C O N F I D E N T I A L A N D P R I V A T E S T R I C T L Y EDC C OMPANY P RESENTATION D ECEMBER 2013
DISCLAIMER This presentation contains certain “forward looking statements. ” These forward looking statements include words or phrases such as EDC or its management “believes”, “expects”, “anticipates”, “intends”, “plans”, “foresees”, or other words or phrases of similar import. Similarly, statements that describe EDC’s objectives, plans or goals also are forward-looking statements. All such forward looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those contemplated by the relevant forward-looking statement. Such forward looking statements are made based on management’s current expectations or beliefs as well as assumptions made by, and information currently available to, management. EDC does not make expressed or implied representations or warranties as to the accuracy and completeness of the information contained herein and shall not accept any responsibility or liability (including any third party liability) for any loss or damage, whether or not arising from any error or omission in compiling such information or as a result of any party’s reliance or use of such information. The information and opinions in this presentation are subject to change without notice. This presentation does not constitute a prospectus or other offering memorandum in whole or in part. Information contained in this presentation is a summary only and is prepared for discussion purposes and is not a complete record of the discussions. This presentation shall not constitute an offer to sell or the solicitation of an offer to buy any security. There shall be no sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to qualification under securities laws of such state or jurisdiction. By receiving this presentation, each investor is deemed to represent that it is a sophisticated investor and possesses sufficient investment expertise to understand the risks involved. Prospective investors should undertake their own assessment with regard to their investment and they should obtain independent advice on any such investment’s suitability, inherent risks and merits and any tax, legal and accounting implications which it may have for them. 2
TABLE OF CONTENTS Page 1 Key Investment Highlights 4 – 22 2 YTD 3Q 2013 Financial Highlights 23 – 33 3 Growth Projects 34 – 42 4 Summary 43 – 44 APPENDICES Page i Stages of Geothermal Development 47 – 51 ii WESM 52 – 54 iii Feed-in-Tariff and Retail Open Access 55 – 57 3
KEY INVESTMENT HIGHLIGHTS 4
1 Key Investment Highlights I II III IV V Favorable Strong Credit & Domaine Contract-based Track Record Industry Investment Expertise Cash Flows of Growth Dynamics Profile 2 nd largest vertically Energy sales largely 88% increase in Geothermal is a Financial risks integrated geothermal derived from long term generating capacity competitive, strategic and deliberately managed company in the world revenue contracts achieved in 2009 – 2010 reliable energy source --- --- --- --- --- Fully integrated in all Cash flows generated at Power Plant acquisitions Grid marked by robust Superior financial and geothermal concession both Parent and Project driving revenue growth demand and tightening operating results to areas Company level reserves margin stakeholders --- --- --- --- --- Diversifying into wind Geothermal concession 8 concessions RE Act of 2008 provides Robust credit and energy agreements start expiring successfully acquired in regulatory support to the investment profile in 2031 Chile (4) and Peru (4) sector maintained 5
2 ND LARGEST VERTICALLY INTEGRATED GEOTHERMAL I Domaine Expertise COMPANY GLOBALLY STEAM PLANT COMPANY COUNTRY CAPACITY CAPACITY (in MW) (in MW) 1 Calpine USA 1,310 1,310 2 EDC Philippines 1,130 1,130 3 Comision Federal de Electricidad Mexico 958 958 4 Enel Green Power Italy 915 915 5 Chevron USA 1,329 887* 6 Ormat Israel 689 749 7 Mighty River Power New Zealand 385 385 8 Terra Gen USA 337 337 9 Contact Energy New Zealand 335 335 10 Orkuveita Reykjavikur Iceland 333 333 11 CalEnergy Generation USA 329 329 12 Star Energy Ltd. Indonesia 227 227 13 Northern California Power Agency USA 220 220 Note: * Not included is the 442 MW operated by the Indonesian Government through PLN Source: Bertani, Ruggero, 2010: Geothermal Power Generation in the World 2005-2010 Update Report 6
I TECHNOLOGY & GEOGRAPHICALLY DIVERSE Domaine Expertise 1 1,208 MW 87MW Burgos 1 1,129MW Geothermal (Under development) 79MW Hydro Power 1 120MW Pantabangan 1 12MW Masiway % share 110MW Bacman I 1 20MW Bacman II 7% of Installed Capacity 1 10% of Electricity Produced 125MW Upper Mahiao 2 112.5MW Tongonan 87 MW 1 232.5MW Malitbog 2 1 180MW Mahanagdong 112.5MW Palinpinon I Wind Energy 3 50.9MW Optimization 80MW Palinpinon II (under development) 3 52 MW Mindanao I 2 54 MW Mindanao II 2 YTD 3Q 2013 Revenues LEGEND NPC DUs WESM NGCP TOTAL % 694.4MW Geothermal steam 87MW Wind field and power plant (under development) LUZON - 550 778 498 1,826 9 (Integrated) VISAYAS 8,245 7,789 550 - 16,584 84 MINDANAO 1,373 - - - 1,373 7 435MW Geothermal steam 132MW Hydro power plant TOTAL 9,618 8,339 1,328 498 19,783 100 field and power plant (EDC subsidiary) (EDC/EDC subsidiary) % 100 49 42 7 2 7
I FULLY INTEGRATED AND SPANS THE ENTIRE Domaine Expertise GEOTHERMAL VALUE CHAIN Exploration Development Production Surface Exploration Geo-scientific Investigation Fluid and Recycling Systems Fluid Collection and Recycling Design and Construction Operations; Electricity Generation; Exploration and Well Testing Maintenance and Repair; Resource Management; Resource Assessment Power Plant Development Feasibility Study 8
II GENERATES CASHFLOWS AT BOTH PARENT AND Contract-based Cash Flows SUBSIDIARY LEVELS Revenues (2) as of Sept. 2013 FGHPC 1,826 9% IFC GIC Public Lopez Group EDC E: 1.69 % V: 1.12 % E: 5.03 % V: 3.35 % E: 43.35 % V: 61.91 % Parent (4) EGC (3) 19,783 E: 49.93 % V: 33.62% 9,618 8,339 49% 42% • 694.4 MW Power Plants 588.4 MW Unified Leyte Power Project EBITDA (2) as of Sept. 2013 106 MW Mindanao Power Project FGHPC Note: 49 MW No. Negros was put 1,526 on preservation mode starting July 12% 2011 EDC Parent (4) 12,668 100% 5,432 100% EGC (3) 43% 5,710 45% (1) Wind Energy Projects EDC Geothermal Corporation (EGC) Net Income (2) as of Sept. 2013 87.0 MW Burgos ( Under Development) FGHPC 100% 100% 60% EDC 1,082 100% Parent (4) 17% Green Core Geothermal Bac-Man Geothermal First Gen Hydro Power 2,076 32% Inc. (GCGI) Inc. (BGI) Corporation (FGHPC) International 6,400 Expansion 192.5 MW Palinpinon 110.0 MW Bac-Man I 120.0 MW Pantabangan EGC (3) 112.5 MW Tongonan 20.0 MW Bac-Man II 12.0 MW Masiway • Chile 3,242 • Peru 51% • Indonesia (1) Formerly First Luzon Geothermal Energy Corporation (FLGEC) (2) All figures in PHP millions as of Sept. 30, 2013 (3) EGC figures do not include Bacman revenues from own generation - capitalized since these were incurred pre-operations as per accounting rules (4) EDC Parent figures include, Drillco, EWEHI, and International 9
POSSESSES STABLE AND PREDICTABLE CASH FLOWS II Contract-based Cash Flows Percentage of Consolidated USD Revenues (2) Linkage 49% Electricity 73% National Cashflow Power Electricity Corporation Sovereign off-take Power Purchase Agreements Cashflow or Cashflow Bac-Man (1) Dividends Steam Geothermal Electricity Steam Sales Agreements (SSA) 51% Electricity 0% Cashflow or Electric Cooperatives/ Green Core Cashflow Dividends Third party customers Geothermal Steam Electricity Commercial off-take Geothermal Resources Sales Contracts (GRSC) Cashflow FG Hydro Dividends Electricity (1) Undergoing rehabilitation Power Supply Agreements (PSA) (2) As of Sept. 30, 2013 Transition Supply Contracts (TSC) Subsidiaries of EDC 10
II LIMITED EXPOSURE TO VOLATILE SPOT MARKET Contract-based Cash Flows TERM STRUCTURE OF CONTRACTS (1) LONG-TERM CONTRACTUAL AGREEMENTS CONCESSION 2031 In PHP Millions Geothermal Renewable Energy Service Contract 2031 year concession agreements WESM start expiring NPC 1,328 9,618 7% NGCP 49% 498 19,783 2% 7% DU 2024 ELECTRICITY Power Purchase Agreements (sovereign) 8,340 42% revenue from volatile spot market 2022 Power Supply Agreements (commercial) SPOT 1-2 YRS 3-5 YRS >6 YRS WESM 7% - - - 9% NGCP - 2% - - NPC - - - 49% DU - 11% 9% 22% revenue from REVENUE IN PHP MILLIONS REVENUE IN GWH contract tenors of 3-5 yrs WESM Distribution National Grid WESM 1,328 Utilities/Industrial Distribution Corporation of the 276 7% 1,663 Utilities/Industrial Philippines 5% 31% 42% (Ancillary Services) 8,340 110 42% 2% National Power National Power National Grid expanded revenue base from Corporation Corporation Corporation of the non-institutional clients 9,618 3,283 Philippines 49% 62% (Ancillary Services) 498 2% (1) Consolidated revenues as of Sept. 30, 2013 11
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