OCI (OCI) Investor Update summary

Strategic rationale and acquisition overview

• Entered binding agreement to acquire OCI's Clean Ammonia project in Beaumont, Texas, for $2.35 billion, including construction costs for phase one, with OCI managing completion and providing cost, schedule, and performance guarantees.

• Woodside will pay 80% of the purchase price at closing, with the remainder due upon project completion, as defined by agreed terms.

• Acquisition positions the company as an early mover in the lower carbon ammonia industry, supporting a strategy for a low-cost, lower-carbon, resilient, and diversified portfolio.

• Project is 70% constructed, with phase one production targeted for 2025 and carbon sequestration enabling lower carbon ammonia from 2026.

• Acquisition includes an experienced team from OCI, leveraging their operational and commercial expertise.

Project structure, partnerships, and market positioning

• Project is capital-light, sourcing hydrogen and nitrogen feedstock under contract from third parties, notably Linde, with CCS provided by ExxonMobil.

• Ammonia plant capacity is 1.1 million tons per annum for phase one, with scalability for a second phase of equal size; FID readiness for phase two targeted from 2026.

• Location on the US Gulf Coast offers access to abundant feedstock, regulatory incentives (e.g., Section 45Q tax credit), and proximity to key export markets in the US, Europe, and Asia Pacific.

• Project benefits from established value chains and OCI’s track record in ammonia plant development.

• Early production will be unabated ammonia until CCS is operational in 2026, after which lower carbon ammonia will be produced.

Financial and capital management considerations

• Investment meets or exceeds capital allocation framework: >10% IRR, payback <10 years.

• Strong balance sheet and cash flows support continued dividend policy and capital management framework, though gearing may temporarily exceed target range during peak investment.

• Modeling assumes conservative ammonia pricing, with price uplift phased in over 10 years as carbon border adjustment mechanisms (CBAM) are implemented in Europe.

• No pass-through of ammonia price to feedstock or CCS suppliers; contracts are structured independently.

• Phase one is expected to be free cash flow accretive from 2026 and earnings per share accretive from 2027, exceeding internal rate of return and payback targets.