Contact Energy Limited · NZX:CEN
Contact Energy — Downstream Conference 2016
14 slides from Contact Energy's conference presentation, Mar 2, 2016
Slide 1: Leveraging Ahuroa and managing a fluid gas book
Leveraging Ahuroa and managing a fluid gas book Downstream Conference 2016 James Kilty, Chief Generation and Development Officer 2 March 2016
Slide 2: Disclaimer
Disclaimer This presentation may contain projections or forward-looking statements regarding a variety of items. Such forward-looking statements are based upon current expectations and involve risks and uncertainties. Actual results may differ materially from those stated in any forward-looking stat
Slide 3: Snapshot of Contact
Snapshot of Contact $2.9b 166 MW (gross) 1,066 1 Our net assets are of geothermal generation We employ 1,066 New Zealand’s only $2.9 billion (at commissioned May 2014 people from underground gas 31 December 2015) Auckland to Invercargill storage facility 11 554k 5 22% Contact owns and operates Conta
Slide 4: Contact has switched to lower cost fuel and has improved New Zealand's energy and capacity balance
Contact has switched to lower cost fuel and has improved New Zealand’s energy and capacity balance Contact’s actions have contributed to a competitive, Thermal plant closures have restored balance following a reliable and sustainable electricity supply period of reduced risk as new renewable generat
Slide 5: Contact has changed its approach to gas purchasing
Contact has changed its approach to gas purchasing Contact has moved away from long term “take or pay” Contracted gas volumes commitments to shorter term transactions 45 Other Maui (max) Swap 40 Genesis Maui (min) OMV » No need to purchase all gas on a long term basis 35 » Adequacy of P50 reserves s
Slide 6: Ahuroa gas storage
Ahuroa gas storage Four Production Wells Injection Compressor Extraction Train 27 TJ per day of injection 45 TJ per day of withdrawal (= 2 x 100 MW Stratford peakers) 1H16 Results Presentation 15 February 2016 Contact Energy Limited 17 PJ of storage capacity(= 2 x 100 MW Stratford 6 peakers generati
Slide 7: Ahuroa project history
Ahuroa project history 2008 $197m investment in a staged development spanning 2008-2010 » Jun 2008 - Contact purchases depleted reservoir from Origin (ex Swift) » Dec 2008 to May 2009 - Injection of pad gas » Oct 2010 - First stage commissioned (45TJ/day withdrawal ). Additional 2A wells drilled at
Slide 8: Ahuroa pipeline created options and reduced cost
Ahuroa pipeline created options and reduced cost Investment payback rapid on cost savings alone and completes first stage of possible expansion » 8.7km in length » 450mm diameter » 2 river crossings » ~45 bar pressure » ~4TJ line pack (2 x Peakers for 2 hours) » 170TJ/day max capacity » Creates a ga
Slide 9: Stratford energy 'hub'
Stratford energy ‘hub’ Integrated storage and generation assets with third party gas processing » Contact can operate at Stratford independently of Vector » Option of using two pipelines to supply Stratford » NZEC JV operate Ahuroa under a long term agreement » NZEC JV also provides gas processing s
Slide 10: How Ahuroa works …
How Ahuroa works … Well depth of 2200m Downstream Conference 2 March 2016 Contact Energy Limited 10
Slide 11: The role of Ahuroa gas storage is developing, adding value to Contact's thermal operations
The role of Ahuroa gas storage is developing, adding value to Contact’s thermal operations Daily Stratford generation » Cost 100 Gas volume (TJ per day) 80 Peaker II • Take-or-pay management key role during 2009 - 2014 period Ahuroa or spot gas 45 TJ 60 Peaker I • Injection of prepaid gas when elect
Slide 12: Expansion options
Expansion options » Contact already has resource consents for all expansion options » Development time = ~2 years » There are also some smaller options (e.g. just additional injection capacity) Downstream Conference 2 March 2016 Contact Energy Limited 12
Slide 13: Contact is confident that the industry will resolve North Island capacity uncertainty
Contact is confident that the industry will resolve North Island capacity uncertainty If Huntly closes, North Island capacity is required North Island supply and demand currently balanced with additional capacity required irrespective of Tiwai plans Source: Transpower 5,500 Excess » North Island cap
Slide 14: Questions?
Questions?