The renewable fuels company

July 2018

Ambition | Growth | Sustainability

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Company overviewVelocys, the renewable fuels company, is at the forefront of thedecarbonisation of fuels for aviation and road transport

VLS.L Ticker

Share price13p

Issuedshares330m

Market cap£43m

£

Notes: see notes 1 & 3, all values are estimates

Velocys focus:• Renewable jet fuel production in the UK with Shell and BA

— Waste-to-jet biorefinery has started pre-FEED stage• Renewable diesel production in the US

— Mississippi biorefinery project completed pre-FEED stage• ENVIA landfill gas-to-fuels JV has proven the Velocys Fischer-Tropsch

(FT) technology at commercial scaleVelocys FT technology enables:• Economic conversion of wide range of low cost, abundant feedstocks

(like municipal waste and woody biomass) into high value fuels• Distributed smaller scale biorefineries• Fuels that qualify for high value credits in the US (federal and state),

UK, and other countries to follow• Meeting strong demand from corporations for greenhouse gas (GHG)

and particulate reductions (up to 70% and 90% respectively4,5)• Entirely “drop-in” into conventional fossil fuels with no blend limitations

for naphtha and diesel and 50% for jet fuel

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The teamBig oil & gas experienceBP, Shell, Phillips:refining & marketing businessmanagement, manufacturing,finance, supply & logistics

Renewable / GTL experienceSasol, Syntroleum, SGS:project management, plantcommissioning & startup,operations, GTL products

Commercial & financing experienceGoldman Sachs, Natixis:investment banking, commoditiestrading, PE/VC fund raising, projectfinance

Rest of Velocys team• Oil & gas, GTL, project engineers• Commissioning and operating experts• Commercial finance professionals

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Henrik WarebornInterim Chief CommercialOfficer

David PummellChief Executive Officer

John TunisonInterim Chief FinancialOfficer

Dr. Paul SchubertChief Operating Officer

Velocys timeline – innovation delivered

Velocys Inc.formed (fromBattelle)

Oxford Catalystsformed (fromOxford Univ)

Micro-channel FTdemoAustria

Oxford Catalystslisted on AIM

OxfordCatalysts &Velocysmerged

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‘05 ‘06 ‘07 ‘08 ‘09 ‘10 ‘11 ‘12 ‘13 ‘14 ‘15 ‘16 ‘17 ‘18 ‘19 ‘20 ‘21 ‘22‘01 ‘02 ‘03 ‘04

FT fielddemo withPetrobras

Namechanged toVelocys plc

ENVIA JVformed & FID

ENVIAoperational

UK biorefineryproject enterpre-FEED withShell and BA

USbiorefineryproject start

Notes: see note 1, 2

R&D Development Commercialisation• New team• New strategy• New focus delivery

Velocys projects

Operational

2018 20192017

Development

Development

Landfill gas-to-wax plant performing at commercial scaleValidation of Velocys’ commercial scale FT technology completed

2020 20222021

Commissioning thenoperational

Commissioning thenoperational

20232016

Construction

ENVIA OKC

Mississippi forestry residue biorefinery

UK waste to jet-fuel biorefinery

Woody biomass-to-fuels plant - pre-FEED completeIntegrated demonstration in progressSite secured in Natchez, MS. Permitting at advanced stage

Waste to jet-fuel plant - consortium announced with Shell andBritish Airways. Pre-FEED started

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Targeted dates

Notes: see notes 1 & 2

Construction

Construction

The opportunityPetroleum-based fuels cause GHGsand pollution and are not sustainableor renewable

of RIN generatingfuels deliver >20%GHG reductions6

<25%

of RIN generatingfuels are cellulosic6

~1%

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Demand for diesel and jet fuelcontinues to increase, making thechallenge bigger

Notes: a) with legislative support via US RFS

1st and 2nd generation biofuelsa havenot maximised sustainable carbonemissions reductions

2nd generation advanced cellulosicbiofuels projects are capital intensiveand require legislative support

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There is an abundant low cost feedstock supply of waste and woody biomassglobally

Velocys fuels can yield GHG and particulate reductions of up to 70% and 90%respectively4,5

Accelerating demand continues to outstrip available supply and this is forecast tocontinue

Legislation promoting advanced biofuels has been established in US since 2006and the UK in 2018. Momentum is building in many other countries

Airlines are aggressively seeking solutions to reduce their carbon emissions andmany have invested into renewable jet fuel projects

Business drivers

Notes: see notes 1 & 3, all values indicative

UK Renewable Transport Fuel Obligation requires 5% renewable-derived sourcingfor large resellers beginning in 2019 (up to 12.4% by 2032)13

Velocys fuels are drop-in fuels with no impact on engine design and supply chain

Velocys’ first-of-a-kind commercial scale proven technology and business modelenable entry to renewable fuels markets to grow a material supply position

Mississippi biorefinery update

8Notes: see notes 1 & 3

• Project development strategic investment process to onboard one or morestrategic investors is underway and on track

• Site secured in Natchez, Mississippi with $60m of state/local incentives

• In US Department of Agriculture (USDA) Loan Guarantee phase II process— With Sumitomo Mitsui Banking Corp (SMBC) as the lender of record

• Final investment decision expected in early 2020

• Significant value uplift from feedstock at equivalent $1/gallon to finalproducts at $8.20/gallon15

— Of which federal credits (approximately 50%), state credits(approximately 25%) and product revenues (approximately 25%)

• Team is delivering a complex programme of activities— Working with partners and licensors to further commercially de-risk the

project through maximising product revenues and minimising costs

• Project is on track to deliver an investable first-of-its-kind project

Excellent infrastructure & utilities, attractive incentive packageSite selected in US - Natchez, Mississippi

Biorefinery site

Mississippi riverNatchez

Adams Port

Railroad

Water mains

Proposed water wellsand well header

Electrical substations,transmission anddistribution lines

Effluent pipingand outfall

9Notes: see notes 1 & 2

10Notes: see notes 1 & 2

UK waste-to-jet fuel project update• Development partnership in place with Shell and BA for a commercial scale waste to

renewable jet fuel biorefinery— 10 million gallons per year capacity— Experienced global players in both production and consumption of biofuels— Velocys project development team supported by the significant experience and

competencies of its partners

• RTFO legislation has created strong policy support for biofuels in the UK

• The project is proceeding at pace— Project feasibility study is complete— Pre-FEED funded by £4.5m partner investment and approximately £0.5m UK DfT

grant— FEED expected to start in H1 2019

• Significant benefits to Velocys— Supports messaging of “Velocys, the renewable fuels company”— Validates our strategy and business model to attract strategic investors and open

up a second market— Demonstrates our renewable feedstock flexibility (landfill natural gas, woody

biomass residues and municipal waste)

11Notes: see notes 1 & 2

ENVIA update• Velocys is a JV partner in ENVIA

• Commercial scale Oklahoma City plant converts landfill gas to diesel, naphtha and wax

• Velocys’ FT technology data will be used in commercial discussions with future strategicpartners for the Company’s US and UK projects

• Key ENVIA milestones— October 2017; met performance and regulatory requirements by reaching

200 barrels per day operational capacity— December 2017: completed qualification run for Renewable Identification Number

(RIN credits) registration— March 2018: RINs verified— April 2018+: ENIVA has sold D7 RINs and its liquid products to contracted 3rd

parties

• Current operations— Operating in reduced production due to a reactor leak event— Coolant system on the second FT reactor modified and operating procedures

updated— Second FT reactor has been operated in the same operating cycle during which the

first reactor developed the leak, without incident

Red Rock Biofuels – Lakeview project

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• Red Rock Biofuels (RRB) recently announced construction of a biorefinery inOregon— To produce diesel and jet fuel— Offtake agreements in place for all future jet fuel production with several

major airlines— Will use Velocys FT technology under licence— Velocys received $6m from RRB in May 2018— Deal worth around $15m to Velocys during construction and early operation

stages of the plant plus $30m over the life of the biorefinery

• Velocys now implementing supply chain activities to deliver reactors andcatalyst

• As licensor of FT technology, Velocys is working closely with RRB and theirEPC to support the project through construction to operation

• Our business model is to both develop our own biorefineries and license our FTtechnology where it makes strategic and commercial sense

• RRB project further validates the attractiveness of the US woody biomass torenewable fuels market

Slide notes1. Velocys internal/proprietary information, which has not been verified by any independent source, unless specifically noted2. Velocys RNS/press releases 2010-present3. Velocys indicative, internal/EY advisor modelling, where project specific numbers are used, these are indicative and will refine as

engineering studies complete and will be communicated in due course. Files used include project models, enterprise model,project economics model, financial statements/management information and cash models

4. NNFCC Report “Greenhouse gas calculator development for British Airways/Velocys,” November 20175. Anderson, B. E. and e. al. (February 2011). Alternative Aviation Fuel Experiment (AAFEX), NASA Langley Research Center6. https://www.gpo.gov/fdsys/pkg/FR-2016-12-12/pdf/2016-28879.pdf7. https://energy.gov/eere/bioenergy/2016-billion-ton-report (reported in US tons)8. https://www.eia.gov/outlooks/steo/report/us_oil.cfm9. US Energy Information Administration (EIA), Annual Energy Outlook 2017 with Projections to 2050, March 2017, p. 99, available

at https://www.eia.gov/outlooks/aeo/10. US Energy Information Administration, Annual Energy Outlook with Projections to 2040, DOE/EIA-0383 (2016), August 2016

available at https://www.eia.gov/outlooks/aeo/pdf/0383(2016).pdf (hereinafter "AEO 2016"). The "Reference" is EIA's base casewhile its "Extended Policies" case assumes future extensions of some major energy policies, including various energy tax credits,fuel economy regulations for light-duty and heavy-duty vehicles, and CO2 emissions standards for existing power plants. Thedecline in diesel (and gasoline) demand in the Extended Policies case is attributed to EIA's assumption that fuel economystandards will continue to be tightened

11. UK waste to jet source is internal research by Dr Neville Hargreaves. ICAO (International Civil Aviation Organisation) rules.Changes to the Renewable Transport Fuels Obligation (published by the Government in September 2017 and became law inApril 2018)

12. RVO for cellulosic fuels for 2017 https://www.epa.gov/renewable-fuel-standard-program/final-renewable-fuel-standards-2017-and-biomass-based-diesel-volume

13. RTFO development fuels subtargethttps://www.gov.uk/government/uploads/system/uploads/attachment_data/file/644843/renewable-transport-fuel-obligations-order-government-response-to-consultations-on-amendments.pdf Road fuels demand http://www.racfoundation.org/data/volume-petrol-diesel-consumed-uk-over-time-by-year

14. Argus petroleum price forecast for liquid products and environmental credits report dated 4 May 2018

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