Company Announcements

1. INTRODUCTION

The Board of Directors of Hengyuan Refining Company Berhad (HRC), formerly known as Shell Refining Company (Federation of Malaya) Berhad, is pleased to announce that it has approved the investment for the Atlas II project to be executed within its refining complex in Port Dickson.

Atlas II comprises the replacement of the top dome and the catalyst separation system of the regenerator reactor of the Long Residue Catalytic Cracking Unit (LRCCU). The replacement is required as the current system will be reaching end of life post the 2018 Turnaround.

This investment ensures HRC can continue to operate the LRCCU unit with the right level of equipment integrity and assures that the upgrading of residual fuel to high value products can be continued in future. As such, this investment underpins HRC’s commitment to long term sustainable refining in Malaysia.

2. THE TOTAL INVESTMENT COST

The Total Investment Cost for the project is USD25 million +/- 10%.

3. DURATION OF THE PROJECT

The project is expected to come on-stream after the Q3 2018 major site turnaround.

4. FINANCIAL EFFECTS

The project will be financed using a mix of cash flow generated from operations and a further draw down from an existing term loan.

5. DIRECTORS’ AND SUBSTANTIAL SHAREHOLDERS’ INTEREST

None of the directors or substantial shareholders of HRC or persons connected with them have any interest, whether direct or indirect, in the investment decision.

6. STATEMENT BY DIRECTORS

HRC’s Board of Directors is of the opinion that the above investment decision is in the ordinary course of business and is in the best interest of the company.

7. APPROVALS REQUIRED

This investment decision is not subject to the approval of shareholders of HRC or any relevant authorities.

This announcement is dated 16 June 2017.