United Chemical Company

UNITED CHEMICAL COMPANY

OVERVIEW AND HIGHLIGHTS

Nursultan Shalkarov

Project Manager 2021, Nur-Sultan UCC PROFILE

“United Chemical Company” LLP (UCC) was established in order to develop chemical industry in the Republic of Kazakhstan and is а subsidiary of "National Welfare Fund "Samruk-Kazyna" JSC, an Investment Holding possessing total assets in the amount of more than $68.4 billion in oil and gas production/transportation, logistics, chemical, nuclear, mining and smelting, energy, mechanical engineering, real estate and venture funds. Most of UCC's initiatives are located in the special economic zones established to provide investment opportunities such as affordable feedstock availability, ready-to-use infrastructure, free allocation of land plots, neighborhood with the largest growing markets of the CIS countries and China, the existence of various sources of raw materials, preferential taxation and customs regulations.

UCC products produced

Polypropylene Sulphuric acid BOPP-film bags

Glyphosate Glyphosate herbicide (liq.) herbicide

6 PROJECTS

IMPLEMENTATION LOCATION PROJECTS CAPACITY PERIOD STAGE Polyethylene 1 250 KTA DFS-FEED Gate Construction works complete Polypropylene 500 KTA 2017-2021 ~ 79% ▪ BOPP – 10 KTA Polymer Production ▪ PE film – 4 KTA 2012-2015 Operation ▪ PP bags – 24 mln. pcs.

SEZ SEZ Polyether Polyols 100 - 150 KTA 2021 - 2027 Concept

NIPT ATYRAU NIPT Monamin 15 KTA 2020-2024 Business plan ▪ Caustic soda 20 KTA Chlor-alkali ▪ Iron chloride 10 Kta 2021-2024 Business plan - DFS Gate ▪ Hypochlorite calcium 15 KTA

Hydrogen peroxide 10 KTA 2020-2024 Business plan - DFS Gate DFS-FEED Gate Urea 887 KTA 2019-2025

Conclusion of JVA SEZ SEZ

TARAZ TARAZ PE and PP (MTO) Up to 1 bcm of natural gas (feedstock) 2020-2025 Concept ▪ Liquid – 2,9 mln. liters

CHEMICAL PARK PARK CHEMICAL Glyphosate herbicide 2016-2019 Operation ▪ Granules – 1 KTA

Sulfuric Acid plant 180 KTA 2010-2015 Operation SK

11 STEPNOGOR SEZ NIPT ATYRAU

• Period: 2007 – 2032 • Location: Atyrau Region General Information • Total Area: 3475 ha • Shareholders: Ministry of Energy of the Republic of Kazakhstan United Chemical Company LLP

• Distance to Atyrau city – 42 km. Location • Distance to highway – 5 km • Railway access to the Russia, China and Central Asian countries.

• Corporate income tax – 0% • Property tax – 0% Tax incentives • VAT – 0% • Land Tax – 0%

Gas supply Raw minerals in the region Feedstock • TCO – Dry gas (Tengiz oil field) ▪ 4,5 billions tons of oil • NCOC- LPG (Kashagan oil field) ▪ 2,0 trillion m³ of natural gas.

Completed Utilities Industrial Infrastructure – under construction • Gas-turbine Power plant - 310 MW • Water treatment system – 15 000 m3/day (1st stage) • Access rail road -15,6 km. 46 000 м3/day (2nd stage) Infrastructure • Railway station • Industrial gases – Nitrogen: 7 000 m3/day (1st stage) • Access automobile road - 5,3 km. 28 500 m3/day (2nd stage) • Grid connection-110-kV and 220-kV 8 • Power Substation -110/35/10 kV and 220 kV SEZ CHEMICAL PARK TARAZ

• Period: 2012 – 2037 • Location: Zhambyl Region General Information • Total Area: 505 ha • Shareholders: United Chemical Company LLP; Ministry of Industry and Infrastructural Development of the RoK

• Distance to Western Europe - Western China highway – 50 km Location • Railway access to the Russia, China and Central Asian countries.

• Corporate income tax – 0% • Property tax – 0% Tax incentives • VAT – 0% • Land Tax – 0%

Gas supply through “Kazakhstan - China” gas pipeline Minerals in the region • Phosphorites • Length – 1 305 km. • Quartzite Feedstock 3 • Capacity – 40 bln. m /year • Precious metals – gold and silver; 3 • Off take contract – 1 bln. m /year (until 2037) • Non-ferrous metals – copper, zinc and lead; • Nonmetals – barite and coal

Completed utilities: • Water supply – 41 m3/day • Internal road – 15,6 km Infrastructure • Electric power – 140 MW • Internal railway – 5,2 km • Gas - 1 bcm/year • Solid waste landfill – 8 Ha 10 PROJECTS

SEZ SEZ Polyether Polyols 100 - 150 KTA 2021 - 2027 Concept

NIPT ATYRAU NIPT Monamin 15 KTA 2020-2024 Business plan ▪ Caustic soda 20 KTA Chlor-alkali ▪ Iron chloride 10 Kta 2021-2024 Business plan - DFS Gate ▪ Hypochlorite calcium 15 KTA

Hydrogen peroxide 10 KTA 2020-2024 Business plan - DFS Gate DFS-FEED Gate Urea 887 KTA 2019-2025

Conclusion of JVA SEZ SEZ

TARAZ TARAZ PE and PP (MTO) Up to 1 bcm of natural gas (feedstock) 2020-2025 Concept ▪ Liquid – 2,9 mln. liters

CHEMICAL PARK PARK CHEMICAL Glyphosate herbicide 2016-2019 Operation ▪ Granules – 1 KTA

Sulfuric Acid plant 180 KTA 2010-2015 Operation SK

11 STEPNOGOR UCC perspective projects

PVC major Licensors: • Polyvinyl Chloride (PVC or Vinyl) is a • Feedstock – Ethylene (ethane chain), high strength thermoplastic material chlorine and oxygen • Technip FMC (Italy); widely used in applications, such as • Feedstock source – TCO (Atyrau), • Thyssen Krupp Industrial Solutions Polyvinyl pipes, medical devices, construction, caustic soda manufacturers. (Germany); transport, packaging, wire and cable • Import capacity – (2019) – 59,03 KTA • Nouryon (formerly AkzoNobel Specialty chloride insulation. Chemicals), (Netherlands); (CAGR – 4%) • Domestic production - no • It is the world's third-most widely • Solvay (Solvin* with BASF) (Belgium); produced synthetic plastic polymer. • Formosa Plastics (Taiwan).

Sodium carbonate major Licensors: • The main uses of Sodium carbonate • Feedstock – Sodium carbonate is are as water softener, food either found naturally or is • Solvay (Belgium); Sodium processing aid, pH modifier, chemical manufactured from sodium chloride • TATA Chemicals Limited (India). manufacturing and electrolyte. (common salt) carbonate • It is also used in the manufacture of • Feedstock source – salt/limestone (Soda ash) glass, paper, soaps and detergents, mines (CAGR – 3%) and many other useful chemicals. • Import capacity – (2019) – 363 KTA • Domestic production - no

Ammonium nitrate major Licensors: • Ammonium nitrate is used • Feedstock – Ammonia • Technip FMC (Italy); commonly in fertilizers; in • Feedstock source – Natural gas pyrotechniques, herbicides, and (KazTransGas). • Thyssen Krupp Industrial Solutions Ammonium insecticides; explosive mixtures used (Germany); • Import capacity – (2019) – 496 KTA in mining, quarrying, and civil • KBR (USA); nitrate construction. • Domestic production - no (CAGR – 21%) • Casale (Switzerland ). • it is the most common nitrogenous component of artificial fertilizers.

10 SUGGESTED WAYS OF COOPERATION

Partner United Chemical Company

❑ Partner's equity share in the ❑ 50% or less of equity share in joint joint venture – equity or more venture than 50% ❑ Provision of ready-to-use infrastructure ❑ Ensure the sale of the products (off-take contract) – preferably ❑ Tax incentives

❑ Experience in operations of ❑ Supply of feedstock on favorable similar production facilities – prices, terms and conditions preferably

12 GOVERNMENT SUPPORT TO INVESTORS

The government support of investments meant to create favorable investment climate to boost economy and investments into development of new, expansion and renovation of the existing production facilities along with the use of modern technologies, upgrade qualification of Kazakhstani human resources and environmental protection.

The state support instruments for the investment activity are following:

State in-kind grants Investment subsidies Tax preferences for participants of SEZ

shall mean the assets, the property of the Republic of shall mean a non-repayable and non-refundable budget subsidy Corporate income tax – 0% Kazakhstan, which are granted for temporary free use (cashback) granted as an investment preference to a legal entity of the on the right of temporary free land use to a legal entity Republic of Kazakhstan, which signed an investment contract on Property tax – 0% of the Republic of Kazakhstan engaged in investment investments in the amount of at least 5 mln monthly calculation indices, VAT – 0% project and subsequently can be delivered into established by the republic budget law and effective on the day of filing possession of investor. an application for investment preferences and implementation of Land Tax – 0% investment project

Government identified financial tools such as: State support to the investors through the following financial operators:

❑ Medium and long-term financing for investment projects (Equity) Baiterek Development Development Bank of Kazakhstan Investment Fund of Kazakhstan ❑ Leasing and trade finance (loans, credits) ❑ Project and working capital financing

❑ Agent services for investment projects financed by the National Agency for Entrepreneurship Development Kazyna Capital Technological Development Fund «Damu» Management government or government-guaranteed debt

13 Export-Credit Insurance Corporation Kazakhstan Project Preparation Fund «Kazаkh Export» CONTACTS

Thank you for your attention!

United Chemical Company LLP Address: 5th floor, Tower 4, 17/10, E-10 str., Nur-Sultan 010000, Republic of Kazakhstan Tel.: +7 (7172) 737100, 737115 Web: ucc.com.kz E-mail: [email protected] [email protected]