2013 ATPAC Annual Meeting Thailand-U.S. Cooperation: From R&D to Commercialization August 29 , 2013 Bangkok, Thailand Thailand and S&T Related Venture Capital Noppawan Tanpipat, Ph.D. Vice President, Innovation Strategy and Partnering PTT Global Chemical Public Company Limited (PTTGC) Agenda Agenda PTTGC Business Overview A result entity of amalgamation Product portfolio and global business PTTGC strategic approach to technologies Focus of corporate venture capital in innovation process Strictly Confidential 2 2 Agenda Agenda PTTGC Business Overview PTTGC at a glance Product portfolio and global business PTTGC strategic approach to technologies Focus of corporate venture capital in innovation process Strictly Confidential 3 3 ICIS Top 100 Chemical Companies Ranking of the world’s largest chemical producers (listing based on 2011 sales) Strictly Confidential 4 4 PTTGC: The Chemical Flagship of PTT Group PTT is the national energy company engaged in conducting an integrated petroleum and petrochemicals business with the market capitalization of US$33bn1, ranked as 95th in Fortune 100 company THE LARGEST OLEFINS PRODUCER IN THAILAND AND FIFTH IN ASIA 1 COUNTRIES OPERATING PETROCHEMICAL CAPACITY [Million tonnes per annum] 5 EMPLOYEE • Polymer producer with the combined production capacity of 3,482 ktpa and products ranging from HDPE, LLDPE, LDPE, PP, PS and ABS • 7th largest aromatic producer in Asia with capacity of 3,526ktpa • First and sole producer of phenol, acetone, ACN ethylene oxide and related products in Thailand • Business partner with world’s leading companies such as LyondellBasell from Netherlands, Asahi Kasei Chemical from Japan, Sime Darby Plantation from Malaysia, Cargill from the US, and Perstorp from Sweden 3531 SALES [Billion USD] 18.6* Note: 1) As of 30 March 2012 Strictly Confidential 5 5 Fully Integrated Petrochemical and Refinery Operations with Diversified Product Portfolio Strictly Confidential 6 6 Leading chemicals company in South-East Asia with broadest expertise in downstream derivatives Strictly Confidential 7 7 Diversified Product Portfolio and End Markets Strictly Confidential 8 8 Agenda Agenda PTTGC Business Overview PTTGC at a glance Product portfolio and global business PTTGC strategic approach to technologies Focus of corporate venture capital in innovation process Strictly Confidential 9 9 PTTGC Strategic Direction “To be a Leading Chemical Company for Better Living” PTTGC’s Strategies 1. Enhancing our core uplift 2. Creating long-term value via HVS growth 3. Emerging into green business models Strictly Confidential 10 10 Global Business: Asia, Europe and US Strictly Confidential 11 11 page 12 Global Megatrends Impacting Chemical/Plastic Industry Sustainability Energy Conservation Waste Reduction New Materials / Substitutes Monomer Convenience Polymerization/ Conversion Compounding Processing End Users “The Trends of Changing World Impact the Plastics Value Chain in Many Aspect.” Regulations, Environment, and Health Health & wellness Global Warming Transportation Urbanization Next Billion Customers & Rise of Asian Demand 12 page 13 R&D Development Phase & Gap Science & Innovation Innovation and emerging technology acquisition arms to PTTCG Source: Modified from BCG Analysis PTT Chemical International 13 CVC Agenda “Green and Transformative”— CVC as an accelerator to growth beyond current business focus. Existing Technology New Future business growth enabled by new technology Value creation Un-Captured Captured Market Strictly Confidential 14 14 S&I Model To Acquire Emerging Technology Client or stakeholder views Researcher interests and views Collaboration and Partnering In-house R&D Corporate strategy and priorities Research Direct Investment Technology Development Prototype and Trial Joint Development Opportunity Indirect Investment VC Fund Portfolio Companies Technology Incubator Technology Platform Corporate venture capital (CVC) as one of strategic technology investment arms o Strategic benefits o o o o o Open “window on new technology” through venture investments. Leverage external sources of innovation through contact with “technology-based investment bankers, entrepreneurs, scientists, deal finders and makers, consultants and network ”. Create opportunities in joint development and become strategic partners. Strengthen entrepreneurial companies’ product marketing through the existing corporate’s marketing experience and contacts. Financial benefits o o o Shorten time and OPEX expenditure in leveraging R&D technology to be commercialized. Minimize risk and impact from technology failure via indirect investment while managing opportunity of getting returns on investments upon exit events, such as IPOs or sales to third parties. Potentially acquire a “right to operate (or produce)” of new and innovative processes (or products) to compete in their existing market via emerging technology. Strictly Confidential 15 15 page 16 Unconventional Raw Materials Crude Oil Natural Gas PARADIGM SHIFT? 1800 1850 1900 1950 2000 Renewable Resources Coal 2050 Source: Adapted from BASF 16 page 17 Example: Synthetic Biology Synthetic biology: Development of new bio-synthetic route to a wide range of products Source: Technology Strategy Broad, “A synthetic biology roadmap for the UK” 17 page 18 Value Proposition by CVC Shortcut for Risky technology development and Commercialization of new emerging innovation at reduced risk. Client or stakeholder views Researcher interests and views In-house and Collaborative R&D Corporate strategy and priorities Research Technology Development Joint development Prototype and Trial Strategic alliances Indirect Investment CVC Portfolio Companies Technology Platform Technology Incubator 18 Collaboration & Partnering University Industry Government Agency Strictly Confidential 19 19 page 20 S&I Expansion Life Science Research Unit Strictly Confidential 20 Private & Confidential Thank You www.pttgcgroup.com 555/1 Energy Complex, Building A, 14th – 18th Floor, Vibhavadi Rangsit Road, Chatuchak, Bangkok 10900 Thailand. Telephone : +66 (0) 2265-8400 Fax : +66 (0) 2265-8500