ARROW ENERGY
SURAT GAS PROJECTApril 30 – May 10
SURAT GAS PROJECTTODAY’S AGENDA
Welcome and introductionsWelcome and introductions
A E d tArrow Energy update
Field Development update
Surat Gas Project Environmental Impact Statement (EIS) overview
Groundwater
Agriculture and amenity
ARROW ENERGYTHE HISTORYTHE HISTORY
2P 3P Shell / PetroChina
16000
18000S e / et oC a
Takeover
12000
14000
PJ
8000
10000
Staff numbers
2007 212s re
serv
es
4000
60002010 432
2011 700
Gro
ss
0
2000
Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11
2012 * 1200
*Dec 2012
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ARROW ENERGYCURRENT OPERATIONS
• Commenced gas production in 2004• 1100 wells – 600 producing• Providing energy to 400 000 homes
CURRENT OPERATIONS
• Providing energy to 400,000 homes
Domestic - Surat Basin• Tipton• Daandine• Daandine• Kogan• Stratheden
Domestic - Bowen Basin• Moranbah Gas Project
Arrow LNG• Surat Gas Project
B G P j t• Bowen Gas Project• Arrow Surat Pipeline• Arrow Bowen Pipeline• Arrow LNG PlantPower supply• Braemar 1, Braemar 2 (100%),Yabulu,
Daandine, Moranbah, Swanbank
PROGRESS UPDATEARROW ENERGY
Gas Sales: 100% of LNG sold
Reserves: 8000PJ – equal to or greater than2P reserves at FID
Reserves: 8000PJ equal to or greater than other proponents when FID was taken
Budget: $1-Billion approved to spend in 2012400050006000700080009000
Staffing: Large single accommodation contract in Brisbane (13 floors) signed in March. New accommodation for Moranbah and Dalby
01000200030004000
Arrow APLNG QCLNG GLNG EIS Approvals
Arrow Surat Pipeline – approved in 2010 LNG Plant, Surat Gas Project and Bowen
Pipeline out for public consultation20000
Arrow APLNG QCLNG GLNG
Pipeline out for public consultation Bowen Gas Project – IAS submitted
Land Access: 476 agreements in place; 270 underway in 2012; no cases before Land Court 5000
10000
15000
underway in 2012; no cases before Land Court
FEED readiness review underway, LNG Construction tender end 2012
0APLNG ARROW QCLNG GLNG
2P reserves 3P reserves
ARROW ENERGYEIS APPROVALS – STATUSEIS APPROVALS – STATUS
Proposed Project Timeframes
2011 2012 2013 2014 2015 2016 2017 2018Arrow Surat Pipeline – approved
Arrow Surat Pipeline ConstructionSurat Gas Project EISFinal Investment Decision
Surat Gas Project EIS Submission
Arrow Bowen Pipeline EIS
LNG Plant Project Construction
Arrow Bowen Pipeline ConstructionArrow Bowen Pipeline EIS Submission
Gladstone LNG Plant EIS LNG Plant Project ConstructionGladstone LNG Plant EIS Submission
Bowen Gas Project EIS
LNG Production
Bowen Gas Project EIS Submission
BGP IAS submitted
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EIS Submission EIS consultation Approval decision expected (2yr approvals)
ARROW ENERGYAPPROACH TO SCL
Strategic Cropping Land (SCL) lies over just 15% of Arrow’s total tenurej
ATP 683 has SCL over the eastern portion (Condamine Floodplain)
This area contains a significant amount This area contains a significant amount of gas reserves
ATP 683 is the subject of best practice j ptenure management & technology trials to demonstrate co-existence
Last week, Arrow informed 700 properties of its intent to relinquish those properties from the tenure, to give more certainty to the community
Arrow previously excised the town of Cecil Plains from the ATP in Nov 2010
ARROW ENERGYAPPROACH TO SCL - ACCESS
95 agreements in place (ATP 683) access to 16 black soil properties for
exploration & drilling trials and waterexploration & drilling trials and water monitoring & research
11 agreements in negotiation 11 agreements to commence 11 agreements to commence
Access and safety inductions tailored to intensively farmed land
Single contact for all land holders
Restricted personnel access –t ti l l t ipotential electronic access;
i.d. permits for black soil
Privacy provision at discretion of Privacy provision at discretion of landholder (option to make public)
New all-terrain vehicles to reduce impact in wet weatherimpact in wet weather
ARROW ENERGYAPPROACH TO SCL – EXPLORATION
Exploration & Appraisal
Pitless drilling trials have commenced
SCL specific project management including dedicated rig and crewg g
Infrastructure trials – pipeline and power reticulation
Detailed feasibility assessment of Substitution of Allocation scheme
New mobile wash down units New mobile wash down units
No fraccing on ATP 683 (or existing Surat Gas Project area)
Worked through Arrow Committees with landholders, Local/State Govts USQ, NGOs
,
ARROW ENERGYAPPROACH TO SCL – FIELD DEVELOPMENT
Field Development
Evaluating drilling of up to 8 wells g g pfrom a single well pad to reduce footprint and associated infrastructure
Increased well spacing (160 to 320 acres (0.8km to 1.5km))
Flexibility in well locations
Studying ways to reduce gathering system pipe diameter and potential for alternative construction method - plow (not trench) smaller gathering pipe to preserve soil profile
3 existing field development case studies with farmers on SCL (various farming practices)
ARROW ENERGYWATER MANAGEMENT
Produced Water • Arrow – 25 GL per year (750 GL total)
CSG I d t 125 GL• CSG Industry - 125 GL per year • Existing farmers - 124 GL per year
GAB impact of CSG industry’s total drawdown represents 0.004% of water in the GAB (1/25,000th of 65M GL) before mitigation
Local impacts - working with landholders to b tit t th i G t li d t ll tisubstitute their Govt licensed water allocations
from GAB; plus other regional options
First supply agreement being finalised to use 50% of c rrent ater prod ction from Tipton50% of current water production from Tipton
Arrow has commenced a central research centre and farm Theten to showcase CSG water for irrigation over 370 1300 ha of cropswater for irrigation over 370 – 1300 ha of crops
70 – 100 water monitoring bores planned in the Surat in 2012 as part of a $75M water research programprogram
ARROW ENERGYSURAT GAS PROJECT TIMELINE
Sept 2012 End 2013
Surat concept Select Engineering Definition Project Execution
D i t S l t A i t d i th b t hi h l l d i
Technology trialsWe are here
During concept Select, Arrow engineers are studying the best high level design for:
• Well types, well spacing and artificial lift• Gas and water gathering flow lines to centralised facilitiesGas and water gathering flow lines to centralised facilities• The number, approximate locations and capacity of centralised production
facilities• How to power centralised facilities and wells• The development sequence
At the end of this stage, we will have an integrated view of how the above designs work together as a system
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designs work together as a system
ARROW ENERGYINDICATIVE CENTRAL GAS PROCESSING FACILITIES
We expect to have centralised gas production facilities (CGPFs)production facilities (CGPFs) processing gas from wells.
Indicative feed areas (shown in l i ) b dcolours opposite) are based on:
• the maximum distance gas can be drawn from wellsdrawn from wells
• good drainage characteristics, taking into account the terrain
Each CGPF has processing and compression equipment
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ARROW ENERGYQUESTIONS
SURAT GAS PROJECT DEVELOPMENT AREAS AND TIMING
Target area for development between 2013 and 2023:between 2013 and 2023:
~ 2,000 wells
Production wells: ~ 15 wells in next 12 months
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