28 slides from Channel Infrastructure Nz's shareholder meeting presentation, Aug 6, 2021
Slide 1: Special Meeting: Marsden Point Terminal Proposal
Special Meeting Marsden Point Terminal Proposal 6 August 2021
Slide 2: Disclaimer & Important Information
Disclaimer & Important Information Information: This presentation has been prepared solely for information purposes to provide a general No representation or warranty: To the maximum extent permitted by law, neither Refining NZ, nor any of overview of The New Zealand Refining Company Limited’s (Refi
Slide 3: Board of Directors and Speakers
Board of Directors Speakers SIMON ALLEN NAOMI JAMES Independent Director Chief Executive Officer RICCARDO CAVALLO LINDIS JONES JAMES MILLAR LUCY NATION VANESSA STODDART PAUL ZEALAND Manager of Refining Chief Financial Officer Independent Director Vice President of Regions, Independent Director Indep
Slide 4: Introduction and Agenda
Introduction Refining NZ proposes to convert the Marsden Point site to a fuel import terminal, changing its name to Channel Infrastructure Agenda • Strategic Review • Terminal Proposal • Investment Highlights • Comparison to Simplified Refinery • Resolutions 3
Slide 5: Online attendees – Question Process
Online attendees – Question Process 3
Slide 6: Online attendees – Voting Process
Online attendees – Voting Process 3
Slide 7: Chairman's Address
CHAIRMAN’S ADDRESS SIMON ALLEN #
Slide 8: Strategic Review: Optimal business model to maximise through the cycle returns
Strategic Review Optimal business model to maximise “through the cycle” returns to shareholders Strategic review context Case for change Strategic review outcome Significant decline in GRM, Structural oversupply in refining Simplify refining operations to exacerbated by COVID-19 capacity maintain ca
Slide 9: Marsden Point Terminal Proposal
Marsden Point Terminal Proposal 177 hectares of land 35 year resource consent Deep harbour and jetty access Large electricity and gas connections Proximity to NZ’s largest population base Note: The TLF and Wiri Terminal end-delivery points do not form part of the Import 5 Terminal System (ITS) asset
Slide 10: Channel Infrastructure
Channel Infrastructure New Zealand’s leading independent fuel infrastructure company, with a focused strategy to grow and develop Marsden Point, including as an energy hub 11
Slide 11: CEO's Address
CEO’S ADDRESS NAOMI JAMES #
Slide 12: Critical infrastructure delivering more stable earnings
Investment Highlights Critical infrastructure delivering more stable earnings through long term customer agreements Ownership of critical and highly efficient infrastructure Long term customer contracts Projected stable earnings, cash flow and dividends Supporting decarbonisation of New Zeal
Slide 13: Ownership of critical and highly efficient infrastructure
Investment Highlights Ownership of critical and highly efficient infrastructure • Primarily supplying Auckland and Northland fuel requirements, which make up 40% of New Zealand fuel demand • On current forecasts, the RAP will meet Auckland’s future fuel demand • RAP supplies all of the jet fuel dist
Slide 14: Long term customer contracts
Investment Highlights Long term customer contracts • 10-year initial term with 2 x 5-year options to renew (at customer option) • Combination of fixed and throughput-based fees for shared terminal capacity: • Incentivises customer utilisation of infrastructure • Fixed fees expected to largely cover
Slide 15: Projected stable earnings, cash flow and dividends
Investment Highlights Projected stable earnings, cash flow and dividends Commentary Example EBITDA calculations • Revenue from shared terminal capacity, IPL laboratory testing services, • Assuming revenue of: Wiri terminal lease (until 2025) and any Private Storage services (to be priced on a value
Slide 16: Supporting decarbonisation of New Zealand's economy
Investment Highlights Supporting decarbonisation of New Zealand’s economy • Significant contribution to New Zealand’s decarbonisation: • circa 98% reduction in Scope 1 and 2 CO2 emissions5 of over 1 million tonnes per annum • Approximately 85% reduction in required electricity supply and no natural
Slide 17: Focussed growth strategy – Marsden Point as an energy hub
Investment Highlights Focussed growth strategy – Marsden Point as an energy hub Flexibly developing • Strategic fuel storage6 Marsden Point as an • Growth in electricity energy hub for the • Other imports north of New Zealand • Transition to future fuels – biofuels, SAF and hydrogen imports, product
Slide 18: Comparison to Simplified Refinery
Comparison to Simplified Refinery Fundamental change in business risk profile and an expected near-term return to dividends CHANNEL INFRASTRUCTURE WOULD PROVIDE: • Relatively stable earnings with a fixed fee component, take-or-pay protection Significantly lower earnings volatility and lower operat
Slide 19: Timeline
Timeline Strategic Review Simplified Refinery Import terminal Final Investment Decision (FID) / Import terminal Phase 1 implementation assessment/planning Binding customer agreements commencement (April-June 2020) (July 2020 - Jan 2021) (July 2020-now) (Target – end Q3 2021) (Target – by mid-2022) C
Slide 20: Simon Allen, Chairman
SIMON ALLEN CHAIRMAN #
Slide 21: Shareholder Approval: Now is the right time to make this change
Shareholder Approval Now is the right time to make this change In the opinion of Independent Appraiser, Grant Samuel: • “Maintaining the Simplified Refinery until 2035 would be a sub-optimal outcome for Refining NZ and its shareholders” • “The transition to an Import Terminal is fair to the Non-Cust
Slide 22: Resolution: Change in nature of business and major transaction
Resolution 1 Change in nature of business and major transaction “That the Proposal is approved for the purposes of NZX Listing Rule 5.1.1(a) and, to the extent applicable, NZX Listing Rule 5.1.1(b) and Section 129 of the Companies Act 1993, subject to the Approval Requirements”. 14
Slide 23: Resolution: Provision of import terminal services
Resolution 2 Provision of import terminal services “That Refining NZ’s entry into documentation with each of the Customers (or their nominees) for the provision of import terminal services and transitional arrangements from the Processing Agreements, is approved as a Material Transaction under NZX L
Slide 24: Questions
Questions <#>
Slide 25: Online attendees – Question Process
Online attendees – Question Process 3
Slide 26: Resolutions
Resolutions Resolution 1: “That the Proposal is approved for the purposes of NZX Listing Rule 5.1.1(a) and, to the extent applicable, NZX Listing Rule 5.1.1(b) and Section 129 of the Companies Act 1993, subject to the Approval Requirements”. Resolution 2: "That Refining NZ's entry into documentation
Slide 27: Our shareholders are key stakeholders
OUR SHAREHOLDERS ARE KEY STAKEHOLDERS We welcome your further feedback. Please email us at: corporate@refiningnz.com <#>
Slide 28: Special Meeting: Marsden Point Terminal Proposal
Special Meeting Marsden Point Terminal Proposal 6 August 2021