Noble Group. Our Business Model and How We Create Value

Transcription

1 Noble Group Our Business Model and How We Create Value Autumn 2015

2 Disclaimer The material in this presentation has been prepared by Noble Group Limited ( Noble ) and is general background information about Noble s activities current as at the date of this presentation. This information is given in summary form and does not purport to be complete. Information in this presentation, including forward-looking financial information, should not be considered as advice or a recommendation to investors or potential investors in relation to holding, purchasing or selling securities or other financial products or instruments, and does not take into account your particular investment objectives, financial situation or needs. Before acting on any information, you should consider the appropriateness of the information having regard to these matters, any public information relating to Noble, and in particular, you should seek independent financial advice. All securities and financial product or instrument transactions involve risks, which include (among others) the risk of adverse or unanticipated market, financial or political developments and, in international transactions, currency risk. This presentation may contain forward-looking statements including statements regarding our intent, belief or current expectations with respect to Noble s businesses and operations, market conditions, results of operation and financial condition, capital adequacy, specific provisions and risk management practices. Readers are cautioned not to place undue reliance on these forward-looking statements. Noble does not undertake any obligation to publicly release the result of any revisions to these forward-looking statements to reflect events or circumstances after the date hereof to reflect the occurrence of unanticipated events. While due care has been used in the preparation of information herein, actual results may vary in a materially positive or negative manner. Forecasts and hypothetical examples are subject to uncertainty and contingencies outside Noble s control.

3 About Us Noble Group (SGX:N21) is a leading supply chain manager: we buy physical commodities and transform them into customised, consumable products that meet the requirements of our customers through (1) our logistics and transportation services (2) our price risk management and hedging services and (3) our processing and blending capabilities Our core strategy is to be the best company in the world at moving the physical commodity from the producer to the consumer and managing the market, credit, and operational risk associated with that We seek to be partners rather than competitors with our producer customers and with investors looking to invest in producing assets, with Noble supplying best-in-class execution at the most competitive price Our most valuable assets are our network of relationships with our producers and consumer customers, our midstream supply chain assets and expertise, and our people who provide value-added services to our customers Our objective is to build long-term value for our shareholders, our partners, our customers and our people, with a sustainable global franchise and a focus on long-term supplier and customer relationships 1

4 Our Business Today We are ranked no. 77 in the 2015 Fortune Global 500 Our tonnage for 1H 2015 was 133 million tonnes and revenue reached $35 billion In Oil Liquids, we are one of the largest gasoline blenders on the Gulf Coast In Energy Coal, we are one of the biggest shippers of seaborne coal In Power & Gas, we have one of the leading electricity distribution businesses in North America In Metals, we have a key industry role in global aluminium markets In Carbon Steel Materials, we have a significant non-producer share of the seaborne market In Logistics, we annually charter approximately 1,000 ships to carry products OUR BUSINESSES ENERGY Oil Liquids Energy Coal GAS & POWER Energy Solutions Gas & Power METALS & MINING Metals Carbon Steel Materials CORPORATE Logistics Origination & Customer Solutions 2

5 How We Create Value as a Physical Merchant We source commodities from our producer customers in low-cost regions We source from producers including miners, smelters, oil and gas producers, refiners and power generators With an asset-light strategy, we secure diversified and consistent sources of trade flows through contractual arrangements and investments in associates rather than from asset ownership or on a cargo-by-cargo basis We service the requirements of our customers by transforming commodities in: We provide value-added transformations / services - Space/location through our logistics and transportation services - Time through our price risk management and hedging services - Form through our processing and blending capabilities to ensure the optimal product mix and qualities We also provide structured and trade financing solutions to facilitate delivery of our services We deliver products to our network of customers across the globe We serve customers including steel mills, metal processors, oil refineries, petrochemical plants, power generators and power and gas consumers We service customers by delivering the products they want in the desired locations at the times they need them, and we offer financing and structured solutions to facilitate seamless execution 3

6 Creating Value through Transformations and Services We source commodities from our producer customers in low-cost regions We provide value-added transformations / services We deliver products to our network of customers across the globe Logistics and transportation services (e.g. freight, breaking bulk and ground transportation) Price risk management and hedging services (e.g. swaps and scheduled deliveries) Processing and blending capabilities (e.g. quality and mix specifications) Structured and trade financing solutions (e.g. payment terms, prepayment and offtake / marketing arrangements) 4

7 Noble s Business Evolution and Operating Performance

8 Commodity Prices Have Witnessed Significant Retreat in Recent Years Price performance since January 2014 Copper Coal (1) Natural Gas GSCI (2) Sugar (3) WTI Iron Ore (4) (29.5%) (30.8%) (34.9%) (40.8%) (40.9%) (48.0%) (58.2%) (1) Newcastle Thermal 6,000Kcal/kg (2) S&P GSCI Index (3) Sugar No.11 Contract, started trading in Nov-2012 (4) Iron Ore (Fe 62%) CFR China 6

9 Presenting a Challenging Environment For All Natural Resources Companies Price performance since January 2014 Diversified Miners (1) Major Miner/Trader Noble Major Coal Producers (2) Major Independent Iron Ore Producer Major Copper Producer (34.4%) (35.8%) (45.5%) (56.8%) (66.0%) (68.5%) (1) Diversified Mining includes Anglo America, BHP, Glencore, Rio Tinto and Vale (2) Major Coal includes Adaro, Arch Coal, Peabody, Shenhua, Walter Energy and Whitehaven 7

10 Noble s Key Country Exposures were China AND Brazil GDP growth over last 5 years Five years ago, Noble was heavily exposed to two key countries: 25% 20% 15% 10% 5% 0% -5% -10% China Brazil 22.9% 18.3% 14.7% 12.9% 9.6% (0.9%) (1.6%) (7.7%) China in 2008, 42% of our total group volumes were delivered into China; and Brazil by 2012, 42% of Noble s non-current assets were in Brazil Noble has deliberately and actively repositioned the company. Today, whilst China remains important, North America is our largest market with c.32% of volume. Further, our exposure to Brazil is now indirect through our 49% share of Noble Agri, which we expect to reduce as Noble Agri builds a more globally diversified group Source: IMF Nominal GDP growth US$ terms 8

11 Noble s Key Product Exposures were Coal, Sugar AND Iron Ore Performance since Jan 2013 (indexed to 100%) 120% 100% 80% 60% 40% 20% Thermal Coal (1) Sugar 11 (2) Iron Ore (3) Jan 13 Jul 13 Jan 14 Jul 14 Jan 15 Jul 15 (36%) (48%) (62%) We have not just repositioned the geographic concentration of our business but also the product concentration Five years ago, the Noble business could be broadly categorised as a big bulk commodities business: coal and iron ore, and the freight needs around those commodities, as well as Sugar/Agri. In 2010, Agri and Logistics were 54% of operating income We have grown a suite of new core businesses that give us diversified drivers of profitability. Profits from these businesses (Oil Liquids, Gas & Power, and Retail Energy) represented 60% of operating income in the last 12 months (1) Newcastle Thermal 6,000Kcal/kg (2) Sugar No.11 Contract, started trading in Nov-2012 (3) Iron Ore (Fe 62%) CFR China 9

12 Management Responded With the Following Strategic Initiatives INITIATIVES Reverted back to an asset-light business model - Merger of Gloucester and Yancoal: - Sale of 51% of Noble Agri: - Write-down of mining assets: Diversified our business geographically: Diversified our product exposure: Developed significant upstream partnerships: Expansion of our customer franchise and contractual arrangements: RESULTS 778 million cash / capital recycled $3.3 billion cash / capital recycled over $800 million written down (1) North America grew from 12% of our tonnage to 32% (2) Oil Liquids, Energy Solutions and Gas & Power grew from 26% to 60% (3) X2, Harbour Energy and a number of early-stage associates $10.8 billion contracted cash flows (4) (1) Including impairments and losses from Noble s share of P&L over the last 5 years (2) From 2008 to June 2015 (3) From average to LTM June 2015 (4) Nominal cash flows, to which Noble applies discount and holds reserves against, for more details please see p114 10

13 Becoming Asset-Light Recycling cash, reducing exposure & enhancing supply chain across Agri and Bulks Agri & Non-current Mining as % of Noble s Balance Sheet Total Assets as at Dec 2010: $17B Total Assets as at Jun 2015: $20B NAL 7% Others 45% Agri 42% Mining (1) (Non-Current Assets) 4% Mining (1) (Non-Current Assets) 13% Others 89% Recycled cash, reduced exposure and enhanced supply chain through the sale of 51% of Agri, the merger of Gloucester and Yancoal, and various impairments taken against mining assets (1) Defined as Energy Coal and CSM non-current assets 11

14 Evolution to an asset-light model Reduction in Fixed Assets Fixed Assets and Fixed Assets as % of Total Assets (US$MM) 12% 14% 13% 13% 15% 15% 3% 3% 6% 8% 2,216 2,556 2,870 2,876 4% 4% 1, , FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 1H2015 Our asset-light business model allows us to better weather the challenging commodities market, reducing direct exposure to movements of commodities prices 12

15 Our Business Has Become More Diversified Geographically Volume Contribution by Region (1) North America has grown from c.12% of our volumes to c.32% 12% North America Reliance on China has been reduced from c.42% to c.30% of our volumes 42% China 32% Our geographic spread will diversify further as we continue to grow our customer franchise. We have targeted growth agendas across Asia, India, Latin America, and the Middle East 30% 23% Asia (ex-china) 26% 23% Others 12% H2015 (1) Excludes Gas & Power segment volumes 13

16 and Much More Balanced Across a Broad Range of Products Contribution by Business to Operating Income from Supply Chains (1) Average Last Twelve Months to 30 June 2015 NAES 0% Gas & Power 2% Oil Liquids 24% Metals 10% CSM & Energy Coal 64% Oil Liquids 30% NAES 18% CSM & Energy Coal 27% Metals 13% Gas & Power 12% (1) Excludes Corporate segment. Underlying business and segment reporting has changed since , therefore figures presented have been regrouped to reflect the existing business structure. Energy Coal and Met Coal previously managed as one business unit, therefore these business units have been grouped for both periods presented 14

17 Formation of Strategic Partnerships Consistent with Noble s asset-light strategy, these partnerships secure long-term trade flows and free Noble from the burden of operating industrial assets or the need to carry these assets on our balance sheet This allows us to focus on our core competency to be the best company in the world at moving the physical commodity from the producer to the consumer and managing the market, credit and operational risk associated with that 15

18 Noble s Operating Performance Volume Growth and Margin Recovery Continued Volume Growth (Million Tonnes) Gross Margins Recovering % 2.13% % H2014 2H2014 1H2015 1H2014 2H2014 1H2015 Energy Mining & Metals Logistics 16

19 Noble s Operating Performance Attractive Returns on Equity From Our Core Business Net Income from Core Operations (Adjusted, US$MM) (1) Major Associates & Investments (US$MM) (2) Adjusted ROE From core operations (3) c.20% 612 c.23% 682 Operating assets Noble Agri Agriculture 1,324 Yancoal Coal mining Newly established vehicles X2 Mining To be funded Harbour Oil & Gas 148 1H2014 2H2014 1H2015 Last 12 months Run rate (Including savings) (4) Noble continues to generate robust earnings from its core businesses, and delivered LTM returns on equity of c.20% from these core businesses Total 1,778 Carrying value % of total assets 9% In addition, Noble holds investments in a number of associates / JVs, which present significant upside potential and access to trade flows, allowing us to be well positioned for future commodity cycles (1) Adjusted for share of profits & losses of Joint Ventures and Associates, impairments, and negative goodwill (2) Carrying value as at 30 June 2015, X2 commitment not yet funded (3) Net income from core operations of $612MM over equity of core operations (total equity less total of investments in JVs and investments in associates as at 30 June 2015) (4) Based on LTM plus $70MM target cost savings 17

20 Noble s earnings aspiration over the next 3 5 years Target operating income from supply chains in excess of $2 billion NOBLE OPERATING INCOME FROM SUPPLY CHAINS: $2B+ CUSTOMERS PEOPLE EXECUTION METALS CARBON STEEL MATERIALS Oil Liquids Energy Coal Gas & Power Energy Solutions Corporate $200MM $200MM $700MM $300MM $300MM $250MM $100MM 18

21 Our Businesses

22 Our Key Business Segments Today Corporate Logistics Origination & Customer Solutions Associates & JVs Metals & Mining Metals Carbon Steel Materials Oil Liquids Energy Coal Energy Gas & Power Gas & Power Energy Solutions Volumes (Million Tonnes) EBIT (US$MM) Volumes (Million Tonnes) EBIT (US$MM) Volumes (Million MWh) EBIT (US$MM) 1H H H H H H

23 Metals & Mining Metals Business Overview Business Overview Mark Hansen Head of Metals Noble is a leading participant in the global base metals market, sourcing from producers worldwide through offtake agreements, short and long-term purchases, as well as marketing arrangements, before distributing to a global industrial consumer base The bauxite, alumina and aluminium business is the most mature one within Noble Metals, with a 55% interest in the Jamalco alumina refinery one of the largest integrated alumina operations in the Americas Noble has also been a leading participant in the global metals markets for many years, and our zinc, copper, lead and nickel businesses continue to grow Noble Metals provides innovative solutions to maximise the value of the supply chains for our partners both producers and consumers across non-ferrous metals Strengths / Strategic Opportunities Our key global franchises are aluminium, alumina, zinc and copper, where we add global coverage and services, as a leading merchant We continue to expand our base metal business throughout the world, including accessing new opportunities in Asia where our business is still developing We cultivate strong relationships with our direct customer base who appreciate our flexible approach to accommodating their product needs We customise supply arrangements for our global metals consumers to maximise sourcing options We partner with producers globally on flexible terms to maximise the value of production We offer customised structured financing solutions 21

24 Metals & Mining Metals Business Model Mines, smelters & refineries Products, transformations & services Traded products: Aluminium, alumina and bauxite, copper, zinc, lead, nickel and raw materials (concentrates, etc.) Capabilities and services include: - Offtake and marketing services - Logistics and warehousing solutions - Tolling arrangements - Structured financing arrangements, including prepayments - Location/time/quality swaps - Financing trades Smelters & refineries, galvanizers, stainless steel producers, and large end-users (aero, auto, construction and packaging) Our Metals business incorporates the trading and management of supply chains for key base metals, as well as ownership of certain strategic assets including a global network of LME warehouses and one of the largest integrated alumina operations in the Americas 22

25 Metals & Mining Metals Business Footprint ALUMINIUM COPPER ZINC, LEAD, NICKEL BAUXITE, ALUMINA RAW MATERIALS (1) Products Origination market Canada / US Western Europe CIS Latin America United States Sub-Saharan Africa Australia Western Europe India United States Latin America and Caribbean Africa Latin America Australia Sub-Saharan Africa Mongolia Origination method Scrap market Open market Prepayments Marketing & offtake Scrap market Open market Prepayments Investments Open market Prepayments Marketing Investments Open market Prepayments Investments Swaps Prepayments Investments Marketing & offtake Noble s Customers Aerospace Automotive Construction Packaging Wire and cable Tubing Brass Galvanizers Automotive Stainless steel Refineries Smelters Smelters (1) Concentrates & other intermediate raw materials 23

26 Metals & Mining Metals Business Case Study Nyrstar On 1 October 2013, Noble was appointed as the strategic marketing partner for the European-based zinc producer Nyrstar, an integrated mining and metals business with market-leading positions in zinc and lead In conjunction with the marketing arrangements, Noble also provided a prepayment financing facility The contract was won in competition against 20 other firms In line with Noble s asset-light strategy, established a partnership with one of the world s leading producers of zinc Provides instant access to significant customer flows in the European zinc market (200,000 tonnes per annum of high-quality export-grade zinc metal) Expands Noble s customer footprint into other geographies beyond Europe by strengthening our product portfolio Consistent with Nyrstar s new global commercial strategy of diversifying distribution 24

27 Metals & Mining Metals Business Case Study Clarendon Alumina Production and Jamalco In June 2013, Noble signed a major prepayment and alumina offtake agreement with Clarendon Alumina Production ( CAP ) CAP will supply c. 600,000 tonnes per annum to Noble (c. 6 million tonnes over the life of the contract) The US$120 million prepayment facility will be repaid within ten years In October 2014, Noble announced the acquisition of 55% of Jamalco from Alcoa, providing Noble with an additional 778,800 tonnes of alumina offtake, and aligning Noble as a JV partner in Jamalco alongside the Government of Jamaica Provides Noble with immediate access to high-quality alumina supply Established a partnership with a best-in-class operator (Alcoa) Cultivated a long-term relationship with the Government of Jamaica Enhances Noble s access to multiple potential commodities opportunities within Jamaica 25

28 Metals & Mining Carbon Steel Materials Business Overview Neil Dhar Head of Carbon Steel Materials Noble s Carbon Steel Materials Business focuses on providing products to the steel manufacturing industry encompassing iron ore, chrome, manganese ore, metallurgical coal, and metallurgical coke The business has a global reach, with a focus on Asian steel mills, sourcing cost-competitive products and then bundling these together with risk management and logistics services a more comprehensive service than other suppliers can offer Producers are limited to supplying raw materials and typically do not provide an integrated suite of products. The majority of our supply contracts are with market-leading, low-cost producers Raw material suppliers continue to be under significant pressure as prices further decline due to supply-side overcapacity. Demand growth for carbon steel materials remains weak and will require a number of years to absorb supply-side overcapacity Strengths / Strategic Opportunities With a superior reputation in the global seaborne market, we will further build on relationships on the demand side. China will continue to be a very important consumer and platform for the Carbon Steel Materials Business Our key strengths include: - Strong long-term steel mill relationships (particularly in China) - Significant non-producer share of the seaborne market - Flexibility in trading terms - Strong logistics capable of securing cost-effective and timely supply and assisting clients and the value proposition (particularly in India) We will utilise the following strategies in order to navigate the current challenging environment and deliver long-term profitable growth: - Expand our portfolio via structured transactions and enhance our existing position with low-cost quartile producers - Expand our customer base and leverage the marketing network to cross-sell products in the steel complex 26

29 Metals & Mining Carbon Steel Materials Business Model Products, transformations and services Iron ore, chrome, manganese ore and metallurgical coal mines Traded products: Iron ore, met coal, met coke, and specialty ores & alloys Capabilities and services include: Offtake and marketing services Blending and optimisation Logistics flexibility Structured financing arrangements, including prepayments Branding alternatives Stock & sale Price risk management Global steel mills 27

30 Metals & Mining Carbon Steel Materials 2015 Major Trade Flows Trading head office Regional hub Iron ore (estimated trade flows of c.20.0mtpa in 2015) Met coal (estimated trade flows of c.7.0mtpa in 2015) Met coke (estimated trade flows of c.7.8mtpa in 2015) Special ore and alloys (estimated trade flows of c.2.4mtpa in 2015) 28

31 Metals & Mining Carbon Steel Materials Case Study Long-term Iron Ore Offtake In October 2013, Noble secured a long-term offtake with an Australian iron ore producer Noble partnered with an Australian bank, which syndicated a medium-term prepayment facility secured by the offtake to Noble Noble provided the Australian iron ore producer/the Australian bank with a guaranteed payment stream with minimal execution risks Consistent with asset-light approach by accessing flows without requiring balance sheet deployment Established long-term partnership with low-cost, market-leading iron ore producer Made a deal that was complementary to existing offtake and further diversified Noble s product portfolio Strengthens long-term commodity flows 29

32 Metals & Mining Carbon Steel Materials Case Study Long-term Marketing Arrangement In April 2014, Noble invested into the JSX listing of a chrome concentrate producer The chrome concentrate producer owns a majority share of a South African operating chrome concentrate mine, which was project financed to completion by reputable international banks In parallel with our minority equity investment, Noble secured marketing rights for export quality chrome concentrate Leveraged on existing small offtake relationship into a longer-dated marketing agency agreement across larger tonnage from an operating mine with competitive cash costs Deepens relationship with the owners who have other African mining projects of interest to Noble in the long term Complements our special ores and alloys product offering to Chinese end-users Minority equity position in a JSX-listed entity with a proven board and management team, consistent with asset-light strategy 30

33 Energy Oil Liquids Business Overview Business Overview Strengths / Strategic Opportunities Jeff Frase Head of Oil Liquids Trading Noble is a major participant in global physical oil trading. We trade large physical volumes, including crude oil and refined products, via ship, barge, pipeline, truck and rail, with access to over 15 million barrels of storage globally Noble has blending and wholesale capabilities in North America and the Caribbean, and long-term leases on liquids storage capacity in both Europe and the Far East We work with producers, consumers and refiners to manage exposures along the supply chain, offering clients a variety of services that go beyond the traditional commodity price hedging solutions Given the current low-price environment, we have leveraged Noble s reach to partner with producers and other businesses who have been adversely affected, to provide pre-financing, risk management or logistic services Regulatory change continues to impact the market. For instance, the uncertain regulatory environment that comes with the Renewable Fuels Standard could have an impact on our biofuel s business. The Oil Liquids team understands the risks and opportunities and trades accordingly. Further, the changes relating to Mexico energy reform are expected to create opportunities to expand our Latin American franchise We are one of the largest gasoline blenders on the Gulf Coast and we continue to develop supply and marketing relationships with American, EMEA and Asian customers We have global trading and operations in Stamford, Houston, Denver, London and Singapore We offer flexible structured financing solutions to meet our customers needs: - Recently, we completed a landmark transaction with PetroEcuador providing a US$1 billion loan, which we then repackaged and sold to institutional investors - As part of the deal, Noble is supplying 30 50% of the naphtha and diesel imported by PetroEcuador for 5 years Oil Liquids is working alongside Noble s strong historic relationships within other businesses, such as Energy Coal, to establish new businesses A key element will be our work with our investment partners at EIG to maximise our exposures with their asset activities 31

34 Energy Oil Liquids Business Model Products, transformations and services NOCs, independent E&Ps, refiners, midstream companies and capital providers Traded products: Crude, distillates, gasoline, naphtha, LPG, polymers, biodiesel, ethanol, MTBE/ETBE Capabilities and services include: - Pipeline, terminal trading, and blending - Logistics, storage solutions and fleet management across the globe - Tolling arrangements and inventory intermediation - Offtake and marketing services with customised netbacks - Structured financing arrangements, including prepayments - Global cargo arbitrage across Oil Liquids products - Location/time/quality swaps/options We selectively invest in strategic infrastructure assets such as terminals and pipeline capacities in order to maximise optimality for trading In addition to these services, we also opportunistically provide producers and customers with credit or equity investment to secure critical trade flows We provide value-enhancing solutions for our partners and clients Global oil producer, refiners, traders, governments and large consumers 32

35 Energy Oil Liquids Scale and Presence North America Largest non-refining shipper on Colonial Pipeline and major capacity holder on Magellan and Explorer pipelines Significant New York Harbor, Chicago and Los Angeles products trading Rack distribution business in Southern US and MidContinent Clean products blending and export out of Gulf Coast Clean products marketing and supply Midstream augmentation of product supply business into Mexico Tonnage Growth 5 year CAGR: 20% EMEA NW European refinery supply deal and credit intermediation 7 million barrels of product storage NW Europe products to Africa Key relationship with crude and product exports West African crude to US Distillate supply in Northern and Southern Europe Gasoline Blending Latin America Large gasoline supplier into PMI Long-term agreement for gasoline and diesel into PetroEcuador Storage terminals in Panama to facilitate tender business into Uruguay, Chile, Bolivia, Brazil and Argentina Supply, terminalling and distribution development projects Storage Capabilities Offtake Rail/Truck Transport Trading Blending Rack Sales Supply Pipeline Transport Structured Transactions Products Gasoline and Components Ethanol Distillates Olefins and Polyolefins Crude Oil NGLs Asia & South Pacific India: diesel and gasoline exports to the West Indonesia: servicing mining assets shorts China: export products and import crude Platform to service mining clients Russia Eastern Crude movements Gasoline components to US and Europe Key Partners Harbour Energy: Marketing and Logistics X2: Fuel Supply Mansfield Oil: Clean Fuels JV 33

36 Energy Oil Liquids Case Study Gasoline Blending Contract In 2014, Noble entered into a seven-year lease with blending capabilities of up to 70 million barrels per annum on a pipeline in US As part of the transaction, associated supplier agreements were signed with third parties for butane, rights to a state-of-the-art facility, on-site lab, truck rack lease and storage in Baton Rouge, Louisiana By staffing internally, we eliminated third-party consultants and created annual savings of US$4 million Positions Noble as one of the largest non-refinery traders and blenders in the US and as a major NGL player Established Noble as a major player in the infrastructure-constrained Gulf Coast market There are opportunities for further optimisation and enhancements Complementary to existing offtake and tolling arrangements Secures long-term commodity flows 34

37 Energy Heide crude supply and inventory intermediation In May 2015, Noble entered into an exclusive supply agreement with Heide Refinery with crude and feedstock The 90,000+ barrel per day capacity refinery is located on the North Sea near Hamburg, Germany, with jetty, storage and pipeline infrastructure and the ability to accept 600,000 barrels of crude cargos As part of the transaction, Noble acquired the refinery s crude and product inventory in the tanks on a continual basis Consistent with asset-light approach by accessing flows without owning a refinery Provides an established physical presence in the European refining market The transaction was tightly structured with a collateralised package to generate P&L through multiple revenue streams Enhances our access to key Majors, NOCs and large physical players Strengthens our optionality / ability to bring in a wider variety of products to optimise economics 35

38 Energy Asia Oil Liquids Expansion Strategy Asia Oil team and business have seen significant growth in the last 12 months The team top talents have been attracted from, amongst others, JP Morgan, BP, Citibank and Vitol Crude Oil Opportunity as global crude oil over supply continues, Asia is the most important oil buyer led by China and India Strategy - Leverage our global oil infrastructure - Secure crude oil storage in China bonded zone - Starte crude oil supply chain business to various Asia oil refiners - Noble is uniquely positioned through our strategic relations as the China crude oil market opens up - Good cash-and-carry opportunities Distillate Opportunities Noble has a long-term relationship with mining clients in Indonesia and Australia Strategy - Leverage on our coal/iron ore franchise to fully explore cross selling opportunities - Start our first Indonesia diesel supply chain delivery (October 2014) - Secur distillate storage around Singapore/Malaysia - Good cash-and-carry opportunities 36

39 Energy Energy Coal Business Overview Business Overview Strengths / Strategic Opportunities Manish Dahiya Head of Energy Coal Noble s Energy Coal business is a leading global franchise consisting of a balanced portfolio of trading, marketing and supply chain management services. At its core are long-term relationships and partnerships with both producers and consumers, through which we manage the product flows and also provide supply chain and risk management services While the Energy Coal market is experiencing a downturn, our business remains strong and is positioned for further growth in this environment: - In the traditional large markets of North Asia, we are expanding our new services and leveraging our cross-commodity portfolio to create multiple touch points and new income streams with our clients - We continue to build strategic partnerships with existing and new-build independent power producers ( IPP ) globally, especially in the growth regions of India, South-east Asia, and Africa; creating these long-term shorts is key to excelling in this market now and in the future - We have ventured into new markets, including domestic market product supply in Indonesia, formation of a joint venture in China and an enhanced portfolio of services in North Asia There are opportunities in a difficult market to further boost the existing flows, where some players in the supply chain struggle with the conditions, some take advantage of opportunities created by the conditions and to develop new markets and partnerships Our deep understanding of client requirements helps us to optimise our portfolio and create value along the supply chain We focus on the customer and are the preferred competitive supplier across a balanced portfolio of locations and products based on flexible delivery terms We have strategically located marketing teams within all key consumer markets, including China, Taiwan, India, Japan and Korea Our core flows from Indonesia and Australia and the key relationships in these countries continue to provide growth options as new opportunities emerge from the difficult market conditions We also see growth opportunities in Africa, particularly North and West Africa, and in the Mediterranean region. New coal fired capacity expansions in Africa provide opportunities; given our presence in the region via multiple commodity flows we are aiming to leverage into new coal flows 37

40 Energy Energy Coal Business Model Portfolio of offtake and marketing arrangements with over 20 mines across multiple ports in Australia, Indonesia, South Africa and Russia Products, transformations and services Traded products: Bituminous and sub-bituminous energy coal Capabilities and services include: The Noble brand product and service quality, performance, and conformance Product offtake, supply, optimisation and marketing services Supply chain and logistics management Portfolio optimisation and price risk management Structured and trade finance offerings Investor relationships and project management expertise Time, quality and location spreads Supply contracts to 70+ customers (IPPs, power producers and trading houses) with key focus markets: China, India, Japan, Korea, Taiwan, SE Asia and Mexico 38

41 Energy World s leading energy coal trader and supply chain manager Key Origination Markets Key Destination Markets Offices/representations Domestic Market Trade Flow 39

42 Energy Energy Coal Case Study Long-term Coal Supply Rights In 2013, Noble entered into an agreement to become the exclusive long-term energy coal supplier to a large Indian independent coal fired power station that was under construction In conjunction with the coal supply agreement, Noble provided a secured convertible loan to the shareholders of the power project as part of a last mile funding While Noble sources the coal for this contract from one of its core origination market Indonesia, Noble still has embedded optionality on source and can provide coal price risk management services to the plant The plant is now commissioned and Noble has the right to provide additional coal supplies if the plant capacity expands in the future In line with Noble s asset-light strategy, established a long-term relationship with a new IPP Expands footprint in India with reputable customers Establishes long-term end-user for significant quantity of coal originated from Indonesia Positions Noble to deepen relationship and increase supplies as the customer expands its power generation capacity 40

43 Energy Energy Coal Case Study Indonesian Energy Coal Marketing Rights In 2013, Noble was appointed as the exclusive long-term coal marketing agent and obtained offtake rights for a new Indonesian energy coal mine Noble leveraged its in-country presence and experience to identify this opportunity and relationship In conjunction with the coal marketing agreement, Noble participated in financing to fund construction of the mine and its associated infrastructure Noble has achieved penetration of this new coal source in key South-east Asian markets and thereby established a diversified end-customer base for the mine Financing was tightly structured, with checks and balances in place to ensure repayment of principal The transaction has created a new base flow for Noble to trade and Noble is actively seeking opportunities to grow the relationship In line with Noble s asset-light strategy, managing coal flows without direct mine ownership Leveraged Noble s extensive Indonesian experience to identify this mine with coal quality well suited to Noble s key end-customers in Asia Established multiple income streams, including from value-added services to the mine (such as coal transport logistics and technical assistance) Consistent with Noble s strategy of growing Indonesian customer base through long-term arrangements with trusted counterparties 41

44 Gas & Power Gas & Power Business Overview Business Overview Gareth Griffiths Global Head of Gas & Power Noble s Global Gas & Power business is a client-focused energy trading and merchant business, partnering with both producers and consumers to address their exposures along the whole supply chain The global gas market is undergoing important structural changes. On the supply side, progress is being made for US shale to reach global markets in the imminent future via LNG, and on the demand side, traditional drivers of growth (Japan, Korea, China) are being replaced by new entrants with fast-growing demand In the US, we see opportunities to partner with key exporters offering our expertise in gas purchasing, risk management and gas logistics and with natural gas producers, offering risk management, transport optimisation and structured financing solutions In Europe, regulatory changes and lacklustre demand growth are driving capacity tightening, a consolidation of players in the sector and the sale of assets. Noble sees opportunities to partner with new investors as a service provider, offering our expertise and physical capabilities. In Eastern European countries, we see a role helping to improve security of supply and linking this market into the build out of the LNG platform We seek to develop a portfolio of long-term sustainable supply contracts in growth regions, offering flexible solutions and taking on credit, operational and risk management challenges in which we can offer a competitive edge Strengths / Strategic Opportunities We work with both producers and consumers, offering a wide variety of services to address their commodity exposures along the whole supply chain We leverage our in-house proprietary and real-time research to optimise value for our customers We collaborate with other business units to expand the breadth of product offering for our customers specific needs We continue to explore partnerships with private equity, sovereign wealth funds and hedge funds where we can contribute our knowledge, expertise and relationships to leverage their capital and expand our access to trade flows We continue to build out our LNG platform across the globe and are approaching our goal of reaching 1 million tonnes per annum delivered within the first 12 months of operations Our global G&P business has grown by over 70% in the past 2.5 years, averaging a growth rate of 10% per quarter 42

45 Gas & Power Gas & Power Business Model Gas & Power producers, generators, IPPs, pipeline & midstream companies, and capital providers & investors Products, transformations and services Traded products: Gas, LNG, power, and input coal Capabilities and services include: - Trade execution and physical sales - Risk management and hedging services - Management, optimisation and leasing of assets - Transportation services - Fuel procurement, asset tolling - Structured financing In addition to these services, we also opportunistically provide producers and customers with prepayments and offtakes, as well as partnering with institutional investors with interest in the space We utilise a combination of merchant marketing and energy financing expertise to manage market risk with competitively priced and flexible supply or offtake structures Utilities, retail aggregators, large end-users and IPPs 43

46 Gas & Power Gas & Power scale and presence Platforms North America: Mature and robust business covering all the major products and pipelines in the key market areas across the US and Canada Europe: Covering all the major products across the key European energy hubs; a growing business focused on replicating North American success and expanding reach across Eastern Europe through key partnerships South America: Power trading and asset optimisation business LNG: Connecting gas markets across the globe. Offering flexible tailor-made solutions and building long-term relationships with key LNG producers and consumers - Middle East/Africa: First LNG provider to Egypt under multi-year term deal, connecting supply from Middle East and Europe. Long-term offtake discussions - Europe: LNG storage, exports and reloads - Asia: Spot and term contracts in Japan - Caribbean: Power generation. Small-scale business development opportunities - South America: Business development opportunities in Brazil and Argentina Key focus and value drivers North West Gas (Calgary Can): Transportation and marketing North East Gas and Power: Long-term transportation and marketing, full service, power supply and logistics capabilities North America, FTR: Power transmission rights trading Central and Eastern EU gas: Storage, swing and counter-flow services Others: - Risk management, market access - Asset hedging and optimisation - Physical and financial product diversity - Credit intermediation - Security of supply - Inflection shale play Millions MWh Significant business growth Polar Vortex % Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Gas Business Going Global Major global gas trade flows, 2035 Breadth of customer relations and partnerships IPPs, utilities, aggregators, traders, LNG portfolio players, Harbour Energy, Noble Energy Coal (cross-selling), financial sponsors: capital and asset management 44

47 Gas & Power Gas & Power Case Study Unlocking New LNG Market: Egypt In 2015, Noble was awarded a multi-year / multi-cargo deal to supply LNG to the Egyptian Natural Gas Holding Company (EGAS) Noble contracted LNG supply from, among others, the Middle East and Europe In addition, Noble is leveraging its experience in chartering LNG vessels by handling the related LNG logistics Noble commissioned the first Egyptian LNG import facility in Ain Sokhna and supplied the first two LNG cargoes ever imported into Egypt Positions Noble as a major player in high-growth LNG demand region (Middle East) Demonstrates Noble s ability to unlock new LNG markets Establishes a platform to grow our LNG business into other regions Provides strong flow optimisation opportunities 45

48 Gas & Power Gas & Power Case Study Naftogaz Supply Contract In 2014, Noble executed a one-year supply agreement for up to 2 billion cubic metres of natural gas through reverse flow To date, Noble has supplied approximately 0.5 billion cubic metres, solidifying Noble as the fifth largest gas importer in Ukraine This transaction enables Ukraine to diversify and improve its security of supply, while simultaneously addressing the European Commission s commitment to assist Ukraine in achieving energy independence through access to alternative gas supplies This transaction has led to continued partnership opportunities with Naftogaz Creates a unique partnership, giving Noble access to previously inaccessible neighbouring markets Establishes presence in a niche market Allows Noble to optimise natural gas positions in other central and Southeastern European countries Provides access to regional infrastructure via pipeline capacity and storage Enables Noble to move molecules without owning the supporting infrastructure 46

49 Gas & Power Gas & Power Case Study Power Generation: Eagle Point In 2012, Noble Americas Gas and Power ( NAGP ) acquired a minority stake in a 225-MW gas-fired combined cycle generation facility in Gloucester County, New Jersey, from Sunoco Inc. with the intention of establishing a footprint in the power market as an energy management agreement ( EMA ) provider During the negotiation process, NAGP realised incremental value could be derived from the optimisation of the gas pipeline asset As part of the transaction, Noble acted as energy manager for the plant In 2013, Noble sold its stake to the majority owner while retaining the commodity and service flow NAGP continues to manage and optimise the pipeline asset and to provide gas supply and hedging services to the facility In a follow-on transaction, Noble provided structured financing to the buyer, enabling Noble to maintain an EMA and gas supply position for an additional three years Consistent with asset-light approach, with a recycling of capital within two years Provided Noble with an EMA, gas supply and commodity hedging opportunity Established Noble as an EMA provider in the power market Deal led to multiple follow-on transactions 47

50 Gas & Power Energy Solutions Overview Business Overview Jim Wood President Noble Americas Energy Solutions ( NAES ) NAES is a leading power marketer focused on offering supply and risk management services to commercial and industrial ( C&I ) customers Strategically, NAES acts as a conduit for customers to manage their price and energy risk exposure. We buy energy wholesale and repackage that energy into retail products. NAES continually develops products and risk management tools that change the manner in which customers think about, and manage, their energy expenditure NAES has grown gross margin and EBIT every year for the last decade. Retention rates are among the highest in the industry We continue to grow our business within our existing markets and are actively evaluating opportunities to expand our business into other geographies Lower price volatility continues to impact margins across the North America. However, our client-focused business model along with our superior risk management expertise has placed NAES in a strong position to create value for our customers in an ever-changing energy environment Strengths / Strategic Opportunities Deliver best-in-class energy solutions, risk management and client services Help clients understand the markets and its inherent risks, create a plan for the future and execute the plan Create the best client experience in the market Generator/Supplier independent Focused on commodity management for the larger C&I sector Strategic opportunities - Consolidation of competitors - Deeper penetration in existing markets - Mexico s energy reform (pending rules and regulations) - Renewables and technology 48

51 Gas & Power Energy Solutions Business Model Products, transformations and services Wholesale energy producers, generators and traders Traded products: Electricity and natural gas Capabilities and services include: We buy wholesale energy and repackage into retail products for our customers We help our customers manage price, supply and transport risks Product Structures - Pricing structures fixed price, heat rate, day-ahead index, real-time index, caps, floors, collars - Quantities (hourly and monthly) block, shaped block, load following - Portfolio management products layered hedging strategy - Renewable products Risk Management Services - Load shape and swing - Regulatory - Market energy, basis, etc. - Credit Commercial & industrial consumers 49

52 Gas & Power Energy Solutions Scale and Presence Energy Solutions Scale & Presence We operate from six locations with 210 employees and are currently the fourth largest C&I retail marketer in the US at just under 8,000 MW peak load (1) We have approximately 1,200 consumer clients, with 90,000 meters. We source supply from over 60 suppliers We maintain high customer retention rates by providing superior customer service, flexible product options and the best energy professionals in the industry WA OR NV CA ID AZ UT MT WY CO NM ND SD NE KS OK MN IA MO AR WI IL MI OH IN KY TN ME VT NH NY MA CT RI PA NJ DC DE WV MD VA SC NC We provide retail electricity in all the deregulated states in the US and natural gas in California and Nevada TX LA MS AL GA FL (1) Source: DNV-GL 2014 report Retail electricity service Retail electricity and natural gas service Retail natural gas service Wholesale electricity delivery to C&I customers Energy Solutions office locations 50

53 Gas & Power Energy Solutions in Context: Significant Value Upside In September 2010, Noble acquired Energy Solutions (previously, Sempra Energy Solutions) for US$582 million enterprise value The current net book value of Energy Solutions on our balance sheet is US$322 million Comparable transactions have indicated a valuation well in excess of US$1.25 billion, implying c.us$900 million+ of premium over book value Based on past business performance and transaction multiple commensurate with deals concluded in the sector >$1.25B Significant valuation upside of c.us$900mm+ Net working capital 87 Net long-term assets 236 Net capital employed (1) Illustrative valuation (1) Net capital employed before any working capital adjustment as at 30 June

54 Gas & Power Energy Solutions Key Statistics Energy Solutions achieved average pre-tax profit of US$174 million per year over the past three years The business delivered steady growth for every one of the past nine years, with c.38% compounded annual pre-tax profit growth rate over the past nine years The business is extremely stable and resilient - Over the past nine years, the worst one day P&L performance has been a loss of less than US$1 million, and the worst 10 day performance has been a gain - The number of up days averages 227 vs. down days averages of 25, since Average VAR of $143,000, Max VAR of $380,000, since 2007 High credit worthy client base. Since becoming part of Noble, credit write-offs average less than $500,000 per year 52

55 Corporate Logistics Business Overview Michael Nagler Head of Chartering The Logistics business services external clients as well as Noble s internal freight requirements with modern competitive ocean transport in the dry bulk segment (including iron ore, energy coal, and grains), which are transported in Cape, Panamax and Supramax bulk carriers In addition to providing ocean transport, the Logistics business provides both internal and external customers with long-term freight solutions and freight market guidance. The business executes forwards in the Freight derivatives market as hedges to its physical freight exposure In 2014, Noble Chartering became the first non-japanese incorporated shipping firm to be granted a 15-year consecutive voyage charter contract with a leading Japanese power utility We have established partnership with industry leaders: - K-Noble is our JV with K-Line. It was established in 2012 and controls eight capesize ships - OPG Power JV was established in 2014 with 2 Ultramaxes - Jindal Steel and Power JV owned 4 Kamsarmax new builds Strengths / Strategic Opportunities Noble Chartering was established in 1988 and has grown to be an award-winning dry bulk operator with a reliable track record of punctual performance across all market conditions Noble Chartering is one of the top five Freight Forward Agreement (FFA) traders in the market, with risk management and market intelligence platforms built around trading At any given time, Noble has over 200 vessels on charter, either owned, bareboat, time charter period, or trips, comprised of vessels that have young age profiles and high RightShip safety ratings Noble Chartering holds Contracts of Affreightment ( COA ) with major industrial companies around the globe Noble Chartering manages a flexible fleet of ships to offer optimal support to clients Noble is able to access new and profitable opportunities by leveraging internal flows from other businesses (e.g. iron ore, coal, coke and grain) Noble Chartering provides critical value add to our clients by offering assistance on trading/hedging, by providing freight derivatives, risk management and market intelligence 53

56 Corporate Origination and Customer Solutions Overview Business Overview Strengths / Strategic Opportunities Nigel Robinson Co-Head Dimitrios Kavvathas Co-Head The Origination & Customer Solutions team leverages the origination and customer solutions activities of each of the businesses OIL LIQUIDS ENERGY COAL ENERGY SOLUTIONS BUSINESS LINES GAS & POWER METALS CAPITAL AND ORIGINATION PARTNERS CUSTOMER FINANCING SOLUTIONS CARBON STEEL MATERIALS CHARTERING Structured Commodity Finance Commodity Enhanced Finance Financing Solutions REGIONAL CUSTOMER COVERAGE The team supports the businesses by originating new opportunities through a broad network of customer relationships, frequently at the C-Suite level, as well as full financial channel coverage through relationships with banks, institutional investors and other global pools of capital Regulatory changes impacting banks participation in commodity trading and commodity financing have resulted in them participating less in physical business and in a reduction of balance sheet availability, which have constrained access to capital for our counterparties The team s customer financing solutions capabilities facilitate the origination of new offtake, marketing, and supply arrangements by actively working with our counterparties who are seeking financing alternatives at both ends of the supply chain to develop creative financing solutions that accommodate their specific needs The team has embedded capital and origination partners in each business who understand the strategy and flows of the business and who also have the financial skills to structure, price and distribute different elements of the capital structure to facilitate access to trade flows AMERICAS EMEA ASIA 54

57 Corporate Research Business Overview Giovanni Serio Head of Research Research is core to our asset-light strategy. While asset-heavy traders rely on their asset flow data, we collect proprietary trade information and data and process it along with other available statistics to develop a cutting edge fundamental analysis on each commodity we trade Real-time decision support and analysis of specific trades through collation and analysis of proprietary as well as publicly-available data to arrive at: - Insights into correlations, market anomalies, and short-term impacts of market forces and events - Recommendations on tactical and strategic trading opportunities, with insights into short/medium fundamentals and factors driving market call - Quantitative modelling of typical market responses to price and fundamentals action in order to timely anticipate market moves - Monitoring and forecasting of key market statistics and the market response to these Focus is not just on directional price movements, but also on how to capture volatility in geographic, quality, and time spreads Regular updates to CEO, Management Committee, and Risk Committee Strengths Research team is embedded within the trading teams, enabling real-time communication and analysis with the trading book leaders to make decisions: - 80% of work involves helping businesses on trades and analysis - 20% of work is focused on broader fundamental research External customer-facing activities include support to marketing and origination activity in the form of: - External reports - Visits to clients and counterparties - Sharing of views and research with external players Our proprietary data is the most valuable in-house commodity Weekly and monthly publications on trends and views 55

58 Corporate Research Value Chain Data Information Insight Market call Data Gathering Finding and developing proprietary and external data sources Proprietary data On-field surveyors Originators and marketers visits Ship-tracking Deals tracking Internal marks External data Government and official stats Consultants data Prices Weather data Data Processing Developing / building models to convert raw data into useful analysis Data organisation Data cleaning and validation Importing into shared Noble systems Building supply and demand balances by country or region Data analysis Statistics and econometrics models Linear optimisation tools to replicate processing economics Back-testing Supply and Demand Forecasts Dissemination Weekly and monthly reports Weekly meetings and calls Daily conversations and s Trading Insight Interpreting the data and market moves to generate trading ideas Directional call Flat price directional moves Cross-commodity relative trades Geographical arbs Trading imbalances Supply-demand bottlenecks Time spreads Storage economics Future fundamentals expectations Quality spreads Refining or crushing margins Blending economics 56

59 ASSOCIATES & JVs Our partnerships create opportunities and value As part of our asset-light strategy, we have reduced our exposure to controlling and operating assets such as Gloucester and Noble Agri and, at the same time, released over US$4.1 billion of cash In addition, we have looked to partner with industry-leading players in new businesses such as X2 Resources and EIG in Harbour Energy - Allows us to leverage the operating expertise and day-to-day management of our partners - Enables us to focus on our core competencies by providing critical supply chain services to enhance overall equity value - Strengthens our access to commodities flows of key products that Noble trades Associates represent 10% of our total assets, with Noble Agri and Yancoal representing 8% of total assets - Consistent with our strategy of building key relationships in opportunistic new markets, the remaining 2% represents small equity interests in Inflection Energy LLC, an oil and gas exploration and production company, and a number of stock exchange-listed independent mining and resource development companies that are in the process of ramping up to commercial production Total Assets (BV) Total Associates (BV) Total Assets: US$19.9 billion (1) Total Value of Associates: US$2.0 billion (1) Others 17% (1) As at 30 June 2015 Others 89% Associates 10% Harbour 1% Yancoal 16% Noble Agri 67% 57

60 ASSOCIATES & JVs Noble Agri establishing an agri platform to capture key growth markets Key highlights Landmark joint venture between Noble Group, and a consortium consisting of COFCO, HOPU Investments, and other financial investors through sale of 51% of Noble Agri for US$1.5 billion Engages in agricultural trading and processing businesses which it originates from low-cost producing regions to regions with high demand, such as Asia and the Middle East Owns and operates logistics and processing assets in strategic locations within key global trade flows Principal international origination platform for COFCO to create a fully integrated value chain: - Diversification of product offering and geographies - Synergies from integration - Fully capture trading margin embedded in COFCO s import volumes Intention to integrate Noble Agri with other COFCO-owned trading businesses in particular, Dutch agricultural commodity trading firm Nidera China is a key demand growth market Global demand for agricultural commodities is increasing China is anticipated to see the largest increase in import volumes of agricultural commodities in absolute terms China s self-sufficiency has been decreasing across commodities, with increasing net import requirements for all major categories Global Agri import volume share (1) 2012/13 China 15% (77 million tonnes) Japan 9% S. Korea 5% Mexico 4% US 3% 2023/24E China 24% (174 million tonnes) Japan 6% Mexico 6% S. Korea 3% Egypt 3% Source: USDA, OECD-FAO, FAPRI (1) Top 5 Agri importing countries chosen based on top 5 countries of each individual commodities 58

61 ASSOCIATES & JVs Noble Agri Long-term Vision Unique platform building on partners complementary strengths Consistent with Noble Group s asset-light strategy to partner with industry-leading players in each of its platforms to build world-class businesses Noble Agri JV transaction released US$3.3 billion (US$1.5 billion sales proceeds and US$1.9 billion shareholder loan repayment) available for recycling across other businesses Evolution of Noble Group s agricultural commodity presence Investment Phase ( ) Noble Agri JV (2014) Integration with Nidera (Pre-IPO) IPO Agricultural activities established in 1998 by entering cocoa marketing and acquiring Grains & Oilseeds ( G&O ) business from Andre & Cie. in 2001 Acquired portfolio of G&O and sugar assets, including oilseed crush and refinery plants in China as well as sugar mills in Brazil Sale of 51% in Noble Group s agricultural commodity trading business to consortium consisting of COFCO, HOPU Investments and other financial investors Principal international origination platform for COFCO to create a fully integrated value chain Intention to integrate Noble Agri with Dutch agricultural commodity trading firm Nidera in which COFCO holds a majority stake Other COFCO businesses to be integrated over time if synergistic with existing business Intention of shareholders to eventually list the combined business on an international stock exchange Introduces external capital to further fund growth ambitions Provides liquidity event for shareholders to realise value created 59

62 ASSOCIATES & JVs Yancoal Gloucester Coal Merger Yancoal is one of the largest pure-play thermal and metallurgical coal exporters in Australia. - Large reserve and resource base with seven operating mining complexes in two of the largest coal-producing areas in Australia - Ownership of critical port infrastructure, which allows for future expansion The Group acquired its stake in Yancoal via a sale of 100% of the Group s shares in Gloucester Coal into Yancoal Australia The initial carrying value of our stake in Yancoal upon completion of its cash and scrip merger with Gloucester Coal in 2012 was US$825 million over US$500 million in excess of current book value which was validated by third-party valuation experts Post Merger Structure (at Inception) Yanzhou Coal Mining Company 78.0% Yancoal Australia 100% Gloucester Coal Noble Group 13.2% Summary Transaction Terms Yancoal Australia purchased all of Gloucester s ordinary shares at a consideration implying a price of A$10.21 per share of Gloucester Noble received: - Shares in the Yancoal merged company - Special dividend of A$0.47 per share prior to the effective date of the merger - Capital return of A$2.68 per share 6 months after the merger was implemented - Total cash of US$417 million - Inter-company loan repayment of US$361 million 60

63 ASSOCIATES & JVs Inflection Energy LLC ( Inflection ) partnering with a natural gas company with tremendous growth promise Inflection is an upstream oil and gas exploration and production company with assets principally located in the Marcellus Shale developing dry gas window Noble provided initial equity commitment to Inflection as part of a Series C funding round for 26.2% of Inflection as an active equity partner In addition, Noble provides Inflection with marketing and risk management services Noble has marketed 100% of Inflection s dry-gas production and has been counterparty to multiple hedging transactions Company is continuing to expand its footprint in Marcellus Shale, with 15 producing wells and 5 additional developments expected to be operational by year end As growth potential for Company s core asset base remains significant, Noble has contributed to Inflection s development plan with an aim to recycle capital with attractive value creation 61

64 ASSOCIATES & JVs Atlas and Cockatoo partnering with development companies to enhance our strategic access to trade flows Atlas Resources Established in 2007, PT Atlas Resources Tbk ( Atlas ) is an Indonesian coal producer that holds a number of mining business licences for production and exploration in the provinces of East Kalimantan and South Sumatra and mining authorisations for exploration in the province of Papua Noble initially invested in Atlas through debt and converted the debt into equity as part of the IPO process in 2011 Over the years, Noble has entered into a series of arrangements with Atlas, including operating agreement, strategic development agreement, marketing agreement, and long-term coal sale agreement As one of the key coal producers in Indonesia, Atlas continues to be a strategic partner for Noble, particularly with Noble s growing activities in Indonesia Cockatoo Cockatoo Coal Limited ( Cockatoo ) is an ASX-listed coal development and production company Baralaba mine is Cockatoo s flagship project and is one of the lowest cost PCI coal producers in the Bowen Basin, Australia Noble had been an investor in Blackwood Corporation and became a 21% shareholder in Cockatoo when Blackwood and Cockatoo merged in As part of the transaction, Noble became an offtake and marketing partner to Cockatoo In 1Q 2015, Noble extended its relationship with Cockatoo, supporting its A$125 million rights issue with A$53 million participation to raise capital to expand Baralaba s production from 1 million tonnes per annum to 3.5 million tonnes per annum. As part of the transaction, Noble entered into a new 28.5 million tonne offtake arrangement with Cockatoo PCI is a niche product, primarily exported from Australia. While utilisation rates remain low in developing countries, we expect demand from China and India to increase three-fold over time. Cockatoo represents a strategic partnership that provides Noble with a critical PCI footprint in Queensland, Australia 62

65 How We Manage Our Business

66 Noble s Board and Management Committee Our 14 member Board comprises of highly successful senior professionals with backgrounds in industry, banking, accounting, legal, diplomacy and commodities trading Our Board has and will continue to evolve, just as our Company has evolved - Of our 14 Directors, over half have served for fewer than four years (1) - Ten of our Directors are Independent Non-Executive Directors - Our Board has established seven committees with at least four members, each charged with different responsibilities and chaired by an Independent Non-Executive Director Audit Committee is chaired by Iain Bruce (retired Senior Partner of KPMG Hong Kong) Investment & Capital Markets, Risk, Corporate Governance, and Nominating Committees are chaired by David Eldon (ex-chairman of The Hong Kong and Shanghai Banking Corporation Limited) Remuneration & Options Committee is chaired by Alan Smith (former Vice Chairman at Credit Suisse First Boston) Our 12 person Management Committee represents the core leadership of our Company - Members of the Management Committee are highly motivated and collegial, and incentivised on a risk-adjusted basis - Each member is a highly-respected professional in his own right, with most having built successful careers elsewhere before joining Noble Group (1) Irene Lee, Richard Margolis, Christopher Pratt, Paul Brough, David Yeow, Patrick Yu, William Randall, and Yusuf Alireza. For more information please refer to our website, 64

67 Corporate Governance Structure Board of Directors 3 Executive Directors 1 Non-Executive Director 10 Independent Non-Executive Directors Board Committees Audit Committee Risk Committee Nominating Committee Corporate Social Responsibility & Government Relations Committee Corporate Governance Committee Investment & Capital Markets Committee Remunerations & Options Committee Management Committee Yusuf Alireza CEO William Randall President Robert van der Zalm Group CFO Bill Cronin COO & CRO Jeff Frase Oil Liquids Jim Wood Retail Energy Gareth Griffiths Gas & Power Neil Dhar Carbon Materials Nigel Robinson Financial Services Giovanni Serio Research Jeffery Alam Group General Counsel Mark Towson Human Resources 65

68 Risk Reporting and Governance Risk Committee Board of Directors CEO Credit Committee Presents to Reports to Role of Risk Leadership Ensures implementation of the decisions made by the Risk and Credit Committees Ensures consistency of policies across the group Establishes a company-wide framework for measuring, monitoring and evaluating the quantifiable financial risks Market Risk Risk of commodity price fluctuations FX risk Interest rate exposure Credit Risk Counterparty credit risk Performance risk Operational Risk Inventory risk Supply chain risk CRO Oversees the development of risk limits; review daily exposures against limits and determine corrective actions as appropriate Leads the risk measurement, risk monitoring and risk evaluation functions Oversees day-to-day duties of the risk management function and has a thorough understanding of all trading activities Ensures the bracketing of company risk through back-testing, sensitivity assessment, scenario implementation and industry-leading quantitative tools 66 Formally presents to the Board of Directors on a regular basis

69 Key Principles of the Risk Management Framework Risk Management Framework Risk Infrastructure Risk Governance Risk Analysis & Quantification Risk Management Advanced risk management systems supported by a global team of professionals Key risk specialists by business line Unique quantitative tools Strong policies Centralised mandate Strict approval procedures Unfailing oversight Multi-faceted Close collaboration between Risk, Trading & Research Quantitative analysts with deep industry knowledge Risk management structure parallels commercial business structure Strength and quality of Noble s people Geographic and product diversification Market Risk Credit Risk Operational Risk Credit Risk Operational Risk 67

70 Key Principles of the Risk Management Framework Example of a Metal Transaction Producer Shipping Warehouse Shipping Consumers Buy from producer/trader on a spot/forward basis and hedge Transport from producer/trader to warehouse for storage Warehouse/ store metal prior to onward shipment Charter transport for shipment to customer Deliver to customer and unwind hedge Risks Incurred Market + Credit Operational Risk Force Majeure Operational Risk Force Majeure Operational Risk Force Majeure Market + Credit Counterparty credit risk (to suppliers, customers and financial brokers) exists throughout the supply chain Examples Prepayment/ forward purchase Logistics/freight/ insurance and tax Warehouse/ storage and insurance Logistics/freight/ insurance and tax Sale/ invoicing terms Risk Management Spread and premium risk remains after hedging purchase price Loss or damage in transit covered by insurance Loss or damage due to force majeure covered by insurance Loss or damage in transit covered by insurance Unwind hedges and sale of inventory eliminates spread and premium exposure Physical Commodities Belgium Belgium Belgium Belgium to Germany Germany Merchandising / Hedging Belgium / London Belgium / London Belgium / London Belgium / Germany / London Germany / London 68

71 Process flow diagram of risk capital framework and oversight Risk Equity Oil Liquids Diversified VaR Risk Capital Board of Directors Risk Committee Businesses Energy Coal Metals CSM VaR & MDDL Risk Management Function Portfolios Management Committee Macro Hedging VaR & MDDL Global G&P Undiversified VaR All traders and businesses are given pre-defined limits, which are recorded, strictly observed and regularly reviewed Limits are granted based on: - Global opportunities and the diversification desired - Current Noble targets, as a group and for each business - Best allocation of capital in terms of risk-adjusted returns - The state and outlook of the particular industry - Management and trader experience with the specific product and comfort with the size of the exposure - Ease of exposure measurability, hedging and liquidity characteristics Limits cover a multi-dimensional set of constraints including: - Markets and regions - Products, grades, tenors by specific product, etc. - Type of financial instruments - Limits on VaR and Greeks (position limits on various market risk factors) - Loss limits - Multi-tiered approval process for non-standard products 69

72 Market Risk Assessment Market Risk deploys a multi-layered exposure limit policy on individual traders, products, books, strategies and businesses, as well as Group-wide Our approach, which is not solely VaR-centric, deploys a multi-pronged methodology to triangulate the risk At Noble, the common VaR is used as a simple metric for policy and regulatory reasons. Its main points include: - 75 trading days delta-normal VaR with exponentially reduced weights which attribute about half the weight in the last 12 days of trading - Regular back-testing and, if needed, adjustments for accuracy - 95% confidence level, meaning that, within a one-day horizon, losses exceeding the VaR figure are not expected to occur, on average, more than once every 20 days Simulated-stress cases based on our proprietary principal components analysis ( PCA ), which: - Disassembles the risk into: (a) flat price risk, (b) rotations i.e. contango/backwardation risk, (c) structural curve changes (bends) and (d) other market changes - Emphasises the seasonality of risk in the approaching weeks and months through careful selection of historical windows over multiple years - Is adjusted for fat tails and, in fact, typically yields higher risk assessments than industry-standard VaR approaches - Emphasises the illiquidity of positions and accounts for the time to exit Fundamental stress scenarios including historical analogues or those produced by the Business, Risk, and Research teams Historical position back-testing, sensitivities, etc. While policy centres on VaR, daily management emphasises all other approaches, including the intimate market knowledge of relevant senior management by all those involved 70

73 Value at Risk Group VaR at current levels demonstrates the Group s conservative approach to risk in current markets VaR derived from 95% confidence level, 75 trading days, exponentially weighted so that last 12 days carry half of the weight Reported daily along with other risk management measures 0.56% 0.45% 0.35% 0.39% 0.39% 0.24% 0.36% 0.31% 0.21% 0.34% 0.34% 0.38% 0.38% 0.33% 0.34% 0.25% 0.24% 0.28% Jan 14 Feb 14 Mar 14 Apr 14 May 14 Jun 14 Jul 14 Aug 14 Sep 14 Oct 14 Nov 14 Dec 14 Jan 15 Feb 15 Mar 15 Apr 15 May 15 Jun 15 71

74 Concentration and Exposure Analysis 72

75 Strategy Analysis and Reporting 73

76 Risk Reporting (VaR, PCA & Illiquidity) Weekly VaR back-testing (global and by desk) with issue investigation and proactive adjustments Weekly Illiquidity Report includes all positions with a (potential) liquidation issue and magnitude of loss assessment in case of an adverse move 74

77 Risk Analysis High level overview of risk, diversification, and dollarized exposures; global and by platform 75

78 Internal credit risk analysis framework Business Segment Factors Counterparty Specific Factors Contract or Deal Specific Factors Business segment in which the counterparty operates determines rating parameters Producers, trading & marketing, processor, distributor, end-user, logistics company, ship owner, etc. Qualitative and quantitative factors Country risk, political risk, etc. Track record Historic relationship Letters of credit or guarantees Credit insurance Asset security Operational control Subordination Credit risk serves as a strategic partner to key corporate functions and the commercial organisation Focused on counterparty credit analysis, approval and internal credit rating assignment Rating methodology developed internally to maintain consistency across credit evaluation and rating approaches for all counterparties Approach and scale consistent with international rating agency standards to support development of credit pricing and credit reserve methodologies, as well as risk capital management Credit input and review of all counterparties and transactions 76

79 Credit Risk s Responsibilities Counterparty credit analysis, approval, and internal credit rating assignment Credit risk exposure measurement and reporting of: - Financing / Accounts Receivable Risk - Mark-to-Market / Potential Future Exposure Credit and tenor limit determination OTC margin calls and overall collateral management Trading master agreement negotiation and management Management of daily transaction flow and originated transactions Active monitoring and management of counterparty portfolios Active watch list management through identification and oversight of high-risk counterparties Reporting of portfolio and other relevant metrics Serve as a strategic partner to key corporate functions and the commercial organisation Support in due diligence efforts for potential new clients / deals / acquisitions 77

80 Credit Approval Process Representation from more than half of the Company s Management Committee on the Global Credit Committee demonstrates the importance of the risk culture at Noble Applies a clear approval split between day-to-day trading and medium/long-term strategic transactions: - All MTM counterparty risk to be approved by Credit - Pre-Finance < 1 year to be approved by Credit - Others approved in the Platform or Capital Investment Committee Dual sign-offs from credit and business management is required Monthly Regional Credit Committees with a focus on: - Recent approvals - Portfolio review (trends, concerns, key risks, etc.) - Credit provisioning and write-off process Monthly Global Credit Committee with a focus on: Global Credit Committee Yusuf Alireza CEO William Randall President Bill Cronin Group COO & CRO Robert van der Zalm Group CFO Kristiaan Behiels Global Head of Credit Risk Jeffrey Alam Group General Counsel Wildrik De Blank Group Treasurer Dimitrios Kavvathas Co-Head Financial Services Asia Credit Committee Kristiaan Behiels Global Head of Credit Risk William Randall President Neil Dhar Global Head of Carbon Steel Complex Neil Argo Head of Global Operations, Hards Paul Jackaman CFO Asia Pacific Manish Dahiya Global Head of Energy Complex Mark Hansen Global Head of Metals US / EMEA Credit Committee - Credit approvals that exceed Head of Credit / Chief Risk Officer level - Portfolio review (trends, concerns, key risks, etc.) - Review and approval of Credit provision and write-off recommendations Platform Credit Committees Kristiaan Behiels Joshua Rogers Jeff Frase Gareth Griffiths Yannis Tzamouranis Ralph Torrence Michael Kirby Global Head of Credit Risk Head of Credit Risk, Energy Global Head of Oil Liquids Global Head of Gas & Power Global Head of Market Risk Head of Global Operations, Energy CFO US and EMEA 78

81 Internal credit rating methodology Our methodology has been developed internally and provides a consistent credit evaluation and rating approach for all counterparties Counterparties are assessed from the perspective of the business segment under which they operate, with rating parameters defined accordingly. Business segments are defined as: Oil and Gas E&P, Mining, Trading & Marketing, Petrochem, Distributor, End-user, Service or Logistics Company, and Ship Owner Our internal credit rating model incorporates qualitative and quantitative factors as well as country risk and any agreed sector caps Our rating approach is consistent with rating agency standards and supports the development of credit pricing and credit reserve methodologies. It can also be used for risk capital management Additionally, we adjust facility ratings where deal structure justifies/requires it (e.g. letters of credit, guarantees, credit insurance, margining arrangements, asset security, operational control, and structural subordination) 79

82 Capital Structure Management Capital Allocation Framework Capital Structure Supports Business Growth and Initiatives Noble s capital structure is designed to support growth and new business initiatives to maximise returns We are committed to maintaining our investment grade rating - Priority on liquidity, balance sheet / contract duration matching Financing Objectives Financing Instruments & Cost Projected Returns / Risk Growth Opportunities We have implemented a capital allocation framework for working capital and investments - Limits established to diversify risk Focus on returning excess capital to shareholders via dividend distributions, share buy backs and asset sales - Conservative dividend policy BBB-/Baa3/BBB- Investment Grade Rating - Optimise share buyback programme Projected Returns / Risk 80

83 Misconceptions about Noble Group 81

84 Misconceptions about Noble Group: Fair Value and Mark-to-Market 82

85 Fair Value as Part of Noble s Business Noble s Business Model has Evolved Noble has evolved its business model over the past few years to emphasise its role as a supply chain manager based on customer relationships rather than as an owner of supply chain assets As a result, we have reduced our ownership of fixed assets - Our fixed assets have reduced from US$2.9 billion at the end of 2013 to less than US$900 million at the end of 2014 As a supply chain manager the majority of our revenue and the value we create comes from contractual arrangements including: - Purchase and sale of commodities as principal including processing and blending - Marketing of commodities as an agent - Delivery of supply chain services including logistics and transportation - Provision of price risk management and hedging As a result, there has been a significant growth in our volumes from 180 million tonnes (excluding Agri) in 2012 to 255 million tonnes in the last 12 months 83

86 Fair Value as Part of Noble s Business What We Are Required to Fair Value We are required under accounting rules to fair value any contract that has a derivative financial instrument component, as well as inventories we hold as a supply chain manager The following items are fair valued: - Inventory - Forward purchase agreements - Forward sale agreements - Marketing agreements - Offtake agreement - Long-term supply contracts If a contract contains a derivative financial instrument, it must be fair valued in accordance with IAS39 In addition to compliance with these rules, we adhere to strict internal guidelines which are conservative when marking our positions The fair value methodology uses four key inputs for valuations: - Underlying price - Volume But we do not fair value: - Cargo-by-cargo trades - Marketing agreements with fixed price per tonne - Offtake agreements at market - Leases - Discount rate - Reserves (when appropriate) As part of Noble s regular practice of assessing Fair Value, reserves or valuation adjustments are considered to ensure that the present value assigned to a contract reflects all risks appropriately and complies with IFRS guidance Only contracts that have a derivative financial instrument are fair valued 84

87 Fair Value as Part of Noble s Business Composition of Fair Value Gains and Losses of Contracts Profile of Net Fair Value Gains & Losses (US$MM) < 4 years > 4 years Net Fair Value As at 31 Dec ,469 2,098 4,567 As at 30 June ,058 2,022 4,080 Reduction in Level 1 & 2, primarily due to the roll-off of short term contracts in Oil Liquids and cash realisation Level 3 increased slightly due to the transfer of existing contracts from Level 2 during the first quarter, in accordance with the Group s accounting policies due to reduced data observability Breakdown of Level 1, 2, and 3 (% of Net Fair Value Gains & Losses) Net Fair Value Gains (US$MM; as at 30 June 2015) FY2014 Level 3 23% 1H2015 Level 3 29% 10,800 Level 1 & 2 77% Level 1 & 2 71% 5,680 1,600 4,080 Undiscounted & Unreserved Discounted & Unreserved Further Performance Contingency Reserves Net Fair Value (Carrying Value) 85

88 Fair Value as Part of Noble s Business Net Fair Value in Context of Noble s Balance Sheet Net Fair Value (as at 30 June 2015) Level 3 7% Other Mine Properties <1% Cash & Equivalents 8% Other Assets 8% Yancoal 2% Agri 8% Inventories 14% Fixed Assets 5% Net fair value gains on commodity contracts and derivative financial instruments ( net fair value ) comprise less than 23% of Noble s total assets Of these, 71% are Level 1 & Level 2 with either observable market prices or values based on observable market data Only 29% of the net fair value (representing only 7% of Noble s total assets) are Level 3 contracts where valuation techniques for which one or more inputs that are significant in aggregate to the fair value measurement are unobservable Level 1 & 2 16% Trade Receivables 23% 81% of the value of derivative contracts with a duration of at least two years and 98% of the value of the Level 3 net assets have been reviewed by PwC NAES 2% Prepayment & Other Receivables 7% Total Assets: US$17.5 billion (1) 86 (1) Total Assets net of fair value losses Valuation Basis: Level 1: based on quoted (unadjusted) prices in active markets for identical assets or liabilities Level 2: based on valuation techniques for which all inputs that are significant to the fair value measurement are observable, either directly or indirectly Level 3: based on valuation techniques for which one or more inputs that are significant to the fair value measurement are unobservable

89 Net Fair Value Profile Decline in net fair value to US$4,080 million at 30 June 2015 compared to US$4,567 million at 31 December 2014 Segment (As at 30 June 2015) Region & Type (As at 30 June 2015) Financial Hedges 6% Gas & Power 14% EMEA 17% Mining & Metals 35% Energy 51% Americas 27% Asia Pacific 50% The majority of net fair value as at 30 June 2015 is comprised of physical commodity contracts in thermal coal, metallurgical coal, and coke Geographic split of net fair value, based on origination markets, at 30 June 2015 reflects the Group s strong presence in Asia Pacific The Americas are largely represented by the Group s Energy Solutions, Gas & Power, and Oil Liquids businesses Financial hedges reflect the value of financial instruments, including futures, swaps and options, used for hedging purposes and will fluctuate period to period based on commodity price movements 87

90 Fair Value as Part of Noble s Business Valuation Process: Strict Governance and Oversight Strict & Regular Review of Price Curves Noble s pricing curves are governed by stringent review policies and systematic procedures to ensure accuracy These policies include monthly and annual reviews, segregation of duties between functional areas and the involvement of multiple independent teams: - Business: Initiates transactions and requests pricing curves from product control - Market Risk: Reviews curve marking proposals and provides inputs into that process - Strats: Provides guidance relating to the marking of curves and advises on the source data. Develops models for back-testing and reporting purposes - Product Control: Updates daily curves and is the only team permitted to set up new curves - IT: Loads new curves in the trading system Transparent MTM Governance Policy Clear policies approved by the Audit Committee Standard manuals covering accepted approaches and external pricing input standards Independent control groups involved in modelling and valuation Independent price testing and curve validation on a monthly basis - Committee includes members of the Finance, Research, Market Risk, Credit Risk, Strategy, and Business teams Segregation of responsibilities for sign-off of final balance sheet presentation and P&L recognition Reporting to Group CEO and CFO on all major transactions including back-testing actuals against initial assumptions Cash realisation on our portfolio on a year-to-date basis is within expectations, as confirmed by the Group s back-testing activities Clear controls and strong methodical process in place to ensure accuracy, appropriateness and independence of valuations 88

91 Fair Value as Part of Noble s Business Forward Curve Protocol and Governance Commodity prices and other forward curves are set as per best industry practice and adhere to a rigorous price curve protocol. The protocol and its application have been reviewed in detail by E&Y and PwC The daily curve process is managed by Finance with a formal monthly Curve Review Committee meeting. The committee includes members of the Finance, Research, Market Risk, Credit Risk, Strategy, and Business teams Risk systems automatically connect to external exchanges and pricing services on a daily basis Each market has a benchmark curve (e.g. Brent in Oil Liquids). Other locations are adjusted with automated exchange-based freight curves. Quality adjustments are applied with market curves where available, or alternatively using historical statistical relationships which are signed off by the Curve Review Committee Funding and counterparty credit discounting curves are market-based and use best-practice methodology Forward Curve Process (Coal example, all inputs are sourced from leading external information providers) Forward Period Data Source Update Frequency Exchanges, brokers Daily Consensus service Quarterly 2020 onwards External USD inflation forecast Annually 89

92 Mark to Market Committee Paul Jeremy Brough Independent Non-Executive Director. Joined 6 May 2015 Mr. Brough is an Independent Non-Executive Director of GuocoLeisure Limited (listed on the Singapore Stock Exchange) and a Non-Executive Director of Habib Bank Zurich (Hong Kong) Limited, a Hong Kong restricted licence bank. He stepped down as the Chairman and CEO of Emerald Plantation Holdings Limited ( EPHL ) on 1 April 2015 and resigned from the EPHL Board on 15 April 2015; and was an Executive Director and Interim CEO of Greenheart Group Limited (listed on the Hong Kong Stock Exchange) until he was re-designated as a Non-Executive Director of the company effective 2 April Mr. Brough came to Hong Kong in 1983 to join KPMG, where he became a Partner in 1991 and, later became, the Senior Partner of Hong Kong. He retired from KPMG in Mr. Brough is an associate of the Institute of Chartered Accountants in England and Wales, the Hong Kong Institute of Certified Public Accountants and the Hong Kong Securities and Investment Institute. Irene Yun Lien Lee Independent Non-Executive Director. Joined 1 March 2012 Ms. Lee is the Executive Chairman of Hysan Development Company Limited, an Independent Non-Executive Director of Cathay Pacific Airways Limited, CLP Holdings Limited and Hang Seng Bank Limited (all listed on the Hong Kong Stock Exchange); and is an Independent Non-Executive Director of HSBC Holdings PLC and The Hongkong and Shanghai Banking Corporation Limited. She has held senior positions with a number of global financial institutions involved in investment banking and funds management over the past thirty years. She has been an Executive Director of Citicorp Investment Bank Limited in New York, London and Sydney, and Head of Corporate Finance at Commonwealth Bank of Australia and Chief Executive Officer of Sealcorp Holdings Limited, both based in Sydney. She also served as a member of the Australian Government Takeovers Panel and numerous listed and unlisted companies in Australia. Ms. Lee holds a Bachelor of Arts Degree from Smith College, United States of America, and is a Barrister-at-Law in England and Wales and a member of the Honourable Society of Gray s Inn, United Kingdom. 90

93 Mark to Market Committee (Cont d) Richard Paul Margolis Independent Non-Executive Director. Joined 20 June 2013 Mr. Margolis is a former diplomat, investment banker and businessman with more than 30 years experience in Greater China. He currently holds senior advisory roles with the Holdingham Group, Rothschild (Investment Bank) and Milestone Capital. Subsequent to his diplomatic service with the Foreign and Commonwealth Office in London, Beijing, Paris and Hong Kong, Mr. Margolis pursued a private sector career in Hong Kong. He was Managing Director, Corporate Finance at Smith New Court Far East, and Head of Strategy and Planning for Asia Pacific at Merrill Lynch. Mr. Margolis served on the boards of China Oilfield Services, Hsin Chong Construction (both listed on the Hong Kong Stock Exchange) and Bank of China International Investment Management Company, and was a member of the Hong Kong Stock Exchange Listing Committee and the Hong Kong Securities and Futures Commission Advisory Committee. From 2003 to 2011, he was the Regional Director, North East Asia for Rolls-Royce. Mr. Margolis was awarded the CBE (Commander of the Order of the British Empire) in 2011 for services to British business in China. Christopher Dale Pratt Independent Non-Executive Director. Joined 3 June 2014 Mr. Pratt was the Executive Chairman of Swire Pacific Ltd from February 2006 until his retirement in March He was also Chairman of Cathay Pacific Airways Limited, Hong Kong Aircraft Engineering Company Limited, John Swire & Sons (H.K.) Limited and Swire Properties Limited, and a Director of Swire Beverages Limited, Air China Limited and The Hongkong and Shanghai Banking Corporation Limited. He joined the Swire group in 1978 and has worked with the group in Hong Kong, Australia and Papua New Guinea. Mr. Pratt was awarded the CBE (Commander of the Order of the British Empire) in 2000 for Services to the Community in Papua New Guinea. Mr. Pratt is an Independent Non-Executive Director of Johnson Electric Holdings Limited, PureCircle Limited and the Grosvenor Group. 91

94 Summary of PwC Review PwC assurance review focused on the majority of long-term physical commodity contracts included in Level 2 and Level 3 net fair value. Engagement performed in accordance with the Singapore Standard on Assurance Engagements 3000 Mandate Evaluate whether the Group s valuation of certain long-term physical commodity contracts at 30 June 2015 complies with IFRS 13 Fair Value Measurement and standard industry practice Coverage Counterparty contracts reviewed represented as at 3o June 2015: 81% of the value of derivative contracts with a duration of at least two years 98% of the value of the Level 3 net assets Scope Engagement scope defined and process overseen by new independent Board Committee Counterparty by counterparty contract valuation reviews performed Review covered 12 areas, including governance and controls, and 35 relevant criteria. Relevant Criteria were reviewed on a contract by contract basis Assessed the completeness and appropriateness of the Relevant Criteria Overall Final Conclusion.the individual valuations and overall valuation of the contracts included in the Group s consolidated balance sheet as at 30 June 2015 comply, in all material respects, with the Relevant Criteria ; and that the Relevant Criteria represent those factors which are necessary for management to ensure that the MTM valuations are derived in a manner which is in compliance with the relevant requirements of IFRS 13 as well as standard industry practices 92

95 Coverage of PwC Review 81% Coverage of Undiscounted and Unreserved Net Fair Value US$8.7 billion out of US$10.8 billion covered 81% Coverage of the Value of Contracts with a Duration of at Least 2 Years US$2.2 billion out of US$2.7 billion covered US$8.7bn US$2.2bn 98% Coverage of the Value of the Level 3 Net Assets US$1.16bn US$1.16 billion out of US$1.18 billion covered Level 3 represents US$1.2 billion (29%) of total Net Fair Value, which are valued using techniques for which one or more inputs that are significant in aggregate to the fair value measurement are unobservable Why have we focused on Level 3 and greater than two years? - Typically these are the points where the unobservable inputs start to become material 93

96 Contract by Contract Review All Inputs to the Model Application of Each Relevant Criteria Construction of the Valuation Model Each Contract Valuation Model Discussions to Supplement Understanding of Inputs and Assumptions All factors that a potential buyer of the Contracts would have taken into account have been considered and reflected in the valuation of these Contracts 94

97 Areas Addressed in PwC Review 12 areas reviewed by PwC to assess contract-by-contract valuations at 30 June 2015 in compliance with IFRS 13 and standard industry practices Areas Reviewed Adoption of IFRS 13 Yield Curves Volumes Foreign Exchange Governance & Oversight Own Credit Spread Future Commodity Prices Model Reserves Policies Counterparty Credit Spread Freight MTM Values In total, 35 relevant criteria reviewed, with detailed procedures performed to assess compliance with the relevant criteria, to support PwC opinion 95

98 Key Valuation Parameters and Steps to Assurance Noble Methodology PwC Assurance Volumes Production volumes derived by referencing terms of the contracts and where the related commodity deposit reserves are deemed to be either proven or probable in compliance with JORC-compliant standards Further volumes adjustments made to reflect quality or market conditions Checked the volume forecast to the contract (amounts, period, etc.) Checked the volume forecast to the mine s forecast given to us from the business Challenged the volume forecast with the business and support functions Checked that adjusted volumes did not exceed the proven and probable reserves under the most recent JORC-compliant report Looked at recent production volumes (volume back-testing) to assess whether the forecast production volumes are consistent (where appropriate) Discount Rates Incorporates both the Company s own funding costs as well as counterparty credit spreads Reflects inputs obtained from external sources Counterparty credit spreads based on internal counterparty credit reviews and derived from CDS spreads for companies with equivalent ratings, in line with market practice Checked the derivation of the risk-free curve (including checking the source of external inputs where available) Checked the addition of own credit spread (again including checking the source of external inputs where available) Checked that the counterparty spread matched the right curve for the counterparty rating (again including checking the source of external inputs where available) Checked that the right discount factor was then applied 96

99 Key Valuation Parameters AND Steps to Assurance (cont d) Noble Methodology PwC Assurance Price Forward price curves reflect inputs obtained from external sources, where available Where no such external sources exist, forward curves constructed using an industry-accepted methodology Checked the margin to the contract Checked that the right benchmark curve had been applied (including checking the derivation of the curve, including checking the source of external inputs where available) Discussed with the business and modelling team any adjustments to the forward curve for the relevant benchmark (quality adjustments) Checked the arithmetical application of the margin to the volumes, which gives the gross cash flow Reserves Reserves taken to allow for future uncertainty Factors considered include: - Marginal cost of production - Logistical bottlenecks - Required further infrastructure development - Weather related issues (such as drought or flooding) Checked the reserves were consistent with the MTM deal summary Challenged the business and modellers on the derivation of reserves and the explanation for them Checked all reserves and valuation adjustments that should be considered as part of the MTM valuation have been considered 97

100 Future Commodity Prices Benchmark curves set using liquid market observable prices which are interpolated to an anchor price and escalated thereafter Consensus Economics (1) used for anchor consensus price Escalation post-anchor price based on USD CPI inflation plus real-cost adjustment based on external analysis from sources such as the IMF Noble Research views on fundamentals of each commodity taken into consideration as an additional information source $/t Liquid Forward Curve Anchor Price Escalation Nominal Real Priority is given in accordance to the reliability and observability of external information 98 (1) Consensus Economics is a global macroeconomic survey firm that polls more than 700 economists monthly for their forecasts for over 2000 macroeconomic indicators in 115 countries. The company is headquartered in London

101 Quotes from PwC Report We emphasise that our work was not restricted to an examination of the governance, organisation and policies that govern the valuation models. In the case of each Contract reviewed by us, we also obtained the detailed valuation model and checked the application of the Relevant Criteria to the construction of the model. This included an examination of all the inputs as well as the construction of the model itself. We supplemented this with detailed discussions with the various teams that play a role in this process, to clarify our understanding of the inputs and relevant assumptions. Overall, we note that Noble has adopted an approach to valuations which is consistent with the Relevant Criteria, in all material respects. Indeed, in some aspects of the model construction (such as the development of discount rates and development of counterparty credit risk curves), Noble has an approach which is more sophisticated than that of many non-financial companies. We also note a strong segregation of duties between the different teams that provide key inputs into the models. We note that where observable inputs are available (such as interest rates, credit spreads, forward commodity prices, etc.), these are used in the modelling approach. The unobservable inputs are consistent with assumptions that other market participants would use. We note that the MTM valuations (against actual profit and loss) are backtested by the Finance team and the results are presented and discussed during the monthly MTM review meetings. To ensure effective control and validation of the MTM computations, we would recommend putting in place a formal process (and policy) to ensure backtesting is conducted regularly using a standardised approach. 99

102 Conclusion AND Next Steps PwC Assurance Review Summary Noble has an approach that is more sophisticated than that of many non-financial companies Strong segregation of duties between different teams that provide key inputs into the model Observable inputs are used where available, consistent with market practice Application of production volume adjustments and allocation of reserves for uncertainties in the valuation are consistent with market practice All factors that a potential buyer of the Contracts would have taken into account have been considered and reflected in the valuation Noble will continue to review, refine and strengthen the valuation methodology and governance framework Steps to improve further the presentation of information, such that there is transparency, comparability and consistency over the valuation of Contracts Steps to formalise policies and practices further 100

103 Misconceptions about Noble Group: Associates 101

104 Yancoal Gloucester Coal Merger Yancoal is one of the largest pure-play thermal and metallurgical coal exporters in Australia: - Large reserve and resource base with seven operating mining complexes in two of the largest coal-producing areas in Australia - Ownership of critical port infrastructure that allows for future expansion The Group acquired its stake in Yancoal via a sale of 100% of the Group s shares in Gloucester Coal into Yancoal Australia The initial carrying value of our stake in Yancoal upon completion of its cash and scrip merger with Gloucester Coal in 2012 was US$825 million over US$500 million in excess over current book value which was validated by third-party valuation experts Post Merger Structure (at Inception) Yanzhou Coal Mining Company Noble Group Summary Transaction Terms Yancoal Australia purchased all of Gloucester s ordinary shares at a consideration implying a price of A$10.21 per share of Gloucester 78.0% Yancoal Australia 100% Gloucester Coal 13.2% Noble received: - Shares in the Yancoal merged company - dividend of A$0.47 per share prior to the effective date of the merger - Capital return of A$2.68 per share six months after the merger was implemented - Total cash of US$417 million - Inter-company loan repayment of US$361 million 102

105 Yancoal In Context AND Accounting Treatment Assets as at 1H2015 Total Assets: $19,927 million Yancoal: $306 million Yancoal 1.5% Rest of Noble 90.1% NAL 6.6% Other Associates 1.7% Yancoal is recognised as an associate on the Group s balance sheet, based on relevant IFRS rules as we are deemed to have significant influence IFRS stipulates that the existence of significant influence by an investor is usually evidenced in one or more of the following ways: - Representation on the Board of Directors or equivalent governing body of the investee - Participation in the policy-making process - Material transactions between the investor and the investee - Interchange of managerial personnel - Provision of essential technical information Yancoal is a long-term investment for the Group with William Randall, Noble Group s President on the Board of Directors, long-term marketing and offtake agreements, and regular dialogue on potential partnership activities 103

106 Yancoal Market Trading Summary Yancoal shares are not regularly traded in the market with a 9% free float 78% owned by Yanzhou Coal Mining Company, which is ultimately majority owned by the Shandong Provincial Government Long-term financial support underpinned by Chinese government s commitment to Australian Foreign Investment Review Board and to Yancoal to provide ongoing operational support and ensure solvency Summary Trading Statistics Shares (MM) % of shares outstanding Value (US$ 000) Free Float % 7,852 Value Traded since January 2014 (A$MM) 3.0 Daily traded volume (3 month average) Daily traded volume (12 month average) % % Ownership Structure Ownership Structure % of shares outstanding Yanzhou Coal Mining Co Ltd 78.0% Noble Group Limited 13.2% Free Float 8.8% 0.0 Jan 14 Mar 14 May 14 Jul 14 Sep 14 Nov 14 Jan 15 Mar 15 May 15 Jul 15 Source: Bloomberg 104

107 Yancoal Valuation Noble s valuation model incorporates a conservative price curve compared to broker consensus Price curves are established based on broker reports and market consensus and follows a strict methodology and governance policy note that all price curves were reviewed by PwC as part of the assurance review Key valuation parameters are largely sourced from third parties The valuation model and all parameters are updated and reviewed on a quarterly basis Yancoal Enterprise Value (US$BN) 6.6 Key Valuation Parameters Inputs Sources WACC 9% 4.3 Coal Price Curve Based on broker reports, market consensus & fundamental research Production Volume Short-term plan from Yancoal; long-term plan from BDA (2) and updated by Noble Cost structure From Yancoal, and verified with market sources Capex From Yancoal Current market implied enterprise value (1) Implied enterprise value from Noble balance sheet valuation FX Curve Market observable forward curve from Bloomberg (1) As at 3 August 2015 (2) Long-term plan provided by Behre Dolbear Australia ( BDA, a mining consulting firm) during its review of Yancoal operating assumptions in 2012, and have been further updated regularly, when relevant, based on our understanding of changes to the mine plans since the BDA s report was issued 105

108 Yancoal Valuation and Recognition The associate value of Yancoal has declined from a value of US$825 million upon closing in 2012 to US$306 million as at 30 June 2015 due to the losses incurred by Yancoal and impairments The valuation of Yancoal is reviewed by our auditors Yancoal Associate Carrying Value on the Group s Balance Sheet (US$MM) Yancoal Valuation High-Low Range and Recognition (US$MM) High Low Upon Closing Dec Mar Jun Dec Mar Jun 15 Valuation Range Valuation on Noble s Balance Sheet 106

109 Misconceptions about Noble Group: Capital Structure 107

110 Capital Structure Capital Structure Matches Asset Mix and Supports Business Growth Asset Liability Profile Excess liquidity available to execute business model: 31% 69% 47% 53% 20% 80% 38% 62% - Liquidity headroom (4) of US$2.9 billion, which is 55% of working capital and 85% of total debt less RMI - US$15.2 billion total available facilities, of which US$4.6 billion is committed Investment grade ratings BBB-/Baa3/BBB- - Many of our peers are not rated Pre-NAL Sale (2) ST Assets ST Liabilities Debt Maturity Profile (1) (US$BN) Post-NAL Sale (3) LT Assets LT Liabilities & Equity Dec Mar Jun 15 <12 months months months > 5 years 39% of Group debt maturing after one year as we conservatively manage our debt profile to reflect our asset-light balance sheet, particularly following the sale of the 51% stake in Noble Agri (1) Debt maturity not pro forma for 5 August 2015, redemption of US$735 million principal value of notes (US$755 million total payment including interest) (2) 31 December 2013 (3) 30 June 2015 (4) Readily available cash and unutilised committed facilities, as at 30 June

111 Capital Structure Funding Costs Reflect Our Flexible Financing Strategy and Longer-Term Maturities Noble has a variety of short- and long-term financing sources at its disposal and has structured its debt portfolio to finance increased working capital levels and future revenue streams Our cost of funding is higher when compared to our peers for several reasons, including: - Noble has a higher proportion of long-term debt (c. 40%), which carries a higher interest cost than short-term debt - The level of liquidity headroom that we have maintained is higher in relation to the size of the business compared to our peers Our traditional conservatism in our approach to balance sheet funding has served us well during the last six months as, and despite some almost inevitable changes in terms of supplier credit and the availability of LCs, we have continued to optimise balance sheet and delivered growth in our business 109

112 Credit Ratings INVESTORS SERVICE The affirmation of the ratings reflects the fact that Noble s business operations remain healthy, with 1H 2015 volume growth of 40% year-over-year. Noble s Baa3 issuer rating reflects its significant global operations across a variety of commodity products, as well as its extensive product and geographic diversity. Such results indicate the strength of its market position and franchise in an environment in which commodity prices have been under significant pressure. adjusted net debt to EBITDA, excluding adjustments for Noble Agri Ltd (unrated), was at about 3.5x for the 12 months to 30 June retained cash flow to net debt about 21.4%. We expect Noble to improve its financial leverage and maintain its strong liquidity position over the next 6 12 months as the effects of cost saving initiatives and rationalizing capital allocation toward businesses with higher returns bear fruit. We also anticipate that the company will control its debt levels by moderating its use of working capital and maintaining discipline around capital expenditure and shareholder return initiatives. the marked-to-market valuation review completed by PricewaterhouseCoopers is a positive step in providing more transparency and assurance on the reasonableness of Noble s fair value methodology and assumptions. Moody s acknowledges the accounting firm s opinion that Noble s valuation approach is consistent with International Financial Reporting Standards and that, in some ways, Noble has adopted an approach which is more sophisticated than that of many non-financial companies. We are confident that the outlook will revert to stable in the next 6 to 9 months 110

113 Misconceptions about Noble Group: Cash Flow & Liquidity 111

114 Cash Flow & Net Debt Post Noble Agri Sale Net Debt Movement for the Nine Months Ended 30 JunE 2015 (US$MM) 5,411 3,327 3,365 2, ,330 2, ,028 Adjusted net debt at 30 Sep 2014 Net debt at 30 Sep 2014 Proceeds from NAL disposal Operating profit before change in working capital (1) Increase in working capital Acquisition of Jamalco Other net investing activities Dividends & share repurchases Other net financing activities (2) Net foreign exchange differences Net debt at 30 Jun 2015 RMI Adjusted net debt Net debt decrease of US$1.1 billion following sale of 51% in Noble Agri. US$3.3 billion proceeds from disposition have been recycled and redeployed in our growing asset-light businesses Increase in working capital relates primarily to investments in our Oil Liquids, Gas & Power and Metals businesses 4Q 2014 investment in Jamalco bauxite mining and alumina refining joint venture. Other investments made to further enhance our distribution supply chain networks US$320 million returned to shareholders, including US$202 million special dividend, US$46 million 2014 interim dividend and US$72 million of share repurchases in 2Q (1) Excludes change in cash with futures brokers not immediately available for use and includes taxes paid and interest received (2) Excludes bank debt additions/repayments and redemption of senior notes and includes interest paid on financing activities and other

115 Industry Leading Liquidity Liquidity headroom plus RMI is at US$5.2 billion, more than enough to cover short-term debt maturities Highly liquid inventory, easily convertible to cash with more than 85% comprising LME metals and oil liquids as at 30 June 2015 The Group s liquidity headroom at US$2.9 billion as at 30 June 2015 continues to be robust compared to that of our peers Liquidity Headroom Readily Marketable Inventory 85% 83% 78% % 95% 55% 49% 91% 92% % 20% 28% 23% Noble Peer A Peer B H 2015 % of Working Capital % of Short-Term Debt % of Total Debt-RMI RMI (1) Agri RMI % of Inventory (1) (1) Excluding Agri 113

116 Cash Flow Significant Cash Flow Will be Generated From Our Existing Fair Value Portfolio Illustrative Discounted and Undiscounted Future Cash Flow Profile through Contract Maturity (1) Aggregate undiscounted mark-to-market value of US$10.8 billion, and discounted value of US$4.1 billion at 30 June 2015 Our mark-to-market portfolio generates cash flow and will continue to generate material cash flow over the life of the contracts Discounted Cash Flows Undiscounted This cash flow will be generated without requiring any material new investment from Noble Net Fair Value Gains at 30 June 2015 (US$MM) 10,800 5,680 1,600 4,080 Undiscounted & Unreserved Discounted & Unreserved Further Performance Contingency Reserves (2) Net Fair Value (Carrying Value) 114 (1) Illustrative profile of cumulative discounted cash flows and undiscounted cash flows for a portfolio of long-term contracts (2) This represents additional contingency beyond the discounting already applied to account for potential unforeseen operational challenges

117 Misconceptions about Noble Group: Inventory Sales 115

118 What is an Inventory Sale? The Group utilises a readily marketable inventory sales programme that is fully non-recourse to the Group The structure incorporates an option (not an obligation) for the Group to repurchase the inventory As at 30 June 2015, the Group s balance was US$1.1 billion. The average balance through the year is approximately US$1 billion with the highest having been US$1.5 billion and the lowest at US$800 million during the six months to 30 June 2015 The structure conforms to IFRS standards for true sale There is no profit associated with entering into an inventory sale transaction Key Terms and Considerations - Readily marketable liquid inventory - Inventory cannot be designated for onward sale to a customer - Inventory is exchange deliverable, stored in exchange approved warehouses and/or traded in liquid markets - Option to repurchase (not an obligation) - Both physical commodity contract and underlying hedge also sold to the counterparty Inventory Sale Balance (US$MM) 1, ,293 1, ,476 1,094 1,109 1,093 1Q 14 2Q 14 3Q 14 4Q 14 Jan 15 Feb 15 Mar 15 Apr 15 May 15 Jun

119 Misconceptions about Noble Group: Governance 117

120 Governance Corporate Governance Structure Benefits Our Stakeholders Noble Group is governed by policies and procedures designed to ensure that all stakeholders are treated with fairness and respect Our Board has established seven committees with at least four members, each charged with different responsibilities: - Each committee has at least four Board members - Each committee is chaired by an Independent Non-Executive Director We will continue to review our committee assignments and make changes whenever necessary to remain a best-in-class organisation Certain policies - such as composition of committees, public disclosure of executive remuneration, and term limits for Directors and rotation of auditors - will continue to be reviewed and will be potentially changed to the extent we believe such action is warranted Recent Governance Actions: Added one Non-Executive Director and two Independent Non-Executive Directors in 1H 2015 Created independent committee, which commissioned the PwC report Independent committee undertook separate review, including four Non-Executive Independent Noble Board members: - Paul Jeremy Brough, 25 years in accounting and management - Irene Yun Lien Lee, Executive Chairman of Hysan Development Company Limited - Richard Paul Margolis, 30 years as a diplomat, banker and businessman - Christopher Dale Pratt, Ex-Executive Chairman of Swire Pacific Limited Audit Committee chaired by former Partner of KPMG with over 50 years experience in accounting Risk Committee headed by former Chairman of HSBC with over 37 years of experience in the banking and finance sectors 118

121 Governance Noble s Board of Directors Our Directors have held various senior executive and board positions at industry-leading companies Five of our Directors have served on our Board for more than ten years, and their experience and expertise are invaluable Eight Directors have been appointed within the last four years, of which six are independent, bringing fresh perspectives to our business Name Position Year Joined Professional Experience Richard Samuel Elman Founder, Chairman and Executive Director 1994 Over 50 years in commodities Yusuf Alireza Chief Executive Officer and Executive Director years at GS Ex-Co-President of GS Asia, Member of GS Global Management Committee William James Randall Executive Director and President years in commodities Xubo (Patrick) Yu Non-Executive Director 2015 President of COFCO Robert Tze Leung Chan Independent Non-Executive Director years in banking Ambassador Burton Levin Independent Non-Executive Director Chairman, Corporate Social Responsibility & Government Relations Committee years in diplomatic services for the US in Asia Alan Howard Smith Independent Non-Executive Director Chairman, Remuneration & Options Committee years in legal and banking industries (Former Credit Suisse First Boston Vice Chairman) Iain Ferguson Bruce Independent Non-Executive Director Chairman, Audit Committee 2002 Over 50 years in accounting (Retired KPMG Partner) David Gordon Eldon Lead Independent Director Chairman, Corporate Governance / Risk / Investment & Capital Markets / Nominating Committees years in banking (Ex-Chairman of the Hongkong and Shanghai Banking Corporation) Irene Yun Lien Lee Independent Non-Executive Director 2012 Executive Chairman of Hysan Development Company Limited Richard Paul Margolis Independent Non-Executive Director years as diplomat, banker and businessman Christopher Dale Pratt Independent Non-Executive Director 2014 Ex-Executive Chairman of Swire Pacific Limited Paul Jeremy Brough Independent Non-Executive Director years in accounting and management David Yeow Independent Non-Executive Director 2015 Over 20 years in legal and banking industry 119

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124 Board Committees Audit Committee Iain Ferguson Bruce, Chairman Richard Samuel Elman Irene Yun Lien Lee Christopher Dale Pratt Paul Jeremy Brough David Yeow Investment & Capital Markets Committee David Gordon Eldon, Chairman Alan Howard Smith, Vice Chairman Yusuf Alireza Richard Samuel Elman Irene Yun Lien Lee Christopher Dale Pratt William James Randall Paul Jeremy Brough Corporate Social Responsibility & Government Relations Committee Ambassador Burton Levin, Chairman Yusuf Alireza Iain Ferguson Bruce Robert Tze Leung Chan Richard Paul Margolis Yu Xubo David Yeow Corporate Governance Committee David Gordon Eldon, Chairman Robert Tze Leung Chan, Vice Chairman Iain Ferguson Bruce Richard Paul Margolis Yu Xubo David Yeow Risk Committee David Gordon Eldon, Chairman Irene Yun Lien Lee Richard Paul Margolis Christopher Dale Pratt Alan Howard Smith Nominating Committee David Gordon Eldon, Chairman Ambassador Burton Levin, Vice Chairman Richard Samuel Elman Irene Yun Lien Lee Alan Howard Smith David Yeow Remuneration & Options Committee Alan Howard Smith, Chairman Robert Tze Leung Chan Richard Samuel Elman Christopher Dale Pratt 122

125 Executive Directors Richard Samuel Elman Chairman and Executive Director Mr. Elman is the founder and Chairman of the Company. He first arrived in Asia during the mid-1960s from England and has more than 50 years experience in the physical commodities industry. Prior to setting up the group in 1986, he spent 10 years with Phibro as Regional Director of their Asia operations, including two years in New York as a Board Director. Yusuf Alireza Chief Executive Officer and Executive Director Prior to joining Noble, Mr. Alireza was Co-President of Asia (ex Japan) for Goldman Sachs and a member of that firm s Global Management Committee. He joined Goldman in 1992 in New York, moved to London in 1997 where his last position was Head of EMEA sales and structuring efforts. In mid 2008 he moved to Hong Kong to lead Goldman s Asia Pacific securities division. Mr. Alireza also serves on the Global Board of Room to Read. Mr. Alireza has a joint undergraduate and graduate degree from Georgetown University s School of Foreign Service. William James Randall Executive Director and President Mr. Randall s career started with Noble Group in Australia in February 1997, transferring to Asia in 1999 where he established Noble s coal operations, mining and supply chain management businesses. He served as a Director of Noble Energy Inc before being appointed Global Head of Coal & Coke in 2006, and a member of the Noble Group internal management Board in He was appointed an Executive Director and Head of Hard Commodities in 2012, prior to which he was Head of Energy Coal & Carbon Complex. He holds a Bachelor degree in Business from the Australian Catholic University, majoring in international marketing and finance. 123

126 Non-Executive Director Xubo (Patrick) Yu Non-Executive Director Mr. Yu has been the President of COFCO Corporation ( COFCO ) since 2007, and he is also the Chairman & Non-Executive Director of China Agri-Industries Holdings Limited (stock code: 0606 HK), Chairman & Non-Executive Director of China Foods Limited (stock code: 0506 HK), Vice-Chairman and Non-Executive Director of China Mengniu Dairy Company Limited (stock code: 2319 HK), Chairman and Non-Executive Director of China Modern Dairy Holdings Ltd. (stock code:1117 HK). He joined COFCO s agri-commodity import and export department in 1988 and started COFCO s commodity futures business in 1992 after working in the Chicago-based joint venture between COFCO and the Continental Grain Company. He has been the General Manager and Chairman of COFCO Futures, Director of Dalian Commodity Exchange, Member of China Futures Association, Executive Member of China Grain Association, and Chief Director of China Animal & Plant Inspection & Quarantine Board. Mr. Yu obtained a degree of Executive Master of Business Administration from China Europe International Business School, and a Bachelor s degree in economics from University of International Business & Economics, China. 124

127 Independent Non-Executive Directors David Gordon Eldon Lead Independent Director Mr. Eldon retired as Chairman of The Hongkong and Shanghai Banking Corporation Limited, and as a main Board Director of HSBC Holdings plc, in 2005 after 37 years with the HSBC Group, all of which were spent in the Middle and Far East. He is currently Non-Executive Chairman of HSBC Bank Middle East Limited, of HSBC Bank Oman S.A.O.G., and Chair of HSBC s Global Commercial Banking Risk Committee. He was previously Non-Executive Chairman of the Dubai International Financial Centre Authority ( DIFCA ), and is presently a member of the DIFCA Higher Board. He is a Past Chairman of the Hong Kong General Chamber of Commerce. Mr. Eldon was a Consultant for the Korea National Competitiveness Council - Office of the President, as well as being a Founding Member and Past Chairman of the Seoul International Business Advisory Council. He is Chairman of the Advisory Board of Asiya Investments, a Middle East based investment house operating in Asia, and Adviser to Singapore-based Southern Capital Group and Hong Kong based New Lily International Ltd., as well sitting on the Advisory Board of Alexander Proudfoot. In addition he has a number of Government and community appointments in Hong Kong and overseas. Mr. Eldon is a Fellow of the Chartered Institute of Bankers, and was conferred an Honorary Doctor of Business Administration by the City University of Hong Kong in November He was named the DHL/SCMP Hong Kong Business Person of the Year for 2003, and in 2004 was awarded the Gold Bauhinia Star by the Government of the Hong Kong SAR. In 2005 he was made a Commander of the Order of the British Empire for his contribution to banking, and awarded Honorary Citizenship of Seoul in recognition of his work for the city. He was awarded the Asian Banker Lifetime Achievement Award in 2006, and received an Honorary Doctorate from the Hong Kong Academy for Performing Arts in Mr. Eldon is a Justice of the Peace. 125

128 Independent Non-Executive Directors (Cont d) Iain Ferguson Bruce Independent Non-Executive Director Mr. Bruce joined KPMG in Hong Kong in 1964 and was elected to its partnership in He was the Senior Partner of KPMG from 1991 until his retirement in 1996 and served as Chairman of KPMG Asia Pacific from 1993 to Since 1964, Mr. Bruce has been a member of the Institute of Chartered Accountants of Scotland, and is a fellow of the Hong Kong Institute of Certified Public Accountants, with over 50 years international experience in accounting and consulting. He is a fellow of the Hong Kong Institute of Directors and the Hong Kong Securities and Investment Institute. Mr. Bruce serves as an Independent Non-Executive Director on the Boards of several publicly listed companies in Hong Kong, namely Goodbaby International Holdings Limited, Louis XIII Holdings Limited (formerly known as Paul Y. Engineering Group Limited), Sands China Limited, Tencent Holdings Limited and Wing On Company International Limited. He is also an Independent Non-Executive Director of Yingli Green Energy Holding Company Limited, a company whose shares are traded on the New York Stock Exchange. He is an Independent Non-Executive Director of Citibank (Hong Kong) Limited and MSIG Insurance (Hong Kong) Limited, and is the Chairman of KCS Limited. Robert Tze Leung Chan Independent Non-Executive Director Mr. Chan is an experienced banker with 39 years of experience in both commercial and investment banking having worked in London, Malaysia and Singapore. He retired from United Overseas Bank at the end of 2011 after 35 years of service, 25 years of which he was the Chief Executive Officer of United Overseas Bank, Hong Kong. He is an Independent Non-Executive Director of Hutchison Port Holdings Management Pte Limited, Quam Limited and Sibanye Gold Limited. He is Chairman and Non-Executive Director of The Hour Glass (HK) Limited, and a Senior Adviser to Long March Capital Limited, a fund management company based in Beijing and Shanghai in partnership with leading Chinese institutions including the CITIC Group. He is also a Director of Dalton Foundation Limited. He holds degrees in Bachelor of Science (Econ) Hons. and Master of Business Administration, and is a Fellow of the Hong Kong Institute of Directors. 126

129 Independent Non-Executive Directors (Cont d) Irene Yun Lien Lee Independent Non-Executive Director Ms. Lee is the Executive Chairman of Hysan Development Company Limited, an Independent Non-Executive Director of Cathay Pacific Airways Limited, CLP Holdings Limited and Hang Seng Bank Limited (all listed on the Hong Kong Stock Exchange); and is an Independent Non-Executive Director of HSBC Holdings PLC and The Hongkong and Shanghai Banking Corporation Limited. She has held senior positions with a number of global financial institutions involved in investment banking and funds management over the past thirty years. She has been an Executive Director of Citicorp Investment Bank Limited in New York, London and Sydney; and Head of Corporate Finance at Commonwealth Bank of Australia and Chief Executive Officer of Sealcorp Holdings Limited, both based in Sydney. She also served as a member of the Australian Government Takeovers Panel and numerous listed and unlisted companies in Australia. Ms. Lee holds a Bachelor of Arts Degree from Smith College, United States of America, and is a Barrister-at-Law in England and Wales and a member of the Honourable Society of Gray s Inn, United Kingdom. Ambassador Burton Levin Independent Non-Executive Director Ambassador Levin has more than 38 years of experience in the diplomatic service for the United States of America in Asia. Ambassador Levin is an advisor to Sit Investment Associates and also the Chairman Emeritus of the Hopkins-Nanjing center. He holds a Bachelor of Arts degree from Brooklyn College and a Master of International Affairs degree from Columbia University, the United States of America. 127

130 Independent Non-Executive Directors (Cont d) Richard Paul Margolis Independent Non-Executive Director Mr. Margolis is a former diplomat, investment banker and businessman with more than 30 years experience in Greater China. He currently holds senior advisory roles with the Holdingham Group, Rothschild (Investment Bank) and Milestone Capital. Subsequent to his diplomatic service with the Foreign and Commonwealth Office in London, Beijing, Paris and Hong Kong, Mr. Margolis pursued a private sector career in Hong Kong. He was Managing Director, Corporate Finance at Smith New Court Far East, and Head of Strategy and Planning for Asia Pacific at Merrill Lynch. Mr. Margolis served on the boards of China Oilfield Services, Hsin Chong Construction (both listed on the Hong Kong Stock Exchange) and Bank of China International Investment Management Company; and was a member of the Hong Kong Stock Exchange Listing Committee and the Hong Kong Securities and Futures Commission Advisory Committee. From 2003 to 2011, he was the Regional Director, North East Asia for Rolls-Royce. Mr. Margolis was awarded the CBE (Commander of the Order of the British Empire) in 2011 for services to British business in China. Christopher Dale Pratt Independent Non-Executive Director Mr. Pratt was the Executive Chairman of Swire Pacific Ltd from February 2006 until his retirement in March He was also Chairman of Cathay Pacific Airways Limited, Hong Kong Aircraft Engineering Company Limited, John Swire & Sons (H.K.) Limited and Swire Properties Limited, and a Director of Swire Beverages Limited, Air China Limited and The Hongkong and Shanghai Banking Corporation Limited. He joined the Swire group in 1978 and has worked with the group in Hong Kong, Australia and Papua New Guinea. Mr. Pratt was awarded the CBE (Commander of the Order of the British Empire) in 2000 for Services to the Community in Papua New Guinea. Mr. Pratt is an Independent Non-Executive Director of Johnson Electric Holdings Limited, PureCircle Limited and the Grosvenor Group. 128

131 Independent Non-Executive Directors (Cont d) Alan Howard Smith Independent Non-Executive Director Mr. Smith was the Vice Chairman Pacific Region of Credit Suisse First Boston, Hong Kong ( CSFB ) from 1997 until he retired in Before joining CSFB, he was the Chairman from 1994 to 1996 and Managing Director from 1983 to 1994 of the Jardine Fleming Group, which he joined in He graduated with an LLB (Hons) degree from Bristol University in 1964, and was admitted as a Solicitor in England in 1967, and in Hong Kong in Mr. Smith is a Director of Genting Hong Kong Limited, Guangdong Land Holdings Limited (formerly known as Kingway Brewery Holdings Limited) and Wheelock and Company Limited. He was Asian Finance Banker of the Year and was twice elected to the Council of the Stock Exchange of Hong Kong. Paul Jeremy Brough Independent Non-Executive Director Mr. Brough is an Independent Non-Executive Director of GuocoLeisure Limited (listed on the Singapore Stock Exchange); and a Non-Executive Director of Habib Bank Zurich (Hong Kong) Limited, a Hong Kong restricted licence bank. He stepped down as the Chairman and CEO of Emerald Plantation Holdings Limited ( EPHL ) on 1 April 2015 and resigned from the EPHL Board on 15 April 2015; and was an Executive Director and Interim CEO of Greenheart Group Limited (listed on the Hong Kong Stock Exchange) until he was re-designated as a Non-Executive Director of the company effective 2 April Mr. Brough came to Hong Kong in 1983 to join KPMG, where he became a Partner in 1991, and later became the Senior Partner of Hong Kong. He retired from KPMG in Mr. Brough is an associate of the Institute of Chartered Accountants in England and Wales, the Hong Kong Institute of Certified Public Accountants and the Hong Kong Securities and Investment Institute. 129

132 Independent Non-Executive Directors (Cont d) David Yeow Independent Non-Executive Director Mr. Yeow is an Independent Non-Executive Director of Bund Center Investment Ltd (listed on the Singapore Stock Exchange) since February He is a Senior Partner and (since 1999) also an executive committee member of Rajah & Tann LLP. In the past two decades, Mr. Yeow was the primary external legal advisor to the Singapore International Monetary Exchange Limited including on its de-mutualisation into the Singapore Exchange Derivatives Trading Limited (SGX-DT); the primary external Legal Advisor to the Singapore Commodity Exchange Limited (SICOM) following on its privatization from the then Rubber Association of Singapore. He served as a Member of the Advisory Board, Singapore Mercantile Exchange Limited (SMX) and was its legal advisor in its sale to ICE; and was a member of the Monetary Authority of Singapore s Financial Centre Advisory Group Banking Sub-Committee. Mr. Yeow is on the mediation panel of the Association of Banks Singapore since 2003; and is a member of the Singapore International Arbitration Centre SGX-DT Panel of Arbitrators. Mr. Yeow graduated from the National University of Singapore with a Bachelor of Laws (Honours) degree. Mr. Yeow is an Advocate and Solicitor of the Supreme Court of Singapore. 130

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134 Management Committee Yusuf Alireza Chief Executive Officer and Executive Director Prior to joining Noble, Yusuf was Co-President of Asia (ex Japan) for Goldman Sachs and a member of that firm s Global Management Committee. He joined Goldman in 1992 in New York, moved to London in 1997 where his last position was Head of EMEA sales and structuring efforts. In mid 2008 he moved to Hong Kong to lead Goldman s Asia Pacific securities division. Yusuf also serves on the Global Board of Room to Read. Yusuf has a joint undergraduate and graduate degree from Georgetown University s School of Foreign Service. William Randall Executive Director and President Will s career started with Noble Group in Australia in February 1997, transferring to Asia in 1999 where he established Noble s coal operations, mining and supply chain management businesses. He served as a Director of Noble Energy Inc before being appointed Global Head of Coal & Coke in 2006, and a member of the Noble Group internal management Board in He was appointed an Executive Director and Head of Hard Commodities in 2012, prior to which he was Head of Energy Coal & Carbon Complex. He holds a Bachelor degree in Business from the Australian Catholic University, majoring in international marketing and finance. Bill Cronin Chief Operating Officer & Chief Risk Officer Bill brings to Noble more than 30 years of experience in the Commodity sector. He served on the Executive Committee of Phibro, New Power, and Direct Energy. Bill s final position with Direct Energy was as President of their wholesale business. 132

135 Management Committee (Cont d) Robert van der Zalm Group Chief Financial Officer Robert has over 25 years of finance management experience in consumer products, speciality chemicals, agricultural, downstream oil and gas, as well as the metals sectors. Prior to joining Noble, he was CFO of BHP Billiton s Global Aluminium business. He joined Noble in January Jim Wood Head of Global Retail Energy and President of Noble Americas Energy Solutions Jim joined Noble Americas by way of Noble s acquisition of Sempra Energy Solutions in 2010 and brings with him 25 years of energy experience. He started at Sempra as Vice President of commodity sales in 2002 and was responsible for implementing Sempra Energy Solutions growth strategy prior to becoming President in Over the past nine years, Jim has led NES s tremendous growth and developed it as one of the largest and most respected energy providers in the USA. Jeff Frase Global Head of Oil Liquids Trading Jeff brings over 23 years of commodity trading expertise to Noble, principally in Oil. He joins us from JP Morgan in New York where he was Managing Director and Global Head of Oil Trading. Prior to JP Morgan, he spent a year at Lehman Brothers and Goldman Sachs where he was a Managing Director and Global Head of Crude Oil and Derivatives Trading. 133

136 Management Committee (Cont d) Gareth Griffiths Global Head of Gas & Power. Head of Energy Coal Trading, Europe and North America Gareth brings over 20 years of trading expertise gained in Europe and North America to the role. He joined us from E.ON Energy Trading in Dusseldorf, Germany, where he was Chief Commercial Officer, Global Merchant Trading and Origination. Neil Dhar Head of Carbon Steel Materials Neil has over 25 years of softs and energy commodities experience in mining, processing and trading. He started his career as a commodities trader at a US investment bank, followed by head of trading at European Utility. He then spent five years as the Chief Commercial Officer of coal at a global mining company before joining Noble in Neil holds a Bachelor degree in Agricultural Science from Melbourne University, Australia, and a Masters degree in Science from the London Business School, UK. Mark Towson Group Head of Human Resources Mark brings to Noble 30 years of international HR experience and expertise gained in the Energy, Banking, Chemicals and Pharmaceuticals sectors. He joined in June 2013 from Weatherford International where he was Senior Vice President and Chief Human Resources Officer. He previously held senior HR roles with BP and Citigroup in the USA, Europe and Asia Pacific. 134