PBG SA

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Company you can relay on, according Forbes & PID rating

COMPANY PRESENTATION

October 2006

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PBG SA – Company listed on the Warsaw Stock Exchange

    IPO – issue price of PLN 32 per share (June 2004) Debut price on the WSE – PLN 35 (July 2 nd 2004) SPO – issue price of PLN 92 per share (Jan 2006) Current market price – PLN 189 (September 29 th 2006)

PBG stock performance on the WSE

Shareholders structure (in votes)

Jerzy Wiśniewski 52,36% Tomasz Woroch 3,79% BZ WBK AIB AM 5,32% ING TFI 5,04% remaining shareholders 33,49%

Managing Personnel

Jerzy Wiśniewski, MBA – President of the Management Board, graduate of the Civil Engineering Faculty of Politechnika Poznańska [Poznań University of Technology].

Małgorzata Wiśniewska, MBA – Vice-President of the Management Board, graduate of the Civil Engineering Faculty of Politechnika Poznańska [Poznań University of Technology]. Post graduate studies in Public Relations at the Finance and Banking Faculty of Wyższa Szkoła Biznesu [Business College] of Poznań.

Tomasz Woroch, MBA – Vice-President of the Management Board, graduate of the Social Studies Faculty of Uniwersytet im. Adama Mickiewicza of Poznań [Poznań University].

Przemysław Szkudlarczyk, MBA – Vice-President of the Management Board, graduate of the Building Machine and Vehicle Faculty of Politechnika Poznańska [Poznań University of Technology].

Tomasz Tomczak – Vice-President of the Management Board, graduate of the Building Machine and Vehicle Faculty of Politechnika Poznańska [Poznań University of Technology].

Mariusz Łożyński – Member of the Board, graduate of Politechnika Poznańska [Poznań University of Technology], Civil Engineering Faculty

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Business Profile General execution of natural gas, crude oil and water installations in turn-key system A. PRODUCTION

of natural gas and crude oil

B. TRANSMISSION

of natural gas, crude oil and water

C. STORAGE

of natural gas, fuels and LNG

D. DISTRIBUTION

of natural gas and water 1.

E. ENVIRONMENTAL PROTECTION &

2.

Water & sewage systems Hydro construction 3.

Renovations

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Business Profile A. Production of natural gas and crude oil

    Above-ground installations for crude oil and natural gas production Installations for liquefaction of natural gas (LNG) LPG separation stations Crude oil desulphurization units

B. Transmission of natural gas, crude oil and water

  Steel pipelines and structures for transmission of natural gas, crude oil and water, including:   steel water pipelines and collectors, crude oil pipelines and high-pressure gas pipelines Gas pressure-reduction and measuring stations, mixing plants, separation nodes, gas compressor stations, etc.

LNG transport

C. Storage of natural gas, fuels and LNG

    Installations for storage and degasification of LNG Storage stations for LPG and C5+ Fuel depots Above-ground installations of underground gas storage facilities

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Business Profile D. Distribution of natural gas and water

 Polyethylene pipelines and installations for distribution of natural gas and water   Heat-generation infrastructure (boiler houses, heat generating plants, heat distribution centres) Co-generation (combined heat and power generation from natural gas)

E. Environmental protection and sanitary systems

  Water and wastewater systems, including:      Water pipelines Sewage systems Wastewater and water treatment plants Water intakes Incinerating plants Hydro-engineering structures

Completed Projects

•

Natural Gas Plant in Kościan

•

Crude Oil Plant in Sławoborze

•

LNG Installation

•

LPG Separation and Storage Station in Władysławowo 7/23

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Projects

•

WWTP – Zabrze

•

NRU Grodzisk Wlkp

•

Fuel Depots - Orlen

•

Stage of fall in Malczyce

Competition

Activity

Natural gas and crude oil plants

Domestic competition

Naftomontaz Krosno ABB

Foreign competition

Gas and crude oil transmission systems Underground gas storages Naftomontaz Krosno, Gazobudowa Zabrze, Gazobudowa Poznan, Gazomontaz Wołomin, POL-AQUA ABB, Sofregas LNG installations Fuel depots Construction of sewage and water systems Renovation of sewage and water systems Hydro-construction Polimex Mostostal Hydrobudowa 6 Warsaw, Polimex Mostostal Hydrobudowa 6 Warsaw, Hydrobudowa 9 Poznan, POL-AQUA, Mitex, Hydrobudowa Gdansk, Budimex, Polimex Mostostal Tractebel, Linde, Costain, Air Products Bilfinger Berger SKANSKA, STRABAG, Ferrovial Per Aarslef, Diringer&Scheidel, Ludwig Pfeifer SKANSKA, Bilfinger Berger, Ferrovial

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PBG Group

100% KB GAZ S.A.

100% ATG Sp. z o.o.

99,56% 99,75% INFRA Sp. z o.o.

Metorex Sp. z o.o.

91,84% Hydrobudowa Włocławek S.A.

99,98% KRI Sp. z o.o.

92,24% PGS Sp. z o.o.

58,10% Hydrobudowa Śląsk S.A.

15,0%

Employment PBG Capital Group - 2104

(05.09.06)

7,76% 10/23

Structure of the PBG Group

Company

ATG Sp. z o.o

KB GAZ S.A.

KRI Sp. z o.o.

INFRA Sp. z o.o

METOREX Sp. z o.o

PGS Sp. z o.o.

HYDROBUDOWA Włocławek S.A.

HYDROBUDOWA ŚLĄSK S.A.

Interest held Business profile

100% Trading, including supply of materials and equipment, comprehensive supplies to companies operating in the gas, oil, heat-generation, as well as water and wastewater industries, organisation of purchases for the PBG Group – optimisation of purchasing terms.

100% Infrastructure investment, environmental protection, such as waterworks and wastewater systems, pumping stations and water treatment plants; low-, medium and high-pressure gas supply systems. It is a pioneer on the Polish market in terms of using directional drilling technologies for laying underground systems.

99.9% Transmission, distribution of and trade in natural gas, generation and distribution of heat, Advisory services in the area of fund raising for and implementation of investment projects relating to the use of natural gas and generation of heat, as well as application of the LNG technology to the distribution of natural gas.

99.75% Specialist services in the area of rehabilitation of water pipes and sewage systems 99.6% Construction of water-pipe networks, sewage systems, heat and gas distribution networks, land melioration networks, hydro-engineering, wastewater treatment plants, road and square pavement.

92.24% Specialist services in the area of road transport, mainly of LNG, road transport by specialist and universal vehicles, transport via pipelines, handling and storage of goods.

91.8% Comprehensive execution and servicing of investment projects in the area of civil engineering, hydro engineering, as well as environmental protection, water supply and sewage systems. 65,9% Execution of huge water supply and sewage systems and hydro-engineering

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PBG Group’s 2002–2006 Financial Highlights [PLN’000]

sales operating profit

800 000 702135 600 000 400 000 200 000 0 162 141 180 666 216 131 408539 45 000 40 000 35 000 30 000 25 000 20 000 15 000 10 000 5 000 0 9 181 2002 14 290 2003 25 880 2004 41331 2005 2002 2003 2004 2005 2006E Net margin 50 000 40 000 30 000 20 000 10 000 0 4 626 11 301

net profit

13 947 36947 47341 10,0% 9,0% 8,0% 7,0% 6,0% 5,0% 4,0% 3,0% 2,0% 1,0% 0,0% 2,9% 2002 6,3% 8,4% 8,8% 2003

Amount [mPLN]

2004 2005

In year 2006 2007…

2002 2003 2004 2005 2006E Backlog of orders 1506,2 760,0 756,00

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forecast

Revenue Structure 2002-2005 [PLN ‘000]

38%

environmental protection industrial infrastructure and buildings production distribution systems transmission storage natural gas distribution sales of w ater and w astew ater treatment 450 000 400 000 350 000 300 000 250 000 200 000 150 000 100 000 50 000 0 0 30 138 15 428 47 655 33 097 22 512 2002 2 160 23 401 10 365 39 661 67 439 26 042 2003 2 794 42 437 5 018 26 414 58 918 50 572 2004

Revenue structure 2005 1% 3% 21% 1% 5% 14% 17%

5 062 19 418 52 547 65 758 79 847 149 738 2005

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Key Clients – Year 2005 Client

GOV. of the PROVINCE of OLSZTYN PKN ORLEN S.A.

PGNiG S.A.

PROCHEM S.A. MUNICIPAL WATER and SEWAGE COMPANY - SZCZECIN MUNICIPAL WATER and SEWAGE COMPANY - WARSZAWA GAZ-SYSTEM Ltd.

MITEX S.A. MEGAGAZ S.A. CONTROL PROCESS S.A.

Ministry of Defence - NATO

%

13,62% 13,29% 10,41% 6,95% 4,82% 3,72% 2,97% 2,35% 1,82% 1,75% 1,28%

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Significant Running Contracts

Contract

Modernisation and extension of the Włocławek wastewater treatment plant

Signed Investor Contractor Value

Sep 17, 2004 MPWiK (Municipal Water and Sewage Company) of Włocławek Hydrobudowa Włocławek SA, PBG SA EUR 16.49m

Górzyca crude oil plant Nov 8, 2004 PGNiG SA PBG SA, Thermo Design Engineering EUR 16.9m

Refurbishment of the existing sewage network of the left-bank Szczecin Dec 9, 2004 Construction of the Grzechotki – Mamonowo road border crossing point Modernisation of Storage Depot in Wrocław and Storage Depot in Nowa Sól Dec 17, 2004 Feb 1, 2005 Construction of the ”SASKA KĘPA II” floating pumping station Jun 28, 2005 ZWiK of Szczecin (Municipal Water and Sewage Company of Szczecin) Governor of the Province of Olsztyn PKN ORLEN SA MPWiK of Warsaw PBG SA, DIRINGER&SCHEIDEL Rohrsanierung GmbH&Co KG PBG SA, Hydrobudowa Włocławek SA PBG SA PBG SA, Hydrobudowa Włocławek SA EUR 42.22m

EUR 13.42m

PLN 45m PLN 30.88m

Modernisation and extension of the fuel and lubricant inland depot in Cybowo Jun 30, 2005 NATO Investments Unit PBG SA PLN 31.12m

Executing Biszcza natural gas plant Executing Wilga natural gas plant Oct 31, 2005 PGNiG SA Oct 3, 2005 FX Energy Poland Sp. z o.o.

PBG SA, Control Process PBG S.A.

PLN 24.6m

PLN 19.87m

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Significant Running Contracts

Contract

Executing of floating pumping station and wastewater collectors in Bydgoszcz

Signed

Dec 22, 2005

Investor

MWiK Bydgoszcz Modernisation of sewage system in Gliwice Nov 29, 2005 PWiK Gliwice

Contractor

Hydrobudowa Włocławek SA, WPPU Alfa Sp. z o.o., Zakład Inst. Wod-Kan i C.O.

Hydrobudowa Włocławek SA

Value

EUR 13.99m

EUR 4,76m Construction of barrage Malczyce on the Odra river Modernisation and extension of the fuel and lubricant inland depot in Gardeja Construction of sewerage system and water supply system for right riverbank of Szczecin Constructing of the sewage system in Elbląg Construction of sewage system Feb 06, 2006 April 2006 June 2006 June 2006 June 2006 RZGW Wrocław NATO Investments Unit ZWiK of Szczecin (Municipal Water and Sewage Company of Szczecin) MPWiK Elbląg MPWiK Wrocław Modernisation of wastewater treatment plant, left bank of Poznan June 2006 City of Poznan PBG SA PBG SA KB GAZ S.A., Energopol Szczecin S.A. and Wiemer & Trachte AG Hydrobudowa Włocławek SA, PBG, ABT, Pekum Hydrobudowa Wlocławek S.A., PBG S.A.

Hydrobudowa 9, PBG S.A.

PLN 102,14 mln PLN 20m EUR 22,5m EUR 15,7m EUR 22,8m EUR 55m, (PBG 13,2) Nitrogen Removal Unit Grodzisk Wlkp.

Sept.2006

PGNiG PBG S.A., Chart Ind., TDE PLN 120m

Potential Market Natural gas

   PGNiG Group’s published investments plans for 2006–2008 – ca PLN 8.75bn, including ca PLN 3.6bn in exploration and production, ca PLN 2.35bn in transmission and ca PLN 2.45bn in distribution (source: PGNiG’s Issue Prospectus) Increase in domestic natural gas production from 4.3bn m m 3 in 2008 3 in 2005 up to 5.5bn Increase in the capacity of underground gas storage facilities from the current 1.5bn m 3 to at least 5bn m 3 – including I st stage of extension of the Underground Storage in Wierzchowice from 0.5bn m 3 up to 1.5bn m 3 (PLN 0.4bn)    Diversification of natural gas supply sources, including plans providing for import of LNG beginning in 2010 (ca 5bn m³ per annum) – LNG onshore terminal (PLN 2bn) and adaptation of Polish gas transmission network (PLN 0.5bn) Construction of pipeline interconnections between the Polish and foreign gas systems (Norway, Germany, Ukraine) „Poland’s Energy Policy until 2025” – growing share of natural gas (as an environment friendly fuel) through its use in the commercial power sector and industry

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Potential Market Crude oil

 Discovery of new deposits in Poland and the related plans for an increase in production from 0.6m tonnes to 1.4m tonnes per annum over the next 3 years – Lubiatow-Miedzychod-Grotow (LMG) crude oil plant (PLN 0.43m)  Construction of the crude oil pipelines from the Ukraine to Poland (Adamów-Płock and Odessa-Brody)

Environmental protection and hydro-engineering

   EU funds for Poland – EUR 4.5bn in 2004–2006 assigned mainly for water and wastewater installations New EU funds for 2007–2013 – EUR 56bn for Poland Funds assigned for flood protection improvement projects – increase in the capacity of storage reservoirs in Poland from ca 2bn m³ to ca 3.3bn m³, reconstruction of ca 1,000 km of embankments and river engineering (ca 4,000 km) - „Programme for the ODRA River 2006” – estimated total cost of main investment projects exceeds EUR 0.52bn

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Potential Market Fuel storage facilities

 NATO’s investments in Poland (2004-2007)total PLN 2bn, including PLN 0.7bn in fuel storage depots;  Extension of PKN ORLEN’s and Naftobazy’s fuel storage depots.

Foreign markets

  Extension of underground storages in Latvia and Hungary Increasing natural gas production in the Ukraine, modernisation and reconstruction of gas transmission network   LNG installations and natural gas plants in Norway Cooperation with Foreign Partners (Wavin, TD Williamson, Pall Corporation, Thermo Design Engineering, Chart, Bergen Engineering, etc.);

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Significant Potential Contracts in 2006/07

Contract

Modernisation and extension of the fuel and lubricant inland depot in Cybowo LMG crude oil plant

Contract award

October 2006 June 2007 LNG plant in Norway Wastewater treatment installation „Czajka” in Warsaw Racibórz reservoir on the Odra river Modernization of a sewage system in Mysłowice November 2006 March 2007 November 2007 Nov. 2006 Sewage system modernization in Warsaw Modernization of the filters for the waterworks in Warsaw Underground Gas Storage in Wierzchowice November 2006 November 2006 June 2007

Budget

PLN 250m PLN 430m EUR 60m EUR 261m PLN 650m EUR 58m EUR 6m EUR 56m PLN 400m

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Competitive Advantages

 Financial capabilities – banking and insurance limits exceeding PLN 0.5bn  Execution capabilities – development through organic growth using EU subsidy and acquisitions, commissioning works to companies from the PBG Group who serve as subcontractors, thus allowing us to fully carry out contract terms and strictly keep to deadlines  Narrow specialisation – delivery of specialised services in several areas: natural gas, crude oil, water and investments in modern technologies; recruitment and employment of highly educated workers  Project management – budget-driven management, extensive use of IT tools, including integrated management systems, virtual document circulation, data warehouse, analytical programs 

Quality, effectiveness and modernity

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PBG Group’s Development Strategy Increasing value through:

 Strengthening on the construction market and high specialisation in executing transmission and distribution installations for natural gas, crude oil and water  Expansion in the area of specialised installations for natural gas and crude oil production and processing, as well as fuel depots for the army and the industrial sector;  Expansion in the area of specialised, sanitary and hydro-engineering systems (including design, construction and refurbishment);  Acquisition of contractor companies, especially companies with niche technologies;  Procurement of high-value contracts as the General Contractor;  Procurement of contracts on the foreign markets;  Implementation of new products and technologies.

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Thank you for your attention C ontact information:

tel. (+4861) 665 17 00, 665 17 50 fax. (+4861) 665 17 01, [email protected]

PBG SA ul. Skórzewska 35, Wysogotowo near Poznań 62-081 Przeźmierowo Poland www.pbg-sa.pl