#1༡༡ TAHUN FOM CERV KOMATSU 053 HD 785 adaro PT Adaro Energy Indonesia Tbk May 2022#2Disclaimer adaro These materials have been prepared by PT Adaro Energy Tbk (the "Company") and have not been independently verified. No representation or warranty, expressed or implied, is made and no reliance should be placed on the accuracy, fairness or completeness of the information presented or contained in these materials. The Company or any of its affiliates, advisers or representatives accepts no liability whatsoever for any loss howsoever arising from any information presented or contained in these materials. The information presented or contained in these materials is subject to change without notice and its accuracy is not guaranteed. These materials contain statements that constitute forward-looking statements. These statements include descriptions regarding the intent, belief or current expectations of the Company or its officers with respect to the consolidated results of operations and financial condition of the Company. These statements can be recognized by the use of words such as "expects,” “plan,” “will,” “estimates,” “projects," "intends," or words of similar meaning. Such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ from those in the forward-looking statements as a result of various factors and assumptions. The Company has no obligation and does not undertake to revise forward-looking statements to reflect future events or circumstances. These materials are for information purposes only and do not constitute or form part of an offer, solicitation or invitation of any offer to buy or subscribe for any securities of the Company, in any jurisdiction, nor should it or any part of it form the basis of, or be relied upon in any connection with, any contract, commitment or investment decision whatsoever. Any decision to purchase or subscribe for any securities of the Company should be made after seeking appropriate professional advice. 2#3Frequently Asked Questions ➤ Recent trends in coal market and coal price ➤ Industry and price outlook Adaro's business transformation Progress of Adaro's projects Adaro's strategy and approach on ESG issues adaro 3#4450 400 350 300 250 200 150 100 50 0 Jan-17 Apr-17 Strong Price Maintained due to Tight Market Jul-17 Oct-17 Jan-18 Apr-18 Jul-18 Oct-18 Jan-19 -NEX (US$) ICI 3 (US$) -ICI 4 (US$) Apr-19 Jul-19 Oct-19 Jan-20 Apr-20 Jul-20 Oct-20 Jan-21 QHD 5500 NAR (RMB) adaro 1100 1000 900 Apr-21 Jul-21 Oct-21 Jan-22 Apr-22 800 700 600 500 400 300 Prices have remained volatile at high levels. Demand from India and Southeast Asia has supported Indonesian thermal coal imports - due to inclement weather and also supply crunch. Australian and Indonesian thermal coal supply has underperformed over the first four months vs last year. ☐ Prices for benchmark Australian coal and Harga Batu Bara Acuan (HBA) have reached historical highs. +#5Million Tonnes Thermal Coal Demand Remains Significant in the Long Run Global thermal coal imports demand (Mt) adaro 1,200 1,000 800 600 400 200 0 ■China India JKT SEA Europe ROW Source: McCloskey by OPIS, a Dow Jones Company ("McCloskey") • Coal remains as significant part of energy mix in emerging economies in Asia Despite push towards renewable energy, emerging economies in Asia still rely on coal for electricity generation due to its availability and affordability. As the world aims to reduce carbon emission, demand for coal will be affected. 5#6Robust Demand Outlook for Metallurgical Coal Million Tonnes 450 400 350 300 250 200 150 100 50 Global metallurgical coal imports demand (Mt) adaro production The long-term demand fundamentals for metallurgical coal remain intact, underpinned by infrastructure Steel growth. and consumption is forecasted to grow. Met coal demand is expected to reach nearly 400 Mt in 2030. India is expected to be the growth driver and China's demand is forecasted to remain stable in the next decade. 2019 2020 2021- 2022- 2023 - 2024 2025 2026 - 2027 - 2028- 2029- 2030 China ■South Korea ■Others Source: McCloskey India Japan ■Europe South America CO 6#7TWh Southeast Asia is One of the Key Markets for Thermal and Met Coal SEA electricity demand more than double to 2040 adaro ASEAN (5) steel demand grows moderately in the short-term 2000 1 600 1 200 800 400 80 78 76 74 72 78 70 68 69 66 64 10% 5% M 0% 78 -5% 73 -10% -15% 2019 2020 2021F 2022F Volume (Mt) y-o-y growth 2010 2018 2020 2025 2030 2035 2040 Source: Southeast Asia Energy Outlook 2019, International Energy Agency 2019 Overview of Southeast Asia ASEAN (5): Indonesia, Malaysia, Philippines, Thailand, Vietnam Source: Worldsteel Association Short Range Outlook, April 2021 The region is home to around 655 million people and 45 million people is still without access to electricity. Its growth in electricity demand, at 6% CAGR, has been among the fastest in the world as the region aims for universal access to electricity by 2030. Coal has been the fastest growing fuel in SEA's energy mix, nearly 20 GW of coal-fired power plant is under construction (IEA). Coal with low pollutant content will be more favoured in the market as many countries try to control emission and new power plants utilize advanced boiler system. 7#8adaro adaro Performance of Adaro Energy#9Solid Financials Backed by Strong Operations Financial position continues to improve adaro Strong cash balance and free cash flow generation 2,000 600 400 200 0.4 1,800 0.3 1,600 1,400 0.2 1,200 1,000 0.1 2018 2019 2020 1Q22 800 (200) 0 600 400 (400) -0.1 200 (600) -0.2 Net Debt Net Debt to Operational EBITDA (x) Net Debt to Equity (x) Production (Mt) 40 30 50 60 • N Wegg 20 10 Almost three decades of production experience through various coal cycles 1992 1993 1994 1995 1996 1997 1998 1999 Tutupan 2000 2001 2002 2003 Wara 2004 2005 2006 Paringin 2017 2018 2019 2020 2021 1Q22 Cash (million US$) FCF (million US$) Capex (million US$) 2007 2008 Balangan 2009 2010 2011 2012 AMC MIP SR 2013 2014 2015 2016 2017 2018 2019 2020 2021 8.00 7.00 6.00 ☑ 5.00 4.00 3.00 2.00 Strip Ratio (x) 1.00 9#10adaro Electrification to reduce the usage of diesel gensets Cost Control - Key for Strong Performance Adaro's estimated coal cash cost breakdown (1Q22) Fixed overhead, 5% Coal processing, 10% Freight & handling, 20% Mining, 35% 40% Fuel, 25% - 30% Strong operational EBITDA generation and healthy operational EBITDA margin 2,500 2,000 40% 39% 1,500 35% 35% 1,000 2,104 1,315 1,408 1,207 500 883 2017 2018 2019 Operational Ebitda (US $M) 2020 70% 62% 53% 60% 50% 40% 30% 20% 755 10% 0% 2021 1Q22 Operational Ebitda Margin Consistently delivers on operational EBITDA target and performed in-line with guidance. Healthy operational EBITDA margin on the back of better cost control from integrated business model. 10#11Operational Excellence and Efficiency Continue to deliver solid results and operational excellence adaro OPERATIONAL 1Q22 1Q21 % Change Production (Mt) 12.15 12.87 -6% Sales (Mt) 12.20 12.59 -3% OB removal (Mbcm) 48.22 52.54 -8% FINANCIAL (US$ millions, unless indicated) 1Q22 1Q21 % Change Net Revenue 1,225 692 77% Core Earnings 484 110 338% Operational EBITDA 755 244 213% Cash 1,556 1,190 31% Net Debt Net Cash 119 Capex Free Cash Flow 70 41 71% 352 104 237% Operational EBITDA Margin Net Debt to Equity (x) 61.6% 35.3% 26% Net Cash 0.03 Net Debt to Last 12 months Operational EBITDA (x) Net Cash 0.14 Cash from Operations to Capex (x) 3.04 3.16 -4% 11#12adaro adaro Snapshot of Adaro Energy#13Supporting Main pillars pillars Who We Are adaro IDX-listed integrated mining and energy company with eight business pillars built to create value and achieve sustainable growth Integrated pit-to-power business model with control over each part of the coal supply chain Eight business pillars to support future growth Our strategy to create maximum value Organic growth from current reserves base. adaro MINING adaro SERVICES ☐ Focus on improving efficiency of coal supply chain and cost control. adaro adaro ☐ LOGISTICS POWER Product diversification, increase reserves and diversify location. adaro adaro ☐ LAND WATER Continue to deepen integration and improve contribution from non-coal mining businesses. adaro adaro CAPITAL FOUNDATION 13#14Integrated Business Model with control over each part of the supply chain ADARO MINING ADAROSERVICES ADAROLOGISTICS ADARO POWER THERMAL COAL MINING SERVICES Maritim Barito Perkasa (MBP) 100% Makmur Sejahtera Wisesa (MSW) 100% Adaro Indonesia (AI) 88.5% Saptaindra Sejati (SIS) 100% Barging & Shipping Operator of 2x30MW mine- Coal mining, S. Kalimantan Coal mining and hauling contractor Balangan Coal 75% Sarana Daya Mandiri (SDM) Dredging & maintenance in 51.2% mouth power plant in S. Kalimantan Coal Mining, S. Kalimantan Jasapower Indonesia (JPI) 100% Barito River mouth Mustika Indah Permai 75% Operator of overburden Indonesia Multi Purpose 100% Operator of Solar PV at Al's mine site in S. Kalimantan (MIP) crusher and conveyor Terminal (IMPT) Coal Mining, S. Sumatra Port management & Adaro Jasabara Indonesia 100% Bukit Enim Energi (BEE) terminal operator 61% (AJI) Tanjung Power Indonesia (TPI) 65% Coal Mining, S. Sumatra Bhakti Energi Persada (BEP) Coal mining, E. Kalimantan Mining services Indonesia Bulk Terminal 100% (IBT) Partner in 2x100MW power 10.2% Adaro Mining Technologies (AMT) 100% Coal terminal & fuel storage plant project in S. Kalimantan Puradika Bongkar 100% Coal research & METALLURGICAL COAL PT Adaro Minerals 83.8% Indonesia Tbk (AMI) Muat Makmur (PBMM) development Cargo loading & unloading Harapan Bahtera Internusa (HBI) 100% Bhimasena Power Indonesia (BPI) 34% Coal mining, C. Kalimantan, E. Kalimantan COAL TRADING Shipping administration Partner in 2x1000MW Coaltrade Services 90% Kestrel Coal Resources¹ 48% International Pte. Ltd (CTI) Queensland, Australia Barito Galangan Nusantara (BGN) 100% power generation project in Central Java Coal Trader Maintenance services 1) Kestrel Coal Resources has 80% ownership on Kestrel Coal Mine Note: Simplified Corporate Structure 581#15adaro MINING Adaro Mining#16Large Coal Reserves and Diverse Portfolio across Indonesia and Australia Adaro Indonesia: 88.5% Existing, S Kalimantan sub-bituminous Reserves: 731 Mt Balangan Coal Companies: S Kalimantan sub-bituminous Reserves 125Mt Resources: 265 Resources: 3.3 Bt Mt 2 PT Adaro Minera Indonesia Tbk (AMI) 3 Central and East Kalimantan Metallurgical coal Reserves: 171 Mt Resources: 980 Mt MIP: 75% stake S Sumatra sub-bituminous Reserves 210.2 Mt Resources 305 Mt 4 BEE: 61.04% stake S Sumatra sub-bituminous Geological study phase Kalimantan ༽,4 5 North Kalimantan East Kalimantan 5.00.2 6 Winst 7 BEP: 10.22% Kestrel Coal stake with option Mine to acquire 90% E Kalimantan sub-bituminous Resources 3.3 Bt 48% of 80% Queensland, Australia Premium HCC Reserves: 190 Mt N Resources: 430.5 Mt 5.00.01 Jambi South Sumatra 5 Bangka Belitung 4 Lampung 0 125 250 500 km JAKARTA Denwin Birdum Caims *Townsville Alice Springs Rockhampton Australia Brisbane 7 Fremande Perth Cap night:520 USGS NFS Sydney Centre Esn Delorme 15000F Banten West Java Central Java 3 Central Kalimantan 1 BALIKPAPAN 2 South Kalimantan N.009 5.00.2 East AEI has more than 8.5 billion tonnes (Bt) of coal resources and 1.4 Bt of coal reserves across thermal and metallurgical coal - providing us with flexibility in the coal market. East Nusatenggara + Note: Reserves and Resources numbers above are before 5.0.0.01 taking into account AEI's equity ownership 108 11600 Copyright 2014 Esu#17Unique Coal Product and Strong Customer Base Focused on Asia 20 Envirocoal is among the lowest pollutant content coal in the seaborne market Ash content: 2%-3% (adb) Nitrogen content: 0.9% - 1.0% (daf) 30 adaro MINING Sulfur content: 0.1% - 0.25% (adb) 30 ASH % (adb) 10 15 5 LO envirocoal 0 Customer geographical breakdown (1Q22) Europe Others India 13% 2% 1% China 10% Indonesia 30% East Asia 27% Southeast Asia 17% Nitrogen % (daf) 2.5 2.0 1.5 1.0 envirocoal 0.5 0.0 Total Sulfur % (adb) 2.5 2.0 1.5 1.0 0.5 envirocoal 0.0 Customer type by volume (1Q22) Others, 10% Power Plant, 90% Others include cement, pulp & paper, and industrial 17#18adaro MINING PT Adaro Minerals Indonesia Tbk (AMI)#19AMI at a Glance adaro Indonesia's leading metallurgical coal producer with low-cost, efficient operation supported by Adaro Group's integrated supply chain network Five CCOW holders located in Central and East Kalimantan, Indonesia. Large coal reserves and resources base which supports long-term sustainable growth. Coal reserves: 170.7 Mt. Coal resources: 980 Mt. Coal production in 2021 reached 2.3 Mt, and coal production target in 2022 is 2.8 3.3 Mt (A 22% -43% y-o-y). Strong demand profile from blue-chip steel companies. Current customers are located in China, Japan and Indonesia. Offers coal supply diversification for customers in a market dominated by Australia, Canada and the US. Close proximity to key markets offers customers with more competitive cost and shorter transportation time. 5 19#20Company Overview Established in 2007, AMI carries out an integrated mining activities through its subsidiaries, which has one of the largest greenfields area in Central Kalimantan for metallurgical coal. The Company's subsidiaries own 5 Coal Contract Of Work ("CCOW") located in East Kalimantan and Central Kalimantan with total area up to 146,579 ha. The 5 CCoWs are in the operation and production operation development stages: Maruwai Coal is currently operating and selling metallurgical coal, Lahai Coal is conducting mining optimization, meanwhile Kalteng Coal, Sumber Barito Coal and Juloi Coal are in development phase. CENTRAL KALIMANTAN PROVINCE Conveyor Line S05 0x 56 m A Workshop Pump house Crusher area JULOI KALTENG adaro SUMBER BARITO MARUWAI LAMPUNUT CCOW STAGE COALS MUARA TUHUP PORT Lahai Green Coal Maruwai Hard Coking Coal, Green Conveyor S04 & Line Hopper 2 Coal Kalteng Met-Coal Juloi Power House Sumber Barito 20 Met-Coal Met-Coal EAST KALIMANTAN PROVINCE LAHAI BAL Metallurgical Coal Cokes Notes: ✓ Operation ☑Production Operation Development 6 20 20#21Solid Performance Supported by Operational Excellence adaro OPERATIONAL 1Q22 Production (Mt) 0.62 Sales (Mt) 0.59 OB removal (Mbcm) 1.47 FINANCIAL (US$ thousands, unless indicated) 1Q22 Net Revenue 182 Core Earnings 85 Total Asset Operational Ebitda Margin 980 66.6% 21 21 21#22adaro adaro PT Adaro Indo Aluminium (AIA)#23PT Adaro Indo Aluminium Leading the Adaro Group's green transformation Increasing revenue contribution from non-coal to balance our business adaro Supporting Government's plan on green industry and processing of mineral product Looking to partner with reliable and experienced companies Development process will be conducted in stages Positive LT outlook as aluminum is needed in many industries including automotive Reduce aluminum imports, create job opportunities and contribute to state revenue 23 23#24Domestic Supply and Demand Balance adaro Domestic Supply and Demand of Aluminum 2500 2000 1500 1000 500 0 Gap 2020 Indonesian Production Capacity 2025 ■Indonesian Aluminum Demand Source: Pre-Feasibility Study Guiyang Aluminum Magnesium Design & Research Institute Corp. Ltd. The high gap between supply and demand of aluminum in Indonesia will potentially increase the country's reliance on imported aluminum.#25Global Demand Outlook Industry 2018 2040 25MT 43MT • Transportation • adaro Remarks Higher demand for electric vehicle, especially for battery packaging and heat sink. Penetration to reduce vehicle weight and use of gasoline. Building and • 22MT 29MT Urbanization and growing construction industry. Construction • Penetration for building materials. Consumer and 15MT 21MT • Industrial Increasing demand for consumer and industrial products. • Packaging Increasing demand for tin packaging. • 13MT 19MT Increasing demand for foil and plastic substitution. Energy Source: Statista, 2020 • • 11MT 16MT Increasing demand for energy sector application, such as solar panel structure. Copper substitute for transmission cable. 70.8 67.9 65.2 62.5 59.2 60.1 60.0 58.0 2016 2017 2018 2019 2020 2021 2022 2023 Demand for aluminum is estimated to increase on the back of economic growth in Asia. Demand for aluminum will be supported by the increase in transportation sector, in line with the commitment of global citizen and the transportation industry to increase the production of new energy vehicle.#26A ST140-00138 HT165 adaro Adaro Services and Adaro Logistics#27Ensuring Operational Excellence • Key part of our vertical integration. • Ensures operational excellence, • • productivity improvement and timely reliable delivery to customers. Stable earnings profile buffers against the volatility in coal price. Focus on providing services for companies in the Adaro Group. adaro Units 1Q22 1Q21 1Q22 vs 1Q21 Overburden Removal Mbcm 40.10 36.15 11% SIS Coal Production Mt 11.61 9.38 24% MBP Coal barging Mt 11.22 12.00 -6% 27 27#28adaro adaro Adaro Power & Adaro Water#29adaro Tanjung Power Indonesia - CFPP Size / Tech. Shareholders Project cost COD Availability Factor 2 x 100 MW CFB technology 65% AP, 35% Korea EWP USD 545 million 2019 72% (Avg. as of end of 1Q22) Adaro Power is One of Indonesia's Largest IPPs Gross Power Generation Capacity stands at 2,260 MW Makmur Sejahtera Wisesa - CFPP Size / Tech. Shareholders COD Availability Factor Adaro Mining Electrification 2 x 30 MW CFB technology 100% Adaro Power #1 Jun 2013, #2 Feb 2014 99.9% (Avg. as of end of 1Q22) Current: 11.7 MW Plan: additional 17.9 MW B Makmur Sejahtera Wisesa - Solar PV Bhimasena Power Indonesia - CFPP Size 130 kWp + 467 kWp Size / Tech. 2 x 1,000 MW Ultra Super Critical Shareholders 34% AP, 34% JPower, 32% Shareholder 100% Adaro Power COD Itochu Project cost Progress USD 4.2 billion 97.4% as of end of 1Q22 Q3 2018 (for 130 kWp) & 467 kWp COD 27 December 2021 USD 800,000 (approx.) 191,857 KWH Project cost Electricity produced Apart from improving the performance of its already-operated power plants and completing the construction, Adaro Power continues to study renewable power projects such as biomass, wind power, and solar PV to support PLN through unsolicited proposal and tenders. Adaro Power is also in the process of developing captive use power generation projects for the Group's other business units such as IBT (Genset & Solar PV) and AMI (Mini-hydro) 29 29#30Adaro Water Currently Owns & Operates 1,670 lps of Water Treatment Plants adaro Also Supports Mining Operations through Slurry Management Business Unit Location Dumai Tirta Persada Dumai, Riau Size 450 lps Adaro shares 49% Status First phase (50 lps) completed Location Adaro Wamco Prima Tanjung, South Kalimantan Mining pumps services Business Adaro shares 60% Status Operation Grenex Tirta Mandiri Location Bekasi, West Java Size 200 lps Adaro shares 49% Status Started construction Drupadi Tirta Gresik Location Gresik, East Java Size Adaro shares Status 400 lps 100% In operation since 2012 Drupadi Tirta Intan Location Banjar, South Kalimantan Size 500 lps Adaro shares 100% Status In operation since 2012 Location Size Adaro Tirta Mentaya Sampit, Central Kalimantan 320 Ips (contract) 400 lps (capacity) Adaro shares 90% Status In operation up to 250lps Adaro Water is currently in the process to achieve operational excellence through continuous improvement in its operating subsidiaries, including WTPs operations and slurry pumps operations. Meanwhile, on the construction side, Adaro Water continues to ensure that the project can achieve its goals in terms of schedule, budget & quality. From business development perspective, Adaro Water continues to actively seeking for new projects through PPP, non PPP and acquisition. 30 30#31adaro Sustainability and Green Initiatives#32Balance of People, Planet and Profit • adaro We strive to balance our responsibilities among the generation of profit, the utilization of planet and employment of people. Our corporate social responsibility programs focus on five main areas: education, economic development, health, environmental enhancement, and socio-cultural enrichment. Our environmental programs cover four main areas: land, air, water, and biodiversity. • PT Adaro Energy Indonesia Tbk is rated BBB on MSCI ESG ratings. idaro 32 32#33Terajoule 35,000 Improving Environmental Performance Reduced total energy consumption by 21% y-o-y adaro ...and reduced GHG emission (scope 1) by 22% y-o-y 30,000 25,000 20,000 15,000 10,000 5,000 Ton CO2 eq. 2,500,000 2,000,000 1,500,000 1,000,000 500,000 2019 2020 ■Total Energy Consumption (in Terajoule) 2019 ■GHG Emission Scope 1 (in Ton CO2 eq) Innovative projects to improve efficiency and environmental performance NANO 85 Fleet Management System reduces queueing time and energy used Kelanis Smart Inverter Solar Cell reduces diesel usage and CO2 emission 2020 33 33#34Ecosystem Restoration and Carbon Capture adaro • • . Through Adaro Land Pillar, we have subsidiaries which own forest management permits for ecosystem restoration and forest management permits for carbon absorption. PT Alam Sukses Lestari holds license to use timber product - ecosystem restoration in natural forest which allows restoration of forest ecosystem to achieve balanced biodiversity. PT Hutan Amanah Lestari holds license for utilization of carbon absorption and is one of the largest holders of such license in Indonesia. We expect that once operational, carbon trading will be the main. business of this company. 34 ==#35Awards and Recognitions adaro 2012 PROPER gold award Ministry of Environment & Forestry Aditama gold award For environment excellence in the coal sector Ministry of Energy & mineral resources Social empowerment award Won nine awards honoring companies that run CSR programs Ministry of Human Dev 2017 PROPER green award Ministry of Environment & Forestry Aditama gold award For environment excellence in the coal sector Ministry of Energy & mineral resources Best of environmental management & safety award Ministry of Energy & mineral resources 2013 PROPER green award Ministry of Environment & Forestry Aditama gold award For environmental excellence in the coal sector Ministry of Energy & mineral resources Global CSR bronze award For sustainable clean water program Pinnacle Group Global CSR 2018 PROPER green award Ministry of Environment & Forestry Aditama gold award For environment excellence in the coal sector Ministry of Energy & mineral resources Best of coal mining service business management & safety award Ministry of Energy & mineral resources 2014 PROPER green award Ministry of Environment & Forestry Aditama gold award For environmental excellence in the coal sector Ministry of Energy & mineral resources Bronze sustainability award For sustainable investment RobecoSAM 2019 PROPER gold award Ministry of Environment & Forestry Global CSR award, one gold and two silver For early childhood education program, CSR Leadership and environmental excellence in leader program. Annual Global CSR & Summit 2015 PROPER green award Ministry of Environment & Forestry Cultural based community empowerment award Awards in several categories Corporate Forum for Community Development & Ministry of Human Dev Bakti Husada award For community health development Ministry of Health 2020 PROPER gold award Ministry of Environment & Forestry 2016 PROPER green award Ministry of Environment & Forestry Global CSR bronze award For community-led sanitation Annual Global CSR & Summit Padmamitra award For poverty alleviation Ministry of Social Affairs 2021 PROPER gold award Ministry of Environment & Forestry MSCI ESG Ratings upgraded MSCI ESG Ratings upgraded to BB MSCI Charity and Community Impact Coaltrans Asia Best Implementation of Good Mining Practices MOEMR to BBB MSCI Best Environmental Excellence Award - Silver Global CSR Summit & Awards Aditama award Good mining practices MoEMR 35#36adaro Adaro Energy 2022 Guidance Coal production (Mt) Consolidated planned strip ratio (bcm/t) 51.8 54.04 58.03 54.53 52.7 58 - 60 5.06 4.69 4.6 4.15 4.1 3.84 2017A 2018A 2019A 2020A 2021A 2022F 2017A 2018A 2019A 2020A 2021A 2022F Operational EBITDA (US$ billions) 2.1 1.9-2.2 Capital expenditure (US$ millions) 496 489 1.4 1.3 1.2 0.88 229 169 193 300-450 iiill all…ï 2017A 2018A 2019A 2020A 2021A 2022F 2017A 2018A 2019A 2020A 2021A 2022F 36#37Conclusions and takeaways . • adaro Despite alternative energy push, coal will remain as an important part of the global energy mix, especially in Asia where coal continues to dominate the energy mix of most countries in years to come due to its availability and affordability. Advanced technologies used in new coal fired power plants enable the use of coal with lower heat value and prefer the use of coal with low pollutant content, which will benefit Indonesian coal producers. Long term fundamentals for coal remains promising. ✓ Indonesia, Southeast Asia and South Asia will be the main demand drivers. Adaro's integrated business model has been proven to be resilient during difficult market condition as it enables us to better control our costs and risks. Adaro offers a complete portfolio of coal products from low CV thermal coal to premium hard coking coal, providing us with flexibility in the coal market. Adaro pays regular dividend with average payout ratio of -46% since IPO in 2008. In total we have paid more than US$1.7 billion in dividend. 37 34#38Thank You adaro#39adaro adaro Appendix: Coal 101#40What is Coal? Coal is a sedimentary rock composed predominately of organic material, with a greater or lesser amount of mineral matter Coal is derived from plant remains in a sedimentary basin and is altered to solid rock by heat and pressure applied during the basin's formation Different types of coals are produced depending on formation and tectonic histories. Two main coal types used in the market: - Thermal coal: electricity generation - Metallurgical coal: steel making A ↑ adaro HUGE FORESTS GREW AROUND 300 MILLION YEARS AGO COVERING MOST OF THE EARTH THE VEGETATION DIES AND FORMS PEAT THE PEAT IS COMPRESED BETWEEN SEDIMENT LAYERS TO FORM LIGNITE FURTHER COMPRESSION FORMS BITUMINOUS AND SUBITTUMINOUS COAL EVENTUALLY ANTHRACITE FORMS A 40#41Integrated Coal Value Chain Use of Coal Upstream Coal Mine Coal adaro Intermediate Downstream End Use Industry Steel and Cement LNG IGCC Power Plants Electricity Coalbed Methane CH4 Pipeline Feedstocks Fertilizers CCS SynGas Gasification Coal Liquefaction Remark: IGCC = Integrated Gas Combined Cycle PETCHEM Plants Petrochemical Products LPG Cooking Diesel/ Gasoline#42Seaborne Thermal Coal Trade South Africa, Colombia and Russia dominate the Atlantic trade United States NORTH AMERICA 48 33 EUROPE EURASIA Russia 175 184 Pa adaro SOUTH EAST ASIA 82 CENTRAL AND SOUTH AMERICA AFRICA 28 16 69 149 Colombia 120 429 186 449 Indonesia 50 24 81 79 208 213 Australia Overall export 2019 2018 2019 South Africa Indonesia and Australia dominate the Pacific Seaborne trade This map is without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries, and to the name of any territory, city or area. Source: IEA, 2020 42 42#43How are coal priced? adaro Different coal types from different regions have distinct quality. Indices are used to price different coal quality: - - - - - globalCOAL NEWC Index, the benchmark price for seaborne thermal coal in the Asia-Pacific region. Indonesia's Harga Batubara Acuan (HBA) comprising of: Indonesian Coal Index (ICI), gCN, and Platts 5900. QHD FOB (6,000 kc NAR) marker assess the price of Chinese coal that is being shipped into the domestic Chinese markets at the port of Qinhuangdao. RB Index: a coal price benchmark high CV thermal coal delivered FOB Richards Bay Coal Terminal in South Africa. DES ARA: coal price benchmark for high CV thermal coal delivered at the ports of Amsterdam / Rotterdam / Antwerp 43