presentaion notes

Notes from Friday 19 June 2009.
From notes and from discussion from others present. Facts I have interpreted. Some area’s I am not as technically strong as others so take this info in the spirit it is intended, ie don’t shoot the messenger.
Stewart Elliot appears absolutely rock solid in his resolve and honesty to make EWC a large international LNG and power station company. His past history as CEO of CEPA is testimony to one part of his successful past. If the information platform is slow, then it is an issue that each investor needs to weigh up. I am personally more resolved now than ever to be a long term investor. This company can grow many multiples if only a couple of their major projects succeed. Their technology particularly with their modular LNG plant design will also be successful imo.
Sengkang LNG
Delay in starting the production platforms and the other pre LNG equipment work has been 100% caused by the Local Election issues in Jan 2009 and new Government officials completing local land owners signings and other regulatory work.
Absolutely nothing in any rumours of the Government requiring extra reserve certification. Nothing in any rumours of any problems with local authorites in planning or permit issues.
Chart and Siemens equipment for Trains 1 and 2 has been ready for a couple of months and stored at the suppliers expense on their premises. Better to have it stored at the supplier under their supervision than sitting at Sengkang. Will be shipped in 4 – 6 months.
An impoprtant meeting took place in Hong Kong at EWC's Head Office two weeks ago with every supplier in the LNG build in attendance for final logistical meeting. Shipping schedules, build schedules etc.An important delivery signal IMO.
First LNG sales confirmed late 2009 / early 2010.
Off Take Agreements will not be entered into by EWC until the equipment is in place. This is a great move, as generally you need to get Off Take Agreements in place to get your finance, thereby putting yourself at the mercy of your customers and the prices they force you to strike. EWC are fortunate in that they have the finance to complete the first 4 trains with their own finance, thereby giving them the bargaining power with Agreements and pricing. Customers will be chasing EWC for their LNG on EWC’s terms.
There is eneogh in 2P reserves now for the first 4 trains for 2mtpa for ten years. There is enough to feed the Sengkang Power Plant at 315KW for 10 years. Helix has identified 695 BCF as 2P. Helix has also identified an extra 2P 285BCF and 30 further projects that have potential gas accumulation of 2.25TCF. There will be eneogh gas for many years for the 10 – 500tpa trains. Payback time is therefore very quick.

Cash position is very strong. Total project cost for first 4 trains US$350m. Cost to complete the LNG Trains 1 – 4 = US$160m. Balance over will be US$40m cash.
Any refinacing will take place to simply roll over their existing and their original lines of Credit. They are in a very strong position with their two major banks. Standard Chartered HK and their Japanese Bank are chasing them to supply further funding. No talk of any capital raisings.

Eramonga Basin AT549 Cuban – Results announced shortly, still awaiting certain test results.

Abbot Point Q.
Consutants in the UK finished their report investigating the company position to participate in their ‘ gas highway ‘ . This involves involvement with the Queensland Government which is strong. It involves plans for a 2 – 5MTPA LNG plant to allow the export of LNG from Eramonga and Gilmore gas fields and also CSG from the North Bowen Basin in Q. It also involves moving 3 rd part gas. It will also involve a Power Plant. I think they advancing well with this project. It is very large and thus moves slowly.

PNG
Another major international project on the books. Exciting new developments with the PNG government to develop a deep water port facility and a LNG facility and Power Station. It initially involves 2mpta of LNG and building on this number to 5mtpa in years 3 / 4 onward. A Land Agreement was officially signed with the LNG Government last week. EWC has been granted all the land required to source the gas from a initial estimates 11tcf. The LNG will be for domestic use and also for export to other S E Asian customers. This project alone has the potential to be huge, particulaly with strong government support.

The meeting was attended by over 50 people. ome facesb appeared to be brokers, some analysts, some investors, a spread. UBS, GS JB Were and ML are all new companies who have started coverage. A similar meeting took place in Sydney as well as the UBS Conference. Private broker meetings also apparntlt took place. Some old news naturally to bring new coverage up to speed but eneogh new news to confirm this company is progressing well to the next stage of market cap.