Transition Risks Description Risk Mitigation Resilience Markets Consumer preference for greener energy alternatives (e.g. transportation, appliances) • Increasing customer awareness on green alternatives reduces their reliance on traditional fuels. • The availability of competitive technologies leads to lower demand and price of oil. • This may also impact the volatility of oil prices as climate change is factored into the perception of risk for oil. Financial impact: Higher cost of investment Value Chain and Impact Region(s): Oil & Gas segment Likelihood and Time period: • Possible • Short, Medium, Long The Group will consider competitive technologies to integrate into its processes and continue to hedge short-term oil prices to reduce price volatility. The Group believes that there will be continued mid and long-term demand for oil and gas. The Group also believes that any changes in consumer preferences for greener alternatives will not materially impact its business in the short to medium term. Increase in cost of capital for funding oil & gas exploration and production projects and reduced access to capital markets • Undersubscription of equity or debt issuances due to investor unwillingness to fund oil & gas exploration and production. • Investor capital in the energy sector is diverted to renewable energy research. Financial impact: Higher cost of capital Value Chain and Impact Region(s): Oil & Gas segment Likelihood and Time period: • Likely • Short, Medium, Long The Group shall practise prudent cash management and maintain strong banking relationships. In 2025, Rex subsidiaries LPH raised NOK 1.1 billion in a Nordic bond issue, while Jasmine Energy raised US$25 million in a bond issue for a drilling campaign in Block 50 Oman. As sustainability linked financing gains momentum, financial institutions may prioritise funding projects that align with the EU Taxonomy for sustainable activities. LPA has initiated its Double Materiality Assessment as the first step in strengthening its sustainability reporting framework. Additionally, the Group is also evaluating low carbon operational strategies and alternative energy solutions to align with evolving investor expectations and access to financing. Rex International Holding Limited 77
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