Throughput and Margin Report for November/December 2018

Processing Fee income for the November/December period was NZD 49.2 million, underpinned by a Gross Refinery Margin) (GRM) of USD 6.53 per barrel for the period and throughput of 7.31 million barrels. This performance was very similar to the same period in 2017. Total refinery throughput for the second half of 2018 was the highest ever in the refinery's history and the refinery to Auckland pipeline achieved a new annual throughput record primarily due to its continued investment in capacity upgrading projects to help meet growing Auckland demand. The Singapore Dubai complex margin for the November/December period was USD 1.80 per barrel, 67 cents lower than the September/October period, impacted by crude oil price volatility and low gasoline margins. However, Refining NZ's November/December uplift over the Singapore Dubai complex margin was strong at USD 4.73 per barrel. Refining NZ's balanced product slate and locational advantage enabled it to achieve a healthy margin notwithstanding current global pressure on gasoline margins. The average exchange rate for the November/December period was USD/NZD 0.68. Appendix I shows further information on throughput, margin and refining income. Natural Gas Update Refining NZ has executed a binding gas supply contract with a first-tier gas reseller that delivers most of its 2019 requirements, subject to gas field maintenance planned in April which the gas producer expects to complete successfully. Nevertheless, Refining NZ continues to build a gas portfolio, will make up any shortfall through firing of liquid fuels and does not expect any material impact on the Company. Crude Shipping Project Following further discussions with interested parties, the Environment Court has confirmed the resource consents issued to Refining NZ for its crude shipping dredging project, subject to minor revisions agreed between parties to the appeal. The revisions are considered effective and workable and de-risk this strategically important project which will increase the competitiveness of the refinery with fuel imported from Asia. A date for dredging to commence has yet to be confirmed and is dependent on the successful completion of monitoring activity on the harbour and a final investment decision from the Refining NZ Board. Historical Analysis A five year history of Throughput, Margins and Processing Fees is attached as Appendix II and can also be found on the company's website: www.refiningnz.com End CA:00329553 For:NZR Type:MKTUPDTE Time:2019-01-17 10:19:37