The energy transition - The issues, impacts and our response

H2

The energy transition The issues, impacts and our response

worley.com

We’ve been here before H2

It’s 1800 The industrial revolution and the use of coal is a profound energy transition for the world. It's dragging millions of people out of poverty, and improving health, education and quality of life.

It’s the 2020s Another energy transition is underway.

This one is driven by urgent action to address climate change and the development of cheaper, low emissions technologies.

Like before, this is a profound change in how humanity develops, uses and benefits from energy. Unlike before, it’s larger in scale and complexity.

It’s unstoppable. Even a global pandemic cannot alter this course. If anything, it has accelerated during COVID-19.

Millions of people still don’t have access to energy, but this transition will help us address the problem in a truly sustainable way.

There is a lot to do and the challenges are immense.

This is how we see our role.

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The energy transition

Where does our energy come from?

31.4%

Primary energy sources

It’s time to roll up our sleeves

Coal

Oil

26.2%

The scale of change required is extraordinary.

23.2%

Around 80 per cent of our primary energy currently comes from fossil fuels.

While some of this is lost through process inefficiencies, it fuels the bulk of the world’s industries and energy-related processes.

Renewables and other low emissions options are growing fast, but to meet sustainability goals, this balance needs to flip.

Bioenergy

9.4% 5.0%

Other renewables

Natural gas

2.2%

2.6%

Nuclear energy

Hydropower

Source: IEA World Energy Outlook 2020

The issues, impacts and Worley’s response

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The global energy transition is not a scenario – it’s our reality. One we need to embrace, plan for and deliver.

Chris Ashton Chief Executive Officer, Worley

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The energy transition

A tough road ahead

World energy related emissions The wedges of response to reach a sustainable path.

We look to the International Energy Agency’s (IEA) Sustainable Development Scenario (SDS) for guidance on the pathway to meet global sustainability objectives. This balances decarbonization with universal access to modern energy and clean air.

STEPS 35

Gt C02

Despite significant progress, our global energy direction continues to misalign with this scenario. To change our trajectory, we need to work on both old and new energy infrastructure, and transform the way we work with energy.

40

Stated Policies Scenario (STEPS) Reduce emissions from existing energy infrastructure

Preference for low emissions infrastructure

30

SDS

Material efficiency and behaviour Sustainable Development Scenario (SDS)

25

20 2015

2020

2025

2030

Source: IEA World Energy Outlook 2020 All rights reserved

The issues, impacts and Worley’s response

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Fugitives and waste

9%

Other energy

9.5%

We’re all involved As some of the biggest users of energy, the world is looking to heavy industrials to lead the charge. This means complexity is no longer confined to your core business. We’ll need to work together to find opportunities and overcome challenges.

Total industry

Agriculture, forestry and land use

18.4%

29.4%

Buildings

Transport

16.2%

17.5%

Source: Our World in Data, University of Oxford - original source Climate Watch, World Resources Institute (2020)

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The energy transition

Approximate global greenhouse gas emissions by economic sector.

Chemicals

Aluminium

Paper

Cement

Iron and steel

2000-2019

Net change

2019-2040 STEPS

SDS

8,000

100

4,000 0

TWh

The energy transition is changing the energy resources we use. This is a unique challenge for the world’s biggest energy, chemicals and resources businesses. It requires changes to processes, developing new technologies and creating entirely new value chains. New energy icons will emerge, as they grasp the economic opportunities.

Light industries

Change in electricity generation source over the last 20 years, compared to the next 20 years, by scenario

Mtoe

An energy revolution

Change in energy resource and related feedstock in the IEA SDS until 2030

0

-100

-4,000

-200

Coal

Oil

Renewables and hydrogen

Source: IEA World Energy Outlook2020. All rights reserved.

Natural gas

Electricity and heat

-8,000

Coal

Gas

Other low carbon

Wind

Solar PV

Source: IEA WEO2020 launch presentation. All rights reserved.

The issues, impacts and Worley’s response

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The pressure is on The risks from a changing energy landscape are real. Energy-intensive businesses face growing scrutiny from various groups, each with their own motives.

Sometimes it’s simple

Sometimes it isn’t

Sometimes there’s no choice

New frontiers

In power, lower emissions are a clear goal. The switch to gas, renewed interest in nuclear power and investment in renewable energy can get us there.

Chemicals and heavy industries are more complex. Cement manufacturing, steel and smelting as well as chemical-based industries such as petrochemicals, ammonia and ethylene make up nearly 20 per cent of combined global emissions, and they have no clear pathway to decarbonization.

Mining is energy-intensive and generates high carbon emissions. Investment horizons are short, and change has been slow.

The options are growing. We’re helping build and operate the world’s largest offshore wind farms, hydropower and solar installations.

We must find more sustainable ways to achieve the same results with technologies such as green hydrogen.

But megatrends such as social value, climate change and digitalization are changing the industry.

Miners are shifting the way they consume and supply the critical resources needed to power the energy transition.

We’re turning waste into an energy source.

We’re using renewable power to electrify the world and energy storage systems to ensure power resilience. Biomass and biofuels are at our disposal, while low emissions hydrogen is emerging as a glue to bind this new frontier together.

Technologies such as energy storage, carbon capture, digital analytics, distributed energy systems, renewables and new flexible retail models are all at our disposal.

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The energy transition

Finding the answers So, how do complex heavy industrials slash their carbon intensity over the coming years? It’s possible, but it’s going to take technologies from many different sectors. No one has all the answers today, but we have a responsibility to find them in partnership with our customers.

Renewable energy

Fugitive emissions

Hydrogen

Energy systems

Energy efficiency

Biofuels

H2 H2

stored CO2

Electrification

Sector key:

New energy minerals

Upstream & Midstream

Gas as a feedstock and transition fuel

Nuclear power

Power

Carbon capture, utilization and storage

Refining & Chemicals

Digitization

Mining, Minerals & Metals

The issues, impacts and Worley’s response

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WORLEY CLIMATE CHANGE POSITION STATEMENT

We acknowledge the findings of the Intergovernmental Panel on Climate Change.

We contribute our project delivery and technical expertise to enable our customers to meet the world’s changing energy needs in a safe, responsible and sustainable manner, in line with the ambitions of both the Paris Agreement and the UN Sustainable Development Goals.

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The energy transition

We are committed to achieving net zero Scope 1 and Scope 2 greenhouse gas emissions by 2030, and to pro-actively supporting our customers to reduce emissions on their projects and assets. We will keep our stakeholders informed of our strategy and progress against established metrics, including the recommendations of the Task Force on Climaterelated Financial Disclosure.

Our role in responding USA AND CANADA

UK

EUROPE

Distributed energy systems

London Array offshore wind farm

Wind energy to hydrogen

Emerging wave power technology

Alternative to gas repowering

Converting industry to 100% hydrogen

Europe’s first waste-to-jet-fuel plant

From plants to plastics

Improving grid resiliency

Negative emissions through BECCS

Producing hydrogen for industrial use

Green hydrogen to ammonia

Transitioning to a cleaner fuel

Liquid Wind’s first eMethanol facility

Blending hydrogen into gas

World's largest green hydrogen production facility

Large scale electrolysis

Converting industrial waste gas into sustainable ethanol

Offshore topside substations

CHINA

Developing a repowering strategy

Solar thermal in China

1PointFive's direct air capture facility

PAPUA NEW GUINEA

Refinery conversion to renewable fuels

Lihir – Worth more than gold

Shell's CCS project

Ore sorting technology

Operating clean generation plants Renewable output forecasting

Revitalizing an old vessel through digitalization

A new renewable fuels plant

Hydro plant upgrades

Australia’s largest hybrid renewable microgrid

Electrowinning using renewables

US electric vehicle expansion project

SOUTH AMERICA

AUSTRALIA

INDONESIA AFRICA 365 wind turbines in 362 days

MIDDLE EAST

Meeting emissions regulations

A carbon-free society An industrial scale solar hybrid Nationwide hydrogen study

Hybrid power for an LNG facility South Australian hydrogen roadmap

NEW ZEALAND Biomass to replace coal facility Carbon capture and storage facility The issues, impacts and Worley’s response 11

Selected case studies 1PointFive's direct air capture facility

Hybrid power for an LNG facility

Carbon capture and storage

The facility, located in the U.S. Permian Basin, is the first commercial scale deployment of Carbon Engineering’s DAC technology, which captures carbon dioxide directly out of the atmosphere. The FEED phase will focus on the first train, DAC 1, which will capture 500,000 metric tons of CO2 annually.

We are providing design, procurement and delivery services for the implementation of a battery energy storage system and small solar PV development at a confidential customer’s LNG facility in Queensland. The batteries will integrate renewable energy input into the plant, and will also provide spinning reserve coverage to the existing gas turbines which provide power to the entire islanded facility.

We recently completed the safe start-up of Chevron Australia’s Gorgon CO2 injection facility on Barrow Island, Western Australia.

Refinery conversion to renewable fuels

World's largest green hydrogen production facility

Liquid Wind’s first eMethanol facility

We are working on the front-end engineering services to convert Phillips 66’s San Francisco refinery in Rodeo, California, USA into a renewable fuels facility.

The project will reconfigure the refinery and produce up to 650 million gallons per year of renewable transportation fuels from used cooking oils, fats, greases and vegetable oils. Once built, the renewable fuels facility is expected to be one of the world’s largest facilities of its kind. We also completed the Pre-FEED and Advisian, our consulting business, carried out the project’s feasibility study.

We've been awarded an early engineering services contract by Shell to support the development of a 200 megawatt electrolysis-based hydrogen plant. Once complete, the project will be one of the largest commercial green hydrogen production facilities in the world.

We are working on the front-end engineering design for Liquid Wind's first commercial scale eMethanol facility. We will also provide the project’s cost estimate. The facility, which will be in Örnsköldsvik, northern Sweden, is expected to produce 50,000 tonnes of renewable methanol every year. The feedstock for the facility will use biogenic carbon dioxide from a biomass-fired power plant and combine it with green hydrogen, made from renewable electricity and water, to produce eMethanol.

London Array offshore wind farm

Negative emissions through BECCS

Green hydrogen to ammonia

We were awarded a contract by Siemens Gamesa Renewable Energy (SGRE) for statutory inspections and general maintenance of wind‐turbine‐generator cranes and lifts across all turbines on the London Array offshore wind farm.

We are providing the early front-end engineering and design (pre-FEED) for the first two carbon capture units at Drax Group’s power station in North Yorkshire, UK. Each unit is expected to capture approximately 4 million tonnes of carbon dioxide a year. The carbon capture units will incorporate the negative emissions process scheme, Bioenergy with Carbon Capture and Storage (BECCS). This project could result in the power station becoming carbon-negative and contribute to Humber’s ambition to become the UK’s first zero-carbon industrial cluster.

We have been working with ammonium nitrate manufacturer, Queensland Nitrates Pty Ltd (QNP), to determine the feasibility of producing green hydrogen at commercial scale. Partly funded by the Australian Renewable Energy Agency (ARENA), this study has been undertaken in conjunction with Neoen, which will supply electricity from large wind and solar generation.

When complete, the facility will be capable of extracting one million metric tons of atmospheric CO2 annually. It will also help to accelerate the deployment of commercial-scale direct air capture technology, which is critical to helping companies around the world meet their ambitious CO2 emission reduction targets.

The wind farm consists of 175 turbines installed in over 20 kilometres off the Kent coast in the United Kingdom. Generating 630 MW, the London Array offshore wind farm produces enough energy to power approximately 470,000 homes, displacing approximately 900,000 tonnes of CO2 per year.

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The energy transition

A first-of-its-kind project on this scale, the facility will be located in the Port of Rotterdam in the Netherlands. Operations are scheduled to start by 2023 and will produce around 50,000–60,000 kg of hydrogen per day.

Each year, around four million tonnes of reservoir CO2 will be injected into the Dupuy Formation beneath Barrow Island. The Gorgon CO2 facilities are expected to inject 100 million tonnes of CO2 over the life of the Gorgon project – reducing greenhouse gas emissions from the Gorgon LNG facility by approximately 40%.

This project is one of a suite aimed at commercializing new green hydrogen based products, as steps toward decarbonizing some of most challenging, emissionsintensive industries.

3,000+ projects contributing to the energy transition Solar

365+ Solar PV projects

950 MW

Worlds largest concentrated solar power (CSP)/PV hybrid project

Wind

782+

Geothermal, hydro and ocean power

320+

Wind power projects

Geothermal, hydro and ocean power projects

310 MW

20 GW

Largest onshore wind farm and largest in Africa

2,600 MW Largest offshore wind farm

Largest hydropower project

Nuclear power

229+

Nuclear power projects

30+ GW

Nuclear projects over

60+

years in 27 countries on five continents

Renewable fuels, renewable natural gas and wasteto-energy

248+

Renewable fuels, renewable natural gas and wasteto-energy

$211m

Savings in a single project through licensor design optimization

Hydrogen

105+

Distributed energy, Electrification, EV and storage energy efficiency and grid transformation

231+

231+

Hydrogen projects

Distributed energy, electric vehicle (EV) and storage projects

Electrification, energy efficiency and grid transformation projects

36 GW

200 MW

$20m/yr+

Largest green hydrogen electrolyzer studied, combined with offshore wind

EPC for PV solar project including grid interconnection

Savings achieved through energy efficiency and electrification for a single industry customer

Carbon capture use and storage

214+

Carbon capture, utilization and storage (CCS) projects

100 MT

Million tons of C02 expected to be captured and stored in world’s largest CCS project

Mining, minerals and metals

56+

Energy transition projects in mining, minerals and metals

70%

Diesel reduction through electrication at world's largest iron ore mine

Energy transition materials

221+

Carbon capture, utilization and storage (CCS) projects

25+

Lithium projects in brine concentrates

25+ yrs

Lithium experience globally

The issues, impacts and Worley’s response 13

Leaving our legacy We stand at the brink of sweeping changes in our lives.

From the way we cook our breakfast, to the transport we depend on to commute, to the way we work – everything is changing.

We’ve played here before

The goalposts have moved

We’re all on the field

The modern world has a growing appetite for energy, but we’ve always found ways to do more with less and given opportunities to millions.

Living standards must improve for those without access to reliable energy, but the environment can’t pay the price.

No company in the energy, chemicals and resources sectors can afford to spectate.

Greenhouse gas emissions come from various sources, but they all matter to humanity.

This is the defining issue of our time. We’re making the energy transition our legacy.

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The energy transition

I have a fundamental belief that the energy transition enabled by digital solutions is central to delivering the vital transformation the industry and our customers need.

Geeta Thakorlal President, Digital & Energy Transition

The issues, impacts and Worley’s response 15