Leyshon Resources One2One Investor Presentation 17th April 2013 ...

proactiveinvestors.co.uk

Leyshon Resources One2One Investor Presentation 17th April 2013 ...

DUBLIN

APRIL 2013

CAN CHINA

REPLICATE THE US

UNCONVENTIONAL GAS BOOM?


CHINA IS CHOKING:

NO x

CO SO 2

C0 2

PM2.5

DEVELOPMENT OR ENVIRONMENT?

CO 2

EMISSIONS1.5

10

8

6

4

2

x

US + EU

BY 2035

Gigatonnes

Source: IEA 2012WEO


CHINA IS SEARCHING FOR: A LOW CARBON ENERGY MIX

COAL GAS NUCLEAR RENEWABLES

DOWN

1%

IN COAL USAGE

GAS

WIND/SOLAR

NUCLEAR

OIL

COAL

PER YEAR

HYDRO

CHINA

27

UNDER

CONSTRUCTION

NUCLEAR REACTORS 2011

(GWe) source: IAEA

US

101

RUSSIA

JAPAN

FRANCE

63

44

24

SOLAR HEATING

GLOBAL CAPACITY

2010

22% 8% 8% 8% 54%

BRAZIL

JAPAN

GERMANY

TURKEY

CHINA

ROW

HYDROPOWER CAPACITY, 2011

TOTAL GLOBAL CAPACITY: 970GW

Source: REN21

CHINA

65 GW

US

49 GW

INDIA

16 GW

SPAIN

22 GW

GERMANY

30 GW


WORLD ENERGY BALANCE: IS CHANGING DUE TO UNCONVENTIONAL GAS

NEW TECHNOLOGY

Source: BP World Energy Outlook 2030

Bcf/d

Well

80

Gas

flows

out

Water

Table

60

40

Hydraulic

fracturing

20

2030

GAS

Water, sand, and

chemical agents

2000

2020

2010

INCREASING PRODUCTION


US UNCONVENTIONAL GAS REVOLUTION: BIGGEST ENERGY EVENT OF THE 21 ST CENTURY

ENERGY

5%

IMPORTS

DOWN

SINCE

OBAMA

30%

2006

29%

26%

OBAMA ELECTED

24%

22%

2011

19%

2035

US TOTALLY

2009

2013

2035

10% (EIA)

3% (IEA)

ENERGY

SELF-SUFFICIENT

1% (BP)


FRACKING: “COULD FUEL BRITISH HOMES WITHIN 3 YEARS”

COMMUNITY

CONCERNS

Vs

SCIENTIFIC

REALITY

DIRTY

ENERGY

PUBLIC

HEALTH

SCIENTIFIC

PROOF

Lower Energy Costs

Reduced CO 2

Use Less Coal

NOT IN MY

BACKYARD

Creates More Jobs

EVIDENCE

METHANE LEAKAGE

GROUND WATER POLLUTION

EARTHQUAKES

ECONOMIC STABILITY

SUSTAINABLE SOURCE

ABUNDANT FUEL


UNCONVENTIONAL GAS BASINS: A GLOBAL RESOURCE

24.4

11

36.1

19.3

5.3

6.5 8.2

14.7

21.9

6.4

11.2

13.7

>100,000

WELLS

ASSESSED BASINS

TOP RESERVE HOLDERS IN 2010 (tcm)

WITH RESOURCE ESTIMATE

WITHOUT RESOURCE ESTIMATE


CHINA IS FACING: “GRAVE CHALLENGES TO ENERGY SECURITY”

CHINA’S

TOTAL ENERGY

DEMAND

IN 2020

UP

25%

AND OIL

DEMAND

UP

33%

OIL GATEWAY

TO THE WORLD

GAS%

100

DEPENDENCE 2010 2030

IRAN

STRAIT OF

HORMUZ

75

EU

50

+

25

-

0

USA

CHINA

INDIA

SAUDI

ARABIA

25%

WEST BOUND

PERSIAN

GULF

25

ASEAN

75%

50

0 20 40 60 80 100

OIL%

EAST BOUND

SOURCE: INTERNATIONAL ENERGY AGENCY

SOURCE: BP STATISTICAL REVIEW 2012


TO REPLICATE US SUCCESS: CHINA NEEDS REFORMS

“Reforms could be tough, but it could be

tougher without reforms.”

------ Chen Weidong, CNOOC

WHICH EMISSIONS PATH SHOULD CHINA TAKE?

World’s largest unconventional gas resource

Improving pipeline infrastructure

Fastest growing gas demand

Developing service industry

More incentives on the way

FINE

WINE

tCO 2

emitted per person in 2009

20

15

10

5

0

India

China

Korea

South

Africa

Japan

USA

Russia

Germany

Turkey Mexico France

Argentina

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Chile

Brazil

Australia

Deregulate the gas market, provide

clearer title and regulation, unlock

acreage from SOES.

Create more access for private

domestic and foreign

exploration companies

Bubble size represents annual CO 2

emissions

Source: World Bank, based on IFA 2011, UN Population Division 2009.

CBM TIGHT GAS SHALE GAS

“Drill more wells!”

2015 2020 2030


UNCONVENTIONAL GAS IN CHINA: BIG POTENTIAL, BIG PLANS, AT A VERY EARLY STAGE

ORDOS BASIN

2 ND LARGEST ONSHORE

OIL AND GAS

PRODUCING BASIN

Net Tarim Import Basin

60%

Junggar Basin

Sichuan

Basin

Ordos

Basin

40%

North

China

Basin

Bohai

Basin

Songliao

Basin

mmcfd

12000

10000

8000

6000

CHINA UNCONVENTIONAL

GAS SUPPLY POTENTIAL

Source: Wood Mackenzie

Junggar Shale

Shale gas

Coalbed Methane

Source: IEA

4000

Songliao Shale

Ordos Shale

Sichuan Shale

Junggar CBM

Ordos CBM

2000

Qinshui CBM

Coal-to-Gas Projects

2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025 2027 2029


ORDOS BASIN: ONE OF CHINA'S MOST PROFITABLE FIELDS

RISING

DEMAND

2.5X

...RISING

PRICES

US$10 per mscf

BROWNFIELD PSC

CLOSE TO TIE-IN POINTS

ORDOS BASIN GAS FIELD

N

Tabamiao

Hohhot

1st Beijing Pipeline

Baode

YELLOW RIVER

LINXING

LXSG-01

PHILLIPS CBM PILOT

Sulige Pipeline

2nd Beijing Pipeline

Sulige

Wushenqi

Jingbian

Xi’an Pipeline

Yulin

Changbei

3rd Beijing Pipeline

Yulin-Jinan

Mizhi

Changdong

Linxing

Sanjiaobei

Sanjiao

Liulin

Shilou North

ZIJINSHAN

MIZHI

TB-06

TB-03

TB-01

TB-09

TB-08 TB-07

TB-05

TB-02

SJB-03

ZJS2

ZJS4

ZJS3

ZIJINSHAN

ZJS5

ZJS6 ZJS1

SANJIAOBEI

SANJIAO

SJSG-01

Pipeline tie-in point

Existing Pipeline

Planned/Under Construction

Ordos Basin Gas Production Areas

West-to-East Gas Pipeline

Shilou

West

Shilou South

Qi Kuo CBM Pilot

Exisiting Wells

CBM Pilot


TARGET ZONE: INDEPENDENTLY ASSESSED HUGE POTENTIAL

Unexplored 380 km 2

1-3.8Tcf GIP gas potential

STRUCTURE MAP OF

SHANXI FORMATION

2013 Exploration Programme:

6 8 300

Wells Fracks Km Seismic

WESTERN

FOLDED

BELT

Hejiahui

P10 PROSPECTIVE AREA

CENTRAL

DEPRESSION

AREA

EASTERN

FAULTED

FOLD

The statements of resources in this Release have been independently determined to Society of

Petroleum Engineers (SPE) Petroleum Resource Management Systems (SPEPRMS) standards by

internationally recognized oil and gas consultants RISC Operations Pty Ltd and NSAI.

Mt. Zijinshan

Xiahua

Xiyue

Drilled

Town

Village

Seismic

Zijinshan Block

Mountain

ZJS2

ZJS4

ZJS3

Zhuangyue

P50 PROSPECTIVE AREA

P90 PROSPECTIVE AREA

ZJS6

Chashang

ZJS5

Yaokou

Chengzhuang

Baiwan

Chengjiata

Houmanyu

ZJS1

0 2 4 8 12 16

KM


WORLD CLASS PSC PARTNER

CHINA’S BIGGEST OIL & GAS PRODUCER

PetroChina can back in to 40% at

development.

Great Wall Drilling is subsidiary of

PetroChina and has 430 rigs

working in 28 countries.

CCDC Downhole Services is a

subsidiary of PetroChina with

55,000 employees, including 31

fracking crews.

China Oilfield Services is the

leading integrated oilfield services

provider in the China market.


FULLY FUNDED TO DEVELOPMENT:

CDB, StanChart, HSBC and SocGen all offer Reserve Based Finance (RBF) at CRR

Successful

Exploration

Successful

Appraisal

Development

Production

NPV@10% /$1.1 bn (60%)

6 Wells

8 Fracking Tests

300 Km 2D Seismic

US$20M

US$20M (EST.)

VALUE

CREATION

VALUE

2 Wells/$3M

CRR RBF

PILOT PROD

ODP

CAPITAL

2012 2014 2016 2018


VALUATION: DRILLING WILL UNLOCK VALUE

NPV

$1,863M

VALUE POTENTIAL

EV

$173M

$$$

LINXING

EV

EAST $15M

CASH

$17M

LINXING

WEST

ZIJINSHAN

CASH

$43M

SEH.AX

LRL.L (OPERATOR)

28%

SANJIAOBEI

60%

INTEREST

INTEREST

28 WELLS

6 WELLS


SUPPORTIVE, SUCESSFUL SHAREHOLDERS:

MAJOR SHAREHOLDERS HAVE STRONG

TRACK RECORD IN SUCESSFUL INVESTMENTS

MANAGEMENT & DIRECTORS

IDG

14%

8%

“One of the earliest and

most successful foreign

funds to enter the Chinese

market since 1992”

W H IRELAND

5%

NEWMONT CAPITAL

5%

Top 20

Shareholders

IAN MIDDLEMAS

4%

66%

Top 100

Shareholders

OTHER FUNDS

25%

86%


SHARE PRICE RISING: ON STRONG LIQUIDITY

£30 MILLION

CASH

RETAINED PROFIT

FROM SALE OF

CHINA GOLD PROJECT

LEYSHON RESOURCES

LRL.L

249M FULLY PAID SHARES

12 PENCE CASH BACKING

BUY-BACK OF 17M SHARES

VERY STRONG

LIQUIDITY

28

26

24

22

20

18

16

14

12

2012 MAY JUN JUL AUG SEP OCT NOV DEC 2013 FEB MAR APR

Yahoo UK & Ireland


FULLY FUNDED US $20M EXPLORATION

AND APPRAISAL PROGRAM UNDERWAY

6

Wells Fracks

8 300

Km Seismic

NEWS

FLOW

“Put me in your PRSA”

ENTERPRISE VALUE: US$15 MILLION

TARGET VALUE: US$1.1 BILLION

Find Out More:

(UNRISKED)

www.leyshonresources.com

Disclaimer

The statements of resources in this Release have been independently determined to Society of Petroleum

Engineers (SPE) Petroleum Resource Management Systems (SPE PRMS) standards by internationally

recognized oil and gas consultants RISC. These statements were not prepared to comply with the China

Petroleum Reserves Office (PRO-2005) standards nor the U.S. Securities and Exchange Commission

regulations and have not been verified by LRL's PSC partner.

These presentation materials are for information purposes only and do not constitute an offer or invitation to

subscribe for or purchase any securities. neither these presentation materials nor anything contained in them

nor the fact of their distribution shall form the basis of or be relied on in connection with or act as any

inducement to enter into any contract or commitment whatsoever.

Certain statements included in this announcement may constitute forward-looking statements. Any

forward-looking statements are based on current assumptions and forecasts and are not guarantees or

predictions of future performance. Such statements involve known and unknown risks, uncertainties and other

factors, many of which are beyond our control, and which may cause actual results to differ materially from

those expressed in the forward-looking statements. Accordingly, although the Company believes that the

expectations reflected in such forward-looking statements are reasonable, LRL, its directors, officers and

agents do not give any assurance or guarantee that the occurrence of the events referred to in this document

will occur as contemplated.

More magazines by this user
Similar magazines