Blue Energy Limited · ASX:BLU
Blue Energy — Investor Presentation (August 2011)
25 slides from Blue Energy's investor presentation, Aug 10, 2011
Slide 1: Welcome to luncheon presentation
I would like to welcome you all to this luncheon presentation and I am pleased to have the opportunity to address you. Given the state of the markets, I am grateful that you can commit the time to hear about Blue Energy. 1
Slide 2: Disclaimer
I urge you all to read the usual disclaimer as it provides protection for me and the Company that we are not encouraging you to invest in Blue Energy without understanding the risks involved. 2
Slide 3: Vision: 3,000PJ by 2014
Our Vision is to deliver for our shareholders. 3,000PJ by 2014. This equates to one LNG train of feed gas supply. Eastern Australia needs more gas and the significance is that supplying gas to Export LNG delivers international pricing for our gas. It is my view that domestic gas prices will rise to
Slide 4: Strategy to realise the vision
To realise this vision of establishing 3,000PJ by YE 2014, the Blue Board has endorsed a strategy which will utilise low cost evaluation programs in our high graded permits, together with information from adjacent acreage to aggressively convert resources to reserves. The strength of Blue’s acreage
Slide 5: 21,000km2 under license in major eastern Australian basins
Blue has 21,000km2 under license in 5 major sedimentary basins in eastern Australia, and holds 100% of these permits (with the exception of the Maryborough Basin where Blue is earning 75%) along with Operatorship. In today’s presentation I will focus on the potential in three of these basins, the Co
Slide 6: Converting GIP to 3P
Our challenge is to convert as much GIP to 3P as cheaply and safely as possible. Our goal is to have 3,000PJ of 3P by YE 2014 – equal to a feed gas supply for 1 LNG train. This graphic illustrates the pathway to this conversion. Our work program and budgets are geared to the conversion of GIP to CR
Slide 7: Gladstone LNG projects and gas requirements
The fact that there are now three LNG projects in Gladstone that have reached Final Investment Decision provides a basis for looking at the real gas requirements for those projects, and how these requirements will impact on other non LNG project companies and on domestic gas supply. These figures, t
Slide 8: Blue Energy's current position, board and management
A quick review of Blue Energy’s current position is shown in this slide and is referenced to 30 June. Since that time, our market cap has risen slightly, but as with most stocks, last week’s turmoil has plundered those sector gains of the recent months. Blue Energy is a lean organisation, but has a
Slide 9: Community, aquifers, safety and environment
Blue Energy aims to be a positive contributor to the communities in which we operate. Our core values include acting at all times with respect toward the local communities and people with whom we interact, and at all times remembering that we are a guest in the community. Blue Energy is a leader in
Slide 10: Bowen Basin: ATP814P
The Bowen Basin is a significant producing Basin and will be a primary source of feed gas for Shell’s Gladstone project. Blue Energy’s ATP814P consists of seven separate blocks covering 2,222km2. 10
Slide 11: Bowen Basin geology
The Bowen Basin is a Permian aged basin and consists of Fluvio-deltaic sedimentation in lacustrine non marine to marginal marine depositional settings. As you would know, it is a major coal producing basin delivering both steaming coal and high quality coking coal to the global and domestic markets.
Slide 12: ATP814P permit status and gas sales MOU
Blue Energy is Operator of this permit, which is mid way through its 12 year term. Blue has 100% ownership of the permit and has an active program underway targeting the Permian Coals. An MOU for Gas Sales has been executed with a power generator. The MOU contemplates a 6-10PJ per annum gas supply o
Slide 13: Underexplored acreage relative to competitors
Blue’s acreage has huge potential as it is underexplored relative to surrounding acreage. There is significant well density in the producing areas whereas by contrast, there is very little well control in Blue’s permit area. Blue Energy’s blocks are well positioned relative to both existing and prop
Slide 14: Target coal seams and Monslatt Block
For those with a geological eye, the target seams are contained in the Permian aged Rangal, Fort Cooper and Moranbah Coal Measures, which are located in a broad syncline which is productive on the western limb with Arrow’s Moranbah Gas Project, but largely un-explored on the eastern limb, where Blue
Slide 15: Maryborough Basin acreage
Blue Energy is currently farming into Adelaide Energy’s Permits and Application areas. There is one current permit and the consortium is awaiting the award of two larger application areas, following successful negotiation of Native Title Agreements. Exploration in the basin dates back to the mid 195
Slide 16: Maryborough Basin shale gas emerging
The Basin is in close proximity to Gladstone. It is an underexplored basin, with early exploration focusing on conventional gas, but more recently, CSG and Shale Gas plays have been identified. The most recent conventional gas well drilled 10 years ago recorded a small gas flow from a shale section,
Slide 17: Maryborough exploration history
The exploration to date has focused on the Early Cretaceous Gregory Sandstone with several wells drilled on the Gregory River Anticline indicating the presence of tight gas accumulations but with only sub economic gas flows at the time. With the development of Coal Seam Gas production in the Surat B
Slide 18: Maryborough shale gas potential assessed by EIA
The Maryborough Basin is one of 4 basins in Australia, assessed by the EIA, to have shale gas potential, and the metrics compare favourably. It is noteworthy that the shale gas phenomenon that has transformed the Nth American gas industry has not yet crystallised in Australia, however, it is only a
Slide 19: Galilee Basin permit
The Galilee Basin is another underexplored Basin but with the large amount of competitor exploration activity due to be undertaken in the next few years, the understanding of the basin will improve greatly. Conventional petroleum exploration has occurred in the basin over the last 40 years, however
Slide 20: Galilee Basin infrastructure and resource assessment
As can be seen by the map, the basin is poorly serviced by gas infrastructure, with the gas fired Barcaldine Power station (53 MW) sourcing gas from the Wallumbilla to Ballera pipeline to the south. With exploration success, this basin has potential to backfill the east coast LNG trains as well as b
Slide 21: Galilee competitor activity
Aggressive competitor activity in the basin will result in better conversion of Prospective Resource to Contingent Resource and Reserves and also a better understanding of the regional play along with infrastructure planning for gas utilization. Large players in the basin include AGL, Origin, CNOOC
Slide 22: Galilee Basin Permian section
The Permian section is time equivalent of the Cooper Basin and Bowen Basin sequences and as such, extensive and thick coal measures have been demonstrated and offer good CSG potential. In the west, strong Jurassic aquifer development (Great Artesian Basin) is evident. Coals outcrops in the east, whe
Slide 23: Gas supply shortfall and Blue's position
We believe there is a short and medium term gas supply shortfall looming. Blue Energy is Operator of all its acreage and therefore can control activity and destiny. We have currently 2,589PJ of recoverable contingent resource and 39PJ of 3P reserves. Given the potential shortfall in some LNG project
Slide 24: Upcoming drilling and activity
In the Bowen Basin we are currently building leases for 2 new exploration drilling locations. We anticipate spudding Monslatt 9 in the third week of August. The Maryborough Basin play is attracting unsolicited interest from global energy players. There are currently two rigs operating in the Galilee
Slide 25: PELE Coy,
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