Aj Lucas Group Limited · ASX:AJL
Aj Lucas — Investor Presentation (February 2013)
31 slides from Aj Lucas's investor presentation, Feb 13, 2013
Slide 1: AJ Lucas Group Limited: Cuadrilla Back on Track – February 2013
For personal use only AJ Lucas Group Limited Cuadrilla Back on Track – February 2013
Slide 2: Executive Summary & Update
Executive Summary & Update For personal use only The Company AJ Lucas Group Limited (“AJL” or the “Company”) Drilling Services Operational Business Units Engineering and Construction (“E&C”) Cuadrilla –European shale gas and liquids; 200 Tcf Gas In Place at Bowland Upstream Investments Mon
Slide 3: Investment Highlights
Investment Highlights Cuadrilla Operating Business For personal use only AJL owns 44% of Cuadrilla Resources Limited (“Cuadrilla”), the UK’s most Drilling advanced shale gas developer and owner of one Europe’s largest independent Largest drilling fleet servicing the coal and CSG sectors in Austr
Slide 4: A Diversified Infrastructure, Construction & Mining Services Group
A Diversified Infrastructure, Construction & Mining Services Group For personal use only Operational Business Units Drilling Services Engineering and Construction • Largest drilling service provider to the coal sector in Australia • Provides engineering and construction services to the resources (co
Slide 5: Successful Track Record of Delivering On Upstream Investments
Successful Track Record of Delivering On Upstream Investments For personal use only Period of Ownership Investment ($m) Sale Proceeds ($m) IRR Realised Investments Gloucester Basin 2002-2008 26.4 259.0 112% Sydney Gas 2007-2008 28.8 34.2 19% ATP 651 2003-2010 5.1 98.6 148% Arawn 2006-2010 7.9 Writte
Slide 6: Group Performance and Outlook
Group Performance and Outlook For personal use only Recent Performance Financial Summary • Difficult trading conditions and global uncertainty caused a significant Note: 1H FY13 are still 2011 2012 2012 2012 2013 reduction in coal prices reducing demand for drilling services. Additionally subject to
Slide 7: Cuadrilla
For personal use only 7 Cuadrilla
Slide 8: Cuadrilla Overview
Cuadrilla Overview For personal use only Net 1.47m acres awarded; a further 0.7m acres pending Large & Highly Prospective Amongst the largest and most prospective acreage holdings in Europe. First mover advantage Land Holding – First Mover Generally targeted basins with proven petroleum histor
Slide 9: Cuadrilla European Plays
Cuadrilla European Plays For personal use only Cuadrilla holds one of the most geographically diversified unconventional portfolios in Europe PEDL165, EXL269 Bowland Shale Fm Multi TCF shale gas Weald: KOSP Acquisition of PEDL247X L&M Blocks Silurian Shales Multi TCF Shale Gas Weald: KOSP (EDL244, E
Slide 10: Cuadrilla Acreage
Cuadrilla Acreage For personal use only Award Date License/Prospect Country Basin Gross Acres Net Acres Partner (%WI) PEDL 165 (Incl Production) UK Bowland 2008 293,018 221,918 Lucas Energy 25% PEDL 244 UK Weald 2008 38,054 28,541 Lucas Energy 25% PEDL 247 UK Weald 2011 135,265 135,265 EXL 189 UK Co
Slide 11: Bowland Basin: Lead Project
Bowland Basin: Lead Project For personal use only The Bowland Prospect Bowland Basin is a very significant shale gas resource play 1000’s feet below aquifers – not enough energy to frac into aquifers OGIP > 200 tcf Very close to major pipeline infrastructure Many places OGIP > 1 tcf / sq.m
Slide 12: Bowland Basin
Bowland Basin For personal use only Pre-Existing Exploration Wells A. Thistleton-1 B. Hesketh-1 C. Banks-1 D. Elswick-1 New Cuadrilla Drilled Wells 1. Preese Hall-1 2. Grange Hill-1Z 3. Becconsall-1Z 4. Anna’s Road-1 Hz (To be drilled in 2013) All the penetrations to date have been vertical wells An
Slide 13: Bowland Basin: Strategically Located
Bowland Basin: Strategically Located For personal use only Land location in the heart of UK Well sites close to national grid high pressure gas pipe locations 13
Slide 14: Bowland Basin: Presence of Gas Confirmed; Development Underway
Bowland Basin: Presence of Gas Confirmed; Development Underway For personal use only Gas Desorption of Cuttings & Core UK’s First Shale Well: Enclosed Flare (40 Ft Column, Init. Flow > 1MM cf/d ) Bowland Basin 2D Database and 3D Survey Area (100 km2) Super Pad Development Plan : Minimal Footprint 14
Slide 15: Cuadrilla: 2013 Work Plan
Cuadrilla: 2013 Work Plan For personal use only Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Drill Vertical Lateral Anna's Road Frack Micro Seismic Becconsall Frack 2D Seismic Poland 3D Seismic 15
Slide 16: Bowland Basin: Comparison to US Peers
Bowland Basin: Comparison to US Peers For personal use only Shale Comparison Bowland (UK) Barnett (USA) Asbian-Brigantian (Late Miss) Chesterian (Late Miss) 3000’+ black shales with interbedded lsts 1000’+ black shales with interbedded lsts Marine-prodelta/basinal Basinal/ slope Fractu
Slide 17: Reserves Certification Key to Valuation
Reserves Certification Key to Valuation For personal use only Selected Shale Transactions Deal Size Resource Companies Involved Date Comment ($m) Estimate Apollo Global Management acquires EP Energy 7,150 Purchaser group includes AJLs co-Cuadrilla shareholder Riverstone Nov Chevron (U.S.) buys Atlas
Slide 18: Drilling Services
For personal use only 18 Drilling Services
Slide 19: Drilling Services Business Overview
Drilling Services Business Overview Business Divisions Drilling Division Revenue ($m) (1)(2) For personal use only One of Australia’s largest and most diverse rig fleets operating in 4 divisions: $200 $190.1 $189.3 $189.6 Exploration and Development $180 $174.7 Multi-purpose rig fleet flexible b
Slide 20: Drilling Services Business Highlights
Drilling Services Business Highlights – Direct exposure to the buoyant Australian resources sector Strong Industry – Coal and energy activity expected to remain strong For personal use only Fundamentals – Australia is the world’s second-largest exporter of coal (25% market share) and is expected to
Slide 21: Engineering and Construction
For personal use only Engineering and Construction 21
Slide 22: E&C Business Overview
E&C Business Overview For personal use only Business Activities Major Projects Actively focus on areas requiring a high level of engineering and technical expertise to Moomba Sleeving Yarwun HDD and Gladstone Area Waterboard create barriers to entry Gorgon HDD $175m $4m $55m Largest capability i
Slide 23: E&C Business Highlights
E&C Business Highlights For personal use only Strong Industry – Massive infrastructure spending forecast in support of coal export growth (railways, port capacity expansion and associated works) and Fundamentals LNG exports from CSG (gas pipelines, gathering systems, pump stations, compressor statio
Slide 24: Safety
For personal use only 24 Safety
Slide 25: Industry Leader in Safety
Industry Leader in Safety For personal use only Lucas Practices A Proactive And Vigilant Safety Culture. Our Goal Is To Achieve An Injury-Free Workplace. Proactive Safety Actions vs. TRIFR 9000 25 Weekly Safety / Toolbox 22.9 Meeting 21.5 8000 Hazard Reports 20.3 The 12 month TRIFR has 20 Safety Obs
Slide 26: Appendix
For personal use only 26 Appendix
Slide 27: Cuadrilla Management Resumes
Cuadrilla Management Resumes For personal use only Chief Executive Officer - Francis Egan joined Cuadrilla Resources as CEO in July 2012. Mr Egan has over 28 years of diverse international experience working in engineering and management roles in the upstream oil & gas industry. Prior to joining Cua
Slide 28: Shares and Options on Issue and Pro-forma
Shares and Options on Issue and Pro-forma Shares and Options on Issue Qty Exercise Price Expiry Notes For personal use only Shares on Issue 132,656,920 Options 93,861 30/06/2013 Performance Related Options 1,000,000 $2.13 22/12/2016 Goldman Sachs Options 11,159,356 22/12/2015 > $1.35 (VWAP Based) <$
Slide 29: Balance Sheet
Balance Sheet Note: 1H FY13 are subject to audit 1H-2013 June 2012 1H-2013 2012 $m $m $m $m For personal use only Current assets Current liabilities Cash and cash equivalents 0.6 4.3 Trade and other payables 69.0 120.3 Trade and other receivables 46.0 57.1 Interest-bearing loans and borrowings 29.4
Slide 30: Loan Facilities
Loan Facilities For personal use only Loan Facilities (As at December 2012 – Subject to audit) $m Kerogen Facilities Mezz loan $93.7 Other Advances $18.4 Accrued interest $1.1 $113.20 ATO Debt Principal $26.50 Accrued interest & fees $12.80 $39.30 ANZ Overdraft $4.3 Wyong Yard Mortgage $2.20 Leases
Slide 31: Disclaimer
Disclaimer These presentation materials (Presentation Materials) are being issued solely to and directed solely to Sophisticated and Professional Investors, as those terms are defined in For personal use only the Corporations Act 2001 (Cth), who may have interest in sub underwriting the Entitlement
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