Investor Presentation July 2011 ASX: PEA Pacific Energy Limited Power Generation For personal use only
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Investor PresentationJuly 2011ASX: PEA
Pacific Energy LimitedPower Generation
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1. Established Power Producer
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17 power stations located at mine sites 175MW+
Kalgoorlie Power Systems (KPS)
Power station developer and owner, 175+MW KPS contracted/installed and 6MW hydro capacity
Typical KPS Power StationFor
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1. Established Power Producer
Kalgoorlie Power Systems (KPS), a leading provider of electricity infrastructure to mine sites in WA, NT and SA
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Pacific Energy’s core business is as a developer and owner of critical power station infrastructure to the mining & resources sector (est. 1981)
Established, well respected and credentialed business in pre-eminent growth sector
• 17 power stations with contracted capacity of 175MW+
• 80% capacity growth achieved in installed power generation equipment since acquisition of KPS (May 2009 – 25 months)
• Additional 10MW of surplus capacity for rapid deployment/growth
• Build, own, maintain long term contract electricity supply model
• Contract term typically extended to match mine life
• Significant “blue chip” client and project list
• Diverse revenue portfolio across clients, mines and commodity type
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51%
27%
22%Ken Hall
Pacific Road
Other
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500,000
1,000,000
1,500,000
2,000,000
2,500,000
0
10
20
30
40
50
01‐Jul‐10 01‐Oct‐10 01‐Jan‐11 01‐Apr‐11 01‐Jul‐11
Volume Closing Price
1. Established Power Producer
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Key shareholders
Share price performance (last 12 months) Trading summary & capital structure
Directors and management
ASX Code 12 month high 12 month low Current share price Shares outstanding Market capitalisation Cash Debt Enterprise value
Director
Cliff Lawrenson
Adam Boyd
Ken Hall
Louis Rozman
Stuart Foster
Position
Non Executive Chairman
Managing Director & CEO
Executive Director
Non Executive Director
Non Executive Director
PEA0.460.200.45350
157.712.319.6
165.0
$$$
m$m$m$m$m
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2. Recent Highlights – 6 Months to 30 June 2011
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Secured 12MW new power station contract with Regis
Secured 3MW new power station contract with Alacer Gold Corp
Commenced retrofit roll-out of Waste Heat Recovery fuel saving system
Commissioned 16MW of new power station capacity
Unaudited 2H 2011 EBITDA of $9.8M – 10% increase from 1H 2011 EBITDA of $8.9M
US$3.4M sale of US property asset settled
Secured 20MW new power station contract with Sandfire
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2.0
4.0
6.0
8.0
10.0
6 months toJun 2009
6 months toDec 2009
6 months toJun 2010
6 months toDec 2010
6 months toJun 2011
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3.0
6.0
9.0
12.0
15.0
6 months toJun 2009
6 months toDec 2009
6 months toJun 2010
6 months toDec 2010
6 months toJun 2011
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3. Financial Performance – 6 Monthly
EBITDA ($ M)Operating Revenue ($ M)
Revenue of $13.5M, up 2% from $13.3M and Adjusted EBITDA (unaudited) of $9.8M, up 10% from $8.9M
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4. KPS – High Quality Client List
7KPS revenue is dominated by major resource companies
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5. Waste Heat Recovery – Fuel Saving Solution
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KPS competitive advantage enhanced – 7% fuel savings
KPS and Mine Client share fuel saving and emission reduction benefits
Earnings growth achieved from existing power station fleet
150MW waste heat recovery solution roll-out over 3 - 4 years
150MW20MWPEA EBITDA enhancement* $9.0M pa$1.2M pa
* Fuel savings only based on current diesel fuel prices @ $0.90/litre
Pacific Energy Benefits
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6. KPS – Targeted Growth to 250MW by 2012
9New opportunities to drive significant additional growth (10% required to achieve 250MW target)
New committed/planned resource project opportunities require approx 700MW generation capacity
NT/QLD 100MW potential
Copper
Uranium
Base metals
CSG 100 MW potential
CSG power infrastructure
WA Northwest 150MW potential
Iron ore
Copper
Moly
WA Midwest 100MW potential
Iron ore
Copper
WA Goldfields 150MW potential
Nickel
Gold
Uranium
SA & VIC 100MW potential
Iron ore
Base metals
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Growth
Optimised offering
• Expanding geographical footprint – QLD, North West WA, later Africa
• Identified new project opportunities within Australia – 700MW
• Proposals provided for 250MW+ new deals – next 2 to 15 months
• Energy efficiency and dual fuel solutions – “industry benchmark” fuel flexibility and efficiency
7. Resources Growth – Value Driver
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Expansion and superior electricity supply offering
Mine site power stations Switch room
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100
150
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250
2008 2009 2010 2011 2012
MW
Calendar Year
8. Growth - Actual & Target (250MW by 2012)
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Contracted Capacity (MW)
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9. Investment Rationale
12Strong outlook for continued demand and significant business opportunities for KPS
Industry fundamentals Project pipeline underpinned by continuing resources growth, related
strong gold and commodity prices
High Growth Mining Regions
Strong demand for long term power solutions (eg: WA, QLD, Africa)
New Markets Clear strategy and significant market opportunities. Expansion into new
markets such as QLD mining, Africa and Asia
Strong Relationships Strong relationships with global and Australian based miners
provides ongoing opportunities
Business development focus
Active Management and Promotion
Focus on competitive advantage Proven management capability
Self Funding Business KPS Business generates significant surplus cash to fund future growth
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Investor Presentation – AppendicesJuly 2011ASX: PEA
Pacific Energy LimitedPower Generation
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Contract Client 2014 2015
Navigator
2010 2011 2012 2013
Degrussa Sandfire
Duketon Regis
Jacinth Iluka
Gwalia St Barbara
Mine Life
Other Other
Gardenwell Regis
Higginsville Alacer
DBS Newmont
Granites Newmont
Cosmos 2 Xstrata
Carosue Saracen
Bronzewing
1. KPS – Existing Contracts
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2017
2016
2019
2016
2016
2017
2019
Contract Life Mine Life
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Existing client revenue (2012 to 2017)Existing revenue (2012 to 2017): 175MW
Portfolio diversity across commodities and clients
2. KPS –Diversified & Contracted Revenues
Gold
Nickel
Other
Newmont
St Barbara
Xstrata
Alacer
Iluka
Regis
Navigator
Norilsk
Other
Sandfire
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Cardinia Reservoir Hydro Power Station• 3.5 MW rated capacity• Commenced operations in December1993
Location map
Blue Rock Dam Hydro Power Station• 2.6 MW rated capacity• Commenced operations in January 1992
3. Hydroelectric Assets
Cardinia Reservoir
Melbourne Water
Corporation
20 year Water Supply
Agreement
20 year “take or pay” Power
Purchase Agreement
Blue Rock Dam
Southern Rural Water Gippsland
Water
TRUenergy
Pacific Energy Limited
100%
Counterparties’ structure
Contractual obligation
Ownership
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