Slide 1: Leigh Creek Energy Project
Leigh Creek Energy Project Right Time Right Place Right Market MAY 2020
Slide 2: Disclaimer
Disclaimer This presentation has been prepared by, or for Leigh Creek Energy Limited (LCK). It contains, and we may make other written or verbal forward looking statements with respect to certain of LCK’s plans, current goals and expectations relating to future financial condition, performance, resu
Slide 3: Table of Contents
Table of Contents 1. Overview i. Corporate ii. Team iii. Technology iv. Site 2. Project i. Pre-Commercial Demonstration ii. 2P Reserve iii. Pathway to commercial iv. Diversification of portfolio 3. Fertiliser i. Low cost of production ii. Market iii. Infrastructure 4. Hydrogen 5. Summary 3 3
Slide 4: Investment Highlights
Investment Highlights Overview Project Fertiliser Hydrogen Summary • 100% owner operator of Leigh Creek Energy Project (LCEP) • 550km north of Adelaide, South Australia 100% OWNER AND OPERATOR • ISG (In-Situ Gasification) process • Ideal site: geology, hydrogeology, arid environment • Infrastructure
Slide 5: 2P Reserve
Overview Project LCEP is Australia’s largest uncontracted Fertiliser Hydrogen 2P gas reserve serving the East Coast Summary market ISG PROCESS Proven process. Converts stranded RESERVES 2P Reserve underground coal to Larger 2P reserve than the (JORC + Production Test) Otway, Bass, Gunnedah, syngas,
Slide 6: Corporate Snapshot
Overview Project Fertiliser Corporate Snapshot Hydrogen Summary Capital Structure Top Shareholders1 # of Shares % of Total ASX Code LCK China New Energy Group 136.3m 23.5 Share Price1 A$0.088 per share Crown Ascent Development 29.5m 5.1 Shares Outstanding 580.3 million shares Bart Properties Pty Ltd
Slide 7: Management Team
Overview Project Fertiliser EXECUTIVE CHAIRMAN MANAGING DIRECTOR Hydrogen Summary JUSTYN PETERS Justyn Peters, LLB, LP, BA. Phil Staveley, CPA, BA (Acc) (Hons), Dipl Btr AICD Qualified lawyer with over 30 years’ experience, Qualified accountant with over 30 years’ experience worked across many indus
Slide 8: ISG Technology
Overview Project ISG TECHNOLOGY Fertiliser Hydrogen 12 GJ synthetic 490 litres of Summary natural gas methanol • The LCEP utilises In-Situ Gasification (“ISG”) processes at the Leigh Creek Coalfield to develop the deep coal resources that are unable to be accessed through open-pit mining • The ISG p
Slide 9: Best site in the world
Overview Project Fertiliser “Best site in the world …” Hydrogen Summary • Coal ideal for ISG - low risk of subsidence, fugitive surface gas and groundwater impact • Remote and arid location • Existing brownfield site • Outside Great Artesian Basin (GAB) • Infrastructure: • townships, power, communic
Slide 10: PCD design objectives met
Overview Project Fertiliser PCD design objectives met Hydrogen Summary ✓ Produce syngas comprising methane, hydrogen, carbon monoxide and other gases ✓ Produce syngas at over 1 million cubic feet per day ✓ Capture information required to upgrade the existing SPE-PRMS of 2,964 PJ 2C resource to 2P re
Slide 11: 2P Reserves (PJ)
Overview Project Fertiliser Australia’s largest, uncontracted 2P gas reserve Hydrogen Summary Australian East Coast Gas 2P Reserves (as at 1 April 2019) 6,000 5,202 5,000 4,802 4,802 2P Reserves (PJ) 4,000 3,201 3,000 2,677 2,001 2,000 1,153 1,153 1,100 1,000 660 567 305 126 0 Source: Leigh Creek En
Slide 12: Pathway to Commercial
Overview Project Fertiliser PathwayPathway to Commercial to Commercial Hydrogen Summary PCD operation complete, EIS approval, commence feasibility study Commercial successful shutdown, ongoing monitoring and Front End Engineering Design Project Operation H2 2019 2020 2021+ 2022+ 2023+ Environmental
Slide 13: Funding pathway progressing
Overview Project Fertiliser Hydrogen Funding pathway progressing Summary LCK Offtake Agreement for Operating Company Fertiliser Company gas Strategic stake Operating interest Strategic Partner LCK earns income from Operating Company and Fertiliser Company 13 13
Slide 14: International interest
International interest Overview Project Fertiliser Hydrogen Summary 1. Joint Venture with China New Energy (LCK major shareholder) • Binding Term Sheet signed • JV in final stage negotiation • ISG operations in China • CNE - funding, access to coal and knowledge and familiarity with the Chinese regu
Slide 15: Asset portfolio diversified – Bridgeport Farm-In
Overview Project Fertiliser Asset portfolio diversified – Bridgeport Farm-In Hydrogen Summary Cooper and Eromanga Basins • Option for 20% participating interest of Authority to Prospect (ATP) 2023 and ATP 2024 • Bridgeport operated asset • Under-explored, highly prospective oil and gas permits in th
Slide 16: Fertiliser market
Overview Project Fertiliser Fertiliser market Hydrogen Summary Fertiliser market: 8 billion people rely on it! Urea Forecast (Middle East FOB Granular) Global demand rising USD 500 • 170 mtpa and rising • Forecast urea prices rising (see chart) Australian demand USD 400 • Fertiliser volumes ~2+mtpa
Slide 17: LCK: Fertiliser is the main game
Overview Project Fertiliser LCK: Fertiliser is the main game Hydrogen Summary 1. Urea is fertiliser; Fertiliser is food; Food security is the ultimate macro trend 2. At the bottom of the global cost curve 3. Urea production consumes CO2 – Reducing CO2 footprint is one of the necessities for corporat
Slide 18: Simpler, cheaper urea production
Overview Project Competitor LCK Simpler, Fertiliser Hydrogen Summary They purchase We produce cheaper urea natural gas syngas at ~$8/GJ AUD <$1/GJ production They convert to syngas LCK has: • Stable supply of gas input for life Feedstock cost of project • Stable cost of gas input for life of LCK can
Slide 19: Hydrogen economy (the Hero fuel)
Overview Project Fertiliser Hydrogen Hydrogen economy (the Hero fuel) Summary 1. Market for hydrogen is emerging and strongly supported by all levels of government 2. COAG Energy Council, November 2019: Emissions targets, energy security, jobs, economic development, de-carbonising energy hungry indu
Slide 20: LCK Hydrogen Option
Overview Project Fertiliser Hydrogen LCK Hydrogen Option Summary Hydrogen is a pathway gas for LCK’s fertiliser production ISG Gas Plant Hydrogen Ammonia Urea Based on LCK Report by thyssenkrupp, 2018 Hydrogen now: Why is hydrogen attractive to LCK now? • $105B international market • Interim product
Slide 21: Carbon Neutral by 2030
Overview Project Fertiliser Carbon Neutral by 2030 Hydrogen Summary LCK will reduce the remainder Urea of the CO2 through ✓ Revegetation Ammonia ✓ Renewables (pumped hydro, Hydrogen thermal power, solar, etc) ✓ Capture the CO2 and store it Syngas underground (Geosequestration) ISG Production Signifi
Slide 22: Headlines – The Top Ten
Overview Project Fertiliser Headlines – The Top Ten Hydrogen Summary 1. 1,153PJ 2P Gas – huge – from 31% of LCK coal 2. 30+ year project 3. ‘Best in the World’ Site – suitable geology, infrastructure in place 4. Successful demonstration completed 5. Full cycle fertiliser producer; disruptive on cost
Slide 23: Contact Us
CONTACT US LEIGH CREEK ENERGY Level 11 - 19 Grenfell Street Adelaide SA 5000 - Australia Phone +61 (8) 8132 9100 Facsimile +61 (8) 8231 7574 EMAIL contactus@lcke.com.au or fertiliser@lcke.com.au 23
Slide 24: Appendices
LEIGH CREEK ENERGY ENRNERGYENERGY APPENDICES LINKEDIN 24
Slide 25: Corporate Strategy
Corporate Strategy CURRENT PHASE - UPSTREAM DEVELOPMENT UPSTREAM DEVELOPMENT PRE-COMMERCIAL COMMERCIAL ENVIRONMENTAL CONSTRUCTION BASELINE panes deotlacet PERIOD OPERATIONS 2P RESERVES DOWNSTREAM DEVELOPMENT
Slide 26: Enterprise Value to Reserve Comparables
Enterprise Value to Reserve Comparables Enterprise Value per 2P Resource (GJ) $3.50 $3.00 2.86 2.69 $2.50 A$ per GJ $2.00 $1.79/GJ transaction price set by sale of the Ironbark gas project to APLNG (Feb. 19, 2019) $1.50 Peer group average $1.43/GJ 1.33 $1.00 0.92 0.67 $0.50 0.13 $0.00 Source: Leigh
Slide 27: SA Government Independent Scientific Assessment
SA Government Independent Scientific Assessment CONCLUSIONS “the Leigh Creek site represents one of the strongest opportunities 1. Geology for low risk commercial UCG 2. Underground anywhere in the world” Water 3. Regulatory Oversight “material differences related to 4. Management site suitability,