Quantafuel

Investor Presentation • Feb 28, 2023

Q4 2022 presentation

QUANTAFUEL ASA

28 February 2023

DISCLAIMER - IMPORTANT NOTICE

THIS DOCUMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM THE UNITED STATES OF AMERICA, ITS TERRITORIES OR POSSESSIONS, AUSTRALIA, CANADA, JAPAN OR SOUTH AFRICA OR TO ANY RESIDENT THEREOF, OR ANY JURISDICTION WHERE SUCH DISTRIBUTION IS UNLAWFUL. THIS DOCUMENT IS NOT AN OFFER OR AN INVITATION TO BUY OR SELL SECURITIES.

This presentation (the "Company Presentation") has been prepared by Quantafuel ASA, reg. no. 915 119 484 (the "Company", and together with its consolidated subsidiaries, the "Group").

This Company Presentation has been prepared for information purposes only, and does not constitute or form part of, and should not be construed as, any offer, invitation or recommendation to purchase, sell or subscribe for any securities in any jurisdiction, and neither the issue of the information nor anything contained herein shall form the basis of or be relied upon in connection with, or act as an inducement to enter into, any investment activity. This Company Presentation does not purport to contain all of the information that may be required to evaluate any investment in the Company or any of its securities and should not be relied upon to form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. This presentation is intended to present background information on the Company, its business and the industry in which it operates and is not intended to provide complete disclosure upon which an investment decision could be made.

This Company Presentation is furnished by the Company, and it is expressly noted that no representation or warranty, express or implied, as to the accuracy or completeness of any information included herein is given by the Company. The contents of this Company Presentation are not to be construed as financial, legal, business, investment, tax or other professional advice. Each recipient should consult with its own professional advisors for any such matter and advice. Generally, any investment in the Company should be considered as a high-risk investment.

This Company Presentation is current as of the date of presentation. Neither the delivery of this Company Presentation nor any further discussions of the Company with any of the recipients shall, under any circumstances, create any implication that there has been no change in the affairs of the Company since such date. This Company Presentation may contain forward-looking statements relating to the business, financial performance and results of the Company and/or the industry in which it operates. Forward-looking statements concern future circumstances and results and other statements that are not historical facts, sometimes identified by the words "believes", "expects", "predicts", "intends", "projects", "plans", "estimates", "aims", "foresees", "anticipates", "targets", and similar expressions. Any forward-looking statements contained in this Company Presentation, including assumptions, opinions and views of the Company or cited from third party sources, are solely opinions and forecasts which are subject to risks, uncertainties and other factors that may cause actual events to differ materially from any anticipated development. The Company provides no assurance that the assumptions underlying such forward-looking statements are free from errors and does not accept any responsibility for the future accuracy of the opinions expressed in this Company Presentation or the actual occurrence of the forecasted developments.

The distribution of this Company Presentation by the Company in certain jurisdictions is restricted by law. Accordingly, this Company Presentation may not be distributed or published in any jurisdiction except under circumstances that will result in compliance with any applicable laws and regulations. This Company Presentation does not constitute an offer of, or an invitation to purchase, any securities.

IN RELATION TO THE UNITED STATES AND U.S. PERSONS, THIS PRESENTATION IS BEING FURNISHED ONLY TO INVESTORS THAT ARE "QIBs", AS DEFINED IN RULE 144A UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "U.S. SECURITIES ACT"). THE SHARES HAVE NOT BEEN, AND WILL NOT BE, REGISTERED UNDER U.S. SECURITIES ACT OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER JURISDICTION IN THE UNITED STATES, AND MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES, OR TO OR FOR THE ACCOUNT OR BENEFIT OF A U.S. PERSON, EXCEPT PURSUANT TO AN APPLICABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT AND IN COMPLIANCE WITH ANY APPLICABLE STATE SECURITIES LAWS.

This Company Presentation is subject to Norwegian law, and any dispute arising in respect of this Company Presentation is subject to the exclusive jurisdiction of Norwegian courts with Oslo District Court as first venue.

STRATEGY AND GROWTH

PLANT & PROJECT UPDATE

FINANCIALS

• Financing solution needed by mid-Q2 estimated equity requirement at USD 70 million for operations and communicated projects
• Delayed positive cash flow from operations
• Skive volumes increase continuously with four operational lines. Cash positive operations still not achieved, but we see improvements month on month
• MK II FEED for Dubai plant close to completion. CapEx has increased, but plant economics still provides attractive returns.
• Planning permission granted for plant in Sunderland
• ReSource Denmark on track commissioning in Q4-23 and start-up Q1-24

STRATEGY AND GROWTH

PLANT & PROJECT UPDATE

FINANCIALS

QUANTAFUEL MK II PROCESS

Way forward

• Dubai Quantafuel's first MK II plant with 80 kta capacity
• CapEx estimate has increased (USD 200 250 million), but plant economics still provides attractive returns
• Final Investment Decision (FID) expected in Q2
• End result will be a plant defining a new standard within plastic recycling
• Future MK II plants expected to reduce Capex levels from modularized approach and optimizing of engineering, sourcing and construction

SUNDERLAND PROJECT PROCEEDING AS PLANNED

Quantafuel continues to receive strong support

• Planning permission granted 6th February 2023
• Capacity to process 100 kta of low value waste plastics in a sorting step preceding the MK II PtL plant
• Construction expected to get underway later this year
• Start of operation in 2025
• Capital light business model
• Ownership of ~20% through developer's fee and sweat equity from IP and competence
• Progressing well with additional sites in the UK

PROJECT PIPELINE

Significant upside from acting now – clear first mover advantage for Quantafuel

STRATEGY AND GROWTH

PLANT & PROJECT UPDATE

FINANCIALS

• In January, the volume of plastic processed increased by 32% from December
• Four operational lines in Skive with volumes increasing continuously
• Focus to run three lines in parallell with fourth on stand-by
• Not yet achieved positive cash flow for a full month, but seeing progress month on month
• Optimising energy use and cost of operation by heating all four lines by self-produced gas (NCG) during normal operations

KRISTIANSUND

Maintaining attractive offtake prices and ramping up feedstock

• Limitation in suitable feedstock still restricts full utilisation of the plant
• Establishment of Polynate together with enhanced co-operation with local stakeholders instrumental in resolving the limitation
• Favourable offtake agreements despite softening demand for mechanically recycled plastic throughout Europe

ESBJERG – RESOURCE DENMARK

Becoming a market leader in an attractive part of the value chain

• A game-changer for the post-consumer plastic waste market in Denmark and a key advantage for the co-located large-scale PtL plant
• Construction is well under way
• Commissioning late 2023
• CapEx estimate increased approximately 10%
• Secured a two-year feedstock agreement of 20,000 tonnes annually

STRATEGY AND GROWTH

PLANT & PROJECT UPDATE

FINANCIALS

FINANCIAL OUTLOOK

• NOK 122 (192) million in cash per 31 December 2022
• New guiding for an 80,000 tonnes MK II plant
• CAPEX USD 200-250 million (USD 100-150 million)
• Annual normalized EBITDA maintained around USD 50 million
• The equity need to realise the remaining parts of the Esbjerg project, the Dubai project and the upcoming pipeline of projects is estimated at approx. USD 70 million
• Impairment of NOK 52 million on the investment in Geminor Invest
• Successful financing solution must be in place by mid-Q2 to fund current operations and future plants

STRATEGY AND GROWTH

PLANT & PROJECT UPDATE

FINANCIALS

CONCLUSION OF THE STRATEGIC REVIEW

• Following the announcement of the strategic review on 12 October 2022, Quantafuel's Management and Board of Directors have, together with its financial advisor ABG Sundal Collier, diligently conducted a broad process targeting potential strategic and/or financial partners to secure a long-term financing solution for Quantafuel to the benefit of the Company, its Shareholders and Employees
• Quantafuel is currently in a challenging financial situation, with a large short-term liquidity shortfall and will need to secure financing before mid Q2 2023 to continue its operations
• The understanding of the board is that the Company's largest shareholders, including KIRKBI and BASF, will not participate in an equity raise or debt financing
• Quantafuel currently sees no other viable or realistic long-term financing solutions as an alternative to the offer received
• Subject to the outcome of the offer, the Offeror is committed to secure the Company's shortterm financing need as well as invest in the Company to realise ongoing projects and the roll out of the next generation of MK II plants

THE OFFER

• Quantafuel has entered into a transaction agreement for a unanimously recommended cash offer for all issued and outstanding shares in Quantafuel
• The shareholders of Quantafuel will receive a cash offer of NOK 6.38 per share
• The Company's two largest shareholders, KIRKBI and BASF, representing 20.6% of the shares, and both with a representative in Quantafuel's board, as well as all members of Quantafuel's Board of Directors and the Executive Management, have signed irrevocable pre-acceptances of the offer
• An offer document setting out the terms of the Offer will be made available to the shareholders by Viridor prior to start of the offer period, and is expected within a few days

• Viridor will also offer Quantafuel a Loan Facility to secure that the Group has sufficient financing during the offer period

• Viridor Limited («Viridor») is a leading UK-based waste management company

• Playing a key part in the UK's transition towards a circular economy, Viridor operates the largest fleet of Energy-from-Waste (EfW) facilities in the UK and the largest multi-line polymers reprocessing plant in the UK
• Viridor has been controlled by funds managed by KKR since 2020

QUESTIONS & ANSWERS

www.quantafuel.com IR@quantafuel.com