REPSOL plantilla 16 9 naranja cast

Repsol Climate Change and Carbon Strategy September, 2015

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Climate Change and Carbon Strategy

MAIN INITIATIVES DEVELOPED 1

FUTURE ACTIONS 2

TREND TOPICS ON CLIMATE CHANGE 3

OUR POSITION ON CLIMATE CHANGE 0

OUR POSITION ON CLIMATE CHANGE 0

1. In Repsol we believe that two global goals have to be pursued:

• To mitigate climate change and

• To provide access to affordable energy in order to support economic growth and development

2. We set up and deploy ambitious energy efficiency programs to reduce energy consumption

and GHG emissions as one of the key elements of our strategy. These programs pursue

long term targets which have been made public in order to facilitate their progress by the

stakeholders.

3. We are convinced that innovation and technological development are essential for ensuring

reliable and sustainable energy supply in the long term.

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• More than 3.1 MtCO2 have been

reduced (50% achieved from 2011

to 2014)

• The reductions have been verified

under ISO14064

GHG emissions

Energy consumption

• Energy maps

• Energy Efficiency plans in our facilities.

• Energy Management Systems certified under ISO 50001 in:

− 5 Spanish refineries and 1 Peruvian refinery

− 2 chemical plants in Spain

− 1 E&P facility in Ecuador

GHG inventories

GHG emissions reduction

target 2006-2013

Reduction of 2.5 MtCO2eq

in relation to

“business as usual”

• 98% of total CO2 verified under ISO14064.

• Company carbon footprint

• Carbon footprint of products

91% 93% 98%

% of CO2 verified

under ISO 14064

Energy management

MtCO2

MtCO2

12.7 MtCO2

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2012 2013 2014

About 150 efficiency actions are taken on every year in our facilities to reduce energy consumption and CO2 emissions.


Until 2004 2005 - 2012 2013 - 2015

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1st GHG

verification ISO

14064

In Refining and

Chemicals

Carbon management Plan

2006-2013

3.1 MtCO2

reduced

Repsol

joins OGCI

Repsol’s

climate

change

position

1st GHG

verification

ISO 14064

in E&P

98% of the

total

emissions

verified

ISO 14064

Carbon and energy management Plan

2014-2020

Repsol’s

policy on

energy

efficiency

1st Carbon

Strategy 2nd Carbon

Strategy

Energy and

Carbon

Strategy Maximum

score

in CDP

1st GHG

verification

ISO 14064

in offices

1st EnMS

certified

ISO 50001

in Refining

1st EnMS

certified

ISO 50001

in E&P

Strong commitment

to tackle

climate change

About 425 M€

investment planned in

CO2 and energy

efficiency measures by

2020

We conduct energy studies and audits to identify opportunities to reduce our consumption and emissions

(about 15 energy audits in all of our industrial facilities every year).

We have an Operational Review – Energy (OR-E) methodology to identify new energy efficiency

opportunities in Upstream.


Transparency

Climate Change Initiatives

• Repsol joint the initiative in June 2015. We are working in 3 different focus areas:

− Long-term solutions: the working group area is sharing and developing a broad and meaningful vision of the future energy

mix.

− Role of Natural Gas: the group is exploring opportunities to save and use natural gas in areas such as power generation,

transportation and homes.

− Carbon Reduction Instruments & Tools: the area is exploring the company policies and process that can help manage

emissions and improve operating and product efficiency.

CDP is one of the most important

questionnaires about climate

change. It requests information on

the risks and opportunities from

the world’s largest companies on

behalf of 822 institutional investor

signatories with a combined

US$95 trillion in assets.

• Repsol has been recognized as one of the best

O&G companies for its Carbon Strategy. Our

company has been included in the group of “leaders”

6 times in the last 9 years.

• Our methodology for the assessment of the risks

implied by climate change, the quality and

effectiveness of our energy efficiency plans and our

transparency in the GHG emissions have been

highly valuated in the last years.

OGCI is an industry-driven

initiative officially launched at the

UN Climate Summit in 2014. It

aims to catalyze action on climate

change.

2012 2013 2014

Maximum score of the Energy

Sector (Disclosure) 98 98 100

Repsol score (Disclosure) 98 98 96

Repsol score (Perfomance) A- B B

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IPIECA is the global oil and gas

industry association for

environmental and social issues.

• Repsol is actively involved in several work streams:

− Energy efficiency

− Methane emissions

− Adaptation to climate change

− Scope 3 GHG emissions

− Reporting

Moving from stakeholder engagement to partnerships

FUTURE ACTIONS 2

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2014-2020 Plan based on:

New approaches to look for opportunities + Identification of technology advances

+ Extension of best practices / EnMS to different Business Units Operational

Excellence

Technology

Update

Design

Improvements

MtCO2/y MGJ

2014-2020 1.9 29.5

Repsol CO2

Objective of

Reduction

13% CO2

12% Energy 2014-2020 (base 2010)

Reduction target

Repsol is developing a plan to manage methane emissions

which takes into account the procedures and actions already

developed and try to implement new initiatives (e.g. LDAR

programs) in order to achieve further methane emissions

reductions in all of our operations.

The methodology established by the CCAC Oil &Gas Initiative

is being followed.

480,000 tCO2 were reduced in 2014 thanks to the implementation of more than 130 actions.

FUTURE ACTIONS 2

Repsol incorporates to its value chain new low carbon fuels and provides new energy vectors for transport with a less enviromental

impact.

Biofuels LPG Electric mobility

We have increased the share

of bios incorporated to our

gasoline and diesel.

In the last 4 years this share

has been 5.8% in Spain.

In 2020 we will surpass

10% in total sales in

Spain.

Repsol is currently working in

R&D initiatives that will bring

new low carbon solutions:

• CO2 capture and

transformation: This

initiative aims to reduce

GHG emissions and

investigate new methods for

giving them new functions.

• Smart asphalts: This

project aims to create safer

roads that reduce energy

consumption.

• Vegetable oil co-

processing: This project

aims to add new biofuels to

the existing range of

conventional fuels.

Non-fossil fuel initiatives

We reduce the carbon

footprint of our fuels by

promoting LPG for

transportation.

There are currently more

than 300 AutoGas supply

points provided at different

Repsol Group service

stations. This network is

gradually expanding.

We will increase supply

points at a rate of at least

100 new each year.

Repsol is developing a

charging network in Spain to

guarantee electric vehicle

mobility. More than 450

operational public and private

charging points are operative

in 2014.

Taking into account the

evolution of the market,

the charging network will

be increased in order to

satisfy the needs of our

customers.

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R&D

Mainly Offshore Wind Energy

projects.

First company in the world

able to design, install and

operate a floating semi-

submerged structure for

offshore wind generation.

Repsol Nuevas Energías

UK participates in the

development of two

offshore wind energy

projects at Scottish coast:

Beatrice Offshore

Windfarm Limited and

Inch Cape Offshore

Limited


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2 degrees Celsius is the maximum increase in global temperature over the pre-industrial levels in order to prevent

dangerous anthropogenic interference with the climate system. The limit has been established by the scientific

community and has formally recognized the “long term goal” of the United Nations Framework Convention on

Climate Change.

2 degrees Celsius limit

About the concept

Repsol’s position

• Climate change is a critical challenge for our world. We recognize both the

importance of the climate challenge and the importance of energy to human life and

well-being.

• We acknowledge that the current trend of greenhouse gas emissions is in excess of

what the IPCC* says is needed to limit the temperature rise to no more than 2

degrees above pre-industrial levels.

• Our company is already taking a number of actions to help limit emissions. These

actions are a key part of our mission to provide the greatest number of people with

access to sustainable and secure energy.

*Intergovernmental Panel on Climate Change


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Stranded assets

About the concept

Repsol’s position

• The stranded assets concept offers limited analysis for key uncertainties and aspects

such as developing new innovative technology.

• Gas (lowest carbon-intensive fossil fuel) represents nowadays a great portion of our

business (61% of the production and 73% of our reserves).

• The main part of the company valuation is supported by proven reserves with a high

probability of being produced in the near term and, therefore, protecting the company

share price. The risk of stranded assets based on resources seems limited today.

• Decisions on making new investments will continue to be based on expected risk-

weighted returns. The issue of climate change and possible climate policy regulations

are incorporated also into such decisions. Sensitivities are used in order to test the

viability of our investments.

Central values from scientific modelling suggest that around 3.650 GtCO2eq is the amount of CO2 that the atmosphere

can allow up to the limit of 2°C (“the carbon budget”). Given that roughly 2.650 GtCO2eq have already been emitted to

date, this suggests that future emissions should be limited to 1.000 GtCO2eq.

The “unburnable carbon” notion asserts that it is estimated that there are more than 3.670 GtCO2eq contained in the

oil, natural gas and coal resources that have been estimated to have been discovered. More than a half of the

discovered resources would have to remain unburned (“stranded assets”) to ensure that an increase in the average

temperature above 2ºC is avoided.


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Carbon pricing

About the concept

Repsol’s position

• Repsol supports carbon pricing as a policy framework that will contribute to provide

our businesses with a clear roadmap for future investment.

• We believe carbon pricing encourages the most efficient ways of reducing emissions

widely and increases investment in low carbon technologies.

• To be effective carbon pricing should be embedded in a coherent policy frameworks

which safeguards a sector’s international competitiveness.

• Repsol includes a carbon pricing in their strategic plans assigning an annual cost

based on a path of CO2 prices. This carbon price is taken into account by the

business units that participate in carbon markets.

A carbon price is a cost applied to CO2eq emissions to encourage the reduction of GHG emissions emitted into the

atmosphere giving boost to lower-carbon investments. Economists widely agree that introducing a carbon price is

the single most effective way to reduce GHG emissions.

THANKS

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