Construction of Balkhashskaya TPS “САМҰРЫҚ” МЕМЛЕКЕТТIК АКТИВТЕРДI БАСҚАРУ ЖӨНIНДЕГI ҚАЗАҚСТАНДЫҚ ХОЛДИНГI“ АҚ JSC “KAZAKHSTAN HOLDING FOR MANAGEMENT OF STATE ASSETS “SAMRUK” АО “КАЗАХСТАНСКИЙ ХОЛДИНГ ПО УПРАВЛЕНИЮ ГОСУДАРСТВЕННЫМИ АКТИВАМИ “САМРУК” Construction of Balkhashskaya TPS Investment Forum of Kazakhstan 2008, July Seoul, Korea

The Project is included to the List of breakthrough projects Construction of Balkhashskaya TPS Actuality Program for development of Unified energy system of the Republic of Kazakhstan until 2010 with perspective to 2015. approved by Ministry of energy and mineral resources of the Republic of Kazakhstan (MEMR RK) 07.07.04, №150 The Project is included to the List of breakthrough projects approved by Protocol of the State commission on economy modernization issues of the Republic of Kazakhstan №7 dated 04.06.07. Correction of forecasting balances of power energy and power capacity within the regions, oblasts and territory of the Republic of Kazakhstan approved by MEMR RK 22.05.06, №160. Deficit of power energy in South region

Construction of Balkhashskaya TPS

mlln.USD (currency 120,7KZT/1$) Construction of Balkhashskaya TPS Project costs mlln.USD (currency 120,7KZT/1$) Construction of the 1st module 2 411 Construction of the 2nd module 2 086 Other expenses, excluded from estimated costs, comprising maintenance of direction and technical personnel of the Balkhashskaya TPS 203 Total capital costs 4 700 Scheme of financing: Share capital – 30% from the total volume of investments 1 410 Loan capital – 70% from the total volume of investments 3 290

Reach of rated capacity Construction of Balkhashskaya TPS Key performance figures № Figures Units of measurement Reach of rated capacity 1 Total cost of construction (at the prices of 2008-2013), total including VAT mln. USD 4 497 2 Specific capital investments including VAT USD/kWt 1 704 3 Average unit prime cost of product for project exploitation period (with discounting) USD/KWth 0,046 4 Net profit (mid-annual for billing period ) mlln. USD 434,357 5 Net present Value (NPV) for billing period (rate 10%) 75,542 6 Simple capital investments payback period years 9 7 Discount payback period 28 8 Internal rate of Return (IRR) % 10,27

Reach of rated capacity Construction of Balkhashskaya TPS Key performance figures № Figures Units of measurement Reach of rated capacity 1 Established electric power output МWt 2 640 2 Annual electric power production mln.kWth 17 160 3 Annual electric power supply 15 444 4 Annual reference fuel consumption thousand tons of r.f. 4 942 5 Annual natural fuel consumption - coal - fuel oil thousand tons 8 649 36 6 Specific reference fuel consumption for electric power supply Gramm/kWth 320 7 Total number of employees person 800 8 Construction period month 102

Kazakhstan South region Construction of Balkhashskaya TPS Kazakhstan South region The South region of the Republic of Kazakhstan includes Almatinskaya, Zhambylskaya, Kyzylordinskaya, Yujno-Kazakhstanskaya and the largest city of the country – Almaty city. Existing deficit is covered by cross-flows from North of Kazakhstan and Central Asia

the main power generator in the region, there is a need in Construction of Balkhashskaya TPS Kazakhstan South region Taking into account loading and depreciation of Zhambylskaya GRES (oil-fired) – the main power generator in the region, there is a need in Construction of power station, which can cover the increasing demand of electricity in the region.

Key figures of the TPS TPS capacity Construction period Fuel Construction of Balkhashskaya TPS Key figures of the TPS TPS capacity Determined electric capacity of the station is 2 640 WВт; Annual power production is 17 160 mlln. kWt·h; Assembly – modular – installation of 2 modules per 2 power blocks; Energy block capacity – 660 МВт. Construction period 1st module 2 х 660 MWт (1320 MWт) – 2008 - 2013 (66 months); 2nd module 2 х 660 МWт (1320 МWт) – 2011 - 2016 (72 months). Fuel The coal of Ekibastuz Coal Basin according to the “Conceptions for fuel complex development of the Republic of Kazakhstan” Consumption: after running the 1st module – 4 324 000 tons/year; after running the 2nd module – 8 648 000 tons/year. Feasibility study Elaborated by “KazNIPIEnergoprom” Institute, LLP and approved by corresponding government bodies.

Location of the Project realization Construction of Balkhashskaya TPS Location of the Project realization Republic of Kazakhstan; South-west of Balkhash lake shore on the border of Almatinskaya and Zhambylskaya oblasts; Earlier specified and partly completed construction site of Yujno-Kazakhstanskaya GRES (YuK GRES). Reasons of choice: The central part of electric power transit “North-South” of Kazakhstan – are power lines with voltage 500÷220kV. Creation of power output in this region will significantly increase the capacity of existing and under construction high voltage lines; Enhancement of the reliability of power supply in south of Kazakhstan during the construction of Balkhashskaya TPS; Prevention of unacceptable growth in prices for power energy in South region of Kazakhstan (cheap coal instead of expensive oil fuel and gas) Availability of large water source – Balkhash lake allows to organize a process of water supply for TPS. Within the project implementation for construction the Yujno-Kazakhstanskaya GRES on the estimated site a range of preparatory works have been implemented.

Realization of the Project Construction of Balkhashskaya TPS Realization of the Project SPV shall be created as Balkhashskaya TPS, JSC, which will perform as project company with following functions: Attraction and organization of financing the Project; Project administration; Conclusion of EPC contract (Engineering, Procurement and Construction Contract – «turn-key» contract); Exploitation and assets operation, built up as a result of Project realization. Conclusion of contracts with KEGOC, JSC – the national (100% state owned) electric grid operator of RK and other consumers to supply electric power. Проверить насчет обеспечения гос гарантией Possible involvement of state guarantee in the project realization as a security for attracted loans.

Strategic or portfolio Construction of Balkhashskaya TPS Financial structure Samruk-Energo, JSC 25% from share capital of BTPS, JSC Strategic or portfolio Investors 75% from share capital of BTPS, JSC Lenders Share capital Balkhashskaya TPS, JSC 30% from Project cost [1 410 mlln USD] Loan proceeds 70% from Project cost [3 290 mlln. USD] guarantee cash flows from the Project PROJECT ЕРС contract

Construction of Balkhashskaya TPS Financial structure In order to realization a capital intensive Project from power energy sector a long term financing is required, when capital investments generate stable and predictable cash flows. Project financing increases investment profit in virtue of high financial instrument, it allows to attract strategic investors. Existence of sound possibilities to use a mechanism of public-private partnership.

Contracts for electric power purchase Construction of Balkhashskaya TPS Financing traffic pattern INVESTORS LENDERS FINANCING Equity capital Loan capital ЕРС contract Balkhashskaya TPS Contracts for electric power purchase Power consumers Balkhashskaya TPS, JSC Debt return Profits

Effects from the project realization Construction of Balkhashskaya TPS Effects from the project realization Construction of Balkhashskaya TPS: will insure the coverage of future burdens in the region, will increase reliability of electric power supply, will create a necessary reserve of power energy, will allow to realize the export potential of the Republic of Kazakhstan.

Holding Samruk, JSC tel: +7 7172 976 551 fax: +7 7172 790 400 www.samruk.gov.kz Samruk Invest LLP tel: +7 7172 790 851 fax: +7 7172 790 851