project briefing presentation may 2013 paul mckenna managing director

PROJECT BRIEFINGPRESENTATION

May 2013

Paul McKennaManaging Director

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TERRITORY GASSHARE IN SOMETHING BIG

• Territory Gas is a privately owned Australian company focused on the development of gas and liquids projects in the Northern Territory, Australia.

• The company’s large hydrocarbon acreage is transected by operating gas pipelines terminating in Darwin (an established gas port).

Commercial in Confidence - All rights reserved @2013 – Territory Gas Aust Pty Ltd

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TERRITORY GASWELL POSITIONED FOR GROWTH

• 100% owner of 28 gas exploration permit applications covering 250,000 km2.

• Tenement position covers several producing hydrocarbon basins.

• Acreage transected by Amadeus to Darwin Pipeline which terminates in Darwin (an established gas port).


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TERRITORY GASLEADERSHIP

Paul Williams –Executive ChairmanPaul Williams is the founder of the QCC group of companies and has over 40 years of business experience in the mining sector.

Paul McKenna – Managing DirectorFormer senior commercial roles at Arrow Energy, Ergon and Energex. More than 25 years in the energy and resources industry.


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TERRITORY GASCOMPANY STRUCTURE

Territory Gas LNG Project

Strategic Advisor Project ExecutiveProject Director

Exploration & Production

Reservoir Engineering

Process Engineering

Stakeholder Management

Finance

Third PartiesDrilling and completions

Gas analysisOEM and EPC

Infrastructure Development

Risk & Environment


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THE NORTHERN TERRITORYTHE NEXT GREAT ENERGY PROVINCE

• As the worldwide demand for energy increases, the exploration focus on gas resources has intensified.

• The Northern Territory has been identified as one of the world’s most prospective hydrocarbon regions.

• It is estimated from geological information that the onshore potential of unconventional shale oil and gas reserves in the Territory are in the order of 200,000 PJ according to the Northern Territory Government.


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THE NORTHERN TERRITORYTHE NEXT GREAT ENERGY PROVINCE

• The Northern Territory’s onshore gas and liquids potential has attracted the investment of some of the world’s most prominent explorers including Statoil, Santos and Total.

• Statoil has committed to spend up to US$175 million by the end of 2016 on exploration in its Georgina Basin permits which neighbour Territory Gas’ acreage.

• Total is spending US$190 over four blocks in the Georgina Basin which lie closely to the east of Territory Gas’ acreage.


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TERRITORY GASGAS TO MARKET

• We will pipe the majority of our gas production to Darwin to be liquefied – Liquefied Natural Gas (LNG).

• The LNG will be transported to high value Asian markets by LNG tankers.

• Hydrocarbon liquids may be transported by road to domestic markets.


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THE GLOBAL LNG MARKETDEMAND IS ACCELERATING

• The demand for LNG is expected to double from around 250 million tonnes per annum (mtpa) currently to more than 500 mtpa by 2020 according to Shell’s latest energy forecasts.

• Despite more projects under construction, LNG supply is unlikely to meet this demand in the near term.


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FLOATING LNG

• Territory Gas plans to use floating liquefaction to connect its gas production with high value overseas markets.

• A self-propelled Floating Liquefied Natural Gas (FLNG) production vessel will be built to pre-treat, liquefy, store and offload LNG to a carrier.

• FLNG enables lower costs and faster project development than conventional onshore terminals because major pieces of infrastructure are not required.

• Proposal for two LNG trains with a combined capacity to produce 3.0 million tonnes per annum (Mtpa) of LNG.


LOWER COST, FASTER CONSTRUCTION

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FLOATING LNG

Potential sites for LNG Floating

facilities


PROPOSED LOCATIONS

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FLOATING LNG

• The Project will require all regulatory and environmental approvals and permits to reach Final Investment Decision (FID). FID is targeted for Q4 2015. If a Notice to Proceed is issued, construction activities may commence in Q1 2016.

• Our LNG’s gated project delivery model is integrated with the parallel upstream exploration program.

• Construction and commissioning (in stages) would take between 24 and 30 Months.

• The plant’s first exports could be expected as early as Q4 2017. The project has an expected life of 40 years.


PROJECT DEVELOPMENT

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TERRITORY GASNEAR-TERM STRATEGY

• Aggressive farm-in and acquisition strategy to build economies of scale.

• Two year initial work program – geological and geophysical interpretation of all tenements including conventional and shale gas exploration targets.

• Exploration activities include aerial, gravity and magnetic surveys, seismic acquisition and drilling program.

• Develop and define sufficient hydrocarbon resource to deliver sufficient feedstock for 2 Mtpa floating LNG project.

• Staged delivery of commercial gas flows from at least four exploration tenements by 2017.


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TENEMENT POSITIONCOVERS PROVEN HYDROCARBON BASINS

• Our 28 exploration tenements cover 250,000km2 and overlie or are adjacent to proven hydrocarbon basins including the McArthur, Carpentaria, Amadeus and Georgina basins.

• Our gas acreage has low social and environmental impact and does not cover cropping land.


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TERRITORY GASEXPLORATION TENEMENTS

McArthur and Carpentaria Basin (Katherine, Jabiru Darwin Areas)

EP 254 EP 256EP 257

Amadeus Basin (Alice Springs Area)

EP 265 EP 274 EP 275 EP 276 EP 277 EP 278 EP 279 EP 280 EP 281EP 282 EP 283 EP 284EP 285

Georgina Basin (Tennant Creek region)

EP 258 EP 259 EP 260EP 261 EP 262 EP263


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EXPLORATIONPLANNED ACTIVITIES

2013 2014 2015

Activities Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

Regional and geophysical studies

Traditional landholder negotiations

Seismic (2D)

Drilling vertical and lateral wells

Multistage fraccing trials

Environmental studies

Financial Investment Decision (FID)

(Note : All drilling activities are subject to rig availability and land access requirements.)


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REGIONAL GEOLOGYAMADEUS BASIN

• To date over 20 million barrels of oil (Mmbbl) and 500 petajoules (PJ) of gas have been produced within central Australia from the Mereenie and Palm Valley fields leaving existing known resources significantly under-developed.

• The Northern Territory Geological Survey estimates up to 6 billion barrels of oil equivalent (35 PJ equivalent) unrisked, recoverable hydrocarbons (650 Mmbbl "risked") remain to be discovered in the Amadeus alone.

• The basin hosts Mereenie oil and gas field and Palm Valley gas field in Ordovician Larapinta Group rocks. More than thirty wells have been drilled to investigate petroleum in a 170 000km2 area.


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REGIONAL GEOLOGYGEORGINA BASIN

• The Georgina Basin is a region of proven oil potential. Previous test wells by petroleum and gas explorers drilled in the Georgina Basin have demonstrated oil shows and good quality source rocks, seals and reservoirs with target horizons ranging from 300 to 1000 metres.

• Global energy giant Statoil has committed to spend up to $175 million by the end of 2016 on exploration in its Georgina Basin permits which connect to Territory Gas’s permits.

• Total is funding a three-stage, four-year exploration program in the Georgina Basin at a cost of up to $190 million.


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REGIONAL GEOLOGYMcARTHUR BASIN

• The McArthur Basin is a region is that may be of potential for non-conventional shale gas production.

• The McArthur Basin has similar characteristics to those shale gas basins located within North America, such as the Appalachian, Fort Worth and Williston Basins, amongst others.


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REGIONAL GEOLOGYCARPENTARIA BASIN

• The Carpentaria Basin also shows excellent reservoir potential exists in the Early Cretaceous sandstones, sealed by the Middle Cretaceous mudstones.

• Drape closures over erosional highs and fault traps are likely to be present. Oil shows have been encountered in these rocks on the southern margin of the basin.


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REGIONAL GEOLOGYFRACTURED BASEMENTS

• Territory Gas has identified several hydrocarbon target areas outside of the major sedimentary basins, primarily basement provinces.

• There are numerous examples from more than 30 counties worldwide where fractured basements can be significant host regions for hydrocarbon plays. For example, Vietnam’s Cu Long Basin is responsible for 95 percent of the country’s hydrocarbon production, of which 85 percent of this comes from fractured granitic basement.

• It is Territory Gas’ intention to conduct a staged exploration program

from desk top studies through airborne geophysical investigations to regional 2D seismic studies to build up a picture of targeted basement structures.


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THE TERRITORY GAS LNG COMBINATION

The Territory Gas LNG project presents outstanding opportunity.

•Increasing global demand for hydrocarbons.

•Rising oil, gas and LNG prices.

•High value Asian markets are easily accessible from Darwin.

•Acreage in close proximity to producing gas fields, existing pipeline and LNG infrastructure.


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DISCLAIMER

This presentation has been prepared on behalf of Territory Gas Aust. Pty Ltd ACN 153 719 772 for purposes of briefing potential investors on the NT LNG Project.

This document is confidential. No part of this document can be copied or reproduced or distributed in whole or in part. By accepting this document, the recipient, including their respective affiliates, related bodies corporate, and respective officers , directors, employees and agents acknowledge and agree to the foregoing and this document and all of the information contained in it, is confidential information of Territory Gas Aust. Pty Ltd As the recipient, you agree that you will,

1.Keep in strict confidential this document and all of the information contained within it and all other information made available to you in connection with it and;

2.Not carry out any activities that may breach confidentiality provisions or compete with Territory Gas Aust. Pty Ltd.

The information in this document is of a general nature and does not constitute financial advice (nor investment, tax, accounting or legal advice).

This document is not a prospectus, disclosure document or offering document under Australian law or any other law. It is for information purposes only. This document does not purport to contain all the information that a prospective investor may require in evaluating a possible investment in Territory Gas Aust. Pty Ltd.

To the maximum extent permitted by law, Territory Gas LNG disclaims any responsibility to inform any recipient of this document and presentation on any matter that subsequently comes to its notice which may affect any of the information contained in this document and presentation. No representation or warranty , express or implied is made to the fairness, accuracy, completeness, or correctness of the information, opinions or conclusions contained in this document.

To the maximum extent permissible by law, none of the Territory Gas LNG respective affiliates, bodies corporate and their respective officers, directors, employees and agents nor any other person accepts any liability including, without limitation any liability arising from fault or negligence, for any loss arising from any of the information contained in this document or otherwise arising in connection with it.

This document contains certain forward looking statements. There can be no assurance that actual outcomes will not differ materially from these forward looking statements. All dollar vales are in Australian Dollars ($A). The forward looking information and proforma and forecast financial information provided in this document is for illustrative purposes only and does not represent a forecast or expectation of Territory Gas LNG as to its future financial condition or performance.


project briefing presentation may 2013 paul mckenna managing director

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