Jatcorp Ltd · ASX:JAT
Jatcorp — Jatenergy — Non-Deal Roadshow (August 2012)
23 slides from Jatcorp's roadshow presentation, Aug 16, 2012
Slide 1: Coal Plus Road Show August 2012
For personal use only Coal Plus Road Show August 2012 Jakarta • Singapore • Hong Kong • Shanghai Jatenergy Limited www.jatenergy.com
Slide 2: Disclosure
Disclosure For personal use only This document has been prepared by Jatenergy Limited to update existing and prospective shareholders. Any statements, opinions, or other material contained in this document do not constitute any commitments, representations or warranties by Jatenergy Limited or/and a
Slide 3: About Jatenergy
About Jatenergy For personal use only • Sydney-based diversified energy company • Owns or has rights to several coal assets: – Two coal tenements and one operational mine in Indonesia’s Kalimantan coal region – Six coal exploration permits and permit applications in Queensland’s Bowen and Galilee Ba
Slide 4: About Coal Plus
About Coal Plus For personal use only • Proprietary coal upgrading technology • Coverts low value brown coal into high value energy products • Jatenergy looking to license technology, specifically in Indonesia on project by project basis
Slide 5: Characteristics of brown coal
Characteristics of brown coal For personal use only • High moisture content (30–65%) • High volatile matter (40–55%) • High oxygen content (15–20%) • Low calorific value (8–12 MJ/kg = 2000–3000 kcal/kg) • Weathers and easily ignited (stacking time <30 days) • Difficult to transport • Low combustion
Slide 6: Methods of upgrading brown coal
Methods of upgrading brown coal For personal use only
Slide 7: Problems with existing coal upgrading technologies
Problems with existing coal For personal use only upgrading technologies • Mostly pilot plant only, hence unproven • Scale restrictions • Commercial value not substantiated • Produce only a single product
Slide 8: Artist sketch of Coal Plus plant
Artist sketch of Coal Plus plant For personal use only
Slide 9: Advantages of Coal Plus
Advantages of Coal Plus For personal use only • Highly efficient and cost-effective • Already in commercial use – three commercial plants established – more commercial plants planned or under construction • Produces multiple, high-value, finished products • Reduces CO2 emissions (compared to direct
Slide 10: Low carbon emissions
Low carbon emissions For personal use only • Coal Plus technology reduces carbon emissions • Potentially Victoria’s brown coal power station could reduced CO2 emissions by over 80% versus direct burning brown coal. Achieved through coal plus processing for making multiple products to reduce emission
Slide 11: Products of Coal Plus
Products of Coal Plus For personal use only • Low volatile solid fuel (LVSF) – Valuable solid fuel, high energy content – Suitable for steel production – Feedstock for various products • Pyrolytic oil (Pyroil) – Valuable liquid – Refined into various energy products (e.g. gasoline) – Chemical feedst
Slide 12: Markets
Markets For personal use only • LVSF and pyrolytic oil are both valuable, high quality products – Brown coal ~$20/t – LVSF ~$200/t – Pyrolytic oil ~$360/t • High demand in most Asian countries (China, Japan etc.) • Can be transported by sea and exported to international markets
Slide 13: Coal Plus plant 1: Shaanxi, China
Coal Plus plant 1: Shaanxi, China For personal use only
Slide 14: Coal Plus plant 2: Inner Mongolia
Coal Plus plant 2: Inner Mongolia For personal use only
Slide 15: Financial model
Financial model For personal use only • Based on Coal Plus plant costing $80 million • Input of 2 Mt/year of wet brown coal • Capex recouped <2 years • Annual EBITDA >$54 million • Internal annual rate of return on investment ~50%
Slide 16: Financial and technical assumptions
Financial and technical assumptions For personal use only • Financial assumptions – Capital expenditure: $80 million – Depreciation period: 10 years – Plant life: 15 years – Tax rate: 25% • Coal characteristics – Moisture content: approx 60% – Ash content: <2 % – Energy content: >25 MJ/kg
Slide 17: Input/output assumptions
Input/output assumptions For personal use only • Inputs/costs Quantity Unit cost – Brown coal: 2000 kt/a $20/t (wet coal) – Transport: $35/t (LVSF) – Overheads: $15/t (LVSF) – Other: $10/t (LVSF + oil) + $10/(103 m3) (gas) – Steam: 0.09 t/t $10/t (dry coal) – Power: 9.61 MWh/t $100/MWh – Gas (recycl
Slide 18: Inputs and outputs
For personal use only Inputs and outputs
Slide 19: Inputs and outputs
For personal use only Inputs and outputs
Slide 20: Inputs and outputs
For personal use only Inputs and outputs
Slide 21: Annual project cashflow
Annual project cashflow For personal use only Income $m LVSF 89.9 Pyroil 22.3 Gas (surplus) 12.0 Total income 124.2 Expenses $m Brown coal 40.0 Steam 0.7 Power 0.7 Transport 15.7 Overheads 6.7 Other 6.4 Total expenses 70.4 EBITDA 53.9
Slide 22: Model sensitivities
Model sensitivities For personal use only • Base IRR = 49.7% Low High Parameter Unit Low Base High IRR IRR (%) (%) Capital cost $m 50 80 100 40.0 78.5 PCI price $/t 150 200 250 29.6 69.5 Coal tar $/t 300 360 420 46.4 53.0 Gas price $/m3 70 90 110 47.4 52.1 Power price $/MWh 80 100 120 49.9 49.6 Coal
Slide 23: Investment returns
Investment returns For personal use only • Business model is robust, with a conservative base case IRR of 49.7% and NPV of $104 million • Main sensitivities to: – Capital cost – well understood from operating plants – PCI price for LVSF – returns still healthy at prices below $150/t – Coal input pri