Annual General Meeting 8 December 2011 Important notice THESE - - PowerPoint PPT Presentation
Annual General Meeting 8 December 2011 Important notice THESE - - PowerPoint PPT Presentation
Annual General Meeting 8 December 2011 Important notice THESE PRESENTATION MATERIALS ARE FOR INFORMATION PURPOSES ONLY AND DO NOT CONSTITUTE AN OFFER OR INVITATION TO SUBSCRIBE FOR OR PURCHASE ANY SECURITIES, AND NEITHER THE PRESENTATION
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Important notice
THESE PRESENTATION MATERIALS ARE FOR INFORMATION PURPOSES ONLY AND DO NOT CONSTITUTE AN OFFER OR INVITATION TO SUBSCRIBE FOR OR PURCHASE ANY SECURITIES, AND NEITHER THE PRESENTATION MATERIALS NOR ANYTHING CONTAINED THEREIN NOR THE FACT OF THEIR DISTRIBUTION SHALL FORM THE BASIS OF OR BE RELIED ON IN CONNECTION WITH OR ACT AS ANY INDUCEMENT TO ENTER INTO ANY CONTRACT OR COMMITMENT WHATSOEVER. The Presentation Materials, being this presentation and any additional documents handed out in the meeting, are being issued on a strictly private and confidential basis and solely to and directed at persons (a) who (i) are qualified investors within the meaning of Section 86(7) of the Financial Services and Markets Act 2000 and (ii) have professional experience in matters relating to investments and who are persons specified in Article 19 and/or Article 49 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Financial Promotions Order”); or (b) who are otherwise lawfully permitted to receive them. Any investment to which the Presentation Materials relates is available to (and any investment activity to which it relates will be engaged with) only such persons. This document is exempt from the general restriction on the communication of invitations or inducements to enter into investment activity and has therefore not been approved by an authorised person as would otherwise be required by section 21 of the Financial Services and Markets Act 2000. It is a condition of your receiving this document or attending this presentation that you fall within, and you warrant and undertake to the Company that (i) you fall within, one of the categories of persons described above, (ii) you have read, agree to and will comply with the terms of this disclaimer, (iii) you will conduct your own analyses or other verification of the data set out in the Presentation Materials and will bear the responsibility for all or any costs incurred in doing so, (iv) you will use the information in the Presentation Materials solely for evaluating your possible interest in acquiring securities of the Company and for no other purpose; and (v) you will not at any time have any discussion, correspondence or contact concerning the information in the Presentation Materials or acquiring securities with any of the directors or employees of the Company, or their subsidiaries nor with any of their respective suppliers, customers, sub-contractors or any governmental or regulatory body without the prior written consent of the Company. If the Presentation Materials have been received in error, they must be returned immediately to the Company. The Presentation Materials are confidential and should not be copied, transmitted, distributed or passed on, directly or indirectly, to any other class of persons. They and any further confidential information made available to you are being supplied to you solely for your information and may not be reproduced, transmitted, forwarded to any other person or published, in whole or in part, for any
- ther purpose.
The Presentation Materials contain only a synopsis of more detailed information published in relation to the matters described therein and accordingly no reliance may be placed for any purpose whatsoever on the sufficiency or completeness of such information and to do so could potentially expose you to a significant risk of losing all of the property invested by you or the incurring by you of additional liability. The proposals in the Presentation Materials are preliminary. The information contained in the Presentation Materials is for background purposes only and is subject to updating, completion, revision, amendment and verification, which may result in material changes. Some of the statements made in the presentation represent the opinion of the directors of the Company. No reliance should be placed on any of the information and no representation or warranty, express or implied, is given by the Company as to the accuracy of the information or opinions contained in this document and, save in respect of fraud, no liability is accepted by the Company or any of their respective directors, members, officers, employees, agents or advisers for any such information or
- pinions.
Certain forward looking statements may be contained in the Presentation Materials. Words such as “expect(s)”, “project(s)”, “believe(s)”, “forecast(s)”, “may”, “anticipate(s)” and similar expressions are intended to identify forward-looking statements. Although the Company believes that the expectations, assumptions, statements, projections, beliefs and opinions reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to be accurate. Accordingly, results could differ materially from those expected, projected, assumed or believed as a result of, among other factors, changes in economic and market conditions, changes in the regulatory environment and other business and operational risks. Forward-looking statements contained in this document regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. The Company does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, circumstances, future events or otherwise. You should not place undue reliance on forward-looking statements, which speak only as of the date of the Presentation Materials. Neither this document, nor any copy of it, may be taken or transmitted into the United States, Canada, Australia, the Republic of Ireland, the Republic of South Africa or Japan, and their states, territories
- r possessions, except in accordance with applicable laws. Any failure to comply with this restriction may constitute a violation of relevant local securities laws or regulations.
In accordance with the guidelines of the AIM Market of the London Stock Exchange, Peter Fagiano, Executive Director of Altona Energy Plc, is a chartered engineer with over 45 years experience in the
- il and gas and process industry sectors. Mr Fagiano is the qualified persons as defined in the London Stock Exchange's Guidance Note for Mining and Oil and Gas companies who has reviewed and
approved the technical information contained in this announcement.
- Altona’s primary asset is a 49% interest in the Arckaringa Coal-to-Liquids (CTL) Project
- Underpinned by an estimated 7.8 billion tonne coal resource in South Australia
- 1.287 billion tonnes (JORC)
- One of the world’s largest untapped energy banks
- Base case for Arckaringa Bankable Feasibility Study (BFS)
- Open cut coal mine producing 10 - 15 million tonnes p.a.
- CTL plant producing 10 million barrels of distillate (e.g. diesel) p.a.
- 560MW capacity co-generation power facility
- Altona’s joint venture partner is Chinese energy major CNOOC-NEI with 51%
- CNOOC-NEI is funding and operating the BFS with a budget of A$40m
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Arckaringa - Developing a clean energy project
£12 million raised since Admission to AIM
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De-Risking Arckaringa
2006 - 2011
- 100% of Arckaringa project acquired.
Estimated 7.8bnt coal resource.
- PFS completed for integrated 10mtpa
mine, 10m bbl/pa CTL plant and 560MW co-generation power plant
- Work carried out by technical teams
from major engineering consultants experienced in clean fuels and power projects internationally
- BFS underway, commenced 2010
- Additional clean fuel applications
being assessed for Arckaringa captured CO₂
- Technology partnership agreements
in place assessing new clean fuel projects in China and South Australia
- Agreement with major shareholder to
assess coal and biomass energy projects in China
- 1.287 billion tonnes JORC
defined at Arckaringa
- JV signed with Chinese
Development partner energy major CNOOC-NEI for 51%
- f Arckaringa in 2010
- CNOOC-NEI funding and
- perating A$40m BFS and
providing project debt finance
De-risking = Adding Value to the Arckaringa Assets
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Arckaringa Project rationale
- Arckaringa coal is suitable for conversion to
synthesis gas (syngas)
- Process based on existing commercial technologies
- Derivative products from syngas include:
- High value ultra clean fuels such as diesel and naphtha
- Chemical feedstock production
- Low cost, low emission electrical power
- South Australia faces a shortage of fuel, base
load power and water
- Both domestically and for the growing mining sector
- Lack of fuel security since closure of the Port Stanvac
refinery
- State estimated to need >1,000MW of additional base load
power over the next 10 years
Arckaringa Project location map
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Arckaringa Project – wider benefits
- SA imports 10m barrels of transportation
fuels from outside the state
- Bulk fuel shipments arrive every 3 days at Port
Adelaide, only 2 weeks storage capacity
- Transportation fuels & SNG produced
from indigenous resources provides economic benefit and homeland security
- A diverse range of energy and chemical products
can be produced from SA’s coal assets
- With CNOOC-NEI as Altona’s partner,
Arckaringa can target coal and liquids exports to China and other Asian markets
Chinese and Asian export potential
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Strong Government support
“Altona Energy’s proposal for the Arckaringa Basin is one of the most exciting developments in the State at the moment. “It is one of the most important strategic projects in the State and lack
- f diesel is the number one fuel issue
we face.”
(Hon. Tom Koutsantonis, Minister for Manufacturing, Innovation, Trade, Mineral Resources and Energy , 15 Nov 2011) “Technologies that convert coal and gas to ultra-clean diesel and jet fuel have the potential to replace Australia's declining oil reserves and make us self-sufficient in liquid transport fuels once again. A domestic synthetic fuels industry would reduce - and maybe even one day remove - our growing trade deficit in petroleum products ….. Australia has enormous potential as a coal-to-liquids producer and an economically viable and environmentally sustainable coal-to-liquids industry would not only increase Australia's energy security, but also provide jobs, exports, revenue and economic growth, particularly in regional communities.“ (Hon. Martin Ferguson, Federal Minister for Resources and Energy, 22 April 2009)
Altona Board with Hon Tom Koutsantonis, 15 Nov 2011
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Arckaringa Project business model
Multi billion tonne coal resource Fischer-Tropsch fuel production Combined cycle power plant Open cut mining Gasification Clean up SO2 and CO2 extraction
Feedstock Mine/ Process Conversion Output Markets
Pre-feasibility Study Economic Model
Capex: US$3.5bn (+/-30%) Opex: US$38 per bbl at 10 million bbls p.a. Revenues: US$1,150m p.a.
Diesel price: US$100 per bbl (based on US$85 per bbl crude) Power price: US$35 per MWh
Refined Synfuels (80 % diesel 20% naphtha) Power 562 MW export capacity South Australia Exports to Asia South Australian electricity consumers
Payback < 4 Years *
* From the commencement of production (based on the Pre-feasibilty Study results derived from RBS Project Economic Model)
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Arckaringa – multi billion tonne resource
Assuming 50:50 ratio of Coal converted to Liquid Fuels and SNG, the Arckaringa coal resources are respectively 75% and 37% of Australian proven reserves Deposit Million tonnes Measured1 Indicated1 Inferred1 Total Wintinna 1,150 750 2,000 3,900 Westfield 100 200 500 800 Murloocoppie 250 300 2,600 3,150 7,850 Million Tonnes (JORC)
Wintinna 187 650 450 1,287
[1] Not current JORC standard, based on SA Dept. of Minerals & Energy standards of the day
World scale energy bank
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Fischer-Tropsch - bankable CTL technology
Source: Jacobs Engineering
- Arckaringa is a prime example of
Clean Coal Energy
- The process is environmentally
superior to conventional coal combustion.
- CO2 can be extracted for
- Storage - “sequestration “
- Further processing, e.g. fuel grade
methanol
Arckaringa Project conceptualisation
CO2 sequestration ready
Source: Jacobs Engineering
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Arckaringa CNOOC-NEI JV
Pathway to Development
- CNOOC-NEI is funding and operating the BFS for A$40m and providing debt project
finance in return for its 51% interest
- CNOOC NEI has a strong strategic and technical commitment to the Arckaringa
Project and the BFS work programme "the Arckaringa Project is a very important project for CNOOC NEI. The company is committed to working closely with Altona and is giving high priority to the work needed to establish the feasibility of the Project“ (Mr. Liu
Suli, Vice President of CNOOC NEI, Dec 2011)
Arckaringa JV Official Signing Ceremony, Canberra, 21 June 2010
Left to Right: Mr Fu Chengyu, then President, CNOOC; Mr Xi Jinping, Vice- President, the People’s Republic of China; Hon. Kevin Rudd MP, then Prime Minister of Australia; Mr Chris Lambert, Chairman, Altona Energy. Victor Li GM ,CNOOC NEIA, and Chris Schrape in the Adelaide JV Office, Nov 2011
CNOOC-NEIA is concentrating on project fundamentals, reducing risk and
completing work to meet Chinese, as well as international, standards
- Chinese geological and open cut mine design standards are extremely rigorous
and meeting them makes projects eminently bankable Whilst this approach takes time early on, it provides a sound foundation for successful Project design and implementation and for future Project approvals in China and Australia CNACG reports completed April 2011
- covered coal geology and coal quality, geotechnical characteristics and the
hydrogeology of the Wintinna coal deposit (EL4512)
- The main geological report subsequently endorsed by the Mineral Resources
and Reserves Evaluation Center of China's Ministry of Land Resources
- Report ratified coal resources of 1.285 billion tonnes in the Wintinna
deposit - more favourable than Altona’s JORC resource estimate of 1.287 billion tonnes as it only includes resources in seams of greater than the 0.5 metres used in the JORC assessment
- The CNACG reports also underpin the design of the 2012 field drilling
programme.
Arckaringa - 2011 Progress Report
Arckaringa - 2011 Progress Report
The JV received a two year renewal of the Arckaringa El’s from SA Government CNOOC-NEIA established a new Adelaide office as base for the JV Operating Team CNOOC NEI in Beijing completed preliminary technical and economic studies on the options for coal conversion (including CTL and power) and on a range of project configuration issues, including:
- The feasibility of upgrading a proportion of the mine’s total coal output
- f up to 15 million tonnes per annum, with part of the upgraded product
to be fed into the CTL plant in order to reduce capital cost, and part to be potentially exported to China.
- The integration and optimisation of mine output, coal upgrading and
the CTL process PEPR approval received from DMITRE for 2012 drilling programme
Arckaringa – 2012 Work Programme
JV Management Committee meeting in Beijing on 29 November approved the following BFS Stage 1 work elements for completion in 2012
- The drilling programme
- Coal sampling and test work
- Preparatory studies to underpin the detailed design work in Stage 2 of
the BFS
- mine design (to Chinese standards)
- preferred coal conversion options (including coal upgrading,
CTL/Power)
- groundwater management and utilisation
- project infrastructure requirements
- transport and port logistics
- product marketing
- environmental impact assessment
- Carbon capture, storage and utilisation
- ongoing technical support requirements
Arckaringa – 2012 Drilling Programme
The programme will feed further data into the mine design studies and coal conversion studies during 2012 and will include:
- Close spaced coal and geotechnical boreholes in the proposed initial mine
development area, for the purposes of firming up mine design parameters and upgrading the geological model and resource estimates to JORC and Chinese standards
- Extraction of bulk samples of coal for testing in China and Australia, with the main
purpose of finalising coal feedstock characteristics for a range of coal conversion
- ptions (including gasification, coal drying, briquetting etc)
- Detailed hydro-geological testing to refine the existing hydro-geological model
developed by Altona and lay the basis for the mine dewatering and groundwater management plan The programme will be carried out in stages, covering a maximum of 34 approved boreholes
- first 6 holes will be multi-purpose, for priority water testing and coal sample extraction
- next 16 boreholes will variously covering hydro-geological testing/observation, coal
drilling and/or geotechnical assessment
- Decision on the necessity for the remaining 12 boreholes will be made as the drilling
programme proceeds
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BFS work programme
Altona’s Pre Feasibility Studies for Base Case CTL and Power Project
Completed
Joint Venture BFS Work Programme – Stage 1
2011 2012 Adelaide Office Establishment Completed Coal Resource Confirmation Completed Mine Plan Drilling (Coal and Geotech) and Hydrogeological Testing Underway For Completion Mine design to Chinese standards Underway For Completion Preferred coal conversion options (including coal upgrading, CTL and power) Underway For Completion Groundwater management and utilisation Underway For Completion Project infrastructure requirements Underway For Completion Transport and port logistics Underway For Completion Product marketing Underway For Completion Environmental impact assessment For Completion Carbon capture, storage and utilisation Underway For Completion
Joint Venture BFS Work Programme – Stage 2
Long Term Mine Plan To Follow Detailed Engineering of selected coal conversion option (integrated with mine) To Follow Engineering transport and support infrastructure To Follow Environmental Management Plan To Follow Procurement and Construction Planning To Follow
Approvals Phase
Environmental Impact Assessment Financing
Leveraging expertise
- Altona intends to leverage its capabilities and relationships to develop new energy
projects in China and South Australia
- Altona has a highly experienced management and technical team
- Relationships/MOUs with leading clean energy technology providers and
development partners
- Rentech Inc. - Production of diesel/Jet fuel from
coal and biomass
- Carbon Recycling International (CRI) - Production
- f methanol (fuel grade) from CO2 (H2 fuel from
coal/biomass/water)
- Waste 2 Tricity - Power production from alkaline
fuel cells of AIM listed AFC Energy (Hydrogen sourced from biomass)
- Tongjiang International Energy Co (20.7%
shareholder in Altona) – Evaluation of coal and biomass energy projects in China
New CRI CO2 to Methanol Plant , Iceland
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Growing global synthetic fuel production
SASOL South Africa Synthetic Fuels Production 160,000 bbls per day Shenhua Coal to Liquids 22,000 bbls per day Qantas & BA airlines evaluating synthetic aviation fuels Production source Market Doosan, Korea Coal to Power 300 MW IGCC Don Valley, UK, Coal to Power Plant 900 MW IGCC Global Synthetic fuel production exceeded 330,000 BPD in 2010 Additional 270,000 BPD of synthetic fuels plants will be
- perational in 2011
“if crude oil prices remain above US$ 52/bbl then CTL production is predicted to be 3,000,000 BPD by 2030” (US DoE) (Today USA
spends US$300bn on imported oil)
EU & US fuel standards Synthetic jet and diesel approved for commercial use 13 American/International airlines agreement to use Rentech synthetic aviation fuel ASTM/ UK MOD Approved 100% synthetic fuel as JET A -1 Sasol 50:50 blended synthetic jet fuel used in refuelling at Johannesburg & Cape Town International airports since 1998 DKRW, USA, Coal to gasoline 20,000 BPD POSCO, Korea Coal to SNG 1 MT p.a. Total/China Power (NCPP 1) Coal to Methanol, Polypropylene Plant 5,000 tonnes per day Arckaringa Project Coal to Liquids 30,000 bbls per day
Summary
- 49% interest in the advanced Arckaringa CTL Project
- PFS completed, BFS underway
- Base case: 10-15mtpa coal mine, 10mbbl/pa CTL plant, 560MW export power
- Underpinned by est. 7.8 bnt coal resource (1.287bnt JORC) in South Australia
- One of the world’s largest untapped energy banks
- Altona’s joint venture partner is Chinese energy major CNOOC-NEI with 51%
- CNOOC-NEI is funding and operating the BFS with a budget of A$40m and providing debt project finance
- Strong commitment to the JV and the BFS work programme
- Proven and bankable technology - Growing global production and demand for synthetic fuels
- Relationships/MOUs with leading clean energy technology providers and development
partners
- Leverage capabilities and relationships to develop new energy projects in China and
South Australia
Appendix
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Corporate and social responsibility
- Water
- plant process water requirements obtained from mined coal
- Mine Open cut using conventional dewatering techniques
- Pro-active engagement with government at technical and political level
- Carbon Dioxide
- CO2 stripping from raw syngas stream: intrinsically CCS ready
- CTL plant includes CO2 dehydration and compression ready for CCS.
- In line with Australian Government policy
- CO2 can be converted into fuel grade methanol
- Government
- South Australia, a mining friendly state
- Long term and broad engagement with South Australian Department for Manufacturing, Innovation, Trade, Resources
and Energy (DMITRE)
- Approved list of development projects
- Federal Government acknowledges CTL and other clean energy projects as key contributors to energy security
- Community
- Long term and extensive strategic engagement programmes in place for local community
- We have supportive local communities to create “green industry” and local employment
- Limited current local activity – cattle grazing on the Arckaringa Station and adjacent pastoral leases
- Aboriginal heritage surveys and consultation a key part of engagement
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Altona’s management team
Christopher Lambert - Executive Chairman Global trading operations Head for Elders Finance Group, Rural and Industries Bank of Western Australia, Barclays Bank and Prudential Securities (USA) London. Structuring of corporate and project finance transactions for governments, central banks, industrial companies and mining houses. Christopher Schrape - Managing Director 30 years of resource and mining experience. CEO of Griffin Coal in Western Australia. 20 years with Rio Tinto. Marketing Manager with Indonesia’s largest coal
- peration (PT Kaltim Prima Coal) from project start-
up in 1991 . Engaged as a Marketing Adviser for several prospective coal and power projects in Asia. Anthony Samaha - Executive Finance Director Chartered Accountant with over 20 years’ experience providing accounting and corporate advice in a diverse range of industry sectors including resource development in Africa and Australia. Zheng (Michael) Qiang – Deputy Chairman Previously economist at the China Economic Commission, China Rare Earth Office of The State Council Rare Earth Leading Group of the State Planning Commission. Deputy General Manager of the China Rare Earth Development Corporation . Held senior management positions AMR Technologies
- Inc. Beijing.
Phillip Sutherland - Non-Executive Director Previously Chief Executive Officer of and Chief Industry Advocate for the South Australian Chamber
- f Mines and Energy (SACOME).
Extensive executive management experience with local, state and federal government agencies. Peter Fagiano - Executive Technical Director 45 years’ experience in the design build of international hydrocarbon projects including oil and gas, LNG, petrochemicals and power. 16 years’ experience in syngas projects for production
- f power, chemicals and transportation fuels.