#1Martin Brudermueller Vice Chairman of BASF SE Hong Kong January 2015 We add value as one company 150 years ◉- BASF We create chemistry 11 111 5 16 43 11 43#2Cautionary note regarding forward-looking statements 150 years Q-BASF We create chemistry This presentation may contain forward-looking statements that are subject to risks and uncertainties, including those pertaining to the anticipated benefits to be realized from the proposals described herein. Forward-looking statements may include, in particular, statements about future events, future financial performance, plans, strategies, expectations, prospects, competitive environment, regulation and supply and demand. BASF has based these forward-looking statements on its views and assumptions with respect to future events and financial performance. Actual financial performance could differ materially from that projected in the forward-looking statements due to the inherent uncertainty of estimates, forecasts and projections, and financial performance may be better or worse than anticipated. Given these uncertainties, readers should not put undue reliance on any forward-looking statements. The information contained in this presentation is subject to change without notice and BASF does not undertake any duty to update the forward- looking statements, and the estimates and assumptions associated with them, except to the extent required by applicable laws and regulations. BASF Capital Market Story January 2015 2#3We create chemistry for a sustainable future Positioning Ludwigshafen, Germany Nanjing, China 70 Antwerp, Belgium Kuantan, Malaysia Geismar, USA Freeport, USA 60 50 40 30 3:5645322 Performance 20 2007 2008 2009 150 years Q-BASF We create chemistry www Perspective 2010 2011 2012 ⚫ Verbund site ■ The #1 chemical company ☐ 74 billion sales, 7.2 billion EBIT bSI in 2013 #1-3 in >75% of businesses, present in >200 countries 6 integrated Verbund sites, production in 60 countries. ■ A track record of strong sales and earnings growth 14% average annual dividend increase, >3% yield in every single year* ~ 64 billion market capitalization end of December 2014 ■ Chemistry as an enabler ■ BASF has superior growth opportunities: sustainable innovations - investments - emerging markets BASF Capital Market Story January 2015 * For 2004-2013 3#4BASF today - a well-balanced portfolio Total sales 2013: 74 billion Percentage of sales 2013* 23% 21% 150 years Q-BASF We create chemistry Chemicals Petrochemicals ■ Monomers Intermediates 7% Performance Products Dispersions & Pigments ■ Care Chemicals Nutrition & Health Paper Chemicals Performance Chemicals 23% Functional Materials & Solutions " Catalysts Construction Chemicals Coatings Performance Materials Agricultural Solutions Crop Protection BASF Capital Market Story January 2015 * Not depicted here: -6% of Group sales reported as 'Other' Oil & Gas 20% ☐ Exploration & Production and Natural Gas Trading 4#5Verbund generates >€1 billion p.a. global cost savings*, supports sustainability 150 years Q-BASF We create chemistry Energy Verbund >€300 million annual cost savings Logistics Verbund >€600 million annual cost savings Infrastructure Verbund >€100 million annual cost savings Global reduction in carbon emissions of 6.1 million metric tons/a. and reduction of waste Example Ludwigshafen: avoidance of 7 million metric tons of freight/a. = 280,000 fewer truckloads Shared use of on-site facilities: fire department, security, waste water treatment and analytics BASF Capital Market Story January 2015 * Savings include only tangible synergies. Additional (intangible) benefits and retained profits are not included. 5#6Business review Growth Levers BASF Capital Market Story January 2015 6#7Q3 2014: BASF with higher sales and earnings despite declining demand 150 years Q-BASF We create chemistry Business performance Q3'14 vs. Q3'13 Q1-Q3'14 vs. Q1-Q3'13 Sales 18.3 billion +3% 56.3 billion +1% EBITDA 2.5 billion +1% 8.2 billion +4% EBIT before special items 1.8 billion +9% 6.0 billion +5% EBIT 1.8 billion +8% 6.1 billion +8% ◉ Net income 1.0 billion (5%) 3.8 billion +3% ■ Reported EPS 1.14 (5%) 4.16 +3% ☐ Adjusted EPS 1.27 (1%) 4.45 +2% Sales development Period Volumes Prices Portfolio Currencies Q3'14 vs. Q3'13 7% ↓(4%) 0% 0% Q1-Q3 2014 vs. Q1-Q3 2013 6% (3%) 0% (2%) BASF Capital Market Story January 2015 7#8150 years Important corporate developments Q-BASF We create chemistry -BASF Recent transaction with Statoil ■ Acquisition of participations in oil & gas fields in Norway ■ Purchase price amounts to US$1.25 billion ■ Increase of production to -60,000 boepd in Norway ■ Additional reserves and resources of ~170 million boe ■ Transaction closed December 1st, 2014 BASF Capital Market Story January 2015 Strengthening of R&D platforms ■ Future set up of global research platforms: Process Research & Chemical Engineering, led out of Europe Bioscience Research, led out of North America (from 2015) Advanced Materials & Systems Research, led out of Asia (from 2016) Restructuring of Performance Products BASF to sell textile chemicals business to Archroma ■ Paper Chemicals division to be dissolved, product lines moved to other divisions ■ Strategic options for parts of kaolin business in evaluation ■ Total earnings improvement of 500 million by 2017 - 8#9150 years Strong free cash flow generation Free cash flow* in billion Q-BASF We create chemistry 4 3.5 3.3 3.2 3 2 1 2.6 2.5 3.2 3.9 3.7 2.6 3.2 1.3 0 2004 2005 2006 2007 2008 2009** 2010 2011 2012 2013 Q1-Q3 2014 BASF Capital Market Story January 2015 * Cash provided by operating activities less capex (in 2005 before CTA) 2009 adjusted for re-classification of settlement payments for currency derivatives 9#10150 years Growing dividend with attractive yield Dividend per share ( ) 0.85 1.00 2.60 2.70 2.50 2.20 1.95 1.95 1.70 1.50 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Dividend yield* 3.2% 3.1% 4.1% 3.8% 7.0% 3.9% 3.7% 4.6% 3.7% 3.5% Dividend payments ■ Q-BASF We create chemistry Dividend of 2.70 per share for 2013, an increase of 3.8% ■ 2004-2013: Average annual dividend increase of ~14% ■ Attractive dividend yield of 3.5% in 2013** Dividend yield above 3% in any given year since 2004 Dividend Policy ■ We want to grow or at least maintain our dividend BASF Capital Market Story January 2015 * Dividend yield based on share price at year-end Based on BASF share price of 77.49 on Dec. 30, 2013 10 10#11150 years Delivering consistent, long-term value Average annual performance with dividends reinvested Q-BASF We create chemistry Last 10 years January 2005 - December 2014 +3.8% Euro Stoxx 50 +8.7% DAX 30 Last 5 years January 2010 December 2014 +14.5% BASF +13.9% +9.6% MSCI World Chemicals 0 3 6 9 12 15 18 BASF Capital Market Story January 2015 +4.5% +10.5% +11.9% 11#12Outlook 2014 Outlook 2014 We aim to: ■ increase our sales volumes excluding the effects of acquisitions and divestitures ■ slightly increase EBIT bSi compared with EBIT bSi of about 7.1 billion in 2013 Assumptions 2014 GDP: 2.3% (previous: 2.5%) ■ Industrial production: 3.4% (previous: 3.7%) ■ Chemical production: 4.0% (previous: 4.4%) ■ US$ / Euro: 1.35 (unchanged) ■ Oil price (US$ /bbl): 105 (previous: 110) BASF Capital Market Story January 2015 150 years Q-BASF We create chemistry 12#13Business review Growth levers - Portfolio development - Market approach – Innovations for a sustainable future - Investments - Acquisitions - Operational excellence BASF Capital Market Story January 2015 13#14150 years BASF outperformed global chemical production by ~3 percentage points p.a. Sales to third parties billion Q-BASF We create chemistry 80 60 40 40 20 20 IFRS Impact 13.7 79 3.7 -0.5 -2.0 0.6 -6.6 20.7 -4.8 72 Volumes Prices Currencies M&A 16.6 Prices 33 Volumes 2001 BASF Capital Market Story January 2015 Currencies M&A 74 74 2012 2012 restated 2013 BASF nominal growth 2001 - 2013 (BASF growth adj. for IFRS: -8%) 7.1% Global chemical production (CAGR 2001-2013) 3.8% 14#15150 years Portfolio development Moving downstream towards customer industries Q-BASF We create chemistry 2001 in % of sales** 2010 in % of sales** 2020 in % of sales** Classical Chemicals Customized Products Chemical Industry ~ 50% 40% P - 30% BASF Capital Market Story January 2015 **Sales excluding Oil & Gas. Targets were published on November 29, 2011. Functionalized Materials & Solutions First customer industries ~ 50% 60% ~70% 15 15#16150 years Portfolio development Towards more market driven and innovative businesses Q-BASF We create chemistry Acquisitions Catalysts ■ Construction chemicals ☐ Water-based resins Pigments, plastic additives ■ Oil & Gas ■ Personal care & food Battery materials ■ Functional crop care ☐ Omega-3 fatty acids ☐ Enzymes ~ €14 billion sales BASF core business Selected transactions 2005 - today Strong partnerships ☐ Gazprom ☐ Monsanto ■ Petronas ■ Shell ☐ Sinopec ■ Statoil ■ Total Divestitures Agro generics ■ Vitamin premixes Styrenics ■ Fertilizers Construction equipment, flooring and wall systems ■ Textile chemicals ~ €7 billion sales BASF Capital Market Story January 2015 16 16#17Restructuring in Performance Products Announced measures to strengthen competitiveness Leather and textile chemicals (March 18, 2013 & October 16, 2014) Water, oilfield and mining chemicals (March 27, 2013) Plastic additives and pigments (April 23, 2013) Pigments (October 23, 2013) Paper Chemicals (January 23, 2014 & September 24, 2014) Nutrition & Health (April 25, 2014) Care Chemicals (June 5, 2014) Further measures BASF Capital Market Story January 2015 Measures ■ Establishment of global innovation center in China Divestiture of textile chemicals ■ Establishment of global business unit to realize synergies ■ Divestment of industrial water management business Adjustments at sites in the Basel area to adapt to changed market ☐ conditions ☐ Downsizing of R&D activities ☐ ☐ Optimization of global production network Closure, restructuring and evaluation of strategic options for production assets Latex plant in EU shut down. Kaolin: Strategic options under evaluation ■ From Jan. 1, 2015: Division dissolved, new set-up follows value chains Adaption of product portfolio and organizational processes to market realities ■ Set of measures to adapt to changed customer needs and market conditions within its Home Care, Industrial & Institutional Cleaning and Formulation Technologies businesses Ongoing 150 years Q-BASF We create chemistry ■ Reduction of >2,400 positions until end of 2017 ■ Annual earnings contribution of €500 Million from 2017 onwards ■ One-time costs in the magnitude of ~€250-300 Million 17#18Market approach Cross-divisional customer industry approach 150 years Q-BASF We create chemistry BASF sales by first customer industry* Consumer goods > 15% Transportation > 15% Construction > 10 % Energy & Resources Bubble Size: BASF divisional sales by first customer industry*/** < 10 % BASF Capital Market Story January 2015 Monomers Dispersions & Pigments Care Chemicals Intermediates Performance Chemicals Paper Chemicals Petro- chemicals Coatings Construction Chemicals Catalysts Performance Materials Excluding Oil & Gas, Crop Protection and Other. 2012 numbers ** Nutrition & Health sales predominantly into Health & Nutrition market 18#19150 years Cross-divisional approach D-BASF BASF's technology Verbund combined with customer know-how We create chemistry Lightweight tridion cell High performance foams. Infrared-reflective film Infrared-reflective coating BASF Capital Market Story January 2015 Solar roof with transparent organic solar panels and OLED modules E-textiles Multifunctional seat Daimler & BASF concept car 'Smartforvision' All-plastic wheel 19 19#20Customer Verbund - adidas and BASF Working together for disruptive innovation: Infinergy™ Target 2015 15million adidas 150 years Q-BASF We create chemistry energy boost boost adidas BASF Capital Market Story January 2015 ◉- BASF The Chemical Company 20 20#21150 years Strong commitment to innovation Innovations for a sustainable future R&D expenditures in billion 2.0 1.8 1.7 1.6 1.5 Corporate Research 21% 1.5 1.4 1.0 0.5 0 2009 2010 2011 2012 2013 Oil & Gas 3% Key facts Q-BASF We create chemistry 1.8 billion R&D expenditure in 2013, further increase of R&D spending planned in 2014 ■ ~10,650 employees in R&D ~3,000 projects ■ Research Verbund: Cooperations with ~600 excellent partners from universities, start-ups Agricultural Solutions 26% Functional Mat. & Sol. 20% Performance Products and industry 20% Target 2015: Chemicals 10% 10 billion in sales from innovations younger 5 years BASF Capital Market Story January 2015 21 24#22Chemistry-based innovations Growth and technology fields 150 years Q-BASF We create chemistry Global needs Key customer industries Resources, Environment & Climate Transportation Agriculture Food & Nutrition Construction Energy & Resources Growth fields Batteries for Mobility Enzymes E-Power Management Functional Crop Care Heat Management for Construction Lightweight Composites Technology fields Materials, Systems & Nanotechnology Raw Material Change Quality of Life Consumer Goods Electronics Organic Electronics Plant Biotechnology Water Solutions BASF Capital Market Story January 2015 Health & Nutrition Wind Energy White Biotechnology 24 22#23Investments Capex budget 2014-2018 by segment and region* Capex budget 2014-2018 by segment Capex budget 2014-2018 by region 150 years Q-BASF We create chemistry Performance Products Asia Pacific 18% 15% Chemicals South Functional 33% America Europe 49% Materials & Solutions €20 billion 4% 12% Other 4% €20 billion Agricultural Oil & Gas Solutions 20% 7% Other 13% North America 25% BASF Capital Market Story January 2015 Source: BASF Report 2013 23 23#24Investments Major projects 150 years Q-BASF We create chemistry Ammonia and gas-to-propylene in USA* MDI plant Chongqing, China Acrylic acid complex Camacari, Brazil JAMBATAN TIMBANG TDI plant Ludwigshafen, Germany Aroma Ingredients Kuantan, Malaysia BASF Capital Market Story January 2015 Under evaluation Expansion oil & gas activities 24 14#25150 years Acquisitions will contribute to profitable growth in the future We want to acquire businesses which ... Generate profitable growth above the industry average Are innovation-driven Offer a special value proposition to customers Reduce earnings cyclicality Q-BASF We create chemistry Provide a minimum return on investment of 8% p.a. after tax Are EPS accretive by year three at the latest Strategic acquisition criteria Financial acquisition criteria BASF Capital Market Story January 2015 25 25#26150 years Operational excellence programs 2 1.3 billion earnings contribution from STEP by 2015 Annual earnings contribution in million 4,000 3,000 2,000 1,000 0 2013 2015 STEP program Q-BASF We create chemistry ■ Targeted annual earnings contribution increased 2 from 1 billion to 1.3 billion by end of 2015 ■ Optimization of processes and structures in all regions, e.g. ■ manufacturing, maintenance ■supply chain ■ engineering, best-cost country sourcing ■ Project timeline: 2012-2015 ■ Between 0.9 and 1 billion by the end of 2014 expected ■ One-time cost: 2 1 billion Former cost NEXT STEP saving programs BASF Capital Market Story January 2015 26 26#27Operational excellence Strong track record BASF Group* 2001-2013 Index 350 300 250 200 150 100 50 150 years Q-BASF We create chemistry CAGR 2001 - 2013 10% EBITDA 8% Sales 3 % Fixed costs * 2001 2006 2009 2012 2013 Excl. companies with major IFRS 10/11 restatements, i.e. BASF YPC Nanjing, Libya onshore, other Oil & Gas and Catalysts companies BASF Capital Market Story January 2015 27 27#28Appendix I: Chemicals Day BASF Capital Market Story January 2015 20 28#29Chemicals segment grows by selling into the BASF Verbund and to the market 150 years Q-BASF We create chemistry Sales Chemicals in million € 25,000 20,000 15,000 10,000 5,000 CAGR 11% 2001-2013 Volume CAGR 5% 2001-2013 New segment structure & JV accounting change (IFRS)* 0 2001 2002 2003 2004 2005 2006** 2007** 2008 2009 2010 2011 2012 2013 restated Sales to other BASF segments Sales to 3rd parties BASF Capital Market Story January 2015 * IFRS 10 & 11 impact: 1.3Bn; Impact of new segment structure: + 5.3Bn ** Without Catalysts (now part of Functional Materials & Solutions segment) 29 29#30Chemicals with stable profitability, little correlation to oil price EBITDA margin Chemicals / oil price Index 2001 = 100 150 years Q-BASF We create chemistry 500 400 300 200 100 Oil price EBITDA margin Chemicals (as % of sales) 2011 2012 2013 restated 0 2001 2002 2003 2004 2005 2006* 2007* 2008 2009 2010 BASF Capital Market Story January 2015 Without Catalysts (now part of Functional Materials & Solutions segment) 30#31Chemicals is a strong earnings contributor EBIT after cost of capital* in million 2,000 150 years Q-BASF We create chemistry 1,500 1,000 500 0 2004 2005 2006** 2007** 2008 2009 2010 2011 2012 restated 2013 EBIT after cost of capital Chemicals Chemicals earned a premium on cost of capital even during the 2008 / 2009 recession* BASF Capital Market Story January 2015 EBIT after cost of capital concept was introduced in 2004. ** Without Catalysts (now part of Functional Materials & Solutions segment) *** The former Plastics segment also earned a premium on cost of capital during the 2008/2009 recession. *** 31#32Chemicals generates strong and steady free cash flow 150 years Q-BASF We create chemistry Cash flow Chemicals in million 4,000 3,000 2,000 1,000 0 2001 2002 2003 2004 2005 2006* 2007* 2008 2009 2010 2011 2012 2013 restated -1,000 Operating cash flow (EBITDA) Free cash flow (EBITDA - additions to plant, property & equipment) Since 2001, Chemicals contributed ~€17 billion of free cash flow to BASF Group BASF Capital Market Story January 2015 * Without Catalysts (now part of Functional Materials & Solutions segment) 32#33Shale gas in the U.S.: Lower energy and feedstock cost Price development of oil / natural gas 150 years Q-BASF We create chemistry Crude oil in US$/bbl 120 100 80 60 60 40 40 20 20 de-coupling of crude oil & natural gas prices Natural gas in US$/MMBTU 20 Crude Oil WTI Game changer shale gas ■ Increased U.S. shale gas production disconnected crude oil prices from natural gas prices in North America ■ Increased production of natural gas liquids (NGLS): ethane, propane, butane ■ NGL price drop drives shift to lighter cracker feed slates - Improved profitability of light feed crackers Narrow cracker output 15 Natural Gas Germany 10 10 Natural Gas 5 USA 0 0 1990 1995 2000 2005 2010 2015 2020 BASF Capital Market Story January 2015 Source: IHS Inc. 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Natural gas price Germany: Statistisches Bundesamt "Grenzübergabepreis" Germany 33#34Chemicals supplies key raw materials to BASF downstream segments Performance Products Functional Materials & Solutions 150 years Q-BASF We create chemistry Agricultural Solutions Acrylic acid • Acrylates Butadiene Ethylene oxide ■ Propylene oxide Pyrrolidones Amines Isobutene Hydrochloric acid Sodium hydroxide -40% of total raw materials supplied by Chemicals segment BASF Capital Market Story January 2015 ■ MDI & TDI Polyamides Mono ethylene glycol ▪ PBT PolyTHF Propylene oxide Acrylic acid Acrylates Plasticizers TDI ~30% of total raw materials supplied by Chemicals segment Solvents Specialty amines Ethylene glycol Nitrotoluene Alcoholates -35% of total raw materials supplied by Chemicals segment 34#35Principles for internal supply driven and merchant market driven products 150 years D-BASF We create chemistry Internal supply driven Reliable supply of key raw materials Economic advantages through superior Merchant market driven Capture value of attractive chemicals markets ■ Access to chemicals not available in the market BASF Capital Market Story January 2015 technologies and Verbund Top-3 position in target market 35#36150 years Close to entire cracker output in Ludwigshafen is used within Verbund Cracker products Ludwigshafen Ethylene ■ Raffinates Propylene ■ Aromatics ■ Butadiene Q-BASF We create chemistry BASF Capital Market Story January 2015 <5% >95% Value chains Merchant Market of the BASF Verbund BASF-YPC Nanjing supply for captive demand: 2006: 60% 2014: 75% 36#37Chemicals is at the heart of the BASF Production Verbund 150 years Q-BASF We create chemistry Additional Verbund benefits Chemicals segment Transfer pricing Additional Verbund benefits Flexible planning along value chains High security of supply, low logistics costs, no sales and sourcing costs Joint quality management Joint engineering and process development Cross-functional knowledge exchange Additional capacity at Verbund sites dilutes fixed costs BASF Capital Market Story January 2015 Downstream divisions Philosophy of transfer pricing ☐ ☐ ☐ Safe and flexible supply at competitive prices Transfer prices linked to market prices No cross-subsidizing Value driven management in all steps of the value chain 37 32#38Chemicals segment accounts for one third of all capex Capex budget 2014-2018 by segment 150 years Q-BASF We create chemistry High capex intensity commands extraordinary focus on capex allocation and project control Performance Products 15% Agricultural Solutions 7% Functional € 20 billion Materials & Solutions 12% Other 13% Chemicals* 33% Oil & Gas 20% ■ Extensive use of cash-cost benchmarking ◉ Preparation of solid business cases for all projects ensures sound decision-making Projects approved only if cost of capital is earned even at hypothetical marginal producer price level BASF Capital Market Story January 2015 38 Including gas-to-propylene project U.S. Gulf Coast, TDI Ludwigshafen, MDI Chongqing, Isononanol Maoming#39Capex in line with revenues to support top and bottom-line growth Consolidated sales indexed (2000 = 100) 150 years Q-BASF We create chemistry Capex as % of sales 400 350 300 250 200 150 100 50 0 16% Capex outlook 14% Consolidated sales Chemicals segment. 12% 10% 8% 6% 4% -Capex as % of sales Chemicals segment 2% 0% 2000 2001 2002 2003 2004 2005 2006* 2007* 2008 2009 2010 2011 2012 2013 2014 2015 2016 restated BASF Capital Market Story January 2015 Without Catalysts (now part of Functional Materials & Solutions segment) 39#40Major investment projects in the Chemicals segment 150 years D-BASF We create chemistry Ammonia and gas-to-propylene in USA* MDI plant Chongqing, China TDI plant Ludwigshafen, Germany BASF Capital Market Story January 2015 * Under evaluation Isononanol plant Maoming, China STILCESARU HAST SPOC Compliance 异壬醇项目商基仪式 奠基 Acrylic acid complex Camacari, Brazil Polyamides plant Caojing, China 40#41150 years Cost curve case study: Acrylic acid China Acrylic Acid cash cost curve, China average cash costs 2015 in US$/kg Cash costs BASF new process BASF classic process D-BASF We create chemistry Continuous process innovation leads to best-in-class technology ■ ■ Proprietary BASF technology, with best-in-class process Significant cost synergies due to two parallel projects (Nanjing, Camacari) Acrylic acid will supply downstream units (superabsorbent polymers; acrylates) BASF Capital Market Story January 2015 Production capacity Source: BASF estimate 41#42150 years Cost curve case study: TDI Europe TDI cash cost curve, Europe average cash costs 2015 in US$/kg Ludwigshafen BASF new Cash costs BASF Europe BASF Schwarzheide Q-BASF We create chemistry New Ludwigshafen TDI plant will provide superior cost structure in Europe Leading single-train technology ■ New TDI plant strengthens and benefits from Ludwigshafen Verbund ■ Schwarzheide plant to be closed after start-up of new plant New TDI plant re-balances competitive environment of European TDI market BASF Capital Market Story January 2015 Production capacity Source: BASF estimate 42#43Cash costs BASF North America Cost curve case study: Caprolactam Caprolactam cash cost curve average cash costs 2015 in US$/kg Q-BASF We create chemistry BASF caprolactam production focused on captive demand BASF Europe BASF Capital Market Story January 2015 Production capacity Source: BASF estimate ☐ BASF plants well positioned 150 years ☐ ◉ ☐ on cost curve Best-in-class cost position in Europe Constant process improvement ongoing Worldscale caprolactam plants supply downstream demand of polyamide 6 applications ■ Further cost improvement in North America after start-up of ammonia JV with Yara 43#44Shale gas is a major opportunity for BASF 150 years Q-BASF We create chemistry BASF #2 chemical producer in the U.S.* Converted Port Arthur cracker with high feed flexibility BASF will maximize opportunity of low-cost methane BASF Capital Market Story January 2015 LLLLLLL LLLLLLL Low energy costs (energy bill dropped by 55% compared to 2007**) Substantial profit improvement Strengthen profitability of the Grow selected C1 value chains 44#45Shale gas is beneficial for methane and ethane based chemistry 150 years Q-BASF We create chemistry Natural Gas Liquids Ethane Propane Butane ► Cracker Feed Composition of shale gas Methane ► Power plants ► Ammonia Methanol ■ Low transportability of ethane Shift to ethane crackers ◉ Propane and butane easy to transport Export with link to global market ☐ Very limited transportability of methane Methane to remain an abundant product with low pricing in North America (despite LNG projects) Methane and ethane to retain their advantageous cost position in North America BASF Capital Market Story January 2015 45#46Ammonia joint venture* enables low raw materials costs for BASF downstreams Hydrogen** Long-term sourcing contracts Nitrogen** 150 years Q-BASF We create chemistry Improved cost position for BASF's downstream products ◉ ■ World-scale producer Yara-BASF Ammonia joint venture Yara merchant market ◉ economics plant with focus on captive demand only (BASF) Site: BASF Verbund site Freeport, Texas Capacity: 750 kt p.a. Advantages of hydrogen & nitrogen based technology: Caprolactam Isocyanates Amines BASF Capital Market Story January 2015 BASF Group - Lower capital investment No greenhouse gas emissions - Faster execution ** Project under evaluation Hydrogen and nitrogen are available in the Freeport area 46#47150 years Gas-to-propylene complex* covers internal demand at attractive conditions Propylene supply North America Methane (from shale gas) Methanol Flexible feed (NGL's, Naphtha) Q-BASF We create chemistry Cost leading gas-to-propylene technology covers supply gap from 2019 ◉ U.S. Gulf Coast location World-scale plant Start-up: 2019 Propylene Propylene (Port Arthur cracker) Acrylic acid Oxo-alcohols Polyols BASF Capital Market Story January 2015 Downstream products Project under evaluation ■ Port Arthur cracker and new ■ on-purpose propylene complex to cover entire captive propylene demand Mid-term no sales to merchant market Lower cost than alternative PDH technology 47#48BASF Capital Market Story January 2015 Appendix II: Oil & Gas 48#49150 years Share of Oil & Gas in BASF portfolio Average EBITDA* 2009-2013 (billion p.a.) Oil & Gas 2.3 (24%) 2009 2013 BASF Group w/o Oil & Gas 7.4 (76%) Cumulative capex** 2009-2013 (billion ) Key facts ■ 2009-2013: - Q-BASF We create chemistry Oil & Gas: Solid profit contributor to BASF Group Oil & Gas accounted for ~30% of BASF Group capex ■ Oil & Gas will remain a significant contributor to BASF's total EBITDA ■ Capex share of Oil & Gas business in BASF's portfolio will decline Oil & Gas 6.4 (31%) 2009 BASF Group w/o Oil & Gas 14.5 (69%) 2013 BASF Capital Market Story January 2015 * Excluding non-deductible oil taxes; restated figures from 2012 onwards in accordance with changes in IFRS Including additions to property, plant, equipment resulting from acquisitions, capitalized exploration, restoration obligations and IT investments; restated figures from 2012 onwards in accordance with changes in IFRS 49 49#50Strong earnings contribution from Oil & Gas Net income Oil & Gas (million ) 150 years Q-BASF We create chemistry 2.000 1.500 1,780 1.201 1.064 1,100 951 1.000 923 857 789 712 601 480 500 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013* Q1-Q3 2014 BASF Capital Market Story January 2015 * Positive impact from special income due to the deconsolidation of Gascade Gastransport GmbH and the disposal of a share in the Edvard Grieg oilfield (BASF Report 2013, pp. 86-87) 50#51Strong free cash flow contribution to BASF Group Cash flow Oil & Gas* (million ) 150 years D-BASF We create chemistry 2.000 1.500 1.000 500 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Operating cash flow Oil & Gas Free cash flow** Oil & Gas ~40% of operating cash flow to BASF Group (avg. 2004-2013) BASF Capital Market Story January 2015 * Wintershall cash flow ** Free cash flow: Operating cash flow less payments related to property, plant and equipment and intangible assets 51#52150 years Oil & Gas - Focus on upstream activities D-BASF We create chemistry Oil & Gas value chain Upstream Midstream Downstream Exploration / Development / Production Transport Storage / Trading BASF Capital Market Story January 2015 52 62#53Clear strategy for further profitable growth in E&P 150 years Q-BASF We create chemistry ☐ E&P Focus ■ Core regions ■ Limited exploration risk Long-term profitable growth Technology ■ BASF technology Verbund Enhanced oil recovery (EOR) Partnerships Strategic partnerships with regional resource holders BASF Capital Market Story January 2015 Production target of >160 million boe in 2015 53 53#54Four core regions and one development region 150 years Q-BASF We create chemistry South America Europe North Africa BASF Capital Market Story January 2015 Operating company Current activities оо Russia Middle East Core region Development region 54 54#55Regional footprint 2013 Production by region 2013 Europe 18% North Africa/ Middle East 132 million Russia 9% boe South America 20% Proved 1P reserves by region 2013 Europe 13% North Africa/ Middle East 9% South America 13% BASF Capital Market Story January 2015 150 years Q-BASF We create chemistry 53% Production ☐ ■ Russia stands for roughly 50% of total production ■ In 2013, natural gas accounted for approx. 75% of total production 1.5 billion Russia 65% boe Reserves ■ Russia provides strong reserve base ■ Gas accounts for approx. 75% of total reserves 55 55#56Reserves and R/P 1P Reserves* (million boe) 1.600 1.400 1.200 1.000 800 600 400 200 0 2003 2006 R/P (years) Key facts 12 150 years Q-BASF We create chemistry 10 8 CO 6 4 ■ R/P ratio increased to 11 years ■ Total 1P reserves amounted to ~1.5 billion boe (2013) ■ Gas accounts for approx. 75% of total reserves ■ Strong contribution to reserve replenishment from assets in Norway and Russia 2 0 ** 2009 2012 Reserve Replacement Rate (RRR, in percent) 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 102 50 52 48 389 116 89 89 131 100 280 Oil Natural gas R/P According to SEC guidelines; Libya onshore 51% BASF Capital Market Story January 2015 ** 2013 adjusted to new conversion factor from m³ gas to barrel of oil equivalent (5,600 scf = 1 boe instead of 6,000 scf = 1 boe) 56#57Active portfolio management - Focus on promising projects 150 years D-BASF We create chemistry Norway Add. 24.5% in 24% in Aasta Vega Hansteen*, Add. 5% in Gjøa, 19% in Asterix Norway Add. 2.5% in Brage 15% in Luno II Acquisitions Divestitures (closing dates) (closing dates) Own/joint-operated Non-own operated Argentina Norway 25% in Maria 50% in Aguada Federal Norway 32.7% in Brage Norway 15% in Gjøa 30% in Vega 2011 2012 2013 2014 Norway Shares of 14 licences UK North Sea 14 licenses Germany 15.79% of VNG Including 13.2% in Polarled Pipeline BASF Capital Market Story January 2015 2015 closing 57#58150 years Recent transaction with Statoil Strategic rationale of the transaction ☐ Q-BASF We create chemistry To strengthen Wintershall's position in Norway by increasing participation in producing oil and gas fields To participate jointly with Statoil in promising development project "Aasta Hansteen" To get access to additional reserves and resources (2P/2C) of ~170 million boe and assets with material exploration perspectivity To increase production of Wintershall Norge from currently around 40,000 boe/day to about 60,000 boe/day To expand position as field operator in Norway and to gain experience with subsea operations by taking over operatorship in the Vega field* To significantly increase Wintershall's EBIT and future operating cash flow BASF Capital Market Story January 2015 58 * Pipeline project will provide route for produced gas from Aasta Hansteen field to onshore processing facilities#59150 years Recent transaction with Statoil Transaction summary Wintershall expands its oil and gas production and reserves in Norway Intensification of the cooperation with Statoil, the leading Norwegian oil and gas major, on exploration and development projects Q-BASF We create chemistry Wintershall acquires shares in assets from Statoil containing reserves and resources (2P/2C) of ~170 million boe and a stake in the Polarled pipeline project* Purchase price of US$1.25 billion plus up to US$50 million if Aasta Hansteen field development is executed according to current project plan Transaction closed December 1, 2014 with effective date of January 1, 2014 59 BASF Capital Market Story January 2015 Pipeline project will provide route for produced gas from Aasta Hansteen field to onshore processing facilities 50#60Production growth from solid project pipeline (major projects) 150 years Q-BASF We create chemistry 2013 Achimgaz (FFD) 2015 2017 2019 Knarr Edvard Grieg Aasta Hansteen Maria Ravn F 17 Area Hibonite Vega Pleyade CMA1 extension Unconventionals Length of development phase BASF Capital Market Story January 2015 Block 4N 2021 Skarfjell Fenix Shuwaihat 60#61150 years ◉- BASF We create chemistry