Channel Infrastructure Nz Limited · NZX:CHI
Channel Infrastructure Nz — Investor Day (October 2024)
40 slides from Channel Infrastructure Nz's investor day presentation, Oct 24, 2024
Slide 1: Marsden Point Energy Precinct Concept
Marsden Point Energy Precinct Concept Helping fuel New Zealand's future to 2050 and beyond Heavy Industrial Zoning 24 October 2024
Slide 2: Agenda
Welcome and Introduction Rob Buchanan, Chief Executive Officer World-class Operator – providing resilient infrastructure and unlocking growth opportunities Agenda Jack Stewart, GM Operations Fuel demand outlook Peter van Cingel, Business Development Manager Marsden Point – a unique and highly strate
Slide 3: Welcome and Introduction
ROB BUCHANAN, CHIEF EXECUTIVE OFFICER Welcome and Introduction
Slide 4: An energy precinct for New Zealand
An energy precinct for New Zealand Long-term pathway to unlocking significant value over time as high-quality tenants are attracted to the 120 hectares of unutilised land and ancillary services Channel can provide Energy Precinct could help underpin New Zealand’s energy and fuel security and resilie
Slide 5: Experienced and Proven Leadership Team
Experienced and Proven Leadership Team Rob Buchanan Alexa Preston Jack Stewart Chief Executive Officer Chief Financial Officer GM Operations Chris Bougen Steve Levell Peter van Cingel General Counsel and Business Development Manager GM Independent Petroleum Company Secretary Laboratory (IPL)
Slide 6: Helping fuel New Zealand's future to 2050 and beyond
Helping fuel New Zealand’s future to 2050 and beyond OUR VISION World-class energy infrastructure company OUR PURPOSE Delivering resilient infrastructure solutions to meet changing fuel and energy needs OUR STRATEGIC PRIORITIES World-Class High Performance Grow from Support Energy Disciplined Capita
Slide 7: Our role in the Marsden Point Energy Precinct
Our role in the Marsden Point Energy Precinct Building diversified, fixed revenue that is independent of fuel volume throughput • Above WACC returns X • Contracted revenue • Input/offtake risk associated with fuels manufacture • Precinct landlord • Fuel ownership • Yield on appropriately valued land
Slide 8: Australian refinery sites are being repurposed as Energy Hubs
Australian refinery sites are being repurposed as Energy Hubs Kwinana Energy Hub Geelong Energy Hub Source: Viva November 2021 Community Meeting Source: BP website
Slide 9: Contracted Revenue Outlook
Contracted Revenue Outlook $M1 ~50% of Channel’s current revenue is fixed and independent of fuel volume throughput. Energy Precinct Concept focused on building additional long-term revenue generation that is independent of fuel volume 140 120 100 80 51% 52% 50% 49% Fixed revenue % 50% 47% 46% 46% 4
Slide 10: World-Class Operator
JACK STEWART, GM OPERATIONS World-Class Operator To provide resilient infrastructure and unlock growth opportunities
Slide 11: Pathway to world-class operator
Pathway to world-class operator Pathway to world-class underpinned by a comprehensive programme of work Infrastructure ANNUAL TARGETS WORLD-CLASS FULL POTENTIAL and Performance Step-wise targets and plan Target outcomes set both: based on three-year horizon Quantitively Systems Target performance KP
Slide 12: Infrastructure and performance
Infrastructure and performance Ongoing investment driving operational performance Significant investment in assets and 100%1 capabilities for long-term infrastructure reliability and resilience: • Investment in world-class fire fighting Tank and Jetty equipment and bund upgrades ~$90 availability mi
Slide 13: Systems and processes
Systems and processes Continued focus on operational discipline Nil1 Refreshed safety engagement program Focus on reporting and continuous improvement Process safety incidents Strong lead-indicator performance Supply chain efficiencies for customers, Zero1 such as reducing ship alongside time, are a
Slide 14: People and capabilities
People and capabilities Significant lift in employee engagement since import terminal conversion Employee engagement is a measure of the +26 investment of our people in the company’s strategy and direction Specific skills and knowledge have been Percentage point lift recruited into the business in l
Slide 15: Asset upgrades
Asset upgrades Conversion project 85% complete with bunding upgrade program remaining through to 2027 Petrol tank farm firefighting manifold Crude oil to jet fuel tank conversion – new geodesic roof World-class bund upgrade
Slide 16: Fuel Demand Outlook
PETER VAN CINGEL, BUSINESS DEVELOPMENT MANAGER Fuel Demand Outlook
Slide 17: Updated Envisory long-term fuel outlook
Updated Envisory long-term fuel outlook • Envisory long-term fuel outlook has been updated (prior outlook Marsden Point Throughput (Million Litres) Outlook2 February 2023): 4,500 • forecast stronger Marsden Point throughput to 2047 4,000 • forecasted volumes have increased by ~2.5 billion litres ove
Slide 18: Updated Envisory petrol and diesel outlook
Updated Envisory petrol and diesel outlook Petrol New Zealand Light Vehicle Fleet1 Envisory forecast higher overall with slower transition anticipated 5,000k 35k • Permanent loss of vehicle kilometres travelled post-Covid • Current economic downturn has slowed acquisition of new vehicles 4,500k 30k
Slide 19: Updated Envisory jet outlook
Updated Envisory jet outlook Jet Auckland Airport International Flight Movements2 • Envisory’s updated jet outlook continues to rely on passenger and destination DKMA1 projections for Auckland Airport Auckland Airport International Flights Channel Infrastructure Jet Fuel Throughput (Million Litres)
Slide 20: Marsden Point
PETER VAN CINGEL, BUSINESS DEVELOPMENT MANAGER Marsden Point A unique and highly strategic site
Slide 21: Geographic Location
Geographic Location Marsden Point has direct access to the Auckland market via Channel’s 170km pipeline. The next nearest alternate Auckland fuel supply import terminal is located at Port of Tauranga, 195km from Auckland by road. The fuels pipeline from Marsden Point is the lowest-emission supply ro
Slide 22: Key Site Attributes
Key Site Attributes Channel Infrastructure’s unique site is well positioned to support New Zealand’s energy transition ✓ 180 hectares of highly strategic land ✓ Heavy industrial zoning ✓ Marsden Point Energy Precinct zoning overlay ✓ Long-term industrial resource consents ✓ 220kV electricity grid co
Slide 23: Land Zoning and operating consents
Land Zoning and operating consents Large area of Heavy Industrial zoning from Marsden Point to Ruakaka town, much of which is geologically challenging with a peat substrate. Channel’s Marsden Point site does not have a peat substrate and has a permissive ‘Marsden Point Energy Precinct’ zoning overla
Slide 24: Land Zoning and Operating Consents
Land Zoning and Operating Consents The Marsden Point site has bespoke zoning and consenting enabling all activities associated with the import, production, refining and distribution of energy products at Marsden Point. Marsden Point Energy Precinct overlay Zoning Whangārei District Plan has a dedica
Slide 25: Strategic Energy Precinct Concept
ROB BUCHANAN, CHIEF EXECUTIVE OFFICER Strategic Energy Precinct Concept
Slide 26: Highest and best use growth opportunities for unutilised land
Highest and best use growth opportunities for unutilised land Significant potential to support New Zealand’s energy transition Additional Storage Potential Opportunities Future Fuels Manufacturing Potential Energy Security Potential Opportunities Opportunities Incremental Jet storage Peaking electri
Slide 27: Benefits to Northland & New Zealand
Benefits to Northland & New Zealand Development of the Marsden Point Energy Precinct will bring significant benefits to regional New Zealand, and improve New Zealand’s energy resilience • Projects will require significant investment in regional New Zealand, using local contractors and expertise wher
Slide 28: Additional storage
Additional storage Minimum Stockholding Obligation • Government consulting on increasing Minimum Stockholding Obligation from 21 to 28 days for diesel • Additional 7 days equates to 70 million litres • Channel well placed with 400 million litres of unutilised tank capacity available for conversion •
Slide 29: WOSL: Wiri Oil Service Limited
1. WOSL: Wiri Oil Service Limited
Slide 30: e-Fuel Manufacture at Marsden Point
e-Fuel Manufacture at Marsden Point Potential high-quality tenant with the opportunity to provide ancillary services On-going study by Fortescue e-Sustainable Aviation Fuel Production Process • Project contemplates a 300MW ~60 million litre e- FEEDSTOCK PROCESS Sustainable Aviation Fuel (e-SAF) prod
Slide 31: Potential Marsden Point Biorefinery project
Potential Marsden Point Biorefinery project Repurposing of some ex-refinery equipment to support lower-carbon fuel manufacturing • Seadra Consortium (Seadra, Qantas, Renova Inc, Kent Plc Typical biofuel Production Process and ANZ) considering the development of a biorefinery on TYPICAL FEEDSTOCKS TY
Slide 32: WOSL: Wiri Oil Service Limited
1. WOSL: Wiri Oil Service Limited
Slide 33: Potential for Energy Firming
Potential for Energy Firming Liquified Natural Gas (LNG) • Domestic natural gas supply shortfall creates opportunity for LNG import facility • Marsden Point site well-suited, with sheltered deep-water harbour, permissive zoning, and existing connection to natural gas network • The gas pipeline from
Slide 34: Potential for Energy Storage
Potential for Energy Storage Flow battery Long-term grid-scale electricity storage utilising liquid electrolyte Leverages Channel’s competitive advantages: • Existing 75 million litre tank • 220kV electricity grid connection at site boundary • Potential green hydrogen source from e-SAF facility • Po
Slide 35: WOSL: Wiri Oil Service Limited
1. WOSL: Wiri Oil Service Limited
Slide 36: Wrap up
ROB BUCHANAN, CHIEF EXECUTIVE OFFICER Wrap up
Slide 37: WOSL: Wiri Oil Service Limited
1. WOSL: Wiri Oil Service Limited
Slide 38: Potential Land Value
Potential Land Value Significant value in the unutilised land provided the right tenants can be attracted Potential strategic land value • Current book value of the unutilised land is ~$15m Seadra biorefinery implies ~$550 per m2 • Value unlock achieved by earning a rental yield on a valuation that
Slide 39: Long-term and considered approach
Long-term and considered approach The Energy Precinct contemplates a pathway to unlocking the value of our land • Channel intends to take a long-term and considered approach to the development of the Energy Precinct • Our objective is to ultimately unlock the value of our land by putting it to its h
Slide 40: An energy precinct for New Zealand
An energy precinct for New Zealand Long-term pathway to unlocking significant value over time as high-quality tenants are attracted to the 120 hectares of unutilised land and ancillary services Channel can provide Energy Precinct could help underpin New Zealand’s energy and fuel security and resilie
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