 24.01.2018 2.02.2018 13.02.2018 22.02.2018 05.03.2018 64,1 14.03.2018 23.03.2018 • OPEC & Non OPEC Supply Cut • High crude exports of OPEC • Inventory Levels • Concerns about the impact of OPEC & Non • Increase in number of rigs & production in US CONS • Expectation of high global GDP • Healthy PMI data in Developing Countries • Political Instabilities in Middle East PROS OPEC production cuts 4
Refinery Capacity Change Thousand Barrels/Day 4000 2009 2010 2011 2012 2013 2014 2015 2016 2017 460 70 3000 244 270 58 520 156 2000 120 417 300 530 340 510 526 76 40 160 198 80 334 1000 400 105 250 196 390 150 810 150 364 181 120 63 640 84 302 340 135 180 305 40 160 195 52 65 0 -220 -255 -543 -486 Capacity Additions -145 -240 -266 -109 1.790 -4,7 -140 -775 1.685 1.678 -421 -443 1800 -1000 -546 1350 -130 1.082 1.080 1.041 1.022 1.017 -143 -232 900 -352 -2000 337 450 -189 -57 -268 0 2012 2013 2014 2015 2016 2017 2018 2019 2020 -3000 China India Middle East Other Asia Other Japan North America Europe Source:, Reuters, UEA , Tüpra ş , sector reports and news Investor Presentation REFINING INDUSTRY www.tupras.com.tr 5
Middle Distillate Cracks ($/bbl) 2015 2016 2017 2018 Diesel Jet Fuel 20 20 15,1 14,4 13,6 16 14,8 15 12,1 12,2 12,4 11,9 12 11,5 11,4 10 10,0 10,4 9,1 9,5 8 7,6 8,0 7,2 6,6 5 4 0 0 Jan Feb *Mar Apr May Jun Jul Agu Sep Oct Nov Dec Jan Feb *Mar Apr May Jun Jul Agu Sep Oct Nov Dec *As of March 27th Source: Platts Investor Presentation REFINING INDUSTRY www.tupras.com.tr 6
Light Distillate Cracks ($/bbl) 2015 2016 2017 2018 Naphta Gasoline 4 2,4 2,7 2 24 0 -0,5 -1,5 -2 18,6 -4 -3,6 18 -4,0 -4,8 -6 -4,9 15,7 -7,3 -8 Jan Feb *Mar Apr May Jun Jul Agu Sep Oct Nov Dec 13,5 12 11,9 9,8 LPG 11,8 0 -2,2 10,2 10,6 -4,7 9,7 -10 -17,2 -15,1 -16,2 6 -20 -20,6 -21,5 -22,3 -30 -26,8 0 -40 Jan Feb *Mar Apr May Jun Jul Agu Sep Oct Nov Dec Jan Feb *Mar Apr May Jun Jul Agu Sep Oct Nov Dec *As of March 27th Source: Platts Investor Presentation REFINING INDUSTRY www.tupras.com.tr 7
Quarterly Product Crack Margins in 2015 - 2017 ($/bbl) 2015 2016 2017 Jet Fuel Diesel 16 15,7 16 15,2 14,4 14,6 14 14 13,1 12,4 12,4 12,0 12 12 11,2 10,7 10,8 10,5 10,5 9,9 11,2 9,5 10 9,4 10 10,2 9,2 8,9 8 8 7,9 8 7,7 7,3 6 6 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Gasoline Fuel Oil (0.01) 19,4 20 -2 18,9 -3,9 -4 -5,3 18 -5,8 -5,7 -6 -7,8 -7,8 16 15,0 -8 14,3 -9,1 15,2 -10,2 13,3 13,5 14 14,5 -10 13 -11,5 -12 -12,5 -12,6 -12 12,8 12 10,9 -14 10,9 10 -16 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Source: Platts Investor Presentation REFINING INDUSTRY www.tupras.com.tr 8
Crude Price Differentials ($/bbl) Ural Differentials Price Differentials 1 Brent Brent 0 0 -0,35 -0,58 -3 -1 -1,30 -6 -2 -2,06 -2,41 -9 -3 -12 -4 11Q1 11Q2 11Q3 11Q4 12Q4 12Q2 12Q3 12Q4 13Q1 13Q2 13Q3 13Q4 14Q1 14Q2 14Q3 14Q4 15Q1 15Q2 15Q3 15Q4 16Q1 16Q2 16Q3 16Q4 17Q1 17Q2 17Q3 17Q4 Jan Feb *Mar Apr May Jun Jul Aug Sep Oct Nov Dec Iran Heavy Kirkuk Kuwait Basra Heavy Arab Heavy Ural 2015 2016 2017 2018 2012-2017 Differential Range *As of March 26th Investor Presentation REFINING INDUSTRY www.tupras.com.tr 9
Turkish Economy Strengths Population (mn) GDP (%) 12 82 2002-2014 4.9% 11,1 1.4% growth in last 5 yrs 2010-2014 5.4% 9 9,2 81 8,8 0-40 yrs >65% 6 82 80 5,1 81 81 5,0 4,2 4,0 3 80 79 3,0 2,9 79 2,1 0 78 2010 2011 2012 2013 2014 2015 2016 2017Q1 2017Q2 2017Q3 2016 2017 2018 2019 2020 Diesel Consumption (mn tons) Car ownership per thousand people 4% annual growth 67% 213 27 220 8.8% average 176 26 growth in last 5 yrs 165 25 134 127 27,7 24 110 26,1 25,1 23 24,2 55 22 22,3 21 0 2016 2017 2018 2019 2020 2014 2015 2016 2017 Source: EMRA, TSI Investor Presentation REFINING INDUSTRY www.tupras.com.tr 10
Turkish Consumption (Million tons) 2015-2017 Diesel Jet Fuel 4,58 20,56 2015 2015 +8.3% +2.7% 22,31 4,40 2016 2016 +8.5% -4% 24,17 4,52 2017 2017 10 14 17 21 24 0 1 2 3 4 5 Gasoline Fuel Oil * 0,60 2015 2,10 2015 -15.7% +3.1% 0,58 2016 2,23 2016 +6.5% -3.5% 0,49 2017 2,30 2017 0 0 0 0 1 0 1 2 2 3 Source: EMRA *Bunker excluded. Investor Presentation REFINING INDUSTRY www.tupras.com.tr 11
Turkish Petroleum Market - 12 Months 2017, (Million tons) Diesel consumption in Turkey in 2017 grew significantly driven by infrastructure projects and demand from heavy duty vehicles. Diesel Jet Fuel 4,52 24,17 2017 +8.3% +2.7% 2017 4,40 22,32 2016 2016 0 1 2 3 4 5 0 4 8 12 16 Gasoline Fuel Oil * 0,49 +3.1% -15.7% 2017 2,30 2017 0,58 2016 2,23 2016 Source: EMRA *Bunker excluded. 0 0 0 0 1 0 1 2 2 3 Investor Presentation REFINING INDUSTRY www.tupras.com.tr 12
Turkey’s Import / Export Balance (Net) (Million tons) 4 Export 3,2 2,8 2,4 1,0 0,7 0,3 0,3 0,1 0,0 0 -3,1 -3,1 -3,4 -4 Import -8 -12 -12,0 -12,3 -13,2 2013 2014 2015 2016 2017 -16 LPG Gasoline Diesel Fuel Jet Source: EMRA Investor Presentation REFINING INDUSTRY www.tupras.com.tr 13
COMPANY OVERVIEW
Tüpra ş Shareholder Structure Publicly Traded %77 %20 %3 *Distribution of Domestic/ Foreign Ownership of Tüpra ş Shares Energy Investments Inc. (SPV) %51 %17,5 %79,98 Free Float %40 %49 %82,5 Foreign Ownership %100 Domestic Ownership * As of December 31th, 2017 Investor Presentation COMPANY OVERVIEW www.tupras.com.tr 15
Tüpra ş Refining Assets & Distribution Network Baku İstanbul OPET Turkey Marmara OPET Terminal Giresun İzmit Terminal 721,000 m3 Storage Capacity 43,130 m3 Kırıkkale Ankara : 58% Tüpra ş İzmir : 9% Opet Batman : 33% Other Companies OPET OPET Antalya Mersin Terminal Terminal 240,000 m3 19,392 m3 Total Capacity : 28.1 mn ton Nelson Complexity : 9.5 Kirkuk : 7.2 mn m3 Tüpra ş Storage Cap. Crude Pipeline Terminal Refinery OPET Storage Cap. : 1.1 mn m3 İ zmir Kırıkkale Batman İ zmit • 11.0 MT Capacity • 5.0 MT Capacity • 1.1 MT Capacity • 11.0 MT Capacity • NC: 7.66 • NC: 6.32 • NC: 1.83 • NC: 14.5 • Storage Capacity:2.51 mn m 3 • Storage Capacity: 1.41 mn m 3 • Storage Capacity:0.25 mn m 3 • Storage Capacity: 3.03 mn m 3 • Base oil 400 k tons Investor Presentation COMPANY OVERVIEW www.tupras.com.tr 16
High Complexity (Nelson Complexity of Refinining Companies) İ zmit After Rup 14,5 15 Tüpra ş 14,5 After Rup 13,0 12,6 Tüpra ş 11,8 11,6 Before Rup 11,5 11,0 9,5 10,4 10 9,9 9,8 9,6 9,5 9,4 9,2 9,2 9,0 8,8 8,7 8,4 7,3 8,0 7,3 7,1 7,1 7,1 7,1 6,8 6,5 5,9 5,8 5,8 5 0 İ zmit Ref. Valero Reliance Essar Marathon Oil Holly-Frontier Neste BP Tesoro Thai Oil IOCL Tüpra ş -2015 Hellenic PKN MOL SHELL Petrom Galp Saras Petrobras Tüpra ş Lukoil HPCL CPCL BCP Esso(Thai) S-Oil MRPL SK Energy BPCL Investor Presentation COMPANY OVERVIEW www.tupras.com.tr 17
Crude Suppliers of TÜPRA Ş (Million Tons) In 2017, Tüpra ş purchased 25 different types of crude oil from 14 countries, with gravities ranging between 18-47 API. Africa America Europe CIS Middle East 90 80 79 76 70 71 67 65 60 63 50 40 Crude Type 2017 30 %5,3 %36 20 17 %58,8 15 14 14 10 13 13 12 11 10 10 10 10 7 6 6 3 2 3 2 1 0 >34 30> 30 - 40 2012 2013 2014 2015 2016 2017 Investor Presentation COMPANY OVERVIEW www.tupras.com.tr 18
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