Galp Energia

Earnings Release • Oct 26, 2015

October 26, 2015

RESULTS THIRD QUARTER 2015

An integrated energy player focused on exploration and production

RCA figures except otherwise noted.

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• Ebitda reached €411 m in Q3, benefitting from Galp Energia's integrated model
• Q3 working interest production increased to 45.7 kboepd with start-up of FPSO Cidade de Itaguaí and high productivity of Lula/Iracema
• Production has now surpassed the 50 kboepd mark
• Appraisal activities underway in Carcará and Potiguar, in Brazil

EXECUTION UPDATE

FINANCIAL OVERVIEW

CONCLUDING REMARKS

APPENDIX

Refining margins vs Brent price

(\$/bbl)

• Crude oversupply pushed oil price down during Q3
• Refining margins at a record level supported by US gasoline demand and lower crude prices

Iberian Market Growth

• Iberian oil market growing for 2 years in a row
• Iberian natural gas market grew 6.4% YoY

Working Interest Production

(150 kbopd)

• Producing c.130 kbopd with four producer wells
• 5 th producer to be connected during 4Q15

FPSO started operations in October 2014 and should reach plateau during 4Q15, ahead of plan

LULA/IRACEMA: FPSO #4 WITH TWO PRODUCER WELLS CONNECTED

(150 kbopd)

Production started in July 2015, one quarter ahead of schedule through one producer well

Second producer well connected in October, with unit producing c.60 kbopd

LULA/IRACEMA: FPSO #5 AND #6 ON TRACK

• Topsides integration performed by BRASA/SBM at Mauá shipyard, in Brazil

• Expected to be deployed in Lula Alto during 1H16

• Construction and integration works completed in Chengxi Shipyard (CXG) and it is expected to arrive in Mauá shipyard in 4Q15

• Expected to be deployed in Lula Central during 1H16

EXECUTING APPRAISAL ACTIVITIES IN BRAZIL

• Carcará NW results confirmed the discovery of light oil and the extension of the Carcará discovery

• DST preliminary activities in Carcará North started in September

• Pitú North appraisal well results to confirm extension of discovery

• Drilling activities to be concluded until year end

DEVELOPING UPSTREAM PORTFOLIO IN AFRICA

• Platform turnaround and tie-back of Lianzi field to BBLT CPT

• Lianzi expected to start production during 4Q15

• Focus on the EPCIC proposals and LNG long term offtake agreements negotiations for Coral FLNG project

• Progressing with Mamba onshore development solution

IMPROVED DOWNSTREAM & GAS PERFORMANCE

Solid marketing performance

• Trading activity supported by structured contracts and network operations
• NG infrastructure and power businesses with stable contribution to earnings

EXECUTION UPDATE

FINANCIAL OVERVIEW

CONCLUDING REMARKS

APPENDIX

Profit & Loss RCA (€ m)

	3Q14	2Q15	3Q15	QoQ	YoY	9M15	YoY
Turnover	4,693	4,253	3,906	(8%)	(17%)	12,082	(10%)
Ebitda	379	446	411	(8%)	9 %	1,255	37%
E&P	131	120	8 9	(26%)	(32%)	304	(11%)
R&M	144	224	245	9 %	70%	635	n.m.
G&P	9 9	9 2	7 2	(22%)	(27%)	295	(13%)
Ebit	243	303	263	(13%)	8 %	816	58%
Associates	1 1	1 7	1 7	0 %	55%	6 0	36%
Financial results	(36)	(10)	(11)	(14%)	69%	(94)	0 %
Taxes	(76)	(108)	(69)	36%	9 %	(247)	37%
Non-controlling interests	(21)	(15)	(20)	(37%)	5 %	(46)	(10%)
Net Income	121	189	180	(4%)	49%	490	n.m.
Net Income (IFRS)	(8)	100	2 7	(73%)	n.m	117	74%

Operating results benefited from improved European refining margins and marketing performance

Upstream Ebitda impacted by lower oil prices despite growing production

Net income increased to €180 m, following stronger operating performance

Capital Expenditure (€ m)

E&P accounted for 87% of Group capex, of which development activities accounted for 88%

Downstream and gas capex mainly to maintenance, safety activities and Africa expansion

Balance Sheet (€ m)¹

	Sep.2015	Jun.2015	Dec.2014	Sep-Jun	Sep-Dec
Fixed and LT assets	7,638	7,778	7,599	(140)	3 9
Work in progress	2,016	2,093	1,768	(77)	248
Working capital	577	852	968	(275)	(392)
Loan to Sinopec	781	835	890	(55)	(109)
Other assets (liabilities)	(536)	(591)	(512)	5 5	(24)
Capital employed	8,459	8,874	8,945	(415)	(486)
Net debt2	2,387	2,330	2,520	5 7	(133)
Equity	6,072	6,545	6,425	(473)	(352)
Net Debt + Equity	8,459	8,874	8,945	(415)	(486)

Working capital positively impacted by lower inventories

Net debt of €1.6 bn considering loan to Sinopec as cash and equivalents, with implicit net debt to Ebitda of 1.1x 3

1 IFRS figures ²Not considering loan to Sinopec as cash and equivalents ³Ratio considers net debt including loan to Sinopec as cash equivalent, plus €168 m Sinopec Shareholder Loan to Petrogal Brasil as debt, and LTM Ebitda RCA €1,661 m

THIRD QUARTER 2015 RESULTS

EXECUTION UPDATE

FINANCIAL OVERVIEW

CONCLUDING REMARKS

APPENDIX

• Focus on Lula/Iracema project execution:
• FPSO #1 and #2 at plateau
• FPSO #3 and #4 in production ramp-up
• FPSO #5 and #6 to be deployed in 1H16
• Production of Lula/Iracema above expectations led to surpass the 50 kboepd milestone
• Improved R&M results supported by higher refining margins and marketing performance
• Maintaining robust financial position, with improved cash flow generation

EXECUTION UPDATE

FINANCIAL OVERVIEW

CONCLUDING REMARKS

APPENDIX

Main E&P data

		3Q14	2Q15	3Q15	QoQ	YoY	9M15	YoY
Working interest production	kboepd	31.8	43.8	45.7	4 %	44%	43.7	53%
Oil production	kbopd	29.7	40.5	42.2	4 %	42%	40.4	49%
Net entitlement production	kboepd	28.2	40.9	43.9	7 %	56%	41.2	65%
Angola	kbopd	6.9	7.4	6.1	(17%)	(11%)	7.1	2 %
Brazil	kboepd	21.3	33.5	37.8	13%	77%	34.1	90%
Realised sale price	USD/boe	93.2	53.0	43.8	(17%)	(53%)	49.0	(50%)
Production cost	USD/boe	11.8	7.6	9.5	26%	(19%)	9.6	(33%)
DD&A	USD/boe	21.2	18.7	15.4	(18%)	(27%)	16.8	(25%)
Ebitda	€ m	131	120	89	(26%)	(32%)	304	(11%)
Ebit	€ m	90	57	33	(42%)	(64%)	133	(42%)
CAPEX	€ m	285	285	223	(22%)	(22%)	782	14%

Higher production in Brazil due to FPSO #4 earlier start-up and ramp-up of FPSO #3

Angola NE production decreased 0.8 kbopd YoY mainly due to Lianzi tie-in and turnaround at BBLT platform

Ebitda decreased 32% YoY due to lower Brent price despite increase in production

Main R&M data

		3Q14	2Q15	3Q15	QoQ	YoY	9M15	YoY
Galp Energia refining margin	USD/boe	4.7	7.3	6.7	(8%)	43%	6.6	n.m.
Refining cash cost 1	USD/boe	2.3	2.6	2.9	12%	23%	2.6	(2%)
Raw materials processed	kboe	25,368	29,800	29,814	0 %	18%	85,809	31%
Total refined product sales	mton	4.5	4.7	4.8	2 %	9 %	14.0	14%
Sales to direct clients	mton	2.4	2.3	2.4	3 %	(1%)	6.9	2 %
Ebitda	€ m	144	224	245	9 %	70%	635	n.m.
Ebit	€ m	72	161	173	7 %	n.m.	422	n.m.
CAPEX	€ m	22	21	24	15%	9 %	50	(26%)

Premium to benchmark of \$0.6/boe impacted by lower arbitrage opportunities between the US and Europe and fewer sourcing optimisation opportunities

Stable sales to direct clients YoY

Ebitda increase of €101 m YoY due to better refining margins and strong marketing contribution

1 Includes impact from refining margin hedging operations Note: Unit refining margin, premium to benchmark and cash costs based on total raw materials processed

Main G&P data

		3Q14	2Q15	3Q15	QoQ	YoY	9M15	YoY
NG supply total sales volumes	3 mm	1,682	1,869	1,909	2 %	14%	5,973	7 %
Sales to direct clients	3 mm	966	919	933	2 %	(3%)	2,851	2 %
Trading	3 mm	716	951	976	3 %	36%	3,122	12%
Ebitda	€ m	99	92	72	(22%)	(27%)	295	(13%)
Ebit	€ m	78	76	54	(29%)	(31%)	242	(13%)
CAPEX	€ m	5	5	8	48%	59%	17	(23%)

Volumes sold increased YoY due to higher trading and electrical volumes

Higher trading volumes YoY supported by increased LNG cargoes sold and stronger network trading

Ebitda down YoY impacted by fewer arbitrage opportunities in the LNG market and lower prices

Investor Relations team

Pedro Dias, Head Otelo Ruivo, IRO Cátia Lopes Joana Pereira João Pereira Pedro Pinto

+351 21 724 08 66 Investor.relations@galpenergia.com Results & presentation weblink :

www.galpenergia.com/en/investidor/Relatorios-eresultados/resultados-trimestrais

For further information on Galp Energia, please go to: www.galpenergia.com