Kemira Presentation MoneyTalks Forum 2011

Water – What is Hot?MoneyTalks ForumTechnopolis Tampere 12th May 2011Kaj Jansson, Vice President, R&D and Technology

StrategyMission:Efficient use and reuse of waterVision:A leading water chemistry companyStrategy:Improve performance of our customers’ water-intensiveprocesses through chemistry applications and products • Comprehensive understanding of water challenges • Unique customer offerings through industry specific applications • Scale and competence benefits by utilizing common products and water chemistry knowledge across the customer base • Cost competitive product portfolio through globally optimized networks of efficient production assets and suppliers 12 May 2011 2

A global two billion euro chemicals companySites: ~100 Countries: 40 Personnel: 4935 North America Sales: 659,8 MEUR (31%) Personnel: 1386 (28%) Europe, Middle East and Africa Asia Pacific Sales: 1207,2 MEUR (56%) Sales: 136,7 MEUR (6%) Personnel: 2876 (58%) Personnel: 259 (5%) South America Sales: 157,2 MEUR (7%) Personnel: 414 (9%) Countries with Kemira sites 12 May 2011 3

Kemira growth targets• Growth in revenues• Mature markets > 3%• Emerging markets > 7%• Earnings before interest and taxes (EBIT), % of revenue > 10%• Cash flow after CAPEX and dividend > € 0M• Gearing <60% 12 May 2011 4

Megatrends driving our businessWorld population 2050: 9.3 billion 100% increase in water withdrawals for urban and industrial use. 100% increase in energy demand 70% increase in food production 11% increase in water withdrawals for irrigated agriculture.• World Energy Council: Deciding the Future – Energy policy scenarios to 2050 • GE Energy• UN Water • How to Feed the World 2050• Looking ahead to 2050: Scenarios of alternative investment approaches 5

Regional differences in water availability Projected availability of water per capita in 2025Population faces water scarcity when annual water supplies drop below 1 000 m3 percapita and water stress when annual water supplies drop below 1 700 m3 per capita Source: Revenga et al 2000, from Pilot Analysis of Global Ecosystems: Freshwater systems. UNEP/Vital Water Graphics 12 May 2011 6

The gap between water demand and supply Water demand Water supply • Quantity up +50%, in 20 years • Scarcity due to climate change • Quality demand rising • Infrastructure missing8000 CAGR7000 2% Municipal Solving the gap through e.g.6000 • Desalination Primary industrial growth from China 40% • Wastewater reuse Industry5000 • Rainwater harvesting Municipal4000 Groundwater Demand Industry management with3000 regulation and tariffs Surface2000 water1000 Agriculture Agriculture 0 Existing 2030 withdrawals Existing, accessible withdrawals 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr supply 4200 Bm3 6900 Bm3 4500 Bm3 Source: Charting Our Water Future by 2030 water Resources Group, 2009. Adapted from Water 2030: Global Water Supply and Demand model; agricultural production based on IFPRI IMPACT-WATER base case 7

SWEET - Center of Water Efficiency Excellence • In 2010, Kemira and VTT established a Center of Water Efficiency Excellence in Finland (SWEET). • SWEET supports Kemira’s strategic target to become a leading water chemistry company. • Four years development programme with total volume of 120 million euros. • Goals achieved in 2010: • First wave of external funding secured • New R&D Center in Sao Paolo in operation • Strategic partnerships formed: • Industrial eg. Outotec, Metso Paper • Research eg. NTU Singapore, University of Alberta 12 May 2011 8

SWEET - Program Focus AreasWater reuse  Water reuse chemistry, including removal of microconstituents, antiscaling, disinfection, nutrient recycling  Chemistry for membrane applications, including enhancement of desalination  Chemistry for advanced wastewater treatment processes, including membrane bioreactorsResource efficient biomass utilization  New chemistry concepts to enhance biomass utilization  Efficiency and improved processes  Enhance biomass based productionSustainable water chemistry  More sustainable chemistry for polymer synthesis and applications  Biogradable and environmental friendly concepts  Sustainable value addition on recycled raw material value chains 12 May 2011 9

Energy / Water Nexus• Do we have a wide enough view of our operative environment in the Water / Energy Nexus? • No water = No energy • No energy = No water • Is there a sustainable role for chemistry in this Nexus?• Have we forgot about synergistic parts in the water intensive sector • Competition for water between food and industrial sectors • Competition lead to recycling of biomass considered as waste – No waste allowed! • Waste to value (energy, water, nutrients) = no waste remaining! 12 May 2011 10

Control, monitoring and diagnostics Water efficiency and reuse Missing tool across Kemira to support our application-based Separation and Measurement, business approach monitoring and purification Water process control • Fragmented (techology and technologies Intensiveness usage) Advanced materials and chemicals for Sustainability water management assessment Capability LevelDifferent capability levels(technology and resources) forvarying offering levels • Alignement into concepts for different levels 12 May 2011 11

Water reuse Case: Finnish mine  The cost of water is 4% of total prodcution cost  Equal to the cost of chemicals used Rain water 1 Million m3/a Ore Ore Enrichment Enrich processing Water Fresh water 6 Million m3/a Effluent treatment Process water circulation 1 Million m3/a Purified water 7 Million m3/a 12 May 2011 12

Forward osmosisPrinciples • Natural phenomena, water diffuse from salty water to pure waterAdvantages • Lower energy use • Higher recovery • Reduced brine discharge Challenges • Dewatering draw solution, Draw solution with high capacity water adsorptionTime expected to be availablecommercially: in the next 10 to 20years 12 May 2011 13

Is this Hot?Maybe it is the future!Recovering high grade water fromflue gases• 40% of water can be recovered• Recovered water can be used as process water for industries• Large scale tests has been planned for Europe, North Africa, South Africa and MENA 12 May 2011 14

Kemira’s innovation approach and focus areas Industrial & municipalGlobal watermegatrends, treatmentglobalmarkets Water Value from wasteCustomer &market Improvementsdemands Energy Waste in water intensiveOpenness & industrialcollaboration Environment processes Sustainable chemistry 12 May 2011 15

Thank You!More information: kaj.jansson@kemira.com Tel. +358 50 085 2109

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Kemira Presentation MoneyTalks Forum 2011

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