Activist Intervention

Walter Hufford, P.G.

Director of U.S. Government and Regulatory Affairs

2

Disclaimer

© REPSOL, S.A. 2018

Repsol , S.A. is th e exclusive ow ner of this document . No part of this document may be reproduced (including photocopying), stored, duplicat ed, copied,

distributed or int roduced into a ret rieval system of any natu re or t ransm it t ed in any form or by any means w ithout the prior w rit ten permission of Repsol ,

S.A.

This document does not consti tu te an of fer or invita t ion to purchase or subscribe shares, in accordance w ith the provisions of the Royal Legislat ive Decree

4/2015 of the 23rd of October approving the recast t ext o f the law on the securit ies market and its implementing regulat ions. In addit ion, this document

does not const i tute an of fer o f purchase, sale or exchange, nor a request for an of fer o f purchase, sale or exchange of securi t ies in any other jurisdict ion.

This document mentions resources w hich do not const itu te proved reserves and w ill be recognized as such w hen they comply w ith t he formal condit ions

required by Battel le for the Eleventh Internat ional Conference on Remediat ion and Recalcitrant Compounds.

This document contains statements that Repsol believes const i tu te forw ard-looking sta tements w hich may include statements regarding the intent , belief ,

or current expect a tions of Repsol and its management, including sta tements w ith respect to t rends af fect ing Repsol ’s f inancial condit ion, f inancial rat ios,

resul ts o f operat ions, business, st rategy, geographic concent rat ion, product ion volume and reserves, capit al expenditures, costs savings, investments and

dividend payout pol icies. These forw ard- looking sta tements may also include assumpt ions regarding futu re economic and other condit ions, such as futu re

crude oil and oth er prices, refining and market ing margins and exchange rates and are general ly ident if ied by the w ords “expects”, “anticipates”, “forecas ts”,

“believes”, estimates”, “notices” and simi lar expressions. These sta tements are not guarantees of futu re performance, prices, margins, exchange rates or

other events and are subject to material risks, uncert ainties, changes and other facto rs w hich may be beyond Repsol ’s cont rol or m ay be dif f icul t to predict .

Within those risks are those fact ors and circumstances described in the f il ings m ade by Repsol and its af f il iates w ith the Comisión Nacional del Mercado de

Valores in Spain and w ith any other supervisory authori ty o f those markets w here the securi t ies issued by Repsol and /or its af f il iates are l isted.

Repsol does not undertake to publicly update or revise these forw ard- looking statements even if experience or future changes make it clear that the

projected performance, condit ions or events expressed or impl ied therein w ill not be real ized.

In October 2015, the European Securit ies Markets Authorit y (ESMA) published t he Guidelines on Alternat ive Performance Measures (APM), of mandatory

applicat ion for the regulat ed inform at ion to be published f rom 3 July 2016. Information and disclosures related to APM used on the present document are

included in Appendix I “Alternative Performance Measures”of the Management Report for the ful l year 2016.

Trust

Social license to operate

“Social license to operate has been ranked as a top six risk over the last five

years as it represents a consistent long term challenge.” Helen Adair

Executive Director,

Climate Change and

Sustainability Services

License to operate

A matter of perspective

Insights

Visuals change everything

Pictures are worth a thousand words

And videos are everywhere

Add the human component

Fear on what was being reported by

certain organizations

Reactions

Activist are not just targeting the oil and

gas industry

Infrastructure projects are being challenged everywhere

Tony Webster

OMS Jaderna TemelinPixabay

20-60-20

1. Approximately 20% of the stakeholders will be agreeable to a project

moving forward

2. Approximately 60% of the stakeholders will need additional information

prior to making a final decision

3. Approximately 20% of the stakeholders will object to the project no matter

what conditions or efforts are made to address concerns (NIMBY – “not in

my back yard”)

Consequently, the role of technical experts is critical in the stakeholder

engagement process to advancing a project forward. The challenge is many

of these technical experts lack the training or the desire to work under

adversarial conditions.

Understanding roles

1. The Perpetrator

2. The Victim

3. The Rescuer

The role of the rescuer

1. Be approachable

2. Shake hands

3. Ask questions respectfully

4. Be a great listener• Hear the discussion

• Acknowledge – be empathic

• Remain calm

• Take time to respond

• It’s ok to say “I don’t know”

5. Be someone they can relate to

6. Protect your credibility at all cost

7. Follow up on commitments or questions

A new paradigm

Social media is a powerful tool – understanding how it will be used in support

and in opposition of a project is critical

Proper planning prevents poor performance

Transparency, integrity and operating responsibly are key structural

pillars in maintaining a license to operate

Having a robust and effective stakeholder engagement team and

program is fundamental to success

Early engagement and continuous communications are essential

Adaptive Management – planning for and anticipating the unexpected