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CERTIFIED TRANSLATION FROM POLISH Annual Environmental & Social Report 1. Information about the Company Company Name: Grupa Azoty S.A. Company Address: ul. Kwiatkowskiego 8, 33-101 Tarnów, Poland Country: Poland Town/Location: Tarnów Company authorised representative: Piotr Skóra I certify that the data contained in this report completely and accurately represents the Company’s operations during the reporting period. Signature: Piotr Skóra Title: Company Treasurer Date: April 8th 2020 Contact Details: Telephone: (+48) 14 637-48-52 Mobile:785 780 952 Email: [email protected] Please provide key data on the Company performance, as well as production levels at each plant. For each of the 7 large plants please provide: Item Cumulative [PLN ‘000] 2018 2019 Revenue 1,825,771 1,987,039 Profit/(loss) on sales 60,049 99,937 EBIT 47,761 89,227 EBITDA 159,971 223,755 Net profit/(loss) 171,064 58,249 * In the reporting period the presentation of financial statements was changed to improve disclosures regarding the effect of certain transactions on the Company's assets and financial position. The comparative data was appropriately restated. Key performance indicators in terms of energy consumption, emissions, use of natural resources, and carbon dioxide emissions; See Section 4 and Section 5. Number of staff employed and any change in employment over past 3 years As at Dec 31 2017 As at Dec 31 2018 As at Dec 31 2019 Number of direct employees: 2,148 2,200 2,192 Number of contracted workers: - - - Provide information on permits and each subsidiary’s compliance status with IPPC/IED (Integrated Pollution Prevention and Control Directive/Industrial Emissions Directive) Currently, Grupa Azoty S.A. operates pursuant to the following decisions: Integrated permits: • Decision by the Marshal of the Kraków Province dated June 20th 2012 Ref. No. SR-II- 1.7222.1.1.2012, granting an integrated (IPPC) permit to Zakłady Azotowe w Tarnowie-Mościcach for the Hydrogen Unit, valid for an indefinite term (permit amended by Decision of December 3rd 2014 Ref. No. SR-II-1.7222.2.13.2014); • Decision by the Governor of the Kraków Province dated February 16th 2007 Ref. No. ŚR.XIV.JI.6663-6-05, granting an integrated (IPPC) permit to Zakłady Azotowe w Tarnowie- Mościcach for the Park Infrastruktura Complex, valid for an indefinite term (permit amended by Decision of July 29th 2011 Ref. No. SR-II-1.7222.1.3.2011, Decision of September 11th 2012 Ref. No. SR-II-1.7222.1.7.2012, Decision of December 3rd 2014 Ref. No. SR-II-1.7222.2.17.2014, Decision of December 31st 2015 Ref. No. SR-II-1.7222.2.1.2015, and Decision of March 10th 2017 Ref. No. SR-II.7222.2.9.2016); • Decision by the Governor of the Kraków Province dated April 17th 2007 Ref. No. ŚR.XI.JI.6663-3- 06, granting an integrated (IPPC) permit to Zakłady Azotowe w Tarnowie - Mościcach for the POM Manufacturing and Compounding Complex, valid for an indefinite term (permit amended by Decision of July 29th 2011 Ref. No. SR-II-1.7222.1.1.2011 and Decision of December 3rd 2014 Ref. No. SR-II-1.7222.2.14.2014); • Decision by the Governor of the Kraków Province dated July 29th 2011 Ref. No. SW.II.1.AJ.7673- 10/09, granting an integrated (IPPC) permit to Zakłady Azotowe w Tarnowie - Mościcach for the Technical Grade Nitric Acid Unit, Calcium Ammonium Nitrate and Ammonium Nitrate Unit, Nitrogen Fertilizer Granulation Unit, and Dolomite Milling Unit, valid for an indefinite term (permit amended by Decision of December 3rd 2014 Ref. No. SR-II-1.7222.2.15.2014, Decision of August 16th 2016 Ref. No. SR-II.7222.2.8.2016, Decision of July 21st 2017 Ref. No. SR- II.7222.2.27.2016, and Decision of January 18th 2018 Ref. No. SR-II.7222.2.34.2017); • Decision by the Governor of the Kraków Province dated July 17th 2007 Ref. No. ŚR.XIV.JI.6663-2- 06, granting an integrated (IPPC) permit to Zakłady Azotowe w Tarnowie - Mościcach for the Caprolactam and Polyamide Manufacturing Complex (permit amended by Decision of March 16th 2009 Ref. No. SW.II.1.JI.7673-6/08, with respect to the Natural Polyamide Unit), amended in its entirety by Decision by the Marshal of the Kraków Province dated December 1st 2010 Ref. No. SW.II.1.AJ.7673-11/08 (permit amended by Decision of July 29th 2011 Ref. No. SR-II- 1.7222.1.2.2011, Decision of February 16th 2012 Ref. No. SR-II-1.7222.1.2.2012, and Decision of June 20th 2012 Ref. No. SR-II-1.7222.1.5.2012), Decision of October 21st 2013 Ref. No. SR-II- 1.7222.1.3.2013. - [Sulfuric acid production], Decision of December 3rd 2014 Ref. No. SR-II- 1.7222.2.16.2014 - [Sulfuric acid production], and Decision of January 23rd 2018 Ref. No. SR.II.7222.2.12.2017), valid for an indefinite term; • Decision by the Marshal of the Kraków Province dated June 28th 2018, Ref. No. SR- II.7222.13.4.2016, granting an integrated (IPPC) permit to Grupa Azoty S.A. for its Iron- Chromium Catalyst Plant II, valid for an indefinite term; • Decision by the Marshal of the Kraków Province dated July 1st 2015 Ref. No. SR-IV-1.7222.1.2015, granting an integrated (IPPC) permit to Grupa Azoty S.A. for the Central Wastewater Treatment Plant, amended by Decision Ref. No. SR-II.7222.1.7.2018.MM of April 20th 2018 and valid for an indefinite term; Air emissions • Decision by the Governor of the Kraków Province dated December 29th 2014, Ref. No. SR-II- 1.7221.2.2014, granting a permit for release of gases and dusts into the air to Grupa Azoty S.A., valid until December 28th 2024; • Notification of Grupa Azoty S.A.'s EC II CHP Plant Water Treatment Unit and Modified Plastics Facility to the Marshal of the Kraków Province Ref. No. TB/JK/1034/2014, dated November 24th 2014; EU ETS • Decision by the Marshal of the Kraków Province dated April 28th 2017, Ref. No. SR- II.7225.1.21.2016, granting permission to participate in the European Union Emissions Trading Scheme for the CHP plant located on the premises of Grupa Azoty S.A., including a Monitoring Plan, amended by Decision by the Marshal of the Kraków Province dated September 16th 2019, Ref. No. SR-II.7225.2.3.2019.AJ, including a Monitoring Plan, valid for an indefinite term; • Decision by the Marshal of the Kraków Province dated November 24th 2017, Ref. No. SR- II.7225.1.7.2016, granting permission to participate in the European Union Emissions Trading Scheme with respect to greenhouse gas emissions from the units manufacturing nitric acid, ammonia and bulk organic chemicals by way of cracking, reforming, oxidation or similar processes, with a daily production capacity of over 100 Mg, including a Monitoring Plan, amended by Decision by the Marshal of the Kraków Province Ref. No. SR-II.7225.3.12.2018.AJ, dated June 13th 2019, including a Monitoring Plan, valid for an indefinite term; Water and wastewater • Decision by the Mayor of Tarnów Ref. No. WGK.B-III.6210/16/02/03 dated January 13th 2003, granting a permit for collective water supply and collective wastewater discharge, valid for an indefinite term; • Decision by the Governor of the Kraków Province dated December 30th 2014 Ref. No. SR-IV- 1.7322.1.28.2014.MG, granting a permit for special use of water – abstraction of groundwater from an intake point located in Tarnów-Mościce, valid until December 31st 2034; • Decision by the Governor of the Kraków Province dated December 29th 2005 Ref. No. ŚR.XIV.MGą.6811-31-05, granting a permit for special use of water – abstraction of surface water from the Dunajec river, valid until December 31st 2025, amended by Decision Ref. No. KR.RUZ.4211.180.2018.IT dated November 16th 2018; • Decision by the Regional Water Management Authority of Kraków Ref. No. KR.RUZ.421.1.102.2019.AS dated July 1st 2019, granting a permit for discharge of wastewater containing substances particularly harmful to the water environment into the sewerage system of Zakład Oczyszczania Ścieków T.W. Sp. z o.o., valid until July 1st 2023; • Decision by the Marshal of the Kraków Province dated December 15th 2017 Ref. No. SR- IV.7322.1.259.2017.MG, granting a permit for discharge of wastewater into surface waters, valid until December 31st 2021; • Decision Ref. No. SR-IV.1.7328.1.2013.MG, establishing a protected zone for water intake points; Waste • Decision by the Marshal of the Kraków Province dated January 20th 2016 Ref. No. SR-III- 1.7244.4.9.2015.AG permitting Grupa Azoty S.A. to collect and process waste, valid until January 19th 2026; Other • Resolution of the Provincial Assembly of the Kraków Province of October 25th 2010, No. LI/833/10, establishing Industrial Zone at ZAT S.A. (Official Journal of the Province of Kraków, No. 580/2010, item 4475). Reporting period: 2019 2. General Is the project materially compliant Yes [X] If No, please provide details of any material with all relevant EBRD Performance No [ ] non-compliances: Requirements (taking account of agreed action plans, exemptions or derogations)? Is the project materially compliant Yes [X] If No, please provide details of any material with all applicable environmental and No [ ] non-compliances: social laws and regulations? Have there been any accidents or Yes [X] If Yes, please describe, including details of incidents that have caused damage to No [ ] actions to remedy and prevent reoccurrence: the environment, brought about injuries or fatalities, affected project In total, 15 accidents at work were reported.