JSC "Latvijas Gāze" Webinar

Riga, 26 August 2021

1. GAS MARKET 2. JSC "LATVIJAS GĀZE" GROUP RESULTS 2.1. Distribution segment results 2.2. Sales and trading segment results

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AGENDA

GAS MARKET

Global gas market BUST AND BOOM CYCLE

Cold and prolonged winter in Europe
Harsh weather in Asia
Unplanned supply constraints US LNG exports impacted by polar blast
Natural gas inventories in Europe
commenced the summer season below fiveyear average level
Post pandemic gas demand continues to outstrip supply

Global gas market

EUROPEAN STORAGE LEVELS REMAIN BELOW THREE YEARS LEVEL

— LNG deliveries to Europe fell during first half of injection season as Asia provides better netback for LNG

sales compared to Europe
In 2021 European gas traders have less incentive to inject gas as winter-summer spread diminished
to end gas production at the field

— Groningen gas field production in Netherlands continue to decline in line with Dutch government plan

ALTHOUGH WINTER PRICE 2021/2022 IS STILL SUBJECT MAINLY TO:

Weather
Monetary policy tightening
If such high price can be passed to consumer on long term basis

Pushed winter price forwards 2021/2022 above 40 EUR/MWh during Q3

Regional gas market

Bigger regional market comes with bigger competition — Gas sales margins are depressed amid severe competition and continuously rising gas price
Gas prices for market clients will be higher despite smaller trader's margin

In the medium term gas sales industry will be consolidated around big trading companies with strong balance sheet

JSC "Latvijas Gāze" GROUP RESULTS

Group`s key financial figures

— Net profit is negatively impacted by marked-to-market loss of derivatives that are related to future periods

Higher sales price
Higher sales volumes
Higher utilization of distribution network

¹ Gross profit= Revenue from contracts with customers - Raw materials and consumables used ² JSC "Latvijas Gāze" measures derivatives at fair value and doesn't implement hedge accounting

2.1.

DISTRIBUTION SEGMENT RESULTS

Distribution segment key financial figures

Distribution segment is regulated by the Public Utilities Commission
Harsh and prolonged winter increased utilization of distribution network
Continued to develop a safe and available natural gas distribution infrastructure, with major investments made in construction and reconstruction of gas pipelines