RENEWABLE RAW MATERIAL

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1 RENEWABLE RAW MATERIAL Nomacorc has partnered with our bio LDPE supplier, Braskem, to answer many commonly asked questions about the materials in our sugar-cane-derived Select Bio wine closure. RENEWABLE RAW MATERIAL How many tons of Braskem s I'm green PE are produced per hectare of sugarcane? How much of Brazil's arable land is required for production? To produce 200,000 tons of Brakem s I m green PE, corresponding to the volume of total production capacity, it takes appropriately 65,000 hectares of sugarcane, which represents approximately 0.02% of the total arable land of Brazil. This calculation is done considering the average productivity of sugarcane plantations and mills of ethanol production in Brazil. In one hectare, approximately 82.5 tons of sugarcane is produced, which can produce 7,200 liters of ethanol. With this volume of ethanol, Braskem produces 3 tons of green ethylene, generating about 3 tons of Braskem s I m green PE. How are areas for sugarcane cultivation selected? Where is it currently grown? About 90%* of the sugarcane plantation used in Brazilian ethanol production is concentrated in the South-Central region of Brazil, mainly in the states of São Paulo, Goiás, Minas Gerais, Mato Grosso do Sul, Paraná and Mato Grosso. The remaining 10% of sugarcane is mainly concentrated in the Northeast region of Brazil. The South Central region is located more than 2,500 km away from the Amazon region. The expansion of areas used to plant sugarcane is governed by Sugarcane Agroecological Zoning, approved in September 2009, and excludes among other areas, the Amazon and Pantanal biomes. It's important to note that Braskem does not own any sugarcane plantations. The ethanol used to make I'm green Polyethylene is purchased from different suppliers that are selected accordingly with the Code of Conduct for Ethanol Suppliers, which takes into account aspects related to compliance with Brazilian Law and respect for biodiversity. *Source: Sugarcane Industry Association (UNICA): What is the Sugarcane Agroecological Zoning (ZAE Cana)? The Sugarcane Agroecological Zoning is a study of the climate and soils of Brazil's various regions that innovated by taking into account the environmental, economic and social aspects in order to coordinate the sustainable expansion of sugarcane cultivation and of investments in the sector. The set of restrictions related to the environment, economy, society, weather risks and soil conditions conducted by ZAE Cana limit the expansion of sugarcane cultivation to 7.5% of Brazil's landmass (65.7 million hectares). The proposal submitted by ZAE Cana was approved on September 17, Is the use of pesticides and fungicides a regular practice on sugarcane plantations? The main diseases that threaten the plants are treated using biological controls and genetic improvement programs. This way, the use of pesticides on sugarcane plantations in Brazil is low and the use of fungicides is practically nonexistent. What is sugarcane bagasse? Bagasse is a co-product of sugar and ethanol production. Rich in cellulose, bagasse is used to fuel boilers and generate energy to replace the use of gas or other non-renewable energy source. This energy fuels the plant itself that becomes self-sufficient in energy, and when there is surplus, it is sent to the local power grid and sold to supply cities.

2 Why are burning practices held in the sugarcane cultivation? When is the deadline for this to end? The burning of sugarcane, which is performed before manual harvesting, aims to make the activity of cutting sugarcane safer by burning its straw. However, the practice of burning causes serious impacts on public health and on the environment. Eliminating the burning of sugarcane is necessary to implement a system of mechanized harvesting. The deadline for the end of the burning is provided in Brazilian law. Additionally, in 2007 the Protocolo Agroindustrial do Estado de São Paulo (Agroindustrial Protocol of the State of São Paulo) was voluntarily launched, which set more restrictive targets than the law. The mills signing this protocol commit to the anticipation of the deadlines to quit burning in legislation. In mechanized areas, the term is from 2014 to 2021, while in areas considered non-mechanized by current technology the deadline is 2017 to In 2009, over 95% of all ethanol produced in the state of São Paulo, the largest Brazilian producer state, was produced in mills that signed the Protocol. Is green plastic made using genetically modified sugarcane Genetically modified sugarcane is not sold in Brazil. The CTNBio is a multidisciplinary group formed to support Brazil's federal government in formulating, reviewing and implementing national policies related to safety issues involving genetically modified organisms (GMOs). In its website ( it is possible to research which types of GMOs are approved for commercial cultivation in Brazil, which are currently restricted to cotton, corn and soybean only. All of the ethanol consumed to make Brakem s I'm green PE is cultivated in Brazil. Does the growing consumption of sugarcane ethanol for I'm green Polyethylene production have any impact on food production? Today Brazil has 330 million* hectares of arable land, of which 52% is used for raising cattle, 26% remains idle and 22% is used for agriculture. Only 1.4%* of all arable land in Brazil is dedicated to ethanol production, and the consumption of ethanol for the production of Braskem s I'm green PE represents about 1.7% of the total production of ethanol, or 0.02% of Brazil's arable land. The existence of available land, combined with a possible intensification of livestock production, makes Brazil a country with room for expansion of agriculture. The use of land for the production of products other than food, even in a very optimistic scenario for the growth of the production of chemicals from renewable sources, should continue representing a small percentage of the total land available. Specifically in relation to the management of land for the sugarcane production, in the state of São Paulo, where 60%* of the country's sugarcane is planted, legumes are used to fix nitrogen in the soil during crop rotation. Hence 15% to 20% of sugarcane producing areas are dedicated to the cultivation of soybean, beans and peanuts, supplying the food market. For more details go to the website of the Sugarcane Industry Association (UNICA) at *Sources: IBGE, Conab and UNICA. Data compiled by ICONE and Unica. Does sugarcane cultivation use rainwater or artificial irrigation methods? Sugarcane in Brazil is practically not irrigated. Water needs, in the agricultural phase, are resolved naturally by the rainfall of the producing regions, mainly the Center-South of Brazil, and is complemented by the application of vinasse, a co-product of ethanol production that is rich in water and organic nutrients, in a process called fertigation.

3 Is sugarcane cultivated in a socially responsible manner? Sugarcane cultivation is conducted in accordance with Brazilian law and the rules and labor conditions established by the International Labor Organization (ILO) that should be followed by all employers, which are subject to regular inspections by the government. Braskem has a Code of Conduct for Ethanol Suppliers that is part of the "National Commitment to Social Assistance" program, which ascribes new rights to workers and ensures them a better quality of life. What is Braskem's Code of Conduct for Ethanol Suppliers? In order to reiterate its commitment to the principles of sustainable development and manage its relationship with the Chain of Ethanol, Braskem developed the Code of Conduct for Ethanol Suppliers. Its basic principle is continuous improvement and respect for the laws of Brazil inspired by best practices outlined in the Environmental Protocol of the State of São Paulo, the Global Pact and the National Commitment to Improve Working Conditions in Sugarcane. To become a supplier of Braskem, an ethanol producer should observe the commitment to good business practices defined in this document regarding cane burning, respect for biodiversity, environmental practices, human rights and labor and availability of info to the life cycle analysis of the product. Braskem conducts audits at supplier plants to ensure compliance with the practices described in the Code of Conduct for Ethanol Suppliers. Brazilian Agro-ecological zoning policy Brazil s Agro-ecological zoning (AEZ) policy published in 2009 clearly identifies the types of land that can be legally converted to sugarcane plantations, and mapped the permissible areas. The policy excludes expansion in: Amazonia and Pantanal biomes The hydrographical basin of the Paraguay River Areas with any type of native vegetation Areas without favorable soil and climate conditions Areas that require full irrigation Protected areas Indigenous reserves Areas with a high conservation value for biodiversity In order to be authorized for sugarcane production, a new area has necessarily to be originate either from direct conversion of pastureland (degraded, natural and cultivated) or else from another previous crop (soybean, cotton, maize).

4 Code of conduct: The code is based on 5 pillars: 1)Reduction of cane burning - Reduction of GHG emissions and soil preservation, 2)Conserving biodiversity Protection of Pantanal and upper Paraguay basin biomes, 3)Human & Labor Rights Prohibition of forced and/or child labor, respect internationally recognized human rights, 4)Good Environmental Practices Reduce air pollution, preservation of soil, protection of water resources, less use of agrochemicals, improvement of SHE practices and 5)Life Cycle Analysis (LCA) provide the necessary information to conduct a LCA. It has been developed in partnership with UK based company called Proforest, an internationally recognized company specialized in sustainable natural resource management systems. This makes the Code a very robust and credible document, to which 100% of our suppliers have committed. A third party audit program is in place to guarantee compliance. Sugar cane harvesting Signed in 2007, the agreement anticipated legal deadlines for the elimination of the practice of burning, from 2021 to 2014 in the areas where it is possible to mechanized harvesting and 2031 to 2017 in areas where there is no adequate technology for mechanization, with maximum slope of 12% ground. This is a voluntary agreement, which had a membership of more than 170 agro-industrial units and 29 associations of sugarcane producers, which together account for over 90% of São Paulo production. In addition to the requirements of the end of burnings, factors such as the increase in labor cost and agricultural production costs contributed to encourage mechanical harvesting of sugarcane. In 2005 mechanized harvesting in the center-south region of the country accounted for 34% to 42% in 2007 and 89% in 2013, as shown in Figure 4. Thus, the harvester fleet in 2007/08 was 1.28 thousand harvesters, almost tripled to 3.4 thousand in the harvest 2013/2014. Mechanized Harvesting Hand Harvesting

5 Renewable Energy Sugarcane bagasse, a waste product from the crushing process, is often used to generate electric power to supply the entire ethanol production process, which makes it energy self-sufficient, while any surplus power is sent to the grid, adding clean energy to Brazil's energy matrix. Efficient use of resources and closed-loop in the re-use of the residues on the process, which is confirmed by the LCA study where Braskem s I m Green PE absorbs 2,15 kg/co2eq after deducting all the emission in the whole process. During the sugarcane production, there are some residues of the process, but all of them are recycled within the process such as: o Vinnasse and filter cake re-used as fertilizers/irrigation in the fields of sugarcane. o Bagasse is used to produce energy (that fulfills the needs of the sugar mills and also share energy with the energy matrix) Irrigation of sugarcane fields is mainly due to the rain. Inside Braskem s processes, we have water waste treatment that assures de decontamination and conditioning of our efluents, which returns to the process to be re-used.

6 Use of degrade pasture land: The Brazilian Age ecological zoning policy launched in 2009, defines as suitable for sugarcane expansion areas with proper conditions for mechanical harvesting, degraded pasture land and regions with lower need for artificial irrigation. When replacing degraded pasture land, sugarcane helps recover the soil and consequently increase its carbon content.

7 Land use for the production of Braskem s I m Green PE The Brazilian government has established a Zoning Program that determines the areas suitable for sugarcane expansion in order to ensure that food production will not be compromised. Moreover, Brazil has around 330MM hectars or arable land and only 8MM are used for sugarcane (2,4%). 111MM hectares are still available for cultivation (33%). Besides that, due to market conditions, 50% of the sugarcane available is used for ethanol production and the other 50 % is necessarily used for sugar production (considered food). The use of land for Green PE is around 68M hectares (0,02% of the available arable land in Brazil).

8 Distance to rainforest: Almost 90% of sugarcane cultivation and harvesting in Brazil is concentrated in the county s Center-South region, which is located more than 2,000 km (1,200 miles) from the Amazon Region. The other 10% are located in the Brazilian north-east. The soil and climate in the Amazon Region is not suitable for sugarcane. Sources: União da Indústria de Cana-de-açúcar (UNICA), Braskem LCA Study (from cradle to gate) Organização de Plantadores de Cana da Região Centro-Sul do Brasil (ORPLANA), Centro Nacional das Indústrias do Setor Sucroenergético e Biocombustíveis (CEISE-BR), Markestrat Centro de Pesquisa e Projetos em Marketing e Estratégia.