The CEF Group of Companies

CEF Group Turnaround Strategy & Current State of the entity briefing to the Portfolio Committee on Mineral Resources and Energy Agenda

01 CEF Group Overview & Mandate 06 Strategic Fuel Fund 02 CEF Group Governance Structures 07 New Refinery

Transformation Statistics and Youth CEF Group Project Portfolio 03 Developmental Initiatives 08

CEF Group Strategic Challenges and Thank You and Close 04 Emerging Strategy 09 05 PetroSA Turnaround

Page . 2 CEF Group Overview focus on Mandate

Page . 3 CEF Group Overview, Commercial Structure

Comments Department of Mineral Resources • CEF and it entities are & Energy Schedule 2 SOEs and are commercial in nature except for SFF which is a NPC.

• This is about Commercial Viability as we don’t get As the holding company CEF has a holistic view of all government funding business activities in each entity and can support The Holding Company owns all accordingly by being able to align resources to support the subsidiaries / entities 100% • CEF entities operate in the those entities that are struggling. energy sector with commercial, strategic, regulatory and developmental roles.

• There are a number of Funds under Regulatory Renewable Energy and Coal Division Main Administration Subsidiaries Entity associates in which CEF is a minority shareholder.

• Each subsidiary has its own Board of Directors that is EQF EPD accountable to the CEF Board of Directors.

We have operations in Ghana and Mozambique and strategic partnerships in Europe GTLF1 Page . 4 Overview of CEF, its mandate, vision and mission

The Mandate of CEF is The Vision of CEF is to The Mission of CEF is to grow Role of CEF: Search for derived from the CEF Act be a leading integrated our footprint in the energy appropriate energy (No 38 of 1977). The energy company that sector, to be the catalyst for solutions to meet the future mandate is in essence to provides national economic growth and energy energy needs of South contribute to the security of sustainable energy poverty alleviation through Africa, the SADC and the energy supply for the solutions for South Africa. security of supply, and access Sub-Saharan African country. This way CEF contributes to acceptable (affordable) region, including oil, gas, to national energy security. energy in Africa and renewable energy sources

Reason for being Values • Contribute to security of energy supply & be the implementation arm of the Department of Batho Pele Mineral Resources and Energy Integrity • Provide strategic support to the state on energy sector goals support Respect • Enable strategic partnership with private sector and government entities Continuous Improvement • Align with government’s broad objectives (NDP) and act as a vehicle for government policy Stewardship implementation

Page . 5 AEMFC Business Overview

AEMFC Mandate AEMFC Overview • To support the State in all its mineral resources strategies by • AEMFC has been operating its first open COAL MINING operations in Ogies, acquiring and holding a sizeable mineral asset portfolio and Mpumalanga since 2011 supplying the ESKOM Kendal power station . participate in the mining thereof” • Volumes in supply over 2 million tons gradually increasing to 2.5 million tons Purpose Statement by 2020. • AEMFC’s operations are based on processes and norms that • The company employs 280 employees (including contractors) mostly young ensure that our exploration and production is based on safe and 30% of which are women. With the extension of current operation principles that show respect for human life and exercise employment will increase to about 500 employees. overall fair labour practices. • AEMFC is a profitable entity , with ambitious growth prospects. The company • We apply utmost respect and integrity in our dealings with all has maintained an unqualified audit record and an excellent safety record our stakeholders and each other as employees whilst ensuring that we deliver quality products and services in the most innovative and ethical way.

AEMFC Strategic Challenges Core Activities • Acquire and Mine development Funding challenges to Protracted Governance fund Growth Projects Processes • Coal Extraction • Coal processing Coal Qualities • Transportation • Marketing of coal.

6 iGas Business Overview

iGas Mandate iGas Overview • The South African Gas Development Company SOC Ltd • iGas holds the South African government’s 25% share in the ROMPCO gas (iGas), was established by Cabinet in 2000. pipeline which runs from Temane in Mozambique to Secunda in Mpumalanga, South Africa. The pipeline has undergone several major upgrades over the last • Its Mandate is, “iGas will act as the official State agency decade to increase its capacity from 120 to 196 MGJ/a. for the development of the hydrocarbon gas industry in • iGas received its initial funding from CEF, which it has recently fully repaid. The Southern Africa”. company is cash positive and poised for growth. • Per its ministerial directive, “iGas may from time to time • iGas is currently seeking ways to grow the South African gas market and it and in accordance with sound business principles enter engages via CEF with the DMRE on strategic Gas related matters. into joint ventures and should not rely upon state funding other than the resources of CEF”. Core Activities • Management of ROMPCO investment • Development of Liquefied Natural Gas importation terminals and pipelines for iGas Strategic Challenges supply of gas to power and gas to market • Seeking alternatives to the current Sasol gas supply to support local industry post Recruiting and retaining Securing Gas Supplies beyond 2023 and thereby ensure security of gas supply critical skills existing Sasol upstream • Engaging on gas supply to existing and new power stations agreement which goes into decline • Development of a national gas pipeline grid connecting major centres in phases. from 2023 Execution of new large Other SOCs (Transnet) pursuing gas projects LNG and gas pipelines mandate

7 SFF Business Overview SFF Mandate SFF Overview Energy Act No. 34 of 2008 • Operating since 1964 Section 17(1) – The Minister may, in a prescribed manner, for the • The first crude oil it ever owned was stored in its Milnerton tanks - 1967 purposes of ensuring security of supply, direct any state-owned • Operations in the Western Cape (Saldanha Bay & Milnerton) and eMalahleni entity to acquire, maintain, monitor and manage national (Ogies) strategic energy feed-stocks and carriers. SFF VISION • Employs 176 personnel To be the guarantor of strategic fuels through innovative and • Milnerton has 39 Steel tanks, each with 200 000 barrels storage capacity pioneering solutions, not for gain but for the benefit of the South African community. • Saldanha has 6 in-ground tanks, each with 7.5 million barrels storage capacity MISSION STATEMENT • Currently carrying out studies on the South Sudan project and the We are committed to creating sustainability through i) operating development of Block 2 efficiently ii) collaborating with strategic partners in exploring new opportunities and iii) by leveraging agile and empowered people operating responsibly in a compliant manner. Core Activities • Leasing spare capacity to Oil Traders Saldanha In-ground Crude Oil Terminal SFF Strategic Challenges • Management and maintenance of Crude Oil Strategic Stock Market Backwardation Funding Plan - 2013 Draft Strategic • Care and maintenance of Ogies underground bunkers storage facilities Stocks Policy (Capacity to store 75 million barrels) • Oil Spill Response services Access to the Inland Sale of Strategic Stock legal matters market and reputational damage

Page . 8 PASA Business Overview

PASA Mandate SOUTH AFRICAN EXTENDED CONTINENTAL SHELF PROJECT

. Petroleum Agency SA (PASA) promotes exploration for onshore .South Africa has made two submissions to the United Nations in May 2009. and offshore oil and gas resources and their optimal development (a) The South African Mainland (lodged 5 May 2009) on behalf of government. PASA also regulates exploration and (b) A joint submission with France relating to the Price Edward an Crozet Islands production activities, and acts as the custodian of the national (lodged 6 May 2009) petroleum exploration and production database. .The claims amount to approximately 1.87 million square kilometres, which ranks . PASA was designated by the then Minister of Minerals and Energy amongst the 10th largest claims in the world; and if endorsed by the United Nations will to perform certain functions set out in Chapter 6 of the Minerals and more than double South Africa’s maritime territory. Petroleum Resources Development Act, 2002 ("the MPRDA"). .This project has these potential benefits for South Africa:- - the potential for mineral resources including oil and gas; - manganese nodules and crusts possibly enriched with precious metals; and - exploiting the pharmaceutical and medical benefits of microbes associated with the inhospitable ultra-deep ocean floor and toxic hot water geysers. PASA Strategic Challenges

Leadership vacancies Funding for Extended Continental Core Activities Shelf Claims • To increase oil and gas exploration and production activities in SA; .funding for the continuation of the defence of the Extended • To regulate the exploration & production environment Continental Shelf Claim project remains a challenge • To acquire, archive & enhance all petroleum exploration & production . Total of R85m to cover acquisition of more data on the data frozen areas and the data to support island claim is needed • To ensure a viable and sustainable entity to successfully defend the claims

9 PetroSA Business Overview

PetroSA Mandate PetroSA Overview • Operate as a commercial entity and create value for the • Established in 2002* (Soekor & Mossgas and SFF Merger) shareholder. • Employs ~1400 staff. • Advance national objectives in the petroleum industry and contribute to energy security of supply • Owns one of the world’s largest GTL refineries. (45 BBPD) • Compliment and promote government policy and strategic thrust • More than 2 decades of experience in developing and operating oil and gas (Energy Security Master Plan & NDP) fields and infrastructure. • Business spans the petroleum value chain, excluding retail. • Produces diesel, gasoline, kerosene and specialty products • Produced ~70 MMbbl crude oil and more than 1.5 tcf of natural gas to date. • Upstream presence in South Africa and Ghana.

PetroSA Strategic Challenges Core Activities

Growth & Sustainability Reducing Cash Reserves & High • Exploration, development and production of oil and gas. Operational costs – • Participation in and acquisition of local as well as international upstream Depleting Feedstock Abandonment liability of R9.8 petroleum ventures. Billion • Production of synthetic fuels from gas and condensate. • Development of domestic refining and liquid fuels logistical infrastructure. Leadership instability & Operating Model and producing Board capacitation well below name plate • Marketing and trading of oil and petro-chemicals.

10 EPD (Renewable Energy Division) Business Overview

EPD Mandate EPD Overview • To support the DoE in clean energy policy formulation • Established the manufacturing test facility for Solar Water Geysers at the • To catalyse the RE industry in South Africa SABS. • To invest in RE technologies • Built the first wind farm in South Africa. • To invest in other clean and alternative energy • Is now a minority shareholder in 2 Renewable Energy IPP projects technologies • Supports the DoE in developing the biofuels regulatory framework.

EPD Strategic Challenges Core Activities The “start-stop” implementation of the IPP Programme • Developing and participation in RE projects -ACWA financial close • Supporting the DoE in implementing the SWH Progragmme.

11 CEF Group Governance Structures

Page . 12 CEF Governance and Oversight over its entities CEF and it’s entities operate within the realm of the PFMA and Companies Act. Further, there is a delegation of authority based on the materiality of transactions and approvals that governs all approvals. It is articulate on what the subsidiary boards can approve, what must be approved by CEF and ultimately by the DMRE.

Governance & Oversight

Governance Oversight Performance Management Approvals & Support

• CEF Board appoints and • Each Subsidiary Board • Subsidiaries are to provide • CEF approves key removes subsidiary Boards with the support of its monthly business material projects in line i.e.. the Companies Act. CEF respective Committees performance reports to with Delegated levels of Shareholder Compact (PFMA) and EXCO is charged with CEF. authority. requires approval of the overall oversight of • Quarterly Management • All Section 54 approvals Minister to appoint subsidiary Subsidiaries and is Reports providing a much must go via CEF directors. accountable to the CEF more detailed feedback • CEF endeavors to • CEF and the DMRE can have Board. are presented to CEF on create a conducive and representatives on CEF • The CEF Board with the time as per Shareholder’s optimum environment subsidiary Boards support its committees, Compact. for subsidiaries to • This is meant to improve and GCEO and EXCO is • Monthly and quarterly operate. facilitate effective decision responsible for overall business performance • In all major bilateral making and improve delivery. accountability of the CEF engagements are held engagements, CEF • CEF can request to be an Group. between the CEF and ensures that relevant observer to any subsidiary • CEF on the direction of the Subsidiary EXCOS subsidiaries are included Board meeting DMRE determines yearly . remuneration For an effective and seamless working relations between CEF and Subsidiaries constant and open communication must exist between Page . the Group CEO and the Subsidiary CEO’s so that issues can be dealt with efficiently. 13 Overview of CEF Group Governance Structure

Made up of independent directors and CEO and CFO are based on their roles also directors.

DMRE CEF BOARD

Chaired by Board Members in support of CEF BOARD COMMITTEES broader Board mandate

SUBSIDIARY BOARD - SUBSIDIARY BOARD - SUBSIDIARY BOARD - SUBSIDIARY BOARD - PETROSA SFF AEMFC IGAS

Othe Othe BARC G&N HRC S&G BARC HRC BARC HRC BARC HRC CEF SOC EXECUTIVE r r MANAGEMENT TEAM

SUBSIDIARY BOARD COMMITEES Page . 14 SUBSIDIARY EXECUTIVE MANAGEMENT TEAMS Transformation Statistics & Youth Developmental Initiatives

Page . 15 CEF Group Demographics - Race and Gender Profiles per subsidiary as at Q1 2019/20

GENDER PROFILE RACE PROFILE

Male Female African Coloured Indian White 98%

24% 85% 27% 34% 83% 44%

52% 50%

60%

49%

40% 40%

73% 76% 36%

66% 34% 56%

48% 50%

18%

17%

10%

6% 6% 6%

1% 1% 1% 1%

0% 0% 0% CEF PETROSA SFF AEMFC PASA IGAS CEF PETROSA SFF AEMFC PASA IGAS Diagram 1: Gender Demographics per Subsidiary at Q1 2019/20 Diagram 2: :Race Profile per Subsidiary at Q1 2019/20 c

Page . 16 CEF Group Demographics - Youth and People Living with Disabilities Profiles as at Q1 2019/20

Subsidiary Youth Profile People Living with Disabilities per subsidiary

IGAS 0% 50%

33% PASA 2%

53% AEMFC 0,25% 18-35

22% PWD SFF 0%

21%

PETROSA 1,40% 34%

CEF 2,5% 0% 10% 20% 30% 40% 50% 60%

iGas PASA AEMFC SFF PetroSA CEF 0,0% 0,5% 1,0% 1,5% 2,0% 2,5% 3,0%

Diagram 3: Subsidiary Youth Profile at Q1 2019/20 Diagram 4: :PWD Profile per Subsidiary at Q1 2019/20

Page . 17 CEF Group Strategic Challenges and Emerging Strategy

Page . 18 19 Internal analysis : key challenges for the CEF Group

• PetroSA is close to negative cashflows, increasing its cost of doing business and Depleting cash reserves unable to fund its long term plans. PETROSA CRISIS Depleting Indigenous • Reserves are close to depletion and are expected to run out by December 2020 Feedstock and there is still no sustainable techno-economic long term solution for the GTLR.

Overall vision and • Executing holistically the CEF’s mandate and mission, as it has a broad focus STRATEGIC mission DIRECTION • CEF does not have an effective parenting strategy, therefore subsidiaries not Parenting strategy leveraging synergies

• Layers of leadership result in delayed decision-making processes, with unclear Decision Lags GOVERNANCE ‘decision owners’ STRUCTURE • Consistency in applying Group’s Governance and compliance framework, Governance lapses leads to Governance lapses in some instances

• Talent exist, however required a framework for leveraging skills between Effective utilised talent subsidiaries. CAPABILITIES • Leadership vacancies at Executive Level and Boards creates serious challenges. Leadership

• Group profitability is severely challenged because CEF had a heavy reliance on Profitability income from PetroSA which is now facing serious challenges. FINANCIAL • Other subsidiaries are still too small to sustain the Group, but they are growing. SUSTAINABILITY Market share • The Group has an insignificant market share and no sufficiently developed or mature initiatives to grow the market shares The Group has a very low brand equity arising from prolonged negative media coverage of the 2015 illegal sale of the national strategic fuel stock, the 2014/2015 impairment of the Ikhwezi project investment and wrong perceptions about the South Sudan deal signed in 2019. Emerging Strategy

INDICATORS DESIRED FUTURE STATE  25% Market share across • The national energy company mandated for the state participation in oil and gas - delivering value in an the Downstream fuels, integrated and commercially sustainable manner within requisite legislative framework coal and gas.  Average returns of more • An exponential organisation that is an employer of choice and a responsible corporate global citizen than 15% on projects and investments. • Significant contributor to the country’s GDP and energy poverty reduction  Double current asset value • A dependable and capable partner to other organisations and the state, supporting the development of (rare/new) skills required for the country’s energy transition  Presence in the continent/ region • Active and significant player across the energy value chain, with a substantial position in distribution/downstream  Diversified investment and project portfolio • Pioneer , thought leader and knowledge advisory in support of energy policy development  Engaged workforce • Leader of the transition to clean fuels and e-mobility  Brand value • An innovation leader which leverages 4IR technologies to advance the future of the energy sector • Leader in commercialisation of new energy Diversified Commercialis Partnerships Appropriate Strategic Clearly Efficient technologies Turnaround of revenue ation of new across the funding energy defined value operating PetroSA • Meaningful streams technologies continent model infrastructure proposition model

DRIVERS transformation initiatives

20 Strategic Roadmap 21

2019-2020 2020-2025 2025-2035 >2035 Refocus Transition Accelerate Stabilise

Oil and gas E&P (South Africa) Oil and gas exploration South Sudan

Oil and gas E&P (Mozambique) G2G Exploration agreements - oil, gas exploration Tanzania, Kenya, Nigeria New Guinea

Upstream Coal and other mineral exploration and mining Coal and other mineral exploration Botswana and Mozambique Coal/mineral exploration SADC (South Africa) Clean coal processing RE technology and energy storage manufacturing in SA

Explore additional oil and gas storage opportunities in South Africa

South Africa and Mozambique pipeline development Midstream LNG Terminal (South Africa) Renewable energy operations and maintenance

New / Greenfield Refinery (South Africa) Acquire existing refinery and retail sites South Africa Expand South Africa retail footprint Downstream Coal and liquid fuels retail South Africa Liquid fuel retail SADC Gas retail in South Africa Renewable energy power technology supply to Kenya, Tanzania & Africa Gas and RE power generation and retail South Africa Electricity and liquids fuels from Clean Coal technologies

Enabling Designation for state New Governance Exponential Reposition the Stabilise PetroSA Energy 4.0 Frameworks carry & Operating Model Organisation CEF Group PetroSA Turnaround

Page . 22 PetroSA History

1940’s First organised search for oil & gas in SA 1970s IOCs gradually withdraw from SA, UN sanctions 1999 Petroleum Agency SA is formed (Geological Survey of SA) – research focus 1980s State owned Soekor only company exploring for 2001 PetroSA is formed, as NOC 1965 Formation of SoekorOur vision oil and gas offshore SA 2002 MPRDA, Act No.28 of 2002 enacted 1967 Mining Rights Act, No.20 of 1967 enacted: 1991 Minerals Act, No.50 of 1991 passed 2008 MPRD regulations gazetted Offshore concessions granted to IOCs 1994 Licensing round to attract IOCs (Total, Gulf Oil, Esso, ARCO, Superior etc) 2013 MPRDA amendment bill gazetted

1998 White Paper on Energy Policy

E&P Milestones in RSA: 1966 1970“ 1980 1988 . Onshore well drilled by Soekor . Soekor and Rand Mines continue . F-A gas field discovered in . Discovery of Oryx oil field, SA’s in Beaufort West, discovers exploration offshore, more gas Block 9, Southern Cape coast. first oil discovery shale gas. discoveries are made. 1983 1989 1969 1978 . E-M gas field discovered in . Discovery of Sable oil field . Offshore well drilled by . Soekor terminates land search for Block 9, Southern Cape coast. 1990 Superior, discovers gas in Block oil after drilling 66 wells. 1987 . Discovery of Oribi oil field 11a, South Coast. . Mossref GTL Project starts

1992 2000 2007 2015 . Mossgas GTL starts to . E-M gas & Oryx oil . South Coast Gas . Regulations for produce fuels fields start production comes on stream petroleum exploration 1997 2003 2014 and production gazetted . Oribi oil field start . Sable oil field start . F-O gas field start . Regulations provide for production production production shale gas Strategic Challenges & Opportunities

Depleting indigenous gas Indigenous gas to fall below the commercial limit of the GTL Refinery by December 2020 1 feedstock

High Cost Imported 2 Supplementary feedstock at premium prices averaging US$3 – US$6 above Brent Condensate

3 High Fixed Cost Structure Cost structure at same level as required to support a 3 train operation while operating on 1 train

4 Decommissioning Liability Latest estimate is R9.8 billion (only R2.4 bn set aside, thus shortfall of R7.4 bn)

Not designated as NOC or To support the execution of both the commercial and the developmental mandate of a National Oil 5 carrier of state participation Company interest in upstream

6 Leadership Instability Operating with interim Board since July 2017 and acting CEO and CFO since 2014

Page . 24 Repositioning for long-term commercial sustainability Upstream Midstream Downstream (Exploration and Production) (Manufacturing & Refining) (Trading, Sales & Marking)

Exploration Appraisal Development Production Trading Transport Refining Distribution Wholesale Retail

Upstream Characteristics Midstream Characteristics Downstream Characteristics • High risk/High Reward • Margin business/lower risk/low • Margin business/lower risk/low • Inherent resource uncertainty returns returns • Capital Intensive - E&A not funded by banks, thus • Complex with many interfaces • Sales & marketing environment risk company funds. • Market and economic cycles drive • Customer focus • Technology & Data Intensive, rapid changes in demand. • Product distribution capability and technology, ongoing need to acquire and evaluate • Fluctuating petroleum product efficiency data. prices. • Supply chain management • Highly competitive, especially to access quality acreage. • Joint Venture partnerships to share risk and leverage expertise and technology. • No control over fluctuating commodity prices

Strategic Rationale for Repositioning • Designation as NOC and carrier of state participation interest in upstream, to unlock the growth potential of PetroSA, to be a significant player in the oil and gas industry, ensuring security of hydrocarbon supply for the country. • To advance initiatives of national strategic imperative, e.g. new crude oil refinery, LNG importation, biofuels, shale gas and regional gas to aid move towards a lower carbon economy. RSA’s Oil & Gas Potential bodes well for PetroSA’s Upstream Turn Around Petroleum Agency SA (PASA) in-place resource estimates (May 2018) Active Ventures (August 2019) courtesy of PASA

Offshore rights and permits: Onshore rights and permits: (August 2019) (August 2019) Production Rights : 6 Production Rights : 1 Exploration Rights: 17 Exploration Rights: 17 Technical Cooperation Permits: 2 Technical Cooperation Permits: 8 Applications/Conversions in process: YES

E&P Companies active in offshore ventures E&P Companies active in onshore ventures

Tshipise Energy

TETRA4

• 51 Joint ventures for (new) SOE E&P to be part of as custodian of state equity • Currently PetroSA is active in 4 exploration rights and the six production rights offshore

PetroSA Strategy

• To reduce PetroSA’s financial exposure through partnerships in exploration rights. • To leverage partnerships to find and develop gas Financial Impact feedstock for the GTL Refinery in medium-long term. 1. Potential investment of some R5 billion by prospective partners 2. Potentially defers abandonment of offshore

National Imperatives infrastructure, and estimated expenditure of R9.8 bn. - President Ramaphosa’s US$100 Billion Investment Drive - Unlocking South Africa’s Ocean Economy “Project Phakisa” to drill 30 wells in period 2014 - 2024 Potential Investment into PetroSA & South African Economy – West Coast

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

~1 Exploration well Block 5/6/7 (Current offer) @ US$ 50 Million per well Exploration Success = Huge Investment Potential US$ 6.3 Million ~US$ 50 Million ~ZAR 88 Million ~ZAR 700 Million Future Appraisal, Development and Production @ 1 US$ = R14 @ 1 US$ = R14

Block 2C (Current offer) Exploration Success = Huge ~2 Exploration wells @ US$ 50 Million per well Investment Potential US$ 4.68 Million ~US$ 100 Million ~ZAR 1.4 Billion Future Appraisal, ~ZAR 66 Million Development and Production @ 1 US$ = R14 @ 1 US$ = R14

**Statoil is expected to pay a proportionate share towards the drilling of wells Potential Investment into PetroSA and South African Economy – South Coast

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

Block 9 and 11a (Current offer)

Conclude ~US$ 359 Million deal ~ZAR 5 Billion @ 1 US$ = R14 Future Appraisal, Development and Production

Geophysical surveys, geochemical studies and Field Development up to First Gas drilling of 6 exploration and appraisal wells

• Current investment is based on loan funding, repayable from production proceeds • Loan not repayable if exploration is not successful Strategic Partnerships Critical for Transition Period

Gas Production Forecast: Existing Fields + E-BK + Infills + Near field exploration 240

200 3X3

160

2X2 120 Existing Fields E-BK + Infills 1X1 80 E-BK

40 Gas rate (MMscf/d) rate Gas

2025 2040 2019 2020 2021 2022 2023 2024 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039

FA EM SCG FO E-BK FO12 E-AD E-BA E-S 11A E-AT Block 11B/12B Designation of PetroSA as NOC key to Turnaround

 Carry the state’s participation interest in the upstream petroleum sector.  Safeguard and advance the state’s interests in the petroleum sector through: . Involvement in activities aimed at determining the national hydrocarbon potential, exploration, appraisal and development activities. . Ensuring the state receives an equitable share of oil and gas revenues from its domestic resource base. . Active involvement in the execution of work programs by private industry players. . Ensuring the efficient development of oil and gas fields. . Ensuring the optimal extraction of oil and gas reserves through ensuring prudent reservoir management practices.  Build reserves and contribute to security of supply, current account, and cushion state against oil price volatility.  Development of oil and gas infrastructure and gas markets to promote foreign investment.  Act as agent of development, industrialization, skills development and job creation.

Examples of successful NOCs: CNOOC, Petronas, Petrobras, Saudi Aramco, ONGC. Shale Gas Central to PetroSA Turnaround Holds great potential for RSA’s energy landscape

 GTL plants, petrochemical plants, power plants, fertilizer production etc  Pipeline networks, gas gathering infrastructure, processing plants  Skills development and job creation  Service sector and technology development  Increase foreign exchange reserves

PetroSA GTL Refinery

Blocks under TCP shown in map above are waiting for PASA’s decision on exploration rights - exploration is not research (involves seismic acquisitions, exploration drilling etc - PetroSA has the requisite experience). Strategic Outlook & Future Plans – Shale Gas

Enablers

• Karoo acreage being reduced to smaller sizes and made Option 1 available for new TCPs. • Participate in • Funding national • Right set of skills and efforts to technology assess shale • Reputable partners gas potential with financial muscle and and technical associated competence risks. Play a • Apply for TCP or Exploration decisive role Right in country’s • Farm-In efforts to • Participate in all produce blocks awarded shale gas • Prioritize acreage in proximity to potential State markets participation • Consider owning land rights Option 2 • Establish research Dependent on PetroSA unit for shale gas designation to carry state (Strategic Alignment participation with US knowledge centres)

33 GTL Refinery Turnaround Implications if nothing is done

. GTL Refinery Closes / Offshore Platform Shuts Down / Mossel Bay Shuts Down  Operations Cease – Organized Exit takes 3-5 years  Job losses – Direct 1200-1500. Indirect significantly more  Mossel Bay Economy shuts down. GTL refinery is the only major industry.  Major social impact  Southern Cape Economy losses more than R1 billion per annum

. Refinery is converted into an industrial park  Land/equipment is rented to tenants. Services are sold to tenants

. Voorbaai Tank Farm remains in Operation  Converted into an import terminal for the Southern Cape

34 GTL Refinery – Emergency Plan

. Stabilize the Refinery Operation  Focus on stable plant operation – Do the basics  Get the right people with the right competencies in the right positions  Instill organizational discipline  No “skimping” or compromise on maintenance . Right-size the Refinery cost structure  Reduce levels of management  Outsource expensive support functions . Focused refinery projects

35 Mossel Bay Options: Gas Solution

. Gas Options  Indigenous Gas – New Field Development  Imported Gas - LNG . Economically Challenged  GTL Affordability: 3$/GJ  Indigenous Gas and LNG cost: 6-8$/G (best case). Not affordable  Chemicals/Wax can improve economics but has high commercial risk . High Risk  New Field Development – Will it deliver?  LNG – weather risk

36 Mossel Bay Options: Liquid Solution

. Crude Oil Refining  Micro Refinery – ECP [46kbbl/day, CAPEX $140million]  Small Refinery – Liquid Fuels Project [130kbbl/day, CAPEX $2300million] . Economically Challenged  ECP: Economics are marginal. GRM 8-9$/bbl.  Small Refinery: Economics are competitive GRM 18-20$/bbl. CAPEX is high. . Trigger Liabilities  Shutdown of FA Platform triggers abandonment liability

37 Mossel Bay Solution: Liquid & Gas

. Crude Oil & Gas Refining  Full Conversion Crude and Gas Refinery [40-50kbbl/day, 200MMSCF, CAPEX $300million] . Refinery produces Syngas from crude and gas which feeds the Gasloop  Modifications: Calm Buoy and Tankage, Deep Thermal Cracker and Gasifier  Refinery operates with and without gas . Economically Competitive  Crude Refinery margin competitive 16-18$/bbl  Gas Affordability competitive 5.5-6$/GJ (important for upstream partner(s)) . Delays Liabilities  All tailgas can be produced – extends Life of Field - delays offshore abandonment

Note: All numbers are indicative Page . 38 only Mossel Bay Solution: Liquid & Gas

Can produce chemicals

LPG Crude Crude Distiller Petrol

Thermal Refinery Cracker Gasifier Kerosene Synthol Gas Reformer Diesel

New Plant

Existing Plant

39 Trading, Sales & Marketing Turnaround

• Source feedstock more cost effectively • Leverage SFF storage facilities to reduce imported condensate costs Access Enabling Infrastructure • Access Island View infrastructure in Durban • Optimize product supply through Bloemfontein and Tzaneen depots and acquire terminal to penetrate Western Cape commercial markets

• Change strategy away from BFP business Penetrate Wholesale & Retail • Access the high margin markets through resellers Markets • Open new sales outlets e.g. Black farmers and taxi associations • Grow SOE to SOE business e.g. Eskom, Transnet, National Defense Force

• Enter into the bunker market • Identify lubricants partners to grow the lubricants business Increase Product Offering • Grow LPG market share • Optimise MB refinery for the importation of jet fuels and petrochemicals Legislative issues that have an impact on the success of the business Government Key Strategic Initiatives Company PetroSA Risk management at Southern Co Grant Ministerial approval (section 54) to enable the conclusion of strategic partnerships in upstream Key Areas Upstream Offers of up to R5 billion have been made by potential partners Mid-Stream Downstream National Oil Company Designation Designate PetroSA as a National Oil Company (NOC) in the new Oil and Gas or Petroleum Bill and assign state participation interest to PetroSA Timeline Short and Medium Term Nominate PetroSA as the recipient of State Participation Interest Location South Africa & Continent Infrastructure support Island View infrastructure currently held by Transnet to be transferred to the NOC to facilitate its downstream market presence Nature Policy Gas Developments Determination Fast-track efforts to bring imported gas into the country via Coega Designation CEF Group gas determination (or in partnership with Eskom) Leadership and Board Capacitation Stabilize leadership with permanent appointments (Management & Board level) Abandonment Liability Deferral of financial provision of decommissioning liability by 5 – 10 years from 2024 to 2029 onwards The State to support PetroSA from decommissioning liability to free up cash that could be used to turn around the business Feedstock sourcing Leverage G-to-G on Oil & Gas to optimize feedstock sourcing Oil and Gas infrastructure Participate in efforts to integrate SADC region through oil and gas infrastructure, particularly the gas pipeline Shale Gas and Exploration Participate in efforts to ascertain the oil and gas potential of South Africa through the drill bit including playing a decisive role in shale gas Page . 41 Strategic Fuel Fund

Page . 42 SFF HISTORIC TIMELINE . SFF was incorporated in 1964.

. Milnerton and Ogies terminals were commissioned in 1969 and Saldanha terminal in 1981.

. Storage facilities were strategically linked to the South African refining system.

. Through a ministerial directive, SFF in the year 2011 invested R1.049 billion in the Transnet NMPP as linefill.

. Draft Strategic Stocks Petroleum Policy cite SFF as the reserve agency for government owned strategic stocks

. In November 2018, SFF was directed to be South African Government implementing agent on South Sudan Oil and Gas sector.

. May 2019, SFF signs Exploration and Production Sharing Agreement (EPSA) with South Sudan Government.

. Currently employs 176 employees . 43 ADDRESSING STRATEGIC CHALLENGES – Saldanha to South Sudan

Midstream Upstream AS IS (Saldanha) OUR VIEW • Single Revenue source • Best means of stock pilling for • Anchor Refinery tenant Government. • Over-reliance on Traders hence Backwardation • “Sale” of Strategic Stock • S.A. net importer of oil over 70% of the market demand met through Crude or To Be: (Saldanha, Dbn – Gauteng Corridor and Equity refined, makes economic sense to own. barrels trading) • New players in the storage space (Oil Producing • South Africa currently sources more countries). than 80% of its crude supplies from the • Presence in Durban – Gauteng corridor Middle East, concentration risk. • Increased search for barrels for Trading to enhance value chain diversification. • Tankage favors low oil prices whilst • SADC oil supplies upstream favors high oil prices – This will be a perfect hedge for SFF.

Page 44 South Sudan Status Update Over view of the project Project milestones Date • A Memorandum of Understanding concluded between the governments of South Africa and South Sudan to jointly participate in South Sudan’s oil and gas sector. • Open tendering process conducted for Refinery • Former Minister of Energy, honourable Mr Jeff Radebe issued a 19/04/2019 Ministerial Directive to CEF, instructing that SFF act as the South African Studies Government’s implementing agent for purposes of pursuing oil and gas opportunities in South Sudan. • SFF established an office in Juba, South Sudan 02/05/2019 • For the above purposes, SFF Applied and granted Section 54 of PFMA approval by the Executive Authority (Minister Radebe) and the National Treasury was duly notified. • Exploration and Production Sharing agreement 06/05//2019 signed • In risk mitigation, an international entity had be incorporated and SFF applied for and granted Section 54 of PFMA in this regard by the Stakeholder Management Issues Executive Authority (Honorable Minister Mantashe) and the National Treasury was duly notified. • On-going engagements with Nile Petroleum (South Sudan National Oil Company).

Project Features • Various engagements and discussions with National Treasury. • South Sudan is a significant oil producer with estimated oil reserves of 3.5 billion barrels (bbls) of oil and 3 tcf of gas reserves, making it the • CEF Group support and engagements on-going. third largest oil and gas resource .

Key Risks • Some of the biggest national oil companies, like Petronas (Malaysia), CNPC (China) and ONGC (India) are present in South Sudan . • Maiden territory for SFF – Group support and Strategic Partnerships are key • The Project is in 3 parts which are Oil Exploration, Crude Oil Pipeline and a Refinery. • US Dollar restrictions for South Sudan – Delays money transfers as SFF must apply to US Banks.

• All Projects at pre-feasibility studies stage. • Regional political instability even though stability seems to be restored in Sudan. CEF / SFF Strategic Stock Litigation

. Background . During the course of December 2015/January 2016, SFF disposed of strategic stock totalling 10 million barrels stored at its Saldanha Bay Tank Farm to three trading entities namely; Vitol, Taleveras and Glencore. . A contract review process was instituted on the instruction of the then Minister which found that the sale of strategic stock was illegal and unenforceable due to non-compliance with the PFMA, Companies Act, Constitution and other related legislation. . The affected traders purchased strategic stock from SFF as follows: . Taleveras – 4,000,000 barrels (2,000,000 barrels Bonny Light and 2,000,000 barrels Basrah) . Glencore – 3,000,000 barrels (Bonny Light) . Vitol – 3,000,000 barrels (Basrah) . On 12 March 2018, SFF together with its parent company CEF approached the Western Cape High Court to declare the contracts void and unenforceable and further declare that restitution is a just and equitable remedy.

Slide 46 CEF / SFF Strategic Stock Litigation

. Current Status . The forensic investigation completed; . SFF co-operating with law enforcement agencies in their investigation of potential wrong doing . Continue to engage with traders and attorneys to find a solution to the matter. . Conclusion . SFF is still desirous of reaching a resolution to this matter as it has been dragging for an extended period, while the main application is still pending. . SFF is aware that any settlement should be legally sound and endorsed by the court and all key stakeholders.

Slide 47 CEF Group Project Portfolio

Page . 48 CEF Group Growth Agenda, Exploration and Production

South Africa still relies on imports to meet a significant amount of crude oil needs for refining purposes. An increase in domestic supplies can help reduce dependency on foreign oil and improve the country’s trade situation. In fact, South Africa can over time become a top producer in the continent. A focus on developing the exploration and production activity can generate a substantial economic stimulus for South Africa. Being capital intensive and risky, it will however require some form of support from government in terms of legislation and funding as well strategic partnership. Risk Probability Economic transformation and job Education, skills and health A better Africa and world Strategic link to creation Social cohesion and safe Building a capable, ethical and Spatial integration, human settlements and Presidential 7 Point communities is another key developmental State local government Plan priority f Consolidating the social wage through reliable and quality basic services

Initiative Support Potential Economic & Social Impacts Defer abandonment through continued E&P in Block 9 Government Economic : Improved EBIDA due to reduced purchase of Develop E-BK/E-CB and embark on ER61 6 well drilling Business programme (strategic partnerships) imported feedstock as well as ensuring that the Group does not rely on potential support from National Treasury. Diversification of Group Rationalize West and South Coast Assets (Conclude farm outs) Business Revenues (Potential to improve balance of trade) Upstream Private participation funding Government Social : Creation of Jobs for various support services & revitalizing the Pursue free carried State participation interest Government economies of both Mossel Bay & Mpumalanga Development of the T-Project and Vlakfontein Mine extention Business Acquisition/Development of Coal and non-Coal assets Business Other : Continued development of the Oil & Gas Sector and it ability to attract other potential investors into South Africa. Mozambique upstream partnership to secure more gas Government

Strategic Rational for the interventions Investments in mining, oil and gas exploration and production generate substantial economic gains, as well as other benefits such as increased energy independence 49 49 CEF Group Growth Agenda, Midstream

The South African Midstream industry is the portion of the oil and natural gas industry that is responsible for the processing, storage, and transportation of products such as crude oil, natural gas and natural gas liquids. It is responsible for linking far-spread petroleum producing areas and population centers where consumers are located. Transmission pipeline companies are included in the midstream petroleum industry. Storage facilities for crude oil and refined liquids include bulk terminals, refinery tanks and holding tanks to get material into pipelines, or ready to be shipped on a vessel. Risk Probability Economic transformation and job Education, skills and health A better Africa and world Strategic link to creation Presidential 7 Point Social cohesion and safe Building a capable, ethical and Spatial integration, human settlements and communities is another key developmental State local government Plan f priority Consolidating the social wage through reliable and quality basic services Initiative Support Potential Economic & Social Impacts Tank refurbishment and new tank build Business Economic : Security of energy supply for the country and the taking over Operations of the Island View Tanks Business of key strategic tank positions. The building of an LNG Infrastructure will Gas to power projects & development of a Gas economy Business & Govt catapult the development of a Gas Economy as well as jobs LNG Terminal and Pipeline network Government Social : Creation of Jobs for various support services whilst ensuring that Coega LNG Infrastructure Developments Government affordable energy is provided to the South African population Logistics Base Infrastructure Development Business & Govt Acquisition of Existing Storage facilities Business Other : Potential to attract other regional partners to further develop key strategic infrastructure for the benefit of the region.

Strategic Rational for the interventions The development and further investment in Midstream is critical for the country’s security of energy supply but for the development of the 50 following services: Petroleum Cargo Inspection, Petroleum Refining and Distribution Services, Technical Inspection Services, Tank services 50 CEF Group Growth Agenda, Downstream

The South African downstream segment traditionally includes refining, distribution and fuel sales, and marketing to retail and commercial customers. However, with growing interconnectedness between refining and chemicals, in terms of feedstock, opportunities for process integration, and evolving end-markets, much is changing. High cost of entry, vertical integration, and established supply chains constitute strong entry challenges for this part of the value chain. This space is dominated by Multinationals and Traders Risk Probability Strategic link to Economic transformation and job Education, skills and health A better Africa and world creation Presidential 7 Point Social cohesion and safe Building a capable, ethical and Spatial integration, human settlements and Plan communities is another key developmental State local government priority f Consolidating the social wage through reliable and quality basic services Initiative Support Potential Economic & Social Impacts Retail and Downstream entry Business & Govt Commercial and Industry Base growth Business Economic : Creation of an abundance of job opportunities and the reduction in the country’s reliance of multinationals for the provision New Refinery Build Business & Government of security of energy supply. Proposed projects will also spawn IMO Business various associated industries. Acquisition of existing Downstream Player Government Social : Development of the Downstream sector but more Development of the Gas consumer market base Business & Government importantly the skills around Petrochemicals and process Regional integration and growth Government engineering. GTL Refinery affordable feedstock sourcing (G-2G) Government Other : Regional integration and the development of other related Refinery optimization to improve operational efficiency Business infrastructure to support the movement of finished products.

Strategic Rational for the interventions Investments in Downstream will result in the development of the country's petrochemicals sector, regional integration, export opportunities, 51 technical staffing services 51 CEF Group Growth Agenda, Renewables

The most common renewable power technologies include, solar (photovoltaic, solar thermal), wind, Biogas (e.g., landfill gas/wastewater treatment digester gas), geothermal, biomass, low-impact hydroelectricity and emerging technologies - wave and tidal power. Environmental and economic benefits of using renewable energy include generating energy that produces no greenhouse gas emissions from fossil fuels and reduces some types of air pollution, diversifying energy supply and reducing dependence on imported fuels. Creating economic development and jobs in manufacturing, installation are some of the potential spin offs. Risk Probability Economic transformation and job Education, skills and health A better Africa and world Strategic link to creation Presidential 7 Point Plan Social cohesion and safe Building a capable, ethical and Spatial integration, human settlements and communities is another key developmental State local government priority f Consolidating the social wage through reliable and quality basic services Initiative Support Potential Economic & Social Impacts Battery storage developments Business & Govt Economic : Creation of descent job opportunities and increasing of cleaner Development of electric vehicles and charging Business energy alternatives to fossil fuels. Increasing our Renewable Energy network. footprint will also ensure that improve balance of payments on the Clean Coal Technologies Business & Government importation of finished products and feedstock. Rare Earth and other resources to support green Business energy Social : Development of the Renewables energy sector in a much more sustainable manner as part of delivering on our mandate of ensuring Acquisition of existing Brownfield RE Projects Government affordable energy sources for our people. Biofuels opportunity Business & Government Other : Skills development and opportunities to develop home grown Solar Park Determination Government technological solutions

Strategic Rational for the interventions Investments in the Renewables sector will reduce dependence of hydrocarbons and spawn the development of other renewable energy 52 industries. 52 CEF Group Project Portfolio, Key Projects

Page . 53 CEF Group Coega LNG Project Status

The Coega LNG project is focussed on: LNG Berth  The supply of LNG to the existing Dedisa Power Plant

 The supply of LNG to the PetroSA Mossel Bay Gas to Liquids Refinery and the Eskom Gourikwa power plant Cryogenic Line

 Supply to consumers in the Coega IDZ, Port Elizabeth and East London

 Break bulk and supply to other ports (Hub and Spoke Model)

 Support black industrialists participation in the small to mid scale LNG infrastructure and molecule supply chain

Implementation ASAP to address immediate need

 FID by FYE2020/21

 COD by FYE2022/23 Dedisa Key success factors Power Plant LNG Berth

 Dedicated Project Office

 Leverage the existing body of knowledge in iGas, CDC, IPPO

 Shareholder support to navigate contractual and regulatory landscape

1. Start with a simple, quick, least cost of regret solution

Page .2.54 Expand to other ports via a Hub & Spoke model CEF Group Coega LNG Project Structure

End Users/Consumers

Power Plant: LNG Seller IPP

PetroSA: LNG Buyer LNG Terminal Port Gas Equalisation Gas to and Gas and Gas Operations Fund Liquids Wholesaler Pipeline Refinery

Gas LNG Shipper Distribution – BBBEE participants

Page . 55 South African LNG Importation Functional Structure

Gas Equalisation Gas Aggregator Gas Infrastructure Other Players Fund

Transnet Set up fund similar to LNG Purchase from EQF for liquid fuels LNG Terminal •Port Infrastructure / International Market Berth •Enables smoothed •Port Operations ZAR/GJ price to market over a defined period – i.e. Gas Sales to Local IPPO manages LNG Market Gas Pipeline to commodity and Markets •Procures IPP that currency linkage •Power builds power plant •Industry •Automotive •GTL Eskom •BEE Suppliers, etc. •Offtakes from IPP

BEE Players •Buy from Aggregator •Sell to market (industry, automotive, agriculture, etc.) CEF Group Intercontinental Shelf

Extended Continental Shelf Claim Project

. South Africa has made two submissions to the United Nations in May 2009.

. The first submission relates to the continental shelf surrounding the South African mainland, whilst the second submission relates to the region of the Prince Edwards Islands. . The claims amount to approximately 1.9 million square kilometres, which ranks amongst the 10th largest claims in the world; and if endorsed by the United Nations will more than double South Africa’s maritime territory.

Key Benefits Challenges points Funding of the . The project has many economic benefits for South Africa. Project These include the potential for oil and gas, manganese nodules and crusts possibly enriched with precious metals, exploiting the pharmaceutical and medical benefits of microbes associated with the inhospitable ultra-deep ocean floor & toxic hot water geysers.

. The project entered its final & arguably the most critical phase.

Page . 57 New Crude Oil Refinery (Richard’s Bay) Update

Project Overview High Level Scope of work • South Africa has a growing deficit of Euro 5 compliant fuels and chemicals. • Optimize refinery standalone configuration and an integrated refinery with petrochemical This deficit is currently being addressed by the importation of petrol and diesel potential. primarily as well as various polymers. • Development of an LP model. • An opportunity exist to invest in an economically competitive facility to • Develop a detailed economic evaluation and modelling & scenarios for the selected produce these products locally. configurations. • This investment will increase South Africa’s manufacturing competitiveness • Development of +/- 50% Capital Cost Estimate, and for the top selected configurations as per and have a positive socio-economic impact Aramco Engineering Procedures (location factor, market cost index) and Operating Cost • Government to Government agreement concluded in 2018 as part of the Estimates President’s investment drive to revitalise the SA Economy. • Completion of the required studies for Oil refining complexity factor, comprehensive energy • Ministerial MOU concluded in Jan 2019 consumption index, yield of each process unit, energy consumption per feed weight, and • NDA and MOU concluded between Saudi Aramco & CEF in May 2019 for the performing required benchmark analysis globally. development of a Greenfields Refinery base case capacity of 300 MBD utilizing • Develop a scalable capital and operating cost model for sensitivity analysis. (Financial Arabian Light Crude (100% AL) or a blend of Arabian Light and Arabian Extra Modelling) Light Crudes (70% AL / 30% AXL. • Logistics infrastructure design and distribution hubs. • Initial Product Slate: Euro 5 compliant transport fuel, Chemicals imported into •StakeholderPlant Configuration Management Issues South Africa • Location would be in Richards Bay • Engagements with RBIDZ on land access (Critical Path) Product market • Resourcing activities and appointment of service providers • Port, berth, loading facility engagements with Transnet • Transport Fuels: South Africa & BLNS, primarily through MPP • Socio- economic impact study is conducted by CEF with MEC- Economic Development of KZN • Chemical: South Africa, avoid exports where to import parity protection • Steering Commitee engagements • Fuel Oil for Power Gen / Fuel Oil-Crude blend : Consider export potential • Pipeline from Richard’s Bay to NMPP in Durban Key risks / issues / scope changes Prefeasibility timelines • Land availability • Key delivery dates for all the Prefeasibility activities is November 2019 • Local markets for chemicals Key project delivery components • Negotiations • Market Study • Port/ Transnet related infrastructure project timeline • Technical study CEF Group Shale Gas Project

. Project Aims: . To delineate anomalies resulting from hydrocarbon seepage from reservoirs. . To promote economic investment and stimulate intensive evaluation of the hydrocarbon potential in the basin.

. Primary Project Objectives . to establish the presence, distribution, and composition of hydrocarbons in the area . to determine the probable hydrocarbon charge to specific research leads and prospects

. Research Components:- # Components 1A – Evaluate petroleum resource potential – Karoo Deep Drilling Project # Components 1B – Evaluate petroleum resource potential – Geological surveys and resource evaluation # Component 2 – Establishment of regional baseline groundwater monitoring network # Component 3 – Risk assessment of abandoned wells and establishment of a baseline seismic monitoring network CEF Group Mining AEMFC - Strategic Outlook & Future Plans

STRATEGIC • To build AEMFC market share to be in the Top 5 local coal producers in South Africa • To mine renewable energy minerals to support the Integrated Resource Plan 2030 • Obtain 1 million fatality free man shifts by 2025

BASIS • Owns an operating mine (Vlakfontein Mine) in Oggies, MP Province • Profitable since the first year of full production (2012) to date • Coal Supply Agreement (CSA) with ESKOM to 2020 • A credible safety record- no fatalities. Last Lost Time Injury in 2015 • Unqualified audit opinion since establishment • Two acquisitions: Mzimkhulu Mining (26%) and Chilwavhusiku Colliery (40%) • BBBEE Facilitator status with DTI for the next 10 years awarded in 2016/2017 • AEMFC employs 338 employees in total mainly from Phola Township • Relocated 25 families from Twoline Community to fully serviced stands in Phola Township

OPERATIONAL • Commission the Klipportjie Mine by end 2020 (300 jobs) • Open up the Vlakfontein bunker at current operations for mining • Commission the T Project by 2022 (410 jobs) • Diversification of client and mineral assets to include beneficiable minerals • Obtain 1 million fatality free man shifts by 2025 Page . 60 CEF Group Renewables – ACWA Redstone Project

KDI Holdings (Pty) ACWA Power Green Limited Energy Holding Ltd (DIFC . A R11 Billion capital project, with minimum UAE) R4.8 Billion local content.

100% 100% . The 100 MW Redstone CSP baseload solar plant located near Postmusburg, Norther KDI Energy (Pty) ACWA Power Cape Province, South Africa will inter-alia: Limited Green Energy GEPF Africa (Pty) Limited represented by PIC  Deliver clean and reliable electricity 30% Pele Green CEF SOC 70% to some 280,000 households both day Energy (Pty) Limited and night; Limited Humansrus 100% Community  Will have c. 65% local ownership 100% 100% Trust 100% including the Central Energy Fund, PIC, emerging Black Owned ACWA Power GEPF Renewable Pele Green Energy CEF Carbon Redstone Redstone CSP (Pty) Bowwood and Main No Energy Investments industrialists and the Local Limited (Pty) Limited Holdings (Pty) 101 (PTY) Ltd 1 (Pty) Ltd Limited Community; 10% 15% 50% 10% 15%  Creating more than 2200 construction jobs at peak (with about 300 from local community) and additional hundreds of SA supply chain jobs and c. 95 permanent jobs ACWA Power SolarReserve Redstone Solar Thermal Power during operations. Plant (RF) Proprietary Limited  At least R900 million contribution towards Socio-Economic Development over the 20 year PPA term.

Page . 61 THANK YOU