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I begin this overview of our business activity in 2017 by thanking the team of professionals at Cepsa for their invalu- able contribution to results I would dare to qualify as excellent. Their commitment and trust in our future project have made it possible. Thank you to everyone.

I would also like to thank our shareholder and the Board for their trust in me, my management team, and all of the staff that make up Cepsa. Being part of Mubadala Investment Company and its firm support for our long-term vision for the business motivates us to take on large scale projects.

One of the most important milestones for the year has been the production and presentation of the research work, Cepsa Energy Outlook 2030. This is our vision of the evolution of the energy market and what the energy map will look like in 2030.

The new scenarios set out in this work helped us to shape a roadmap to 2030 with the aim of consolidating Cepsa as a global energy company, adapting to the needs of the market, strengthening and broadening the areas where we operate, and searching for new opportunities. In- deed, some of the milestones we reached in 2017 formed part of this 2030 plan.

It is also important to highlight the responsible management of our business, which I believe is essential to assuring our sustainable growth over time. To help us get there we approved a route map for the coming years as part of our 2017-2019 Corporate Responsibility Plan. This Plan consists of over 85 actions that affect all the company. In its first year we managed to meet 90% of the objectives we set, an excellent level. There is still a long way to go, but we will continue to work with the same intensity and commitment to meet the objectives.

We are also particularly pleased, given its importance to our daily operations that our safety statistics improved by 19% compared to last year, with a Lost Work- day Injury Frequency ratio of 1.0 in 2017.

And as I mentioned at the start, we are also very pleased with our Adjusted Net result for 2017, which was 884 million, 60% higher than the previous year.

There have been three key factors behind this result. The first, within the business, was work to improve efficiency across various areas from our industrial plants to management processes. The second, was a recovery in the oil price. Benchmark Brent crude rose by 22% from the previ- ous year, to average $54 a barrel. And lastly, refining margins which averaged $7.5 a barrel, compared with $5.6 the previous year.

Turning to our Exploration and Produc- tion business, we saw a significant rise in profits thanks to the basket of oils we marketed averaging $52.6 a barrel versus $40.2 a barrel in 2016. This rise, com- bined with our ability to adapt to adverse market conditions in recent years and optimization and cost reduction programs, were key to these solid results.

Meanwhile, operational excellence, once again, at our Refining business assured plant availability was 91% for the year, which helped us to profit as much as pos- sible from exceptional refining margins in the year. We also continued to progress with enhancement projects to improve competitiveness and efficiency, such as the aromatics optimization project at La Rábida refinery, which further strength- ens the integration between refining and chemicals.

The work at our marketing business was intense over the past year. We sold 15.9 million tons of petroleum derivative products, we signed new alliances with commercial partners which help us to improve our services for customers, and we also made a significant investment in our service station network to increase our presence in the Madrid region.

The Chemicals business took a particu- lar lead in 2017. We expanded our plant in Brazil to increase LAB production to 260,000 tons and maintain our leadership in this market, and we signed an agree- ment with ADNOC to study the construc- tion of a new LAB plant in Abu Dhabi.

We also started a new natural fatty alcohol business line having inaugurated a new plant in Dumai in Indonesia where we started production in September.

Our Gas and Electricity business also had a good year with results 34% higher than in 2016. The area benefited from higher electricity prices, and slightly lower gas sales were offset by electricity production rising by a third. Meanwhile, another mile- stone for the business was reached when we began construction of our first wind farm situated in Jerez de la Frontera.

The Trading area supplied our refining system with a total of 156.3 million bar- rels of crude from 20 different countries and has sold 12.8 million barrels of our own crude, contracting 1,335 ships and managing a 20-strong time charter fleet.

Over the year we made a total of 888 million of investments to assure we progress with our future strategy using our current strengths to drive our growth. The investments will also help us to maintain our leadership with the support of our integrated model as a guarantee of our competitiveness and sustainability. We must also always keep safety in mind as one of our main values and something that is essential for our development.

Lastly, I would like to underline the commitment of Cepsa s professionals to this future, a future that we are building between us all. We are all aware of the magnitude of the task and ready and will- ing to meet the challenges that may arise, but trust that we will make Cepsa an international energy company of choice.

2017 ANNUAL AND CORPORATE RESPONSIBILITY REPORT