Data sources: Thomson Reuters, DataStream

Start 36,476.00
End 41,955.00
Frequency M Consumer Distributor
Natural Gas Brazil Cons. BRL/CBM Natural Gas Brazil Dist. BRL/CBM
2.00
11/12/2014 1.90 1.48
1.80
10/12/2014 1.90 1.43
9/12/2014 1.90 1.46
1.60
8/12/2014 1.90 1.43
1.40
7/12/2014 1.89 1.45
6/12/2014 1.88 1.20
1.44
5/12/2014 1.86 1.43
1.00
4/12/2014 1.83 1.41
0.80
3/12/2014 1.83 1.41
2/12/2014 1.83 0.60
1.41

1/

1/

1/
1/12/2014 1.82 1.30

1/
1/

1/
20

20

20
12/12/2013 1.81 1.37

08

10
06
11/12/2013 1.79 1.36
10/12/2013 1.79 1.37
9/12/2013 1.78 1.37
8/12/2013 1.78 1.38
7/12/2013 1.79 1.35
6/12/2013 1.78 1.38
5/12/2013 1.78 1.36
4/12/2013 1.78 1.36
3/12/2013 1.78 1.34
2/12/2013 1.77 1.37
1/12/2013 1.77 1.34
12/12/2012 1.76 1.34
11/12/2012 1.74 1.34
10/12/2012 1.74 1.35
9/12/2012 1.74 1.31
8/12/2012 1.73 1.30
7/12/2012 1.73 1.29
6/12/2012 1.71 1.29
5/12/2012 1.69 1.28
4/12/2012 1.63 1.23
3/12/2012 1.64 1.22
2/12/2012 1.63 1.23
1/12/2012 1.62 1.21
12/12/2011 1.61 1.22
11/12/2011 1.61 1.21
10/12/2011 1.61 1.21
9/12/2011 1.62 1.23
8/12/2011 1.62 1.22
 7/12/2011 1.63 1.21
6/12/2011 1.63 1.20
5/12/2011 1.60 1.19
4/12/2011 1.57 1.18
3/12/2011 1.56 1.16
2/12/2011 1.55 1.17
1/12/2011 1.57 1.21
12/12/2010 1.62 1.24
11/12/2010 1.62 1.23
10/12/2010 1.61 1.22
9/12/2010 1.61 1.22
8/12/2010 1.61 1.21
7/12/2010 1.61 1.20
6/12/2010 1.61 1.18
5/12/2010 1.58 1.16
4/12/2010 1.60 1.16
3/12/2010 1.58 1.15
2/12/2010 1.58 1.16
1/12/2010 1.59 1.16
12/12/2009 1.58 1.14
11/12/2009 1.57 1.14
10/12/2009 1.55 1.15
9/12/2009 1.57 1.17
8/12/2009 1.58 1.16
7/12/2009 1.61 1.20
6/12/2009 1.66 1.25
5/12/2009 1.69 1.27
4/12/2009 1.72 1.29
3/12/2009 1.73 1.31
2/12/2009 1.77 1.26
1/12/2009 1.72 1.25
12/12/2008 1.67 1.21
11/12/2008 1.66 1.21
10/12/2008 1.65 1.18
9/12/2008 1.64 1.16
8/12/2008 1.60 1.13
7/12/2008 1.56 1.04
6/12/2008 1.47 1.03
5/12/2008 1.45 1.00
4/12/2008 1.45 1.01
3/12/2008 1.45 0.98
2/12/2008 1.44 0.96
1/12/2008 1.38 0.94
12/12/2007 1.37 0.94
11/12/2007 1.37 0.94
10/12/2007 1.35 0.91
9/12/2007 1.35 0.90
8/12/2007 1.35 0.88
7/12/2007 1.35 0.87
6/12/2007 1.34 0.85
5/12/2007 1.27 0.83
4/12/2007 1.27 0.84
3/12/2007 1.27 0.83
2/12/2007 1.27 0.84
1/12/2007 1.27 0.83
12/12/2006 1.27 0.83
11/12/2006 1.27 0.84
10/12/2006 1.27 0.84
9/12/2006 1.27 0.83
8/12/2006 1.24 0.82
7/12/2006 1.25 0.82
6/12/2006 1.25 0.82
5/12/2006 1.25 0.82
4/12/2006 1.24 0.81
3/12/2006 1.23 0.78
2/12/2006 1.20 0.78
1/12/2006 1.21 0.79
12/12/2005 1.20 0.77
11/12/2005 1.19 0.76
10/12/2005 1.19 0.76
9/12/2005 1.14 0.75
8/12/2005 1.14 0.74
7/12/2005 1.14 0.73
6/12/2005 1.11 0.70
5/12/2005 1.11 0.71
4/12/2005 1.10 0.70
3/12/2005 1.10 0.70
2/12/2005 1.10 0.70
1/12/2005 1.10 0.71
12/12/2004 1.09 0.70
11/12/2004 1.15 0.81
10/12/2004 1.15 0.81
9/12/2004 1.15 0.82
8/12/2004 1.15 0.82
7/12/2004 1.14 0.82
6/12/2004 1.13 0.82
5/12/2004 1.07 0.71
4/12/2004 1.08 0.71
3/12/2004 1.08 0.71
2/12/2004 1.07 0.71
 1/12/2004 1.07 0.71
12/12/2003 1.06 0.71
11/12/2003 1.06 0.72
10/12/2003 1.06 0.71
9/12/2003 1.06 0.70
8/12/2003 1.06 0.71
7/12/2003 1.06 0.71
6/12/2003 1.07 0.72
5/12/2003 1.07 0.72
4/12/2003 1.07 0.71
3/12/2003 1.07 0.70
2/12/2003 1.03 0.64
1/12/2003 0.94 0.59
12/12/2002 0.90 0.54
11/12/2002 0.83 0.53
10/12/2002 0.83 0.51
9/12/2002 0.83 0.50
8/12/2002 0.82 0.49
7/12/2002 0.79 0.48
6/12/2002 0.80 0.49
5/12/2002 0.79 0.47
4/12/2002 0.78 0.48
3/12/2002 0.78 0.49
2/12/2002 0.78 0.51
1/12/2002 0.78 0.51
12/12/2001 0.78 0.50
11/12/2001 0.77 0.49
10/12/2001 0.74 0.49
9/12/2001 0.74 0.49
8/12/2001 0.73 0.48
7/12/2001 NA NA
6/12/2001 NA NA
5/12/2001 NA NA
4/12/2001 NA NA
3/12/2001 NA NA
2/12/2001 NA NA
1/12/2001 NA NA
12/12/2000 NA NA
11/12/2000 NA NA
10/12/2000 NA NA
9/12/2000 NA NA
8/12/2000 NA NA
7/12/2000 NA NA
6/12/2000 NA NA
5/12/2000 NA NA
 4/12/2000 NA NA
3/12/2000 NA NA
2/12/2000 NA NA
1/12/2000 NA NA
12/12/1999 NA NA
11/12/1999 NA NA
 14
20
1/
1/
12
20
1/
Distributor 1/
10
20
1/
1/

Consumer
Data source:
Federal Reserve Economic Data
Link: http://research.stlouisfed.org/fred2
Help: http://research.stlouisfed.org/fred2/help-faq
Economic Research Division
Federal Reserve Bank of St. Louis

DEXBZUS Brazil / U.S. Foreign Exchange Rate, Brazilian Reais per U.S. Dollar, Semiannual, Not Seasonally Adju

Frequency: Semiannual
2.5
observation_date DEXBZUS
7/1 1.8
1/1 1.8 2.0
1.8 2.0
7/1 1.7
1.8 1.9
1/1 1.6 1.7 1.7
7/1 1.7 1.5 1.6
1/1 1.9
7/1 2.0
1.0
1/1 2.0
7/1 2.3
1/1 2.3 0.5
7/1 #N/A

0.0
7/1
10
1/1
4/1
7/1
1 0/
1/1
4/1
7/1
10
1/1
4/1
7/1
10
/1

/1

/1
1
U.S. Dollar, Semiannual, Not Seasonally Adjusted

2.3 2.3
2.0 2.0
1.8 1.9
1.7 1.7
1.6
1/1
4/1
7/1
1 0/
1/1
4/1
7/1
10
1/1
4/1
7/1
10
1/1
4/1
7/1
10
1/1
0/1

/1

/1

/1
1
Description Unit #
Operational Assumptions
Installed Capacity MWh 500
Number of Hours/Year hours 8,760
Capacity Factor % 90%
Dispatch/Year % 50%
Total Energy/Year MWh/Year 1,971,000
Pricing Assumption
Bidding Price/MWh BRL/MWh 50

(+)Required Capacity Revenue BRL/MWh 219,000,000

(+)Revenues − Pass Through (Gas Costs)1 BRL/MWh To be calculated
(+)Revenues − Pass Through (Variable O&M)
BRL/MWh
1
To be calculated
(−)Revenue Tax BRL/MWh To be calculated
1
Markup of 15% for base case, 20% for optimistic scenario, and 5% for pessimistic scenario.
 Bidding Price in BRL/MWh, adjusted for inflation

Bidding Price × Installed Capacity × Number of Hours/Year

Gas Costs + Markup ÷ (1 − Revenue Tax − COFINS)
Variable Costs + Markup ÷ (1 − Revenue Tax − COFINS)
9.25% PIS/COFINS rate applied to all gross revenue streams

and 5% for pessimistic scenario.

Assumption Unit # 2013 2014 2015 2016 2017 2018

Key Projections
CPI (IPCA) %/year 5.91% 6.5% 6.0% 5.5% 5.4% 5.2%
FX BRL/USD 2.34 $ 2.40 $ 2.64 $ 2.72 $ 2.81 $ 2.88
Natural Gas Price USD/MMBtu 3.43 3.85 4.09 4.31 4.43 4.56

Bidding Price BRL/MWh (available) 50

Markup over variable costs % 15%

Operations Date
Beginning of Operations 2019
PPA Duration 25
End of Operations 2043
Construction Period
Capex Schedule 100% 30% 30% 20% 20%
Total Capex 1,200 0 360 360 240 240
Depreciation (in years) 25
Operational Assumptions

Installed Capacity MW 500

Number of Hours/Year hours 8,760
Capacity Factor % 90%
Dispatch/Year % 50%
 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028

5.2% 5.2% 5.2% 5.2% 5.2% 5.2% 5.2% 5.2% 5.2% 5.2%
$ 2.93 $ 2.97 $ 3.00 $ 3.04 $ 3.08 $ 3.12 $ 3.16 $ 3.21 $ 3.23 $ 3.42
4.65 4.76 4.87 4.98 5.09 5.21 5.32 5.44 5.56 5.68
 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038

5.2% 5.2% 5.2% 5.2% 5.2% 5.2% 5.2% 5.2% 5.2% 5.2%
$ 3.43 $ 3.62 $ 3.63 $ 3.83 $ 3.85 $ 4.05 $ 4.08 $ 4.29 $ 4.32 $ 4.54
5.81 5.93 6.06 6.20 6.33 6.47 6.62 6.76 6.91 7.06
 2039 2040 2041 2042 2043

5.2% 5.2% 5.2% 5.2% 5.2%

$ 4.58 $ 4.81 $ 4.81 $ 4.81 $ 4.81
7.22 7.38 7.54 7.70 7.87
Macroeconomic Variable Forecast 2013 2014 2015 2016 2017 2018 2019

FX Rate - EOY (BRL/USD)

- Base Case 2.34 2.40 2.64 2.72 2.81 2.88 2.93
- Optimistic Scenario 2.16 2.38 2.45 2.53 2.59 2.64
- Pessimistic Scenario 2.64 2.90 2.99 3.09 3.17 3.23
IPCA (Brazil’s CPI)
- Base Case 6% 6.5% 6.0% 5.5% 5.4% 5.2% 5.2%
- Optimistic Scenario 5.9% 5.4% 5.0% 4.9% 4.7% 4.7%
- Pessimistic Scenario 7.2% 6.6% 6.1% 5.9% 5.7% 5.7%

Henry Hub* - $/MMBtu $3.43 $3.85 $4.09 $4.31 $4.43 $4.56 $4.65

*Henry Hub is a natural gas distributor.

2020 2021 2022 2023 2024 2025 2026 2027 2028 2029

2.97 3.00 3.04 3.08 3.12 3.16 3.21 3.23 3.42 3.43
2.67 2.70 2.74 2.77 2.81 2.85 2.89 2.91 3.08 3.08
3.26 3.30 3.34 3.39 3.43 3.48 3.53 3.55 3.76 3.77

5.2% 5.2% 5.2% 5.2% 5.2% 5.2% 5.2% 5.2% 5.2% 5.2%
4.7% 4.7% 4.7% 4.7% 4.7% 4.7% 4.7% 4.7% 4.7% 4.7%
5.7% 5.7% 5.7% 5.7% 5.7% 5.7% 5.7% 5.7% 5.7% 5.7%

$4.76 $4.87 $4.98 $5.09 $5.21 $5.32 $5.44 $5.56 $5.68 $5.81
2030 2031 2032 2033 2034 2035 2036 2037 2038 2039

3.62 3.63 3.83 3.85 4.05 4.08 4.29 4.32 4.54 4.58
3.26 3.27 3.45 3.46 3.65 3.67 3.86 3.89 4.09 4.12
3.98 3.99 4.21 4.23 4.46 4.49 4.72 4.75 5.00 5.04

5.2% 5.2% 5.2% 5.2% 5.2% 5.2% 5.2% 5.2% 5.2% 5.2%
4.7% 4.7% 4.7% 4.7% 4.7% 4.7% 4.7% 4.7% 4.7% 4.7%
5.7% 5.7% 5.7% 5.7% 5.7% 5.7% 5.7% 5.7% 5.7% 5.7%

$5.93 $6.06 $6.20 $6.33 $6.47 $6.62 $6.76 $6.91 $7.06 $7.22
2040 2041 2042 2043 2044 2045

4.81 4.81 4.81 4.81 4.81 4.81

4.33 4.33 4.33 4.33 4.33 4.33
5.29 5.29 5.29 5.29 5.29 5.29

5.2% 5.2% 5.2% 5.2% 5.2% 5.2%

4.7% 4.7% 4.7% 4.7% 4.7% 4.7%
5.7% 5.7% 5.7% 5.7% 5.7% 5.7%

$7.38 $7.54 $7.70 $7.87 $8.05 $8.22

 Period
Base - 1 2 3 4
1 Capital investment and disposal - 10,000 - - - -
2 Change in working capital - 550 - 739 - 1,972 - 1,629
3 Sales 523 12,887 32,610 48,901
4 Cost of goods sold 837 7,729 19,552 29,345
5 Other costs 4,000 2,200 1,210 1,331 1,464
6 Tax - 1,400 - 1,434 828 3,550 5,778
7 Operating cash flow (3 - 4 - 5 - 6) - 2,600 - 1,080 3,120 8,177 12,314
8 Net cash flow (1 + 2 + 7) - 12,600 - 1,630 2,381 6,205 10,685
9 Present value at 20% - 12,600 - 1,359 1,652 3,589 5,150
10 Net Present Value 3503

Period
Optimistic - 1 2 3 4
1 Capital investment and disposal - 10,000 - - - -
2 Change in working capital - 550 - 739 - 1,972 - 1,629
3 Sales 523 12,887 32,610 48,901
4 Cost of goods sold 837 7,729 19,552 29,345
5 Other costs 4,000 2,200 1,210 1,331 1,464
6 Tax - 1,400 - 1,434 828 3,550 5,778
7 Operating cash flow (3 - 4 - 5 - 6) - 2,600 - 1,080 3,120 8,177 12,314
8 Net cash flow (1 + 2 + 7) - 12,600 - 1,630 2,381 6,205 10,685
9 Present value at 20% - 12,600 - 1,359 1,652 3,589 5,150
10 Net Present Value 3503

Period
Pessimistic - 1 2 3 4
1 Capital investment and disposal - 10,000 - - - -
2 Change in working capital - 550 - 739 - 1,972 - 1,629
3 Sales 523 12,887 32,610 48,901
4 Cost of goods sold 837 7,729 19,552 29,345
5 Other costs 4,000 2,200 1,210 1,331 1,464
6 Tax - 1,400 - 1,434 828 3,550 5,778
7 Operating cash flow (3 - 4 - 5 - 6) - 2,600 - 1,080 3,120 8,177 12,314
8 Net cash flow (1 + 2 + 7) - 12,600 - 1,630 2,381 6,205 10,685
9 Present value at 20% - 12,600 - 1,359 1,652 3,589 5,150
10 Net Present Value 3503
 Wacc 0.2
5 6 7 Pmt 1
- - 1,442 Revenue
1,307 1,581 2,002
35,834 19,717
21,492 11,830
1,611 1,772
3,902 1,586
8,829 4,529 -
10,136 6,110 3,444
4,070 2,043 958

Wacc 0.2
5 6 7 Pmt 1
- - 1,442 Revenue
1,307 1,581 2,002
35,834 19,717
21,492 11,830
1,611 1,772
3,902 1,586
8,829 4,529 -
10,136 6,110 3,444
4,070 2,043 958

Wacc 0.2
5 6 7 Pmt 1
- - 1,442 Revenue
1,307 1,581 2,002
35,834 19,717
21,492 11,830
1,611 1,772
3,902 1,586
8,829 4,529 -
10,136 6,110 3,444
4,070 2,043 958
 Period
- 1 2 3 4
1 Capital investment and disposal - 10,000 - - - -
2 Change in working capital - 550 - 739 - 1,972 - 1,629
3 Sales 523 12,887 32,610 48,901
4 Cost of goods sold 837 7,729 19,552 29,345
5 Other costs 4,000 2,200 1,210 1,331 1,464
6 Tax - 1,400 - 1,434 828 3,550 5,778
7 Operating cash flow (3 - 4 - 5 - 6) - 2,600 - 1,080 3,120 8,177 12,314
8 Net cash flow (1 + 2 + 7) - 12,600 - 1,630 2,381 6,205 10,685
9 Present value at 20% - 12,600 - 1,359 1,652 3,589 5,150
10 Net Present Value 3503
 Wacc 0.2
5 6 7 Pmt 1
- - 1,442
1,307 1,581 2,002
35,834 19,717
21,492 11,830
1,611 1,772
3,902 1,586
8,829 4,529 -
10,136 6,110 3,444
4,070 2,043 958