2018 CORPOR ATE BROCHURE

Transcription

1 ENGLISH 2018 CORPOR ATE BROCHURE TRAFIGURA GROUP PTE. LTD.

2 Financial and business highlights* $136.4bn Group revenue $48.6bn Total assets $51.0bn Financial lines available to Trafigura 256.0mmt Oil and Petroleum Products total volume traded ** 15.3mmt Metals total volume traded 54.6mmt Minerals total volume traded 3,051 Wet shipping and chartering fixtures per year 1,100 Dry shipping and chartering fixtures per year 3,935 Average number of employees over the year * Financial year: 1 October 2016 to 30 September All figures in USD. ** Million metric tonnes. Printed by Pureprint on Vision Superior which is FSC certified. Pureprint is certified to ISO environmental management system, is registered to EMAS the Eco Management Audit Scheme, is a Carbon Neutral Company and has been awarded the Queen s Award for Enterprise: Sustainable Development. Designed and produced by Group Charlescannon Sàrl. Photography by Group Charlescannon Sàrl, Marcus Almeida, Hyundai Samho Heavy Industries, Nyrstar, Terrafame, Essar Trafigura Group Pte. Ltd. and the companies in which it directly or indirectly owns investments in are separate and distinct entities. In this publication, the collective expressions Trafigura, Trafigura Group, the Company and the Group may be used for convenience where reference is made in general to those companies. Likewise, the words we, us, our and ourselves are used in some places to refer to the companies of the Trafigura Group in general. These expressions are also used where no useful purpose is served by identifying any particular company or companies. Cover image: Corpus Christi storage and export terminal, Texas, US.

3 Overview How we add value Global trade brings the world closer together. It expands the wealth of nations, forges common interests and builds mutual trust. Trafigura makes trade happen. And we make it our mission to do that responsibly. We deploy infrastructure, skills and our global network to move physical commodities from places they are plentiful to where they are most needed. We have been connecting our customers to the global economy for a quarter of a century. We grow prosperity by advancing trade. Find out more Contents Overview 04 At a glance 06 Service and performance 08 Oil and Petroleum Products 10 Metals and Minerals How we add value 12 How we add value 14 Global reach and scale 16 Logistics and infrastructure 18 End-to-end service 20 Financial strength and expertise 22 Responsibility 24 Industrial assets and investments 26 Strategic alliances 3

4 Overview How we add value Trafigura at a glance Trafigura s core business is physical trading and logistics; our assets and investments complement and enhance these activities offices countries North America 6 Offices 230 Employees Trading activities Oil and Petroleum Products In a fragmented market where no single company has a dominant position, we are one of the world s largest traders by volume of oil and petroleum products. Trafigura is one of the few oil and petroleum product traders with global presence and comprehensive coverage of all major markets. Total volume traded 256.0mmt Metals and Minerals We are one of the world s largest metals and minerals traders. We negotiate offtake and supply agreements with miners and smelters and invest in logistics through our subsidiary, Impala Terminals, to improve market access for our clients. Total volume traded 69.9mmt Shipping and Chartering Our Shipping and Chartering desk is closely integrated into Trafigura s business model, providing freight services to commodity trading teams internally and trading freight externally in the professional market. Operations are based in regional offices in Athens, Geneva, Houston, Montevideo and Singapore. All post-fixture operations are managed from our Athens office. 4 Wet and dry fixtures 4,151 Latin America , ,878 2, Offices 1,893 Employees

5 Global presence and key subsidiaries Impala Terminals Trafigura Mining Group Galena Asset Management Impala Terminals is a multimodal logistics provider focused on export-driven emerging markets. It owns and operates ports, port terminals, warehouses and transport assets. It has particular expertise in providing efficient logistic solutions in challenging environments and hard-to-reach locations. Trafigura Mining Group manages mining operations, develops projects, conducts technical audits of existing and potential partner projects; and provides advisory and support services to Trafigura s trading desks, trading counterparties and Galena Asset Management. Galena Asset Management provides investors with specialised alternative investment solutions through its investments in real assets and private equity funds. It operates independently, but benefits from the Group s insights into the global supply and demand of commodities. Europe 11 Offices 578 Employees Middle East Asia & Australia 2 12 Offices Offices Employees Employees Africa 6 Offices 291 Employees 5

6 Overview How we add value Our vision is of an increasingly interconnected and prosperous world where physical commodities pass seamlessly from their points of origin to points of need. 6 Exporting Brazilian iron ore. Porto Sudeste terminal, Brazil

7 Service and performance We are adding value to the global trade in natural resources with exceptional service and performance across the supply chain. Trafigura is an independent, employee-owned physical trading and logistics business. We focus on creating long-term value for our customers by prioritising their interests. We ensure we have the resources and the agility to accommodate fluid customer requirements in fast-changing markets. In an increasingly competitive marketplace, our ability to respond swiftly to shifting patterns of demand is a key differentiator. We use our global presence, market knowledge and logistics capabilities to make trade flow better. We do that by balancing supply and demand, optimising supply chains and servicing the needs of our customers around the world. We invest in industrial assets that streamline and simplify physical delivery. Our Shipping and Chartering Division and multimodal logistics subsidiary, Impala Terminals, supports our physical trading with freight services and world-class infrastructure. What we do Our integrated physical trading and logistics operation delivers outstanding service and performance across the product spectrum. We use our market knowledge, logistics and infrastructure to connect the producers, processors and end-users of physical commodities. We source, store, blend and deliver commodities according to precise customer specifications. We manage diverse risks and complex operational issues. Transformations in space, time and form Space We move physical commodities from places they are abundant to where they are in demand. Time We store physical commodities while supply is unusually high and release inventories at times of high demand. Form We blend physical commodities to match quality or grade to customer specifications. Source Store Blend Deliver We negotiate offtake agreements with oil producers, refiners, mining companies and smelters. We own mines and invest in logistics that improve market access for our suppliers. We store petroleum products at owned and third-party tankage. We store metals and minerals at Impala Terminals and third-partyowned facilities. We blend physical commodities to regional, market and customer specifications in strategically located terminals and warehouses around the world. We operate efficient, safe and high-quality logistics. We move commodities by barge, truck, rail, pipeline and vessel in support of our core trading activities and for third parties. 7

8 Overview How we add value Crude oil Oil and Petroleum Products Trafigura is one of the world s largest independent traders of oil and petroleum products and one of very few with genuine global presence and comprehensive product coverage. Our expertise is matched by extensive logistical and storage capabilities around the world. The crude desk s strong technical capabilities and in-depth resources give us the agility to respond to changing market dynamics and non-standard crude oil opportunities. We have access to long-term supplies of tradable oil streams and control tankage at strategic locations. We provide distribution solutions for many different producers and assist refineries with tailored shipments and specialist financing mmt Our trading teams in Beijing, Calgary, Geneva, Houston, Montevideo, Moscow and Singapore are complemented by offices in Johannesburg, Mexico City and Mumbai mmt Oil and Petroleum Products total volume traded 5.2m+ Barrels of oil and petroleum products traded per day Condensates Trafigura is a leading international condensates trader bringing a wide variety of grades to market in all parts of the world. We are developing new uses for condensates with a diverse customer base that includes refineries, splitters and petrochemical facilities. 1.6mmt 8 Shipping US crude oil worldwide. Corpus Christi storage and export facility, Texas, US.

9 Gasoline Fuel oil Middle distillates Naphtha The gasoline desk manages one of the world s largest seaborne gasoline books. We have an active market presence in components and extensive, strategically located tankage. Our global storage footprint, strategic relationships with downstream operators and carefully managed global distribution system are key strengths. The fuel oil trading desk combines global presence, market knowledge and efficient logistics to connect producers and end-users. Our team has built a significant and sustainable feedstock business and close ties with end-users in the bunker market. We serve our customers needs by blending and shipping between our global network of leased and owned storage facilities. Trafigura manages one of the largest middle distillates books across its global network. We trade the full range of distillates, from low to high sulphur. Our middle distillates trading operation covers jet fuel, diesel and gas oil. We use our global storage network to blend products to local specifications. Our team can adapt quickly to constantly changing specifications across the world to maximise flexibility to all of our customers. Trafigura is a leading naphtha trader; one of the few with a US export facility. We source, store and blend all the most actively demanded products and grades, supporting trade flows to the Far East, South America, Africa and Europe. 27.8mmt 44.3mmt 40.4mmt 16.9mmt LPG LNG Natural gas Biodiesel Trafigura is a leading trader in the rapidly changing LPG market. Our global presence and strong logistical system supports our trading activities. With control of our own storage and chartering facilities, we can tailor cargo specifications to suit a wide range of customers, from petrochemical consumers and blenders to autogas and bottled gas consumers. In this rapidly growing energy market, Trafigura remains the world s largest independent LNG trader. In addition to our spot business we have firm long-term offtake from the US and elsewhere, allowing us to offer unparalleled security of supply. Our LNG infrastructure business supports customers with strategically deployable assets that offer low cost, flexibility and modularity. Our recently formed natural gas desk, focused on the US and Europe, has grown significantly to meet increasing demand as natural gas continues to expand its share in the power generation mix. The biodiesel desk is fully integrated within our global distillates team. It works globally to promote biodiesel as a sustainable alternative and adjunct to fossil fuel-based diesel. 4.1mmt 8.1mmt 7.9mmt 0.6mmt 9

10 Overview How we add value Metals and Minerals As one of the world s largest metals and minerals traders, Trafigura is building global connectivity between miners, smelters and refined metal fabricators. We offer financial assistance through offtake agreements, structured finance and tolling models and develop downstream outlets that underpin volume growth. Our global trading desks operate from Geneva, Montevideo, Singapore and Stamford and are supported by offices in Johannesburg, Lima, Mexico City, Mumbai, Santiago and Shanghai. 69.9mmt Total volume of metals and minerals traded 10 Storing refined metals. Impala Terminals facility, Dubai.

11 Concentrates Refined metals Iron ore Coal Trafigura is the market leader in copper, zinc, lead and nickel concentrates trading as well as alumina and cobalt hydroxide. We create a more coherent supply chain for our customers using geographical and quality arbitrages. Carefully selected investments in infrastructure are furthering volume growth. We work to develop long-term relationships and to guarantee a consistent, high quality service. Trafigura is the market leader for the majority of the refined metals we trade. We trade copper cathodes, copper blister and copper wire rods, aluminium, lead, zinc, nickel and precious metals. We trade the whole spectrum of iron ore products and grades. With origination teams in all the main exporting countries, we use our extensive international network to connect specific buyers with particular grades of stock. We source cost competitive supplies through our close relationships with the major producers and provide support for smaller mining concerns. Our sales teams in China have strong contacts with steel mills and local trading houses. We are one of just two truly global operators in thermal coal. Despite a challenging regulatory environment, with many major economies acting to reduce their reliance on coal, we remain committed to this market. We continue to secure volume growth and increased market share. Our focus is on innovative origination strategies, trading flows and delivery methods. We source coking coal for global steel producers and are growing our presence in coke and petcoke. 7.9mmt 7.4mmt 8.1mmt 46.4mmt Copper concentrates Zinc concentrates Lead concentrates Nickel Cobalt Alumina Refined copper Refined zinc Refined lead Aluminium Nickel Precious metals 11

12 Overview How we add value How we add value We add value by connecting counterparties, building capacity and developing physical commodity markets reliably, efficiently and responsibly. In the pages that follow, we present some of the ways our strategic approach and global resources are advancing trade: Global reach and scale 14 Logistics and infrastructure 16 End-to-end service 18 Financial strength and expertise 20 Responsibility 22 Industrial assets and investments 24 Strategic alliances 26 12

13 Connecting counterparties Trafigura is advancing trade by forging strong bonds with commodity producers, processors and end-users. As a globally active physical trading house, we source, store, blend and deliver commodities worldwide. We source raw commodities, such as crude oil, natural gas, metal concentrates and iron ore, from producers at mines, oil and gas wells. The demand for these comes mainly from processors refineries, smelters and liquefaction plants. We deliver shipments according to their specific requirements. We sell processed commodities such as refined metals, alloys, petroleum products and LNG to end-users. These can include state agencies, manufacturers, utilities, power plants, energy retailers and construction companies. PRODUCERS PROCESSORS END-USERS GLOBAL TRADE TRAFIGURA ADDS VALUE By transforming commodities Space Time Form By reducing costs Global network Market knowledge Low financing cost Operational efficiency Economies of scale Infrastructure investment Supply chain optimisation By managing risks Hedged financial risks Political and liability risk insurance Integrated systems and processes Regulatory compliance Governance and responsibility...reliably Reliability is fundamental. Our trading counterparties are often of strategic importance in their respective economies. Any disruption can have far-reaching consequences. We pride ourselves on always delivering at the right place and time and at the specified quality (space, time and form). Ensuring that customers receive their commodities at the agreed specification when and where they require them demands intense operational activity. We have made substantial investments in infrastructure, storage, transportation and logistics to facilitate this across the globe....efficiently Physical commodities trading is a high-volume, low-margin business. Intense competition and market transparency puts the emphasis on service and operational efficiency. As a leading global trading house Trafigura enjoys significant economies of scale and has access to low-cost funding from international lenders. It creates and supplements local infrastructure and develops multimodal logistics that streamline and simplify supply chains....responsibly Our business spans the globe and we manage a complex array of operational and financial risks. We have learnt to operate effectively in a wide range of political and cultural environments. Integrated systems and processes allow us to apply consistent standards across the Group. Trafigura s culture is founded on a service ethos. Individually, our people are expected to act with a high degree of personal integrity. As a Group, we strive both to meet and to develop international best practice. Our focus is on activities that generate long-term value. 13

14 Overview How we add value Global reach and scale We forge robust connections between suppliers and end-users through our global network, efficient logistics and unparalleled market understanding. Our activities put us at the heart of the global economy we work with governments, state-owned companies and leading multinationals. We conclude over 4,000 shipping fixtures and trade more than 320 million metric tonnes annually. Our global network supports our trading activities. Trafigura operates in 36 countries on six continents. Each of our offices has access to the knowledge, resources and support of the Trafigura Group. We continually invest in systems and processes that equip us to operate effectively in complex markets. We have developed world-leading logistics capabilities that allow us to source, store, blend and deliver commodities reliably and efficiently anywhere in the world mmt Combined volume of commodities traded 4,151 Shipping and chartering fixtures in Trafigura chartered vessel delivering LPG on Panama canal.

15 Impala Terminals state-of-the-art covered mining export facility, Callao, Peru. Porto Sudeste terminal, Brazil. Shipping US crude worldwide Trafigura s minority interest and exclusive commercial rights at Buckeye Texas Partners (BTP), Corpus Christi terminal on the Texas Gulf Coast position us as a key player in the burgeoning US crude export market. The terminal has approximately 7 million barrels of storage capacity for liquid petroleum products, including a refrigerated and compressed LPG storage complex, pipeline connectivity for receiving crude oil and condensate production from the Permian and Eagle Ford shale plays, five vessel berths, including three deep-water berths capable of accommodating most Suezmax class tankers, and three condensate splitters with a combined capacity of 100,000 barrels per day. It also includes one of the largest refrigerated LPG storage facilities in the US. We have negotiated long-term agreements with major pipeline companies to transport crude and condensate from Eagle Ford, one of the most prolific and economically advantageous shale plays in the US. Our global network allows us to place barrels from US customers with counterparties around the world from as near as the Caribbean and Latin America to as far afield as China. 7.3m bbls Storage capacity for oil and petroleum products 15

16 Overview How we add value Logistics and infrastructure We create and develop active trade routes. Where infrastructure does not exist, we build it. If it is already there, we invest to improve it. We have built a global business in pursuit of one basic task making trade flow better. We approach that single mindedly, bringing all our energy and resources to bear. Our strategically located infrastructure gets our customers closer to global markets. We invest in ports, terminals and logistics to enhance our physical trading activities. We build warehouses and storage facilities, operate truck and barge fleets, purchase and charter ships, and develop mines putting in place top-class systems to enhance trade flows. 16 Impala Terminal s export facility at Huelva, Spain.

17 Creating multimodal logistics in Colombia Impala Terminals USD1 billion investment in Colombia has transformed the Magdalena River into a multimodal logistics corridor, with over 102 double-hulled, dry and wet cargo barges to transport oil and other liquid bulk products, containers, coal and other commodities to and from the main Colombian ports on the Caribbean Sea. A purpose-built 500,000m 2 river port at Barrancabermeja, with over 720,000 barrels of storage capacity for crude oil and naphtha is a consolidation hub, connecting river, and road cargoes. 102 Double-hulled cargo barges 720,000bbls Oil storage capacity for crude and naphta Impala Terminals barge operations on the Magdalena River, Barrancabermeja, Colombia. Increasing its state-of-theart, fuel efficient fleet In 2017 Trafigura handled over 4,100 wet and dry fixtures. It is building on its substantial chartered wet and dry freight fleet by adding new-build crude oil and product tankers. At the end of 2018, Trafigura s Wet Freight Shipping book will start to take delivery of 32 new tankers which are currently being constructed in both South Korea and China on a bareboat charter basis. These will supplement our current portfolio of leased tankers and will enable us to continue to extract full value of the cargo infrastructure. Hyundai Samho shipyard, South Korea, where a number of vessels are under construction. 32 New tankers 17

18 Overview How we add value End-to-end service We configure our business around customers needs. Our services add value at every stage of the chain. Trafigura is privately owned and fully independent. We cherish that status. This has real business benefits, it keeps us focused on what our customers want. We work to develop strong, mutually beneficial relationships with our customers. We do that by understanding and then meeting their needs. We access hard-to-reach locations and offer technical advice and financial support. We build infrastructure and devise logistics to streamline and simplify transportation. We operate at scale through state-of-the-art terminals. We deliver on-time, on-spec commodities wherever they are needed. Case study: Moving copper concentrates from Peruvian mines to global markets Source Trafigura Peru buys copper concentrate from more than 150 small, medium and large Peruvian mines. It agrees long-term financing structures, price risk hedging tools, technical support and logistical solutions to secure stable supplies and enable its customers to focus on their core activity. Transport Impala Terminals provides logistical solutions all the way from the mine s doorstep. Concentrates travel by truck and by rail to the warehouse at Callao, Peru s largest port. Store Impala s Callao warehouse is the world s largest roofed mineral export blending and storage terminal. 18

19 Blend Impala blends multiple deliveries to meet the spec and quantities required by its global customers. Load Blended concentrate is transferred via a 2-km, Impala co-financed, conveyor belt to a berthed vessel chartered by Trafigura s Shipping and Chartering Division. Ship The chartered vessel conveys the concentrate to copper smelters around the world. Process Smelters treat and refine the copper concentrate into copper cathodes. Source Trafigura buys copper cathodes from smelters. Deliver Trafigura sells copper cathodes in domestic and international markets. Copper end-users include cable, tube and strip producers. 19

20 Overview How we add value Financial strength and expertise Our business model is resilient, even in the most volatile market conditions. Trafigura s strong balance sheet, commitment to the industry and infrastructure assets give us scope to support our counterparties with prepayment agreements, tolling arrangements and alternative forms of financial support. We maintain lending arrangements with over 120 banks and have raised funds in the US, Europe, Asia and Latam. Our business model prioritises resilience and prudent risk management. We have the financial capabilities and expertise to operate effectively in volatile markets.in our 25-year history, we have grown accustomed to industry cycles and built a profound understanding of our counterparties needs. We systemically hedge price risks. We have systems and procedures in place that allow us to manage complex combinations of operational and financial risk Financing banks $51bn Total financial lines 20

21 Trafigura s Singapore office. Assisting clients with financial solutions Commodity producers use prepayment structures to obtain liquidity and gain access to a wide range of financial partners. Trafigura is the trading industry s leading provider; we arrange financial support between USD500,000 and USD5bn, from 30 days to 5 years, in wideranging jurisdictions across the world for any commodity that we trade. Our goal is to handle the commodity flows, while being a conduit for the financial solution. We monetise the future production of commodities for producers and processors. We leverage our extensive banking and insurance industry relationships to underwrite and syndicate prepayment facilities. Our proven track record attracts collaboration from both commodity producers and financial supporters. Loading copper concentrates, the Democratic Republic of the Congo (DRC). 21

22 Overview How we add value Responsibility Our focus is on growing prosperity and building long-term sustainable value. We are committed to operating our business in a responsible way. Responsible trade drives economic progress and strengthens society. We are leveraging our experience and expertise to embed responsibility in our business and across the sector. Taking this approach makes commercial sense. Our business involves the transportation of millions of tonnes of materials across multiple geographies. The decisions we make can have a profound impact, both directly and indirectly, on the lives of thousands of people. Our long-term prosperity depends on our ability to limit our operational impacts and make a continued and constructive contribution to the advancement of responsible trade. Maintaining high standards is a prerequisite. We have adopted a rigorous framework to minimise and mitigate negative impacts for people and the environment. $61bn Value of crude oil, products and gas purchased from State Owned Enterprises (SOEs) between 2013 and bn bbls Volume of crude oil, products and gas purchased from SOEs between 2013 and Transporting crude oil, Bahamas

23 Cobalt hydroxide processing, the Democratic Republic of the Congo (DRC). Building transparency and trust Transparency comes in many forms from being open about financial performance, to driving deeper stakeholder engagement, to improving monitoring and reporting within the organisation and across our supply chain. As a major facilitator of global trade, we believe that natural resource wealth should contribute to sustainable development and poverty reduction. Being open about how we manage natural resources in countries where we operate gives their populations the tools to hold governments and business to account. This was the motivating factor in 2014 when Trafigura became the first independent commodities trading company to declare its support for the Extractive Industries Transparency Initiative (EITI). EITI is a leading force in the global drive for open and accountable management of natural resources. Over 50 countries worldwide are involved in the implementation of the EITI standard. We work closely with the EITI to extend transparency for global commodity trading by developing best practice and introducing common international disclosure standards across our industry. Storage at Impala Terminals Barrancabermeja facility, Colombia. 23

24 Overview How we add value Industrial assets and investments We invest in companies and in infrastructure that streamline and simplify supply chains. We buy and build terminals, storage, production and processing facilities. Impala Terminals Trafigura subsidiary Impala Terminals is managed independently as a multimodal logistics provider focused on exportdriven emerging markets. It owns and operate ports, terminals, warehouses and transport assets which offer end-to-end logistics solutions for dry and liquid bulk cargoes, general cargo, and containers, both for Trafigura and third-party clients. Impala has particular expertise in providing efficient logistic solutions in challenging environments and hard-toreach locations. It combines strategically located infrastructure with multimodal logistics to streamline supply chains and promote global trade. Its logistics solutions across Africa and in Brazil, Colombia, Peru and Spain, integrate barge, truck, rail, storage and direct-berth access. In Colombia, Impala has developed the first fully multimodal logistics system linking major ports with resource-rich regions and the economic heartland. The company is investing internationally to build capacity and consolidate its global presence. At scale and across the world, Impala has the capabilities and the people to forge safe, reliable and cost-effective links between commodity producers and end-users. Puma Energy Puma Energy is a global oil and petroleum products distribution company backed by strong infrastructure resources. It is active in 49 countries on five continents. The company manages over 20 million m 3 of fuel through its network of 104 terminals, 71 airports and more than 3,060 service stations. Puma Energy is an important downstream energy investment for Trafigura. It operates independently but gains synergies from our access to global fuel markets. Trafigura is the largest shareholder, owning 49.6 percent of the company. Puma s unique business model focuses on international reach and downstream delivery. It integrates fuel supply structures and invests in infrastructure to maximise opportunities in high-growth markets. 24

25 Trafigura Mining Group Trafigura Mining Group manages mining operations, develops projects, conducts technical audits of existing and potential projects and provides advisory and support services to the rest of the company. Its main operations are in Latin America, Europe and the Caribbean. The Group operates the Catalina Huanca mine in Peru and is active in Brazil and Cuba. Its flagship mining operation is owned in a joint venture with Abu Dhabi-based investment and development company Mubadala. Minas de Aguas Teñidas (MATSA) produces copper, zinc and lead concentrates along with some silver on the Iberian Pyrite Belt in Spain s southwestern region of Andalusia. Nyrstar Trafigura is the largest single shareholder in Nyrstar with a holding of 24.6 percent. Our minority stake in the leading metals processing group supports our expanding zinc and lead business. Nyrstar has a market leading position in lead and zinc and growing positions in other base and precious metals. It is the world s second largest smelter of zinc metal, producing over 1 million tonnes annually. Our financing, offtake and distribution arrangements have helped to strengthen the company s business model. We underwrote half of a USD250m rights issue in 2015 and continue to support the firm via a USD250m committed working capital facility. The two companies conduct business dealings on an arm s length basis on normal commercial terms. Long-term purchase and sale arrangements maintain continuity of supply for Trafigura and allow Nyrstar to leverage its strong marketing presence. Terrafame Terrafame is a Finnish multi-metal company producing nickel, cobalt and zinc using the environmentally sustainable bioheap leaching technology at its mine in Sotkamo, Finland. Galena Asset Management our investment subsidiary, identifies real assets opportunities and makes them available to external investors through appropriate structures. About 70 percent of the assets managed by Galena come from institutional investors. Its acquisition of a substantial interest in Terrafame is helping to finance an ambitious investment programme for the company. It is supplemented by loan finance from Trafigura and Sampo plc. In 2020 Terrafame plans to open a new production plant supplying battery chemicals for electric vehicles. Using Trafigura s global marketing expertise this will offer a shorter, more sustainable supply chain for vehicle battery producers

26 Overview How we add value Strategic alliances Strategic alliances with carefully selected counterparties extend the scope of our activities. Financial institutions invest alongside us. Industrial operators contribute complementary skills and resources. Exporting Brazilian iron ore The flagship iron ore port facility on the south-eastern coast of Brazil is a vital international gateway for miners in the country s iron ore quadrangle. The 50 million tonne capacity Porto Sudeste facility south of Rio de Janeiro in Brazil is jointly controlled by Impala Terminals and Mubadala Investment Company. Porto Sudeste s multimodal logistics are forging new global trade routes for independent miners through transportation and scale efficiencies. The privately owned MRS railway provides direct access from the Minas Gerais region. A wagon tippler at the terminal unloads train carriages automatically. From there conveyor belts transfer the product to a 2.5 million tonne storage facility and on to a 20-metre depth mooring berth, which can accommodate two capesize vessels simultaneously and has two 12,000 tonne per hour shiploaders ready to handle port-to-ship transfer. Mining concentrates in Spain The Minas de Aguas Teñidas (MATSA) mining complex is one of Spain s largest mining operations. In 2015, Trafigura and co-owners Mubadala invested EUR220 million in a two-year expansion programme. Major new deposits and a second treatment plant have nearly doubled production capacity to 4.4 million tonnes annually. A brand new mine, the first in Spain for decades, came on-stream in The newly opened Magdalena mine yields exceptionally rich copper concentrate deposits. The MATSA mining operation links to Impala Terminals state-of-the-art logistics and warehousing at the Spanish coastal port of Huelva. We are optimising production and implementing effective health, safety and environmental (HSE) procedures to give MATSA one of the lowest break-even production costs in the global copper mining industry. 26

27 Smelting copper in China Trafigura was the first international trading firm to make a major coinvestment in a Chinese domestic smelting business. Our 30 percent stake in one of the largest standalone copper smelters, a 400,000 tonne per annum facility in Guangxi province on the country s south coast, is linked to a multi-year commercial agreement. Trafigura now supplies 30 percent of its concentrates and offtakes 30 percent of its copper cathode production. The commercial collaboration brings together two companies with complementary strengths. Majority stakeholder Jinchuan Group is China s third-largest copper producer. Its heartland is in the north-west of the country, from where it serves the domestic market. Trafigura s global network and trading expertise adds international suppliers, diverse financing and lower costs. Refining oil in India Trafigura s 24.5 percent stake in India s second largest private oil refiner strengthens the Group s presence in one of the world s fastest growing energy markets. The 2017 acquisition of a 49 percent stake in Essar Oil Limited, as part of an investment consortium with UCP Investment Group together with Rosneft, included a 20 million tonne per annum super-refinery, world-class storage and import/ export facilities, and over 3,500 retail service stations across the country. The Essar Refinery is at Vadinar on India s west coast. It is strategically located on shipping routes to major demand centres in the Far East and near Middle East sources of production. The refinery s fully integrated infrastructure includes pipelines, tankage and its own dedicated power plant, as well as multimodal dispatch via rail, road and sea. 27

28 Trafigura Group Pte. Ltd. 10 Collyer Quay #29-00 Ocean Financial Centre Singapore TH/0247.2e