Galp Energia

Investor Presentation • Feb 13, 2023

4Q22 & FY22 Results & Outlook 2023-25

13 February 2023

1 4Q22 & FY22 Results and 2023 Outlook

4Q22 & FY22 Results

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2022 key performance indicators

Strong operating performance…

127 kboepd Upstream WI production

11.6 \$/boe Refining margin Gas consumption priced at market (PVB)

1.9 TWh (+50% YoY)

Renewable power generation (gross)

400 k TJ (+7% YoY)

Total energy sales to direct clients

… whilst maintaining responsible practices…

1.2 (-2% YoY) LTIF Lost time injuries per million hours worked Comparison vs 2017, reference year. All earnings figures are Replacement Cost Adjusted. FY22 €3.8bn

- 20 % (+7% YoY) Operating emissions reduction (scope 1 & 2)

- 4 % (0% YoY) Carbon intensity Downstream sales approach

- 14 % (-2% YoY) Carbon intensity Production approach

… and delivering robust results

€2.8bn OCF

€1.27 bn Net capex

€1.7 bn FCF

Ebitda

€1.6bn Net debt

0.4x Net debt to Ebitda

€0.52/sh

Cash dividend Final €0.26/sh payment after 2023 AGM

€500 ^m

Buybacks To be executed during 2023

Strategic execution during 2022

showcasing strong delivery

Sépia & Berbigão FPSOs reaching plateau production

Progressing on Bacalhau with start of drilling programme

Coral FLNG first gas on time & budget

Profitably growing renewable capacity

Securing full ownership of Titan solar enabling operating and strategic flexibility

Progressing on battery value chain with engineering works ongoing

Upstream Renewables & NB Industrial & Midstream Commercial

Top quartile refining performance

Progressing with green H2 and HVO projects

Expanding gas trading footprint in Brazil & enhancing access to U.S. LNG sources

Convenience contribution showcasing ongoing transformation

Continuing to expand leadership position in EV charging points

Galp Solar leading decentralized energy growth in Iberia

FY2022: Strong free cash flow

leading to a solid financial position

FY22 Cash flow (€ m) OCF of €2.8 bn and CFFO of €3.1 bn supported by WC release from maturing gas derivatives margin accounts

Net capex of €1.27 bn, considering €140 m Titan Solar stake acquisition and USD:EUR appreciation

FCF of €1.7 bn covering 2x dividends to minorities & shareholders and buybacks

Net debt down €0.8 bn already considering Titan's acquisition and its net debt consolidation, dividends and buybacks

€951 ^m Group Ebitda

€701 ^m Group OCF

€342 m

Group net capex

4Q22: Robust operating results

driven by a strong upstream contribution

	Ebitda	OCF	Net capex
Upstream Strong contribution benefiting from higher production and less in-transit cargoes	791 € m	529 € m	174 € m
Renewables Seasonal lower QoQ radiation and solar prices despite higher installed capacity	17 € m	19 € m	47 € m
Industrial & Midstream Strong performance supported by refining contribution despite gas sourcing restrictions	118 € m	116 € m	29 € m
Commercial Solid contribution despite high price environment impacting demand and adjustments from previous quarters	42 € m	56 € m	66 € m

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Distinctive investment proposition

combining leading growth and grey-to-green transition

Focused Upstream Growth

c.30 % WI production growth by 2023-261

c.10kgCO2e/boe Carbon intensity

Focusing on selective low cost & low carbon intensity assets

Renewables Growth and Integration

c.4 GW Gross renewables capacity by 2025

>9 % Renewables targeted eIRR

Developing a competitive platform to support integration across the energy value chain

Industrial and Commercial Transformation

c.60 % Capex to low carbon

2023-25

>40 %

Low carbon contribution to OCF by 2025

Decarbonisation projects and new energy solutions to drive transition & sustain long term value

Transition to lower carbon

and high grading portfolio

Rapidly increasing low carbon contribution…

…with financing structure to reflect portfolio evolution

Low carbon leverage profile allowing ample financing options to support portfolio development

Note: Illustrative. Assumes macro projections, which may change. 1 Includes HVO, green H2, EV charging, convenience and other low carbon solutions.

Investing to reshape portfolio

maintaining financial discipline & focus on returns

Net capex 2023-25

keeping net capex at

c.€1 bn p.a.¹

supported by divestments

Targeted project IRR²

20 % Upstream

^≥12 % Industrial low carbon projects

10-20 % Commercial

>9 % Renewables (equity)

>10 % New Businesses

Embedding opportunities to crystallise and de-risk value…

… supporting portfolio high grading and low carbon integration

1/3 of OCF for dividends and buybacks

Renewables & NB Industrial & Midstream Commercial Low carbon projects

1 Implicit average per annum during the 2023-25 period. 2 Average IRRs for new developments post-FID.

Competitive portfolio in place

to capture supportive environment

2023-25 Sources & Uses

(€ bn)

2023 guidance

c.€3.2 bn Ebitda

c.€2.2 bn OCF

Brent \$85/bbl | Ref. margin \$9/boe | PVB €60/MWh | Iberian solar price €120/MWh | EUR:USD 1.15

Upstream (adjusted for Angola divestment1 )

Ebitda >€2 bn and OCF >€1.1 bn

Renewables & New Businesses

Ebitda >€180 m reflecting expected lower price environment

Industrial & Midstream

Ebitda and OCF >€550 m, from supportive refining context and gas trading inflection leading Midstream Ebitda to >€250 m

Commercial

Ebitda c.€300 m, maintaining stable contribution whilst increasing convenience & low carbon contribution

Note: For macro assumptions, refer to slide 20 in the Appendix.

¹ Following the Angolan Upstream agreement, assets are registered as 'held for sale'.

Business overview

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Upstream growth and value extraction

from low cost & low carbon intensity portfolio

Angola divestment

Total post-tax cash proceeds of \$830 m

Divestment of upstream assets in Angola (Blocks 14/14k & 32)

Capturing value from mature legacy assets under favourable macro

2022 WI production of 12 kbpd with c.14 kbpd expected in 2023 followed by natural decline

1P reserves of 13 mbbl and 2P of 21 mbbl by YE22

Mid-term outlook

c.3 \$/boe

2023-25

Production costs

Maintaining industry leading production growth

c.60 %

2023-25

Growth capex

c.10kgCO2e/boe Carbon intensity

2023-25

WI production to remain flat at >110 kboepd over 2023-24 until Bacalhau start up

Bacalhau to start in 2025 with plateau in 2026 (c.40 kbpd)

Brazil average decline rates <5% p.a. and potential for optimisations

Targeting Namibia high potential exploration well in 4Q23/1Q24 & maturing exploration portfolio in São Tomé

Competitive renewables position

Ensuring access to green power

Mid-term outlook

Project execution and portfolio growth key to ensure successful capacity build up

Operating capacity (at year-end)

c.9 GW Pipeline 2022 year end

60-70 % Target Project debt

>9 % Targeted eIRR across portfolio

200 MW additional capacity deployed during 2023 and accelerating development & construction

Targeting faster technology diversification and generation mix

Merchant exposure in Iberia & predominantly PPA based outside

Hybridisation, energy management and partnerships as value levers to increase returns

Transforming Industrial asset base

key to deliver decarbonisation path

2023 outlook

Cyclical refining maintenance to enhance system reliability and safety

c.75 mboe Refining throughput

c.\$9/boe Refining margin

\$3-4/boe Refining cash costs reflecting maintenance Progressing to sanction key projects, supported on integrated profile

Renewable biofuel production (HVO project)

270 ktpa HVO capacity (advanced biodiesel / SAF) FID in 2023

Partnership

ensuring global feedstock & risk management

&

Green hydrogen integration

100 MW Electrolyser project FID

in 2023

Up to 700 MW

Electrolysers throughout the decade targeting grey-to-green conversion

Midstream to benefit from gas trading activities

with new flexibility to manage portfolio

2023 outlook

Gas trading with no relevant hedges & pre-sold volumes in place…

c.50 TWh

Trading gas volumes 2023

… and supported by additional gas trading levers

c.15 TWh p.a. U.S. long term contract Henry Hub linked1 start in 2H23

4 TWh p.a.

Brazil gas trading volumes in 2023 (non-upstream)

+15 % Trading gas volumes increase 2023-25

Increasing Ebitda contribution (€ m)

Reshaping Commercial business

to maintain a strong position in Iberia

Short-term outlook

Transforming business to leverage convenience & low carbon

c.7.4 mton (flat YoY)

Oil volumes sold 2023

Expanding leadership position in EV charging

>5 k EV charging points by YE23 (2.4 k by YE22)

>25k

>10 k EV charging points by 2025

+10 %

Convenience Ebitda in 2023

>€120 ^m

Accelerating decentralised energy growth

&

Convenience + low carbon Ebitda by 2025

Total installations by YE2023 (vs 11 k by YE22)

>300 MW

Decentralised energy installed capacity by 2025

Appendix

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Appendix Index

1 | Macro assumptions & sensitivities

• 2 | Key guidance
• 3 | P&L and balance sheet
• 4 | Debt indicators
• 5 | Renewables portfolios
• 6 | Carbon-related targets
• 7 | Upstream Reserves and Resources

Macro assumptions

and sensitivities

Macro assumptions	2023	2023-25
Brent price	\$85/bbl	\$80/bbl
Galp refining margin	\$9/boe	\$6 – 7/boe
Iberian PVB natural gas price	€60/MWh	€60/MWh
Solar captured price	€120/MWh	€100/MWh
EUR:USD	1.15	1.15

2023 sensitivities (€ m)	Change	Ebitda	OCF
Brent price	\$5/bbl	150	85
Galp refining margin	\$1/boe	65	65
EUR:USD	0.05	120	80
Solar captured price	€10/MWh	30	25

Key Guidance for 2023

Operating indicators

Upstream
WI production	kboepd	>110
Production costs	\$/boe	c.3
Renewables
Renewable capacity by YE	GW	1.6
Industrial & Energy Management
Sines refining throughput	mboe	c.75
Sines refining costs1	\$/boe	3-4
Commercial
Oil products sales to direct clients	mton	7.4
Convenience Ebitda growth YoY (from €70 m)	%	+10
EV charging points by YE	-	>5 k
Decentralised energy installations by YE	-	>25 k

Financial indicators

RCA Ebitda	€ bn	3.2
Upstream	€ bn	>2
Renewables & NB	€ m	>180
Industrial & Midstream	€ m	>550
Commercial	€ m	c.300
OCF	€ bn	2.2
Upstream	€ bn	>1.1
Renewables & NB	€ m	>160
Industrial & Midstream	€ m	>550
Commercial	€ m	c.230
Net capex (avg. 2023-25)	€ bn	c.1

2022 results

4Q21	3Q22	4Q22		FY2021	FY2022
644	784	951	RCA Ebitda	2,322	3,849
593	612	791	Upstream	2,020	3,083
2	38	17	Renewables & New Businesses	-13	50
5	48	118	Industrial & Energy Management	64	451
59	103	42	Commercial	288	298
415	408	475	RCA Ebit	1,372	2,345
27	25	54	Associates	96	166
-50	89	134	Financial results	-138	-154
-212	-315	-313	Taxes	-729	-1,254
-50	-20	-76	Non-controlling interests	-143	-223
130	187	273	RCA Net Income	457	881

P&L (€ m) Balance Sheet (€ m)

	31 Dec 2021	30 Sep 2022	31 Dec 2022
Net fixed assets	6,667	7,780	6,876
Rights of use (IFRS 16)	1,079	1,119	1,116
Working capital	1,879	2,333	1,632
Other assets/liabilities	-2,119	-2,627	-2,089
1 Assets held for sale			413
Capital employed	7,506	8,605	7,948
Net debt	2,357	2,096	1,555
Leases (IFRS 16)	1,179	1,248	1,277
Equity	3,970	5,262	5,117
Equity, net debt and op. leases	7,506	8,606	7,948

Debt indicators

	31 Dec 2021	30 Sep 2022	31 Dec 2022
Cash and cash equivalents	1,942	2,413	2,432
Undrawn credit facilities	816	837	1,484
Gross debt	4,300	4,509	3,987
Net debt	2,357	2,096	1,555
Leases (IFRS 16)	1,179	1,248	1,277
Net debt to RCA Ebitda	1.1 x	0.6 x	0.4 x

Debt Indicators (€m) Debt reimbursement (€m)

Carbon-related targets

Metrics and methodology

Metric	Methodology	2017 (reference year)	2022	2030 (vs 2017)	2050
Absolute Emissions' reduction from operations	Equity emissions related to Galp's operations (scopes 1 & 2)	c.4.1 mtonCO2e (S 1 & 2)	c.3.3 mtonCO2e (S 1 & 2)	-40%
Carbon Intensity
Production-based approach	Emissions from operations (scopes 1 & 2) + emissions from use of Upstream products (oil & gas; scope 3)	93 gCO2e/MJ	80.1 gCO2e/MJ	-40%	Net Zero Ambition
	Energy produced by Galp (Upstream oil & gas, power generation)1
Downstream sales based approach	Emissions from operations (scopes 1 & 2) + lifecycle emissions from products sold by Galp (oil products, gas & power; scope 3) Energy of all products sold by Galp	76 gCO2e/MJ	73.5 gCO2e/MJ	-20%

24 4Q22 & FY22 Results and 2023 Outlook

Upstream Reserves and Resources

mboe	2021	2022 (exc. Angola)	Change
Reserves
1P	410	367	-10%
Oil	333	295	-11%
Gas	77	72	-7%
2P	712	668	-6%
Oil	612	572	-7%
Gas	100	96	-4%
3P	950	891	-6%
Oil	849	795	-6%
Gas	101	97	-4%
Contingent resources
1C	417	525	26%
2C	1,521	1,653	9%
3C	3,179	3,349	5%
Prospective resources
Unrisked	4,512	4,545	1%
Risked	803	914	14%

Note: All figures are based on DeGolyer and MacNaughton report as of 31.12.2022. Reserves figures on a net entitlement basis. Contingent resources on a working interest basis. 2022 values already excluding all reserves and resources related to Angolan assets held for sale (@31 December 2022: 1P 13 mbbl, 2P 21 mmbl, 3P 34 mbbl, 1C 20 mbbl, 2C 67 mbbl, 3C 136 mmbbl).

Disclaimer

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