There are decades where nothing happens and there are weeks when decades happen

Vladimir Ilyich Lenin once said “there are decades where nothing happens and there are weeks when decades happen”. ?

I often spend the time between Christmas and New Year to reflect on how the year has developed compared to expectations, and following some quite surprising years in 2020 and 2021, 2022 has not broken the trend. One often refers to 10,000 hours of training necessary to excel in any given activity, however for aluminium market participants, I believe the recent years has condensed the typical 10,000 hours into a much shorter time-frame, as industrial cycles have taken place within a few years.

Being responsible for Finance in Norsk Hydro , one needs to ensure that we address the short term market uncertainties, while still maintaining and strengthening our strategic ambitions, addressing opportunities in the current market environment. I believe that the sum of the initiatives undertaken in 2022 positions and differentiates Hydro very well in the coming years, and even decades, with potential for satisfactory returns over the cycle.

January

It feels like a different time, with mask wearing, travel restrictions, extensive home office and other restricting measures. However, only a year ago we were still finding our way gradually back to normalcy. Following a digital Capital Markets Day in December 2021 (which was originally planned physically), where we launched our new sustainability ambitions within climate, environment and society, including:

• Net zero Hydro by 2050 or earlier
• No net loss of biodiversity in new projects
• Eliminate the need for new permanent bauxite residue storage by 2050
• Eliminate land-filling of all recoverable waste by 2040

it was great to start the year with an announcement of the building a solar park to power a new extrusion press in Poland, and also continuing a long trend of signing long-term power contracts (in this case with Hafslund ECO), which would turn out to be more valuable then anyone foresaw at this point in time. I also participated in 摩根士丹利 's digital investor fireside chat, where European and Nordic power markets and supply chains were high on the agenda.

February

Moving into February, Covid restrictions across the world was loosening, however a short period of optimism was destroyed at the end of the month, by the terrible act of the Russian invasion into Ukraine.

Before reaching the end of the month, we were happy to be included in Fortune's 2022 World's most admired company list, as the only Norwegian company, and one of three from Scandinavia, while also delivering on our strategic ambition through increasing our capacity to recycle post-consumer scrap at our casthouse in ?rdal, Norway, while at the same time reducing our exposure in other parts of the value chain, through the sale of our Indian extrusion plant to Hindalco Industries.

For anyone who has followed the aluminium industry for a decade or more, you will know that the Ford-150 has been important for the demand for aluminium, and that when Ford decided to switch from steel to aluminium for a large share of the parts for the traditional F-150, it lifted demand for aluminium significantly, between 0,5-1% annually. It was therefore pleasing to continue the collaboration with 福特 through the delivery of weight-saving aluminium components for the electrical Ford-150 Lightning.

Although many things went as planned in Februrary, we also had some negative surprises, which included a power failure at our Albras aluminium smelter in Brazil, causing shutdown of 25% of capacity, which was back in Q3-2022. Although covered by insurance policy, we work targeted to learn from such events, to ensure that any learnings are implemented across the system to reduce the risk of similar events taking place again.

For many companies, February is the month of Q4 and full-year reporting, and for ourselves, this fourth quarter reporting was especially exciting, as it was our first time releasing Q4 results and the Annual Report on the same day, including a huge transformation of the Annual Report. Both Q4-21 and 2021 were record results, reflecting tight markets and very high aluminium prices, and an over-achievement on our ambitious improvement program. I was also pleased that the BoD had decided to propose a dividend payment of 80% adjusted net income to our shareholders, or NOK 5,4 per share, significantly up from the average of the three preceding years of NOK 1.25 per share.

We also made significant progress on our Net Zero Products, Net Zero Hydro and Net Zero Society ambitions, trough announcing both the investment into the carbon capture company Verdox, a key step to reduce emissions from our existing aluminium smelters, as well as announcing a partnership with Polestar to create a groundbreaking climate-neutral car, exploring how aluminium can contribute to the Polestar 0 project.

On the 24th of February, however, everything changed, as Russia decided to invade Ukraine, bringing war to European soil. And we need to remember that what was terrible then, is just as terrible today, and I have recently made some reflections on the topic in a separate link. We condemned the unprovoked invasion of Ukraine by the armed forces of the Russian Federation and supported the sanctions by the European Union and the international community.

March

The nightmare from February 24 continued at an escalating pace, and we worked structurally to do our part as a company, not entering into new contracts with Russian counterparts, raising funds for people affected by the war in Ukraine, and reducing commitments with Russian counterparts where we had a legal basis for doing so. Care is one of Hydro's three core values, and our CEO, Hilde Merete Aasheim and Hydro 's employees confirmed this following the company wide fundraising exercise:

This tragedy in Ukraine, now in its fourth week, has deeply touched us all. We condemn the invasion, and I appreciate and admire the engagement by our employees. The efforts by our employees are heartwarming, and truly demonstrate how we live our values of Care, Courage and Collaboration,” says Aasheim

From a strategic perspective, we fired up our first electric boiler at our Alunorte alumina plant, one of several enablers to reduce our target to reduce emissions by 30% by 2030, and net zero by 2050. The business case for this boiler would turn out to be much better than originally planned, as the energy markets developed strongly through 2022. Later, in November, I had the pleasure of seeing the boiler in live action, and we are now underway planning for the approval of the next two boilers.

Improving our sustainability footprint comes in larger and smaller steps, and it is important that we live our ambitions. To work in the building which will become Norway's largest office building with solar panels supports our identity well, and following a decision in March, the solar plant on top of the Hydro V?ker? head office will produce 500,000 kwh per annum.

April

As a company, one of the most important areas to work on to improve our relative cost of capital advantage is within sustainable financing, and I was pleased to announce the signing of a a USD 200 million sustainability-linked loan for the Alunorte fuel switch project in the start of April. The pricing of the loan will be linked to the performance of the company’s greenhouse gas emission reduction target. The loan was also swapped to fixed rate, and the sustainability-linked derivative also constitutes a landmark as the first ever such structure to be executed in the Brazilian market.

April was also a month of good development within our New Energy growth areas, for both Hydro Rein and Batteries in Hydro. Hydro REIN aims for eIRR of 10-12% for its project portfolio, and this includes the profits from development, through contstruction, and into operation, including farm-down benefits along the way. An example of this is the transaction where Eolus and Hydro Rein signed an agreement with MEAG regarding the sale of 75% of the shares in the 260 MW wind power project Stor-Sk?lsj?n in Sweden. The transaction with MEAG resulted in around 40% expected return for Hydro Energy on invested capital, based on the SPA, and the return could more than double following the construction phase.

We also made a large announcement within Hydro Batteries, partnering with Elkem ASA and Altor Equity Partners to accelerate growth of Vianode , a producer of sustainable battery materials. Vianode has developed a range of synthetic graphite products for batteries with unique performance characteristics and produced with significantly lower CO2 emissions than today's standard materials – supporting the ambitions of leading battery cell and automotive manufacturers. As the market for battery materials is growing at an exponential rate, this is an exciting project, a view also shared by the Norwegian Minister of Trade and Industry Jan Christian Vestre :

“I would like to congratulate the parties on a very exciting industrial collaboration! The Norwegian Government has great ambitions for a green industrial boost where batteries are one of six focus areas. The purpose is to create new, green jobs, increase mainland investment, increase exports outside oil and gas and reduce greenhouse gas emissions. These are the kind of projects and partnerships we want more of when we now will go through the biggest restructuring?of?the Norwegian economy ever,”

Aluminium prices where strong and extremely volatile through the start of 2022, starting the year at around USD 3,100 per mt, trading all the way up to around USD 4,000 per mt in March, before starting a gradual decline, but continued volatile trend. In the end of April, we signed a new USD 1,300 million revolving credit facility to strengthen our liquidity in light of the extreme price volatility just mentioned, resulting in high price driven NOC build, and collateral movements, primarily related to our strategic hedging activity. This was to ensure that we are robust to deliver on our strategic ambitions, despite market volatility

And a large part of our strategic ambitions is related to growing in Recycling, and we announced two important milestones in April. Firstly, we started the construction of our state-of-the-art aluminum recycling plant in Cassopolis, Michigan, which will produce 120,000 metric tons recycled aluminium annually, including the first large-scale production of low-carbon Hydro Circal extrusion ingot to North-America.

Secondly we announced the tender offer for the acquisition of 100% of the shares of Alumetal S.A, a company listed on the Warsaw Stock Exchange, for PLN 68.4 per share in cash, representing an aggregate equity purchase price of approx. EUR 232 million. With this transaction, Hydro would strengthen its recycling position in Europe and widen its product offering in the low-carbon and scrap-based foundry alloy market, including an increase in post consumer scrap usage of approximately 150 ktpy. Alumetal is the second largest producer of casting aluminium alloys in Europe with a production capacity of 275,000 tons per year with three plants in Poland and one in Hungary. The company sells its products primarily within Europe and to the automotive sector, which represents the largest customer group. Unfortunately, the completion of this transaction is still pending, as the European Commission decided to open a Phase II review.

May

Hydro REIN continued building substance in May, preparing for raising capital, including forming a joint venture to develop, build and operate the Boa Sorte solar plant in the state of Minas Gerais, Brazil, covering 12% of Albras annual power consumption. In addition, Hydro and Telenor signed a long-term power contract, for a total supply of 330 GWh annually from the Stor-Sk?lsj?n wind park in Sweden, co-developed by Hydro Rein.

In the start of May, we also had the pleasure of delivering another set of record quarterly results, due to the very tight markets and high prices. We were also pleased to report strong growth in volumes of greener products.

When launching our Net Zero Products roadmap in 2021, we had three pathways to zero, where one of them was the circular path, based on recycling of 100% post consumer scrap. At our Q1 results, we also announced that we had produced the first batch of near-zero aluminium, Hydro CIRCAL 100R, in Clervaux Luxembourg. Later in 2022, we also announced that we had sold the first CIRCAL 100R volumes from Hydro Extrusions to a customer in Germany, to be used in the Augsburg Innovation park. We also made another milestone for Hydro CIRCAL 75R, as the aluminium plant in Commerce, Texas was Hydro’s first plant in the US certified to produce Hydro CIRCAL 75R, a low-carbon recycled aluminium product containing at least 75% post-consumer, end of life scrap.

There where other developments in May, which made it a good month for Recycling in Hydro, both for aluminium, but also batteries. We made a decision to upgrade and restart the primary foundry alloy (PFA) casthouse at the aluminium plant in ?rdal, increasing the capacity for the recycling of post-consumer scrap by 25,000 tonnes per year, with production starting in 2023. For battery recycling, Hydrovolt , a battery recycling joint venture between Northvolt and Hydro, has started commercial recycling operations at its plant in Fredrikstad, Norway. Hydrovolt is Europe’s largest electric vehicle battery recycling plant, with capacity to process 12,000 tonnes of battery packs on annual basis, corresponding to around 25,000 EV batteries.

On the financial market side, I also had the pleasure to present at the J.P. 摩根 European Materials Conference, where focus areas included aluminium markets, growth, low-carbon aluminium and renewable energy. It was also good to see that Norsk Hydro was included on the?Euronext OBX ESG Index, a selection of 40 blue-chip companies in Norway, demonstrating the best Environmental, Social and Governance (ESG) practices.

June

For the last years, I have had the pleasure to be part of the European Round Table for Industry - ERT (ERT) CFO Task Force, now renamed the ERT CFO Platform, consisting of CFOs from Europe’s largest companies in the industrial and technological sector. And, it was with great engagement I partook in discussions regarding the proposal for the EU Corporate Sustainability Reporting Directive (CSRD), which I am confident will accelerate the speed and effectiveness of initiatives defined to transform the EU into a greener and more resource-efficient economy. To ensure that?the directive – including the related European Sustainability Reporting Standards contributes to the sustainable development of the reporting organizations while covering the needs for the users of the information, the ERT launched an article on the topic, which is included here. Thankfully, many of the above recommendations were reflected in the next proposal.

On the topic of Sustainable Finance, I also had the pleasure to present the CFO organization's role in the green transition at? 德勤 's Next Generation CFO Academy 2022 today, which included:

1. Identify value pools and enable green growth

2. Enable lower cost of capital through transparency

3. Developing employees and lifting competence

June was a busy month for external presentations, and also included a participation at 摩根士丹利 's Materials Cannonball Run, where topics of interest included markets. green premiums, shareholder distribution, Russian developments, Hydro REIN capital raise, Recycling growth, and Hydro's carbon reduction ambitions.

And, when it comes to Hydro REIN, then in June Hydro Rein and Macquarie Asset Management’s Green Investment Group (GIG) entered into agreements to form a joint venture to build and operate Feij?o, a 586 MW combined wind and solar power project in the northeast of Brazil, supplying electricity to Hydro's bauxite mine Paragominas,?and will further reduce carbon emissions from Hydro's alumina refinery Alunorte, by enabling coal replacement towards 2030

July

As the year progresses you gain new good colleagues, and unfortunately, you also lose good colleagues, which is part of business. However, I was sad to see our good colleague Helena Nonka leave for other opportunities outside Hydro, while of course happy on her behalf, given new opportunities and challenges. Thankfully, with a strong succession pipeline, she was replaced by another good colleague, Trond Olaf Christophersen Olaf Christophersen, later in the year.

The automotive industry is a key consumer of aluminium, and also one of the few industries driving strong aluminium demand growth in the current market environment. In July, we continued investing for the automotive industry with a NOK 300 million (EUR 29 million) investment in a new state-of-the-art extrusion press at its plant in T?nder, Denmark. In addition, we started the construction of an expansion at Hydro’s?aluminium recyling plant in Rackwitz, Germany. The expansion will enable production of the innovative HyForge forge stock segment, an ideal fit when it comes to the high quality standards and rapidly increasing focus on sustainability in the automotive industry.

The Rackwitz investment is an important contributor to Hydro reaching its target of doubling use of post-consumer aluminium scrap by 2025, and with the expansion, Rackwitz plans to produce an additional 25,000 tonnes of HyForge and increase the recycling of post-consumer scrap as a major raw material for new products in the plant. Within automotive and Recycling ,we also decided to invest NOK 150 million ($15 million) into our Henderson facility in Kentucky, U.S. to deliver certified recycled aluminium products to the automotive industry.

As part of being a good neighbor where we operate, we also make investments into the local communities, and in June we completed the construction of a technical school in Barcarena, Brazil. The school aims to strengthen the professional technical training in the municipality, where the Hydro Alunorte refinery and the Albras aluminum factory are located. The school includes an auditorium, library, laboratories, living areas, theater for cultural activities, multi-sport court and cafeterias, in an inclusive and accessible structure. I had the pleasure of visiting the techncial school during a trip to Brazil later the year, and was proud to represent Hydro, and in observing the development of the future workforce for Alunorte and Albras.

Before embarking on summer holidays, I always look forward to updating the market on our half-year results, but the second quarter of 2022, more so than usual. In addition to delivering new record results, on the back of continued strong markets, I also had the pleasure of sharing our updated targeted capital structure, aiming to have adjusted net debt of around NOK 25 billion over the cycle, resulting in a proposal to distribute an additional cash dividend of NOK 3 billion for 2021, as well as an introduction of a share buyback program of up to NOK 2 billion, over the following 12 months, Hydro's first since 2008.

We also launched our green and sustainability linked financing framework, including a second party opinion by the Centre for International Climate and Environmental Research (CICERO). Hydro’s framework was ranked Medium Green by Shades of Green, now a part of S&P Global , the second greenest ranking after dark green, and can be used for future sustainability linked financing products. Towards the end of the year we got to utilize this framework at great success.

August

Although August is a quite month for many, especially in Europe, as the holiday season starts, the Recycling growth agenda was still moving at high speed represented by the decision to invest NOK 500 million in our extrusion plant in Cressona, Pennsylvania. The investment will expand the site’s recycling capabilities, which include remelt and extrusion billet casting, producing low-carbon aluminium products.

There was also development in North America on the renewable energy side, as Hydro Extrusions North America’s facility in Spanish Fork, Utah, became Hydro’s first location in the United States to source 100 percent of its electricity needs from renewable energy, through an eight-year agreement with the City of Spanish Fork and the Utah Municipal Power Agency to procure renewable and locally produced electricity from two recently completed photovoltaic solar installations.

On the more challenging side, the increasing power prices in Europe, with limited signs of improvement in the short term, together with adverse framework conditions, resulted in Slovalco's decision to terminate aluminium production. The casthouse continued its recycling operation, serving customers in the region with 75,000 tonnes of recycled aluminium annually. Correspondingly, Slovalco decided to unwind remaining hedge positions for power, metal and raw materials, resulting in a significant positive effect on adjusted EBITDA for second half of 2022.

August is also the month of the Norwegian " Arendalsuka ", the largest political gathering in Norway held annually since 2012. The event’s mission is clear: strengthen the belief in political empowerment and democracy through open debate and involvement. Personally I had the pleasure of:

• Discussing if the financial industry is doing enough to enable the green transition, with DNB
• Presenting sustainability as a competitive advantage for Hydro
• And sharing some general advice and reflections on cyber security with? 普华永道 .

The key take-away's from the week was:

• We need to enable greener industrial development together in Norway
• Norway needs to speed up the development of new renewable energy, one of our nation's large competitive advantages.
• We need to work coordinated and strategically with the EU on framework conditions for industry and energy

September

September saw good development on a couple of strategic projects earlier announced, including

• Start of construction at our new aluminium recycling plant in Szekesfehervar, Hungary. The new facility will have annual capacity of 90,000 tonnes and is expected to start production in Q1 2024
• Vianode's decision to invest NOK 2 billion in battery materials plant in Norway, producing anode graphite for about 20,000 electric vehicles (EVs) per year by 2024. This investment is the first phase in a larger investment plan. The plant construction will be carried out in parallel with preparations for a second phase plant scaled to provide battery materials to 2 million EVs per year by 2030, covering a significant share of the global EV market

In addition, there were several decisions made to increase efficiency, and lower fotprint, like the investment into the HAL5000 pot control system at ?rdal, developed by the technology community in ?rdal, providing more efficient control of aluminium production. Together with upgrading equipment on the electrolysis cells, the technology contributes to increased production, reduced electricity consumption and lower CO2 emissions.

Similarly, the addition of a third aluminium extrusion press at our extrusion manufacturing plant in Rackwitz, using 20 percent less energy than the two other presses at the plant, allowing us to expand our fabrication area and improve the service level for our customers even more with better delivery times and availability of supply.

Staying within Extrusions, then we are aiming to switch to 100 percent locally produced renewable energy for the operation of our three aluminium manufacturing plants in Sweden. Each plant will focus on investments in solar energy, battery storage, wind power, energy efficiency measures, hydrogen production and in fuel switching to hydrogen, to reach the ambitions, in two phases. This project was also presented at our CMD, as "Greener Sweden".

Unfortunately also September saw curtailments of aluminium capacity, and this time to respond to reduced aluminium demand. The curtailments of 110-130kt were announced and undertaken at Hydro's Norwegian smelters Hydro Husnes and Hydro H?yanger. The decision to partially curtail has not affect manning level at the respective plants. Excess power from the curtailments was sold from Hydro Aluminium to Hydro Energy which sells into the market through a combination of spot and forwards.

Thankfully, even though some markets are challenging, other markets are stronger, which includes the demand for low carbon aluminium for the coming years. Hydro and the VELUX Group agreed in September to a joint target to reduce the amount of CO2 emitted per kilo of aluminium, contributing to the VELUX Group goal to halve its value chain emissions by 2030. By using the low-carbon products Hydro REDUXA and Hydro CIRCAL, carbon emissions per kilo of aluminium used in the manufacturing of VELUX roof windows, flat-roof windows and accessories (shutters and blinds) will be reduced.

Another customer deciding to partner up with us on Hydro CIRCAL, was Flokk , when producing a chair with minimal environmental impact; the H?g Celi. Each chair contains 2,5 kg of Hydro CIRCAL aluminium, which is made from a minimum of 75% post-consumer alumunium.

From an organization perspective, I had the pleasure to travel to Székesfehérvár in Hungary together with Hydro’s finance management team, where we met with colleagues from our Global Business Services. As one of the largest teams in Hydro, GBS really serves as the backbone of our organization by constantly improving and keeping the wheels of our finance, IT and HR daily operations turning. This was followed by a visit to Hydro Extrusions aluminium manufacturing plant, the largest aluminium extrusions plant in Europe with 300 machines for fabrication, primarily serving our automotive customers.

Following the launch of our sustainable financing framework launched in July, I presented at SEB 's Investment Grade Corporate Seminar, where there where discussions on markets, opportunities, and also good feedback on our recently launched Sustainable Financing Framework

Within sustainable finance, we also received the grade "A" on our sustainable reporting from Position Green . And, in addition, my very own ESG advisor, Kirsten Margrethe Hovi , shared her views on ESG reporting and the landscape going forward on one of Norway's most popular business podcasts, Stormkast med Valebrokk & Stordalen .

October

In a volatile and challenging market environment, we saw large changes to framework conditions across the globe, as governments needed to tighten budget deficits, primarily to fund support schemes to cover for high energy costs. Norway also saw significant changes from the proposed 2023 budget, several impacting our activities in Norway, including changes to the power resource rent tax, and on the CO2 compensation scheme. Robust and predictable framework conditions are important for industries making investments based on several decades worth of cash flows. They are also important to attract capital, and on our third quarter roadshow, the changes in Norwegian framework conditions were of such a surprise that they were by several investors compared to changes that they had previously only expected from certain Latin American countries. Food for thought.

One of the biggest positive technological breakthroughs over the latter years in our bauxite mining operations, has been the Hydro tailings dry backfill metohodlogy, a technology which allows the inert tailings from bauxite mining to be returned to areas already opened and mined, instead of being deposited in separate, permanent storage areas. When we decided in October to invest into the new M5 mining front in Paragominas, Brazil, then this will not require new dams, due to the tailings dry backfill.

Sticking with Brazil, then we saw several developments across the Board this month. Following the completion of the Technical school in Barcarena earlier in the year, October saw the completion of first of three units Hydro is building in Belém for the TerPaz (peace House) program. This is a public initiative in the state of Pará, focusing on the social development of the area. The complex will be managed by the state government and provide the surrounding residents with access to over 70 free services, such as medical, dental and psychological care, legal advice, documents emission, leadership training, training, and professional courses. The area consists of 10,000 square meters of land, with 6,500 square meters of development.

In addition, the “Mining & Raw Materials Industry Leadership Award” was presented to Hydro at the annual S&P Global Platts Global Metals Awards for the work done in reducing emissions from operations in Brazil.

Before entering our quarterly silence period, I got to attend 德意志银行 's Mining and Steel series, with good discussions on market outlook and mitigating measures, energy market developments, growth in new business areas, and much more.

I also had the great pleasure to host Hydro's global CFO conference, ?including sessions on the external perspective, sustainable finance, risk management, business updates, and competence development. I am extremely proud of the global finance organization, and I am blessed with a strong team who deliver on our challenges and opportunities, contributing to our Global finance vision of driving value creation with our partners

We also published our third quarter results, breaking the streak of five consecutive quarters of record results, as the challenging markets (lower sales prices and higher input costs) had started to negatively impact earnings, partly offset by CO2 compensation and positive currency effects. The main focus area of the quarterly release, was the undertaken and planned contingency measures to address the ongoing market volatility.

October also saw creative initiatives to reduce our emissions, and Extrusions invested in a 426 meter long solar fence at its extrusion plant in Offenburg, Germany. The fence is the first of its kind in Germany and will contribute to lowering the emissions of the plant.

November

Following the implementation of our Sustainable Financing framework in Q2, I was very pleased to be able to utilize both our sustainable financing framework and our newly established EMTN program in the issuance of NOK 3 billion sustainability linked bonds, fixed and floating with 6- year tenor. These were the first SLB issues in the Norwegian corporate investment grade market, and the SLB priced below initial price guidance and below the fair value curve, which could be seen as a proxy for the SLB pricing benefit.

To underpin our position as an industry leader within ESG, it is important that we live up to external expectations, while also striving to improve our position year after year. That is why we have been striving for transparency and good ESG reporting for more than three decades. But good reporting is not enough – the actions we are reporting on must be integrated into our business strategy and risk management. We are proud to be consistently recognized by leading global ESG raters. Some even say that we are the leader within our industry. Still, we know that staying among the best requires continuous work. I was therefore very pleased to share that we have improved further on several ESG ratings during 2022, and the one I am the proudest of, is the Morningstar rating Morningstar Sustainalytics , which measures ESG risk level. We are now rated as low ESG risk, as one of only three companies among the 200 companies in Diversified metals.

Hydro Rein also strengthened the portfolio with new exciting projects in November, entering into an agreement with Commerz Real AG on forming a joint venture to acquire and develop two early phase solar projects in Jylland, Denmark. Construction is expected to commence in 2024, with production starting in early 2026. The ambition is to grow the portfolio to 1 GW.

As physical conferences are now becoming more normal again, it was a pleasure to open the 高盛 Global Natural Resources Conference with a fireside chat. We discussed Norsk Hydro, the market outlook, improvement initiatives, net zero ambitions, greener aluminium, and a lot more.

I also spent a week visiting our Bauxite and Alumina and Aluminium Metal operations in Brazil for the first time since 2019. And it was very impressive to see how they have worked structurally over the latter years, to reduce the footprint of the Paragominas mine, through the implementation of the tailings dry backfill technology, reducing the footprint and sustaining capex of mining activities. Also observing the 1:1 rehabilitation, recovering as much of the original forest structure and biodiversity as possible, and even contributing with planting my own couple of trees. More information is included in this article.

The best part of being the CFO in Norsk Hydro, is to work with the best Finance team in world. I am blessed with a talent dense global finance organization, across disciplines, that enable our Financial road-map of lifting cash flows and delivering higher returns. The next best thing, is when your talents are recognized for their amazing achievements outside of Hydro's walls. The first hire I ever made in Hydro, was Olena L. Gevoll Gevoll, and ever since she came into Hydro, she has delivered extraordinary results, through IR, Group Performance, and now in our new Energy growth areas. I was therefore proud to see her recognized by E24 as one of Norway's top 3 management talents with finance.

December

December started with some good recognition, as it was announced ?by the World Benchmarking Alliance that Norsk Hydro rank #2 in their Nature Benchmark, assessing almost 400 companies across 8 industries worldwide on their efforts to protect our environment and its biodiversity. To top it all off, we ranked first among companies in the ‘Metal and Mining’ category and in the ‘Social inclusion and community’ impact area.

And in the merry month, Christmas came early for Extrusions, as they signed an agreement to acquire @Hueck, a provider of aluminium window, door, and fa?ade systems and extruded aluminium profiles. HUECK by Hydro has 500 employees, two extrusion presses and an integrated cast house operation. The acquisition will strengthen Hydro’s presence in Germany and other European markets and create a solid platform for further growth of the combined businesses.

The highlight of my year, is Hydro's Capital Markets Day, the day I have the chance to dive into the financial components of today’s Hydro as well as the future Hydro. The event was Back in London this year, and it was great to meet analysts, investors, bankers and media to share the work we have done over the latter year, and our plans for the coming years. In sum, we shared the following messages.

• We have delivered on a broad range of the ambitions we set-out in 2019, and we have significantly improved our track record on relative shareholder value creation. I truly believe that we are currently in a position to continue to do this going forward.
• We have a low and robust cost position, with an ambition to further improve, and in an industry with a steeper cost curve, this can cater for good and improved margin generation.
• Aluminium demand is supported by the mega-trends, and the demand for low-carbon aluminium looks especially strong, and expected to increase from current estimates.
• To capture this demand we have a realistic pathway to near zero aluminium products, and an increasing portfolio of low carbon aluminium products, demanding higher and higher premiums as the carbon content decreases.
• We also have a large portfolio of profitable growth projects, allowing us to strategically allocate growth capital to the parts of the value chain which we believe will lift, but also make our returns more robust in the decades to come.
• Finally, this is all supported by a solid financial framework, ensuring financial strength and flexibility, while also enabling competitive shareholder distribution.

Together with our capital markets day, we also launched some other strategic developments, both within automotive. Firstly, Extrusion decided to expand its European extrusion capacity to the growing electric car market with a NOK 360 million (EUR 35.7 million) investment in a new high strength press at its plant in Szekesfehervar, Hungary. The Szekesfehervar plant employs around 1,600 people and is the biggest extrusion plant of its kind in Europe. The plant has a strong automotive culture and an organization that is geared towards serving the high demands of the automotive sector. With six aluminium extrusion presses, several surface treatment technologies, over 300 fabrication machines and a recycling facility under construction, the plant is taking the lead on Hydro Extrusions’ automotive strategy.

Secondly, we announced that we are partnering with Mercedes-Benz AG -Benz to supply them with low-carbon aluminium to reduce the carbon footprint of their vehicle fleet, including EQ models. We agreed to a common low-carbon technology roadmap in the period 2023-2030. We will deliver our first volumes of aluminium with a footprint below 3.0 kg CO2 / kg aluminium,?Hydro REDUXA 3.0, to Mercedes-Benz in 2023. This is a key example of how we are working to gradually capture the market demand for near zero aluminium, and you should expect us to work hard to establish similar partnership in the period to come.

Before closing the books for the year we also announced an important partnership with Eviny and Zephyr to explore an onshore wind project located in the area between H?yanger and Sunnfjord. The renewable power will be used by existing industry and enable new industrial development in the region. By developing renewable energy at competitive prices, we are safeguarding today’s industrial jobs while paving the ground for new technological developments of climate friendly aluminium production. We want to invest in onshore wind projects where there is local support and the power can be used for industrial purposes.

2023

In sum, I think we can safely say, that even though 2022 started with the tail-end of the Covid pandemic, we experienced the strongest aluminium markets since 1989, followed by war on European soil, an unprecedented energy crisis, and now strong fall in demand, and massive aluminium curtailments in Europe, then we have navigated the short-term, while also holding true to our 2025 ambitions, of strengthening our position in low carbon aluminium, and diversifying and growing in new energy.

And we will continue to do so in 2023, as even though we do not know what the year will bring, I believe we have a robust starting point and a strong relative industry position to address both challenges, but even more interestingly, opportunities, that will come our way.

I will not speculate in what will take place in 2023, but I will say, that I expect that the demand for near zero aluminium will continue to grow at a high pace, and I look forward to doing my part for Hydro, to ensure that we maintain and increase the robustness of our position as the leading provider of low-carbon aluminium, increasing value creation to all our stakeholders.

Thank you 2022, and welcome 2023, we

look forward to meeting you!