OPPORTUNITIES AND COLLABORATION WITH SABIC IN SUSTAINABLE PACKAGING

World Packaging Days , Split , Croatia June 2012Gert CounSABIC , Manager Technical Marketing LD/LL

No. 2

CONTENTS

• Introduction SABIC

• Sustainability as Global responsibility

• Saving energy by using plastics

• Practical sustainability cases with SABIC products

• Consumer protection

• Conclusions and invitation for dialogue & partnership

No. 3

SABIC IN NUMBERS

1976, our beginning

36 years of growth

2nd largest global diversified chemical company*

33,000 employees

40 countries

60 world-class plants worldwide

1 Corporate Research & Innovation Center

14 Technology Centers

3 Application Centers & 8,000 global patents

* Forbes 2011

No. 4

PRODUCTION HAS MULTIPLIED BY 6 IN 20 YEARS

A high rate of growth…

613

22

28

47

67

0

10

20

30

40

50

60

70

1985 1990 1995 2000 2005 2010

Prod

uctio

n (m

illio

n to

ns)

…reaching 66M metric tons in 2010

Metals

5.191

Fertilizers

7.043

Chemicals

42.268

Polymers

10.667

Performance Chemicals

0.458

Innovative Plastics

1.231

No. 5

WE RANK AMONG THE TOP PRODUCERS WORLDWIDE

#1 #2 #3Mono-ethylene glycol

MTBE

Polycarbonate

Polyphenylene

Polyether imide

Granular urea

Methanol Polyethylene

Polypropylene

Polybutylene terephtalate

Engineering plastics and its compounding

No. 6

WE HAVE A CLEAR AMBITION

To be the preferred world leader in chemicals

We will achieve this by partnering with our customers,

helping them achieve their ambitions.

When they grow, we grow.

That’s why for us, OUR CUSTOMERS’ SUCCESS COMES FIRST

No. 7

INGENUITY DRIVEN BY TECHNOLOGY & INNOVATION

Practical innovation • Application development with key customers at the heart of our strategy• More than 150 new products created every year• Backed by more than 8,000 global patents

World-class infrastructure and know-how• 14 Technology & Innovation Centers in Saudi Arabia, Netherlands, Spain,

USA, South Korea and India, with one under construction in China• Three Application Centers in Saudi Arabia and Japan• One Corporate Research & Innovation Center in Saudi Arabia

No. 8

ENSURING A SUSTAINABLE FUTURE IS A GLOBAL RESPONSABILITY

Depletion ofnon-renewable

resources

Global warming

Increasingenergy demand

Destruction ofrainforests

Increasingfood and water

shortage

Toxicity and health risk

No. 9

9

SABIC’S STRATEGIC OPTIONS

Synthetic Hybrid Bio-based

Non-Degradable, Recycling possible

Oxo-Degradable

Bio-Degradable

Compostable

Polymers Today

Through Additives

Through Natural Content

Natural Content0% 100%

Bio-Based

Through Additives

Through Additives

Bio-Based and Bio-degradable

Bio-Based and Compostable

Synthetic and Compostable

No. 10

SAVING ENERGY BY USING PLASTICS

Preserving Food Optimizing energy usage

Light weight solutions

No. 11

WHAT IS THE IMPACT IF WE WERE TO REPLACE PLASTICS?

328 mill t/apl

asti

cs

Plas

tics

plas

tics

Alte

rnat

ive

mat

eria

ls

Alte

rnat

ive

mat

eria

ls

Alte

rnat

ive

mat

eria

ls

39 mill t/a

4.270 mill GJ/a 204 mill t/a

6.690 mill GJ/a

146 mill t/a

total masses for same functionality

energy consumption in total life-

cycle

GHG emisions in total life-cycle

X 3,7 +61%+57%

2,400 million GJ/yr equals : 50 million tonnes of crude oil

No. 12

OUR COMMITMENT

“The SABIC sustainabilitymission is embedded in the fabric of our business.

Our mission includes improving our environmental footprint,innovating products, services and processes that bringsustainability to our customersand growing our business by delivering better solutions forthe planet and humanity.”

• Mr. Al Mady, CEO SABIC - Chairman of the SABIC Sustainability Council

No. 13

REDUCING THE FOOTPRINT OF OUR MANUFACTURING ASSETS

Our operations are steered at continuous improvement and reduction of our environmental footprint, with regards to:

- Greenhouse gases- Energy - Water- Material Effectiveness

World Business Council for Sustainable Development

SABIC will invest more than 100 million EURO in the upgrade of its naphta cracker in Geleen, the Netherlands, in order to significantly improve the energy- consumption of the plant and to reduce CO2 emissions (to be realized before the end of

2013).

No. 14

SABIC LCA APPROACH

Dedicated team of LCA experts

ISO 14044 Method

Impact on “fossil depletion”, “climate change”, “acidification”, “eutrophication” etc….

Analysis on “Cradle to Gate” and “Cradle to Grave” principle

End of Life Principles – Plastics Europe EU 2010 data for packaging • Landfill- 35%• Incineration- 33%• Recycling- 32%

Reproducibility: an independent practitioner should be able to follow the approach and arrive at the same results

Environmental burden associated with infrastructure requirements are excluded

No. 15

CASE STUDY : DOWNGAUGING & RECYCLING ARE THE MAJOR CONTRIBUTORS IN LCA IMPROVEMENT

Product – PP Packaging Cup

Analysis type – Internal screening

LCA

Functional unit – 1 PP packaging cup

(220 grams)

System boundary - Cradle to Gate

Illustration: SABIC Innovative Plastics

40C lower

Processing T

Base caseC. footprint

Adding 20%

Recyclate

10% lighter

ShorterShippingdistance

17% cycle time

reduction

Totalpost improvements

100% 12.1%

10.0%

4.8%1.4% 0.5%

28% total improvements

disposal

shipment

Polymerproduction

molding

Feedstock

PRACTICAL CASES :

SABIC® LDPE MULTI LAYER FILM

SABIC® HDPE MILK BOTTLE

SABIC® UMS FOAM

No. 17

SABIC® MULTILAYER SHRINK FILM : LESS FOR MORE

85% C4 LLDPE + 15% LDPE

50% HDPE + 50% LDPE

Layer A :

Layer B

Layer A :

50% HDPE + 50% LDPE

85% C4 LLDPE + 15% LDPE

70% LDPE + 30% HDPE

Standard Solution (45µ) SABIC 5 Layer Film (35µ)

No. 18

SYSTEM Characterization

C6 LLDPE Film

Crude Oil

SABIC Plants Europe Converters (Europe)

Naphtha Ethylene Multilayer Packaging Film

LLDPE

LDPE

HDPE

UseEOL

Landfill Incineration

Recycling

System Boundary

Avoided Virgin Material

Avoided Electricity

EU 2010 recycling rates for plastics packagingSource: PlasticsEurope Report “Plastics- the Facts 2011”

35% 33% 32%

Cut-off Approach

Excluded Process

No. 19

EXAMPLES OF TYPICAL LCA OUTCOME FOR SABIC® MULTILAYER FILM CONCEPT

45u film 35 u SABIC film

0

50

100

150

200

250

Global Warming Poten-tial

Kg CO2 per

1000 m2 film

45u film 35 u SABIC film

0

20

40

60

80

100

Fossil Depletion

Kg oil

Equiv.

Similar reductions for “particulate matter” formation, “acidification”, “eutrophication”….

No. 20

SABIC® LDPE Ultra Melt Strength grades (UMS) can give 10% density reduction offering downgauging possibilities with improvement of LCA.

SABIC® LDPE UMS IN PACKAGING

No. 21

SABIC® HDPE PRESERVING FRESH MILK

SABIC® HDPE B6246LS potentially enables 20% higher loading of recycled content compared to conventional HDPE due to :

• improved thermo-oxidative stability

• enhanced stable taste performance characteristics.

No. 22

WHAT ABOUT BIOPLASTICS?

Decisions in favor of any material orproduct must be based on sound scientific criteria and a life cycle approach

“Bio-based solutions will be an important part of the chemical industry’s

future”

Only those bio-based solutions must be developed that do not compromise food

production or cause more problems than they solve, such as habitat destruction

or large indirect CO2 emissions”

Mr. Al Mady, CEO SABIC

CONSUMER PROTECTION

No. 24

SUSTAINABILITY & CONSUMER PROTECTION

Positive Contribution to Health &

Environment

Safe Products :SAFE PRODUCTS have recognized

customer value

SAFE PRODUCTS enable safe application (e.g. safe food)

SAFE PRODUCTS meet all relevant

international and customer compliance needs

No. 25

ENABLING CONSUMER PROTECTION

SABIC offers specialized support to customers in using our products in a safe way in the value chain.

This support is based on:- Continuous development of polyolefin base resins with

increased purity

- Proactive service via internet to deliver safe, compliant and sustainable solutions for the value chain, supported by tools to address customer queries

No. 26

SUMMARY

• SABIC is committed to supplying Polyolefines in packaging industry .

• Sustainability is a Global responsibility :

• Using plastics can save energy • High positive contribution of downgauging & recycling in LCA

analysis• Focus on Consumer Protection

• LCA improvements guide SABIC product developments in Packaging

• SABIC is ready for extra dialogue & partnership with customers around sustainability

No. 27

DISCLAIMER

The products and services of SABIC are sold and rendered subject to SABIC’S standard terms & conditions of sale (GTCS), which are available free of charge upon request, by post or digital. Standard terms & conditions other than the GTCS are dismissed and do not apply. Although any information or recommendation contained herein is given in good faith, SABIC makes no warranty or guarantee, express or implied, (i) that the results or specifications described herein will be obtained under end-use conditions, or (ii) as to the effectiveness or safety of any design incorporating SABIC’s products, services or recommendations.

This presentation or document does not contain any calculation, estimate or other warranty or representation that customers and third parties may rely on. Customers and third parties are responsible for making their own determination as to the suitability of SABIC’s products, services or recommendations for the customers’ particular intended use through appropriate end-use testing and analysis, and compliance with applicable laws and regulations.

Except as provided in SABIC’S GTCS, SABIC shall not be responsible for any loss or damage resulting from any use of its information, products or services described herein and SABIC assumes no liability whatsoever in this respects.

Nothing in any document or oral statement shall be deemed to alter or waive any provision of SABIC’s GTCS or this Disclaimer, unless it is specifically agreed to in a writing signed by SABIC.

No statement by SABIC concerning a possible use of any SABIC product, service or design is intended, or should be construed, to grant any license under any patent or other intellectual property right of SABIC or as a recommendation for the use of such product, service or design in a manner that infringes any patent or other intellectual property right.