C R U D E O I L T O C H E M I C A L SSustainability and Local Content

4TH

LARGEST DIVERSIFIED CHEMICAL COMPANY

40,000EMPLOYEES

50COUNTRIES

5.0BILLION US$ NET INCOME

39.5BILLION US$ SALES

87.5BILLION US$ ASSETS

542New patent filings over

the last 12 months

68TOTAL

SUSTAINABILITYPRODUCTSQUALIFIED

13,093TOTAL PATENT

PORTFOLIOFILINGS

SABIC AT A GLANCE

0

20

40

60

80

100

120

1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018

Avg

. C

rud

e $

/bb

l

Global Financial Crisis

Geopolitical unrest + sanctions

Production cuts

+

Arab SpringProduction increase

Shale Effect

End of Sanctions

GEO-POLITICAL CHANGES EFFECT ON OIL PRICES

VOLATILE OIL PRICE AS FUNCTION OF GEOLOGICAL SCENARIOS AND SHALE EFFECT.

PROJECTS TECHNO-ECONOMIC FEASIBILITIES DEPEND ON OIL PRICES

• Olefins and Benzene prices

are correlated to Crude Oil 14-

16 $/ T for 1 $/bbl

• Shale effect Changes resulted

in Feedstock prices volatility

Remain Upstream focused and participate in the shale gas ventures in North America

Move further downstream into performance & specialty chemicals: not sufficient to cover all available Feedstock volumes

Increase Local Content and Feedstock Efficiency by building greater and more integrated Value Chain through Innovation & Technology in order to derive higher benefits and sustainability

GCC PLAYERS OPTIONS

CMAI WA 1999-2016

CURRENT GLOBAL CRUDE OIL

CONSUMPTION SCENARIO

• SHORT, SINGLE LIFECYCLE FOR EXTRACTED CRUDE OIL

• HIGHLY INEFFICIENT USE OF “FOSSIL C” ENERGY

SABIC Internal Screening Carbon-LCA.

1Barrel

90-95%

5-10%

OIL EXTRACTION

REFINERY PRODUCTS &

TRANSPORTATION FUELS

PETROCHEMICALS

& CHEMICAL INTERMEDIATESPLASTICS END OF LIFE

END OF LIFE

PETROCHEMICALS: TO ENHANCE VALUE,

SUSTAINABILITY AND LOCAL CONTENT

Improved by

6 0 %.

Saving

2 , 1 x

Less Than

7 %

Less than

5 - 1 0 %

Less than

1 0 %Approximately

1 0 %

.

Avoids the

emission of

3 , 6 Gt

Of a barrel of oil is used

as chemical feedstock.

>90% is used as fuel

of global GHG emissions

coming from chemical

industries

of global energy

consumption is by

chemical industries

of fresh water used by

industrial processes, 82% in

agriculture

The amount of CO2 emitted

during production against fuel.

Of CO2 that would have been

emitted in the world without

the chemical industry in 2005

The Energy efficiency in the

last 40 years. Chemical

industry outperformed other

industries performances

SABIC is committed to:

-Increase by 25% the chemicals

efficient production by 2025.

-Enhance local Crude conversion to

HVC from 5-10% of Barrel to + 50%

ICCA 2009 Report, IEA, CEFIC, SABIC Corporate Sustainability Report 2014

TECHNOLOGY TO ENHANCE LOCAL CONTENT, SUSTAINABILITY AND PROFITABILITY ROBUSTNESS

INCREASE VALUE FROM CRUDE OIL

SHIFT THE UTILIZATION OF A BARREL TOWARD MORE SUSTAINABLE PRODUCTS

MEET 2030 Kingdom Vision & DELIVER on 2025 SABIC’s STRATEGY

OFFER FLEXIBILITY IN FEEDSTOCK UTILIZATION

ENHANCE LOCAL CONTENT & OFFER HIGHER ROBUSTNESS AGAINST PRICES VOLATILITY.

SABIC pursues the OTC project for five combined reasons:

WHY OTC?

GOOD FOR SABIC, FOR THE NATION AND FOR THE WORLD

SABIC OIL-TO-CHEMICAL

TECHNOLOGY AMBITION

1Barrel

<40%

>60%

CO2/bbl

20-33%

IRR

>20%

NPV

>34%

• TWO LIFECYCLES FOR EXTRACTED CRUDE OIL

• MORE EFFICIENT USE OF “FOSSIL C” PRODUCTS ENERGY, RECYCLE

OIL EXTRACTION

REFINERY PRODUCTS &

TRANSPORTATION FUELS

PETROCHEMICALS

& CHEMICAL INTERMEDIATESPLASTICS END OF LIFE

END OF LIFE

Against standalone PetChemAgainst classic crude use

SABIC OIL-TO-CHEMICAL

TECHNOLOGY: WAVE 1

1Barrel

50%

50%

CO2/bbl

20%

IRR

31%

NPV

79%

• TWO LIFECYCLES FOR EXTRACTED CRUDE OIL

• EFFICIENT USE OF “FOSSIL C” PRODUCTS ENERGY, RECYCLE

• OTC : IMPROVED ECONOMICS AGAINST STANDALONE PETROCHEMICALS AND AGAINST

CONVENTIONAL INTEGRATION.

OIL EXTRACTION

REFINERY PRODUCTS &

TRANSPORTATION FUELS

PETROCHEMICALS

& CHEMICAL INTERMEDIATESPLASTICS END OF LIFE

END OF LIFE

Against standalone PetChemAgainst classic crude use

THE JOURNEY SO FAR

CRUDE OIL TO CHEMICAL (COTC)

314 applications filed worldwide covering 59 patent families For OTC

SABIC partnership with ARAMCO to fulfill 2030 Kingdom Vision

FROM OTC TO COTC

2017

OTC COTC

SABIC-ARAMCO

PARTNERSHIP

ENABLER FOR FUTURE – POTENTIAL FOR

CIRCULAR ECONOMY

SABIC, similar to other leaders

in the petrochemical industry, is

exploring all possible means to

support the Circular Economy.

(More than 10 patents filed by

SABIC are related to this

initiative)

ADDITIONAL OPPORTUNITIES

WITH CIRCULAR ECONOMY

1Barrel

<40%

>60%

CO2/bbl

20% 32%- 47%

OIL EXTRACTION

REFINERY PRODUCTS &

TRANSPORTATION FUELS

PLASTICS END OF LIFE

END OF LIFE

• CIRCULAR ECONOMY OFFERS MULTIPLE LIFECYCLES FOR “FOSSIL C”

PETROCHEMICALS

& CHEMICAL INTERMEDIATES

• OIL TO CHEMICALS OFFERS EFFICIENT UTILIZATION OF “FOSSIL C” BY ENABLING

LOWER-CARBON PATHWAY

• FULFILLS FURTHER SELF SUFFICIENCY AND ENABLES GREATER VALUE TO THE

BARREL

• OFFERS GREATER OPPORTUNITIES FOR THE CIRCULAR ECONOMY TO OPTIMIZE THE

UTILIZATION OF “FOSSIL C” BY LEVELING THE ENVIRONMENTAL FOOTPRINT ACROSS

MULTIPLE LIFECYCLES

0

20

32 33

47

0

5

10

15

20

25

30

35

40

45

50

CurrentScenario

Wave 1 AdditionalPotential

From Circular

Ambition AdditionalPotential

From Circular

% reduction in CO2 emission per barrel

IRR REF20%

increase

31% increase with COTC

STANDALONE PETCHEM CONVENTIONAL INTEGRATION COTC

DE

LTA

IR

R

CONCLUSION

TECHNOLOGY2

PARTNERSHIP3

PEOPLE4

GOVERNMENT SUPPORT 1• GAS & FEEDSTOCK & CRUDE ALLOCATIONS

• INFRASTRUCTURES & MARAFEQ

• GOVERNMENT RELATIONS

• TECHNOLOGIES AND COMBINATION OF TECHNOLOGIES

• IN-HOUSE DEVELOPED and LICENSED-IN

• PROCESS, PRODUCTS AND APPLICATIONS

• HIGH LEVEL STRATEGIC PARTNERSHIP WITH ARAMCO

• ENGINEERING & EPC, CONTRACTORS, TECHNOLOGY

LICENSORS, TECHNOLOGY INSTITUTIONS

• HIGH LEVEL STRATEGIC PLAN TO FULFIL QUALIFIED

RESOURCES

• ENHANCE RESOURCES DEVELOPMENTS IN NUMBER

AND IN QUALIFICATIONS (100, 000 DIRECT and INDIRECT employments)

THE PILLARS FOR COTC

CHEMISTRY THAT MATTERST M