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Global Benzene and Toluene Indian Petrochem 2014 Andy Nicholson V-P Aromatics EMEI Argus DeWitt Mumbai 30 th Oct 2014

25 Years Toluene & Gasoline 1,350 1,200 1,050 900 750 600 450 300 150 Differential Toluene - Spot R'Dam Unleaded Gas (95R) CIF NWE $/T 0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Copyright 2012 Argus Media Ltd. All rights reserved.

25 Years Benzene & Naphtha $/T 1500 1350 1200 1050 900 750 600 450 300 150 0 2009 2010 2011 2012 2013 2014 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Differential Naphtha cif NWE Benzene Spot cif ARA Copyright 2014 Argus Media Ltd. All rights reserved.

Regional Spot Toluene Prices Weekly Averages 1,500 $/t 1,400 1,300 1,200 1,100 1,000 FOB Korea USGC NG FOB ARA 900 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14 Jul-14 Oct-14 Copyright 2012 Argus Media Ltd. All rights reserved.

Regional Spot Benzene Prices weekly Averages 1,600 1,500 1,400 1,300 1,200 1,100 1,000 $/T 900 CIF ARA FOB Korea FOB USGC 800 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14 Jul-14 Oct-14 Copyright 2012 Argus Media Ltd. All rights reserved.

Global Aromatics Supply 41% Benzene 57% 16% BZ (Disp, MSTDP, HDA) Gasoline Pool (Reformate) 77% Toluene PX (MSTDP, MPX) 87% Mixed Xylenes 7% MX (Disp) 94% Copyright 2013 Argus Media Ltd. All rights reserved.

US Refining Capacity is growing and will increase further in 2015 2013-2014 EIA Weekly U. S. Operable Crude Oil Distillation Capacity ( 000 bls per Day) and Operating Rate 17900 Distillation Capacity Op Rate 96 17800 94 17700 92 Capacity 17600 17500 17400 17300 17200 90 88 86 84 82 Op Rate 17100 80 J-13 F-13 A-13 M-13 J-13 S-13 O-13 D-13 J-14 M-14 M-14 J-14 A-14 Valero and others are adding distillation capacity to process more shale crudes Copyright 2013 Argus Media Ltd. All rights reserved.

US domestic gasoline demand to continue to fall Slow Economic Growth; Does not include exports Renewable Fuel Standard-Target is 36 B gallons of ETOH by 2023(not achievable) CAFÉ Standard with targets of 35.5 MPG by 2016 and 54.5 MPG by 2025 Source: EIA and DeWitt forecast Copyright 2012 Argus Media Ltd. All rights reserved.

The US has sought to manage naphtha length by increasing exports of gasoline Copyright 2014 Argus Media Ltd. All rights reserved.

Reformer Operations Yields impacted by: Quality of naphtha Severity Operating rate Three contributions to gross margin Octane, or blend, value Hydrogen and LPG, credit tied to natural gas, or fuel oil, price Aromatics, chemical value Copyright 2014 Argus Media Ltd. All rights reserved.

2012 2014 Monthly US Toluene Net Trade (t) N Am S Am Asia WE MEA EE Total Net Trade 50000 40000 30000 20000 10000 0-10000 -20000-30000 -40000-50000 Jul-14 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Copyright 2014 Argus Media Ltd. All rights reserved.

WE Toluene Quarterly Net Trade by Region 20 10 0-10 -20-30 -40-50 -60-70 Q3 2009 Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Exports '000t Imports Copyright 2012 Argus Media Ltd. All rights reserved. USA South America North America North Africa MEAG East Med Africa Central Europe East Europe South Asia East Asia Eurostat

India Toluene Imports '000t 2014 H1 2013 2012 0 50 100 150 200 250 300 350 Singapore Korea S. Thailand EU Others Copyright 2012 Argus Media Ltd. All rights reserved.

Benzene Supply sources and economic factors that have limited benzene production Global Benzene trade flows, with a closer look at the USA, China and India situations What is the outlook for the benzene market? Copyright 2014 Argus Media Ltd. All rights reserved.

Numerous Impacts on Benzene Supply/Price Gasoline Quality / Feed Slate Reformate Pygas Olefin Demand/Feed Slate Toluene BV Benzene Demand HDA Coal Coke/Steel Demand TDP PX Isom Toluene BV PX Demand Copyright 2013 Argus Media Ltd. All rights reserved.

Regional Benzene Production Sources 2013 15000 12000 Coal kt 9000 6000 Toluene based Pygas 3000 Reformer 0 USA W.Europe Asia excl China China MEA Copyright 2014 Argus Media Ltd. All rights reserved.

2000-2013 Total US Benzene Production with Imports Demand was 9 million tons in 2000 Decreased by nearly 1/3 by 2013. Imports account for more than 20% of demand Less extraction feed offset by decreased demand from derivative units KT 10000 9000 8000 7000 6000 5000 4000 3000 2000 1000 0 PyGas Reformate Toluene Coal Imports 2000 2002 2004 2006 2008 2010 2012 Copyright 2014 Argus Media Ltd. All rights reserved.

W.Europe Benzene Production 9000 '000t 8000 7000 6000 5000 4000 3000 2000 1000 Coal HDA TDP MSTDP & MPX Reformate Pygas 0 2010 2011 2012 2013 2014 2015 2016 2017 Copyright 2012 Argus Media Ltd. All rights reserved.

EU15 Quarterly Net trade as Benzene Equivalent 450 400 350 Cyclohexane 300 250 200 150 100 50 0-50 Cumene/Phenol Styrene/EB Benzene Aniline Source: Eurostat Q3 2009 Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Exports '000t Imports Copyright 2012 Argus Media Ltd. All rights reserved.

Changes limit benzene production in the US and Europe Reformate extraction limited by: declining petroleum-based gasoline demand More usage of renewable or green blend components Shift in crude quality More emphasis on middle distillate production Pygas extraction limited by: Advantaged light feeds produce much less pygas Copyright 2012 Argus Media Ltd. All rights reserved.

2012 2014 Monthly US Benzene Imports with Spot Price '000 t 180 Korea Japan India W Europe FOB USGC USD/USG 5.20 160 140 120 100 80 60 40 20 0 5.00 4.80 4.60 4.40 4.20 4.00 Benzene Imports by Country of Origin (in '000 t) Jan - Jul 2013 2014 Change Change in % Korea 284 397 113 39.7% Japan 193 207 14 7.2% Brazil 112 73-39 -35.0% India 95 80-15 -15.8% Canada 132 119-13 -9.8% Saudi Arabia 69 6-63 -91.1% Other 213 300 86 40.5% Total 1098 1181 83 7.6% Copyright 2014 Argus Media Ltd. All rights reserved.

Paraxylene and Benzene Capacity & Consumption PX demand growth double that of benzene 16.5 mn t new paraxylene capacity planned in 4 years 6mn t new benzene capacity planned, mostly linked to PX PX cannot run at capacity in next five years Uncompetitive PX capacity will be rationalized Feedstock a constraint for some PX capacity 50000 45000 40000 35000 30000 25000 20000 15000 10000 5000 0 World Paraxylene & Benzene Demand PX Bz 2008 2009 2010 2011 2012 2013 2014 2015 Copyright 2014 Argus Media Ltd. All rights reserved.

2012-2014 Benzene Trade In China (t) 140000 120000 100000 80000 60000 40000 20000 0 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Imports (t) Exports (t) Copyright 2013 Argus Media Ltd. All rights reserved.

India Benzene Exports '000t 2014 H1 2013 2012 0 100 200 300 400 500 600 700 Singapore Saudi Arabia USA EU Others Copyright 2012 Argus Media Ltd. All rights reserved.

2014 World Benzene Trade 106 1566 750 189 328 1056 48 593 150 Copyright 2014 Argus Media Ltd. All rights reserved.

US Benzene Costs from Toluene Conversion and Import costs ex- Korea 550 500 /GAL Benzene 450 400 350 300 J'12 M M J S N J'13 M M J S N J'14 M M J S HDA TDP STDP FOB Korea +75 $/t freight Copyright 2012 Argus Media Ltd. All rights reserved.

Benzene Pricing and Toluene based Costs - Korea 1,600 1,400 1,200 1,000 800 600 $/t 400 200 STDP TDP HDA fob S.Korea 0 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Copyright 2012 Argus Media Ltd. All rights reserved.

25 Years Benzene HDA Economics 1800 1600 1400 1200 1000 800 600 400 200 HDA @ Toluene Market Value Benzene Spot cif ARA HDA @ Toluene BV $/t 0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Copyright 2012 Argus Media Ltd. All rights reserved.

Summary/Forward View US Imports of benzene and exports of styrene will increase. Availability of aromatics feed-stocks in Europe is falling. India, the Middle East and the US will supply incremental C6 molecules to meet European needs. Korea and India will be the main sources of increased benzene exports to the US and Europe, based on co-product paraxylene production. Paraxylene demand constraints will limit Asian benzene length. China s benzene import needs appear to be stabilising. Toluene is long in Asia and Europe, tight in the US. Disproportionation economics underpin US benzene pricing. Hydrodealkylation economics may underpin European pricing. Copyright 2014 Argus Media Ltd. All rights reserved.

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