APA GROUP — Investor Presentation 2009

Sep 23, 2009

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ASX RELEASE

24 September 2009

The Manager

Company Announcements Office Australian Securities Exchange 4[th] Floor, 20 Bridge Street Sydney NSW 2000

Electronic Lodgement

Dear Sir or Madam

Company Announcement

I attach the following announcement for release to the market:

• APA Group Craigs Investor Day presentation by Chief Financial Officer Peter Fredricson

Yours sincerely

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Mark Knapman Company Secretary

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APA Group – delivering security and growth

Peter Fredricson, Chief Financial Officer Craigs Investor Day 2009, Auckland 24 September, 2009

About APA Group

• APA is Australia’s largest gas transmission and distribution infrastructure owner and operator

• Gas transmission and distribution : gas pipelines and storage facilities; gas distribution networks in Qld and NSW

• Asset Management : asset management, operating and maintenance services

• Energy Investments : minority interests in energy infrastructure investments

• APA generates secure cash flows from contractual and regulatory arrangements

• with more than 90% of revenue from regulated (natural monopoly) assets and long term contracts

• APA has direct management and operational control over its assets and investments

• no fee leakage or conflicts that arise with external management model

• employing over 1,100 skilled and experienced people who perform all commercial, engineering and operations functions for APA assets and investments

APA owns, manages and/or operates over $8 billion in assets

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APA’s gas infrastructure portfolio

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• Australia has an abundance of natural gas reserves

• 60,300 PJ of 2P reserves, with half (29,700 PJ) in eastern Australia

• Increasing demand for natural gas

• APA delivers gas from all major gas production sources to all major gas markets

• More than 50% of natural gas used in Australia is transported through APA’s pipelines

• APA transports more than 70% of natural gas in Australia’s eastern states

• Progressing new links for gas between east Australian states

APA’s unrivalled national portfolio connects all major gas sources to major markets

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APA’s strengths

� Unrivalled gas asset footprint

• largest gas transporter of natural gas across Australia by pipeline length, capacity and volume

• Integrated portfolio of gas pipeline assets

• providing revenue and operating synergies

� Attractive growth opportunities

• enhancing capacity in APA’s existing pipelines serving major growth markets across Australia

� Stable cash flow

• regulated and contracted revenue

• Internally managed and operated business

• highly skilled and experienced workforce, extracting greater value from the business and responding to a dynamic energy market

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APA’s strategy

Maximise value for securityholders

• Focusing on gas infrastructure assets in Australia’s growing gas market and enhancing APA’s portfolio of assets

• Capturing revenue and operational synergies from APA’s significant asset base

• Pursuing opportunities that leverage APA’s knowledge and skills base

• Maintaining a strong balance sheet

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Record full year result

	Underlying result(1)	2009(2)	2008(3)	Change
		$ million	$ million
	Revenue	958.8	897.8	6.8%
	Revenue excluding pass‐through	687.4	614.9	11.8%
	EBITDA	458.7	430.5	6.5%
	EBIT	359.1	330.8	8.6%
	Net interest expense	(213.0)	(223.8)	4.8%
	Tax	(35.9)	(24.8)	(45.0)%
	UnderlyingNPAT	110.1	82.2	34.0%
	Reported NPAT	78.8	67.2	17.2%
	Operating cash flow	233.6	192.1	21.6%
	Operatingcash flowper security (cents)	48.2	42.7	12.8%
	Distribution per security (cents)	31.0	29.5	5.1%

(1) Underlying results before significant items and AIFRS adjustments

(2) Includes contributions from Central Ranges Pipeline (10 months) and assets sold to EII, including X41 Power Station (5.3 months)

(3) Includes contributions from Alinta O&M agreement (9 months), X41 Power Station (8 months)

Strong underlying cash flow funds distribution and business growth

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FY 2009 strategic and operational highlights

Strong balance sheet

• Completed the establishment of Energy Infrastructure Investments

• Achieved book value and reduced debt

• Additional avenue for investments

• Completed 2010 debt refinancing

• Raised $1.365 billion – Syndicated facility, USPP, bilateral loan

• S&P ‘BBB’ credit rating

• Avoided the unholy trinity of the GFC

• No asset write‐down

• No dilutive capital raising to refinance debt

• No reduction in distributions, instead increased distributions

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FY 2009 strategic and operational highlights

Business growth

• Capacity expansion of gas transmission pipelines

• Goldfields Gas Pipeline, Carpentaria Gas Pipeline, Moomba Sydney Pipeline

• Attractive investments

• Central Ranges Pipeline – part of APA’s New South Wales pipeline system

• Increase in Envestra equity interest to over 30%

• Construction of the Bonaparte Gas Pipeline

• Completed ahead of schedule and on budget

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Consistent and predictable performance

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Underlying operating cash flow
250 $234 m
200
150
100
50
0
2001 2002 2003 2004 2005 2006 2007 2008 2009
$ million
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Operating cash flow per security
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48.2 cps
50
40
30
20
10
0
2001 2002 2003 2004 2005 2006 2007 2008 2009
cents per security
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Underlying EBITDA
500 $459 m
400
300
200
100
0
2001 2002 2003 2004 2005 2006 2007 2008 2009
Distributions per security
35
31.0 cps
30
25
20
15
10
5
0
2001 2002 2003 2004 2005 2006 2007 2008 2009
$ million
cents per security
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Creating value for APA securityholders

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Growing distributions

Achieved 5% growth guidance for 2009 full year distribution

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cents per
security 31.0 � FY09 payout ratio 66% (on
29.5 underlying OCF)
28.0
5.5 14.2 � FY09 45.8% tax deferred
3.5
24.0
component
22.5
� DRP continues at 2.5%
discount
24.5 24.0 16.8
Tax deferred distribution
Income distribution
0
FY05 FY06 FY07 FY08 FY09
Payout ratio 60% 65% 72% 71% 66%
Based on underlying OCF
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Strong segment performance

Strong EBITDA growth in gas transmission and distribution

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120
100
2008
2009
80
60
40
20
0
Queensland New Victoria Western Asset Energy Assets
South & South Australia management investments sold to EII
Wales Australia &
Northern
Territory
Gas transmission and distribution
$ million
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EBITDA split by segment

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Assets sold to
Energy
EII
investments
Asset management 5%
5%
7%
Gas transmission
and distribution
83%
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EBITDA growth

• Gas transmission and distribution – up 14%

• Asset management – up 7%

• Energy investments – up 21%

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Prudent capital management

• FY2009 metrics

• Improved gearing[(1)] of 70.3%, reduced from 72.0% at 30 June 2008

• Interest Cover Ratio of 2.13x, increased from 1.86x in 2008

• Equity raised – $79 million (Security Purchase Plan and Distribution Reinvestment Plan)

• � Credit rating – S&P ‘BBB’ stable outlook

• provides funding flexibility ‐ access diverse markets and broader range of financing options

• Refinancing strongly supported

• Bilateral facility $165 million in July 2008 – 3 year

• USPP A$185m in July 2009 – 7 and 10 year

• Bilateral facility $150m in August 2009 – 5 year

• New syndicated facility $1,030m in August 2009 – 2 and 4 year

• Balance sheet strategy

• Diversifying source of funds

• Extending term of debt facilities in line with long term nature of APA assets

Secure long‐term debt portfolio supporting business growth

(1) Gearing ratio determined in accordance with the syndicated loan facilities.

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Stable and secure revenue

• More than 90% of APA’s revenues are derived from price regulated (natural monopoly) assets and long‐term contracts

• Tariffs are set by regulation for price regulated assets, but existing contract terms remain

• Tariffs commercially negotiated for all other pipelines and new capacity on all pipelines[(1)] , with contract

• Contract terms are often for periods of in excess of 5 years, and APA’s current average contract length is approximately 7 years

FY2009 Revenue Split

Other 4% Contracted 40% Subject to price regulation 56%	Price Regulated	Price Regulated	Commercially Negotiated	Commercially Negotiated
	Tariffs set by regulation	Contract terms remain	Light regulation	No regulation
Contracted 40% Subject to price regulation 56%
	Victorian Transmission System APA Gas Network Central West Pipeline Central Ranges Pipeline Central Ranges Network	Roma Brisbane Pipeline Goldfields Gas Pipeline(2) Amadeus Gas Pipeline	Moomba Sydney Pipeline(Marsden downstream) Carpentaria Gas Pipeline	Moomba Sydney Pipeline(Marsden upstream) Parmelia Gas Pipeline Mid West Pipeline

(1) Except Victorian Transmission System

• (2) Some contracts provide for regulated price to apply

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Increased demand for natural gas

Natural gas and Australian primary energy consumption Growth rates

• It is estimated that Australia’s underlying gas demand will grow an average of 4%* annually over the next 10 years. Key growth drivers include:

• Greater use of gas in electricity generation, mining and energy‐intensive refining

• Introduction of carbon reducing legislation should increase use of gas for electricity generation (as gas becomes more competitive)

• Continued growth expected in coal seam gas (CSG) production

• APA infrastructure is ideally positioned to participate in this growth through the sale of transport, load shaping and storage services

Note*: ABARE – Energy Update 2008

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7.0%
6.0%
Natural gas Total
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
Australian primary energy consumption
9,000 25%
8,000 Natural gas as a
proportion of primary
7,000 energy use (RHS) 20%
6,000
15%
5,000
4,000
10%
3,000 Total energy consumption (LHS)
2,000 5%
1,000
Natural gas consumption (LHS)
0 0%
Historical Forecast
2006-07 2008-09 2010-11 2012-13 2014-15 2016-17 2018-19 2020-21 2022-23 2024-25 2026-27 2028-29
1960-61 1965-66 1970-71 1975-76 1980-81 1985-86 1990-91 1995-96 2000-01 2005-06 2010-11 2015-16 2020-21 2025-26
Energy (PJ)
Natural gas proportion
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Source: ABARE ‐ Energy Update 2008

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Pipeline capacity for power generation

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� APA primarily sells pipeline capacity

• Gas fired power generation requires pipeline capacity and gas throughput:

• Baseload generation

• capacity and gas volumes throughout the year

• Peak/intermediate generation

• capacity and storage required throughout the year

Growth in gas fired power generation

Growth in capacity

Growth in pipelines

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Discretionary capital expenditure

• APA has a low level of stay‐in‐business capex which is required annually – up to $20 million per annum

• Bulk of the assets are underground and require a minimal level of maintenance capex

• APA controls the timing of non‐critical capex

• APA maintains flexibility in relation to the amount and timing of larger growth capex projects

• Growth capex enables APA to leverage additional value from its existing assets

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APA’s infrastructure is underground and require minimal level of stay‐in‐business capex

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Development and growth opportunities

• Northern expansion on the Victorian Transmission System

• Increase Moomba Sydney Pipeline winter capacity in line with contracts

• Installation of automated multi‐directional hub at Young, providing flow and storage flexibility

• Increased capacity for gas fired power generation in line with commercial commitments

• Focus on ensuring coal seam gas is efficiently delivered to southern markets (via Moomba or other alternative routes)

• Expansion to new housing developments on APA’s Gas Network

• Increased capacity on Roma Brisbane Pipeline in line with commercial commitments

• Progressing opportunities evolving from Queensland’s CSG/LNG projects (pipeline and storage infrastructure)

• Expansion of Mondarra gas storage facility

APA’s portfolio provides strategic growth opportunities

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Summary

• Strong FY2009 results demonstrate strength of APA’s business

• APA continues to deliver value to its securityholders through growth in distributions and operating cash flow – at least 5% growth in distributions for FY2010

• Quality portfolio of gas infrastructure assets throughout Australia

• Direct management and operational control over APA’s assets and investments delivers further value to the business

• Attractive growth opportunities with APA’s pipelines serving Australia’s major growth markets

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Supplementary information

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APA’s gas infrastructure business

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	7% � APA provides commercial and operating services and/or asset maintenance services to all its investment enterprises, under long term contracts Asset Management FY2009 EBITDA %1 � Envestra Limited (30.6% interest) – ASX‐listed, one of Australia’s largest natural gas distribution companies – 20,100 km of distribution networks and 1,100 km of transmission pipeline, serving 1.1 million customers � SEA Gas Pipeline (33.3% interest) – An unlisted 680 km pipeline, transporting over half of Adelaide’s natural gas requirements � Energy Infrastructure Investments Pty Limited (19.9% interest) – Unlisted infrastructure company, holding various low growth annuity‐style assets � Ethane Pipeline Fund (6.1% interest) – ASX listed, with sole operating assets the 1,375 km Moomba Sydney Ethane Pipeline � Australia’s largest gas pipeline owner, present in each mainland state and territory � APA manages and operates all its major gas transmission and distribution assets � Gas transmission pipelines: – Approximately10,000 km of high pressure gas transmission pipelines across Australia – Transports more than half of the natural gas used in Australia annually � Gas distribution networks: – 2,800 km of distribution network – More than 75,000 gas users in Queensland and New South Wales � Gas storage: – Mondarra gas storage facility (WA) and Dandenong LNG storage facility (Victoria) 5% Energy Investments 83% Gas Transmission and Distribution APA business segments	7% � APA provides commercial and operating services and/or asset maintenance services to all its investment enterprises, under long term contracts Asset Management FY2009 EBITDA %1 � Envestra Limited (30.6% interest) – ASX‐listed, one of Australia’s largest natural gas distribution companies – 20,100 km of distribution networks and 1,100 km of transmission pipeline, serving 1.1 million customers � SEA Gas Pipeline (33.3% interest) – An unlisted 680 km pipeline, transporting over half of Adelaide’s natural gas requirements � Energy Infrastructure Investments Pty Limited (19.9% interest) – Unlisted infrastructure company, holding various low growth annuity‐style assets � Ethane Pipeline Fund (6.1% interest) – ASX listed, with sole operating assets the 1,375 km Moomba Sydney Ethane Pipeline � Australia’s largest gas pipeline owner, present in each mainland state and territory � APA manages and operates all its major gas transmission and distribution assets � Gas transmission pipelines: – Approximately10,000 km of high pressure gas transmission pipelines across Australia – Transports more than half of the natural gas used in Australia annually � Gas distribution networks: – 2,800 km of distribution network – More than 75,000 gas users in Queensland and New South Wales � Gas storage: – Mondarra gas storage facility (WA) and Dandenong LNG storage facility (Victoria) 5% Energy Investments 83% Gas Transmission and Distribution APA business segments	7% � APA provides commercial and operating services and/or asset maintenance services to all its investment enterprises, under long term contracts Asset Management FY2009 EBITDA %1 � Envestra Limited (30.6% interest) – ASX‐listed, one of Australia’s largest natural gas distribution companies – 20,100 km of distribution networks and 1,100 km of transmission pipeline, serving 1.1 million customers � SEA Gas Pipeline (33.3% interest) – An unlisted 680 km pipeline, transporting over half of Adelaide’s natural gas requirements � Energy Infrastructure Investments Pty Limited (19.9% interest) – Unlisted infrastructure company, holding various low growth annuity‐style assets � Ethane Pipeline Fund (6.1% interest) – ASX listed, with sole operating assets the 1,375 km Moomba Sydney Ethane Pipeline � Australia’s largest gas pipeline owner, present in each mainland state and territory � APA manages and operates all its major gas transmission and distribution assets � Gas transmission pipelines: – Approximately10,000 km of high pressure gas transmission pipelines across Australia – Transports more than half of the natural gas used in Australia annually � Gas distribution networks: – 2,800 km of distribution network – More than 75,000 gas users in Queensland and New South Wales � Gas storage: – Mondarra gas storage facility (WA) and Dandenong LNG storage facility (Victoria) 5% Energy Investments 83% Gas Transmission and Distribution APA business segments
			FY2009 EBITDA %1
	Gas Transmission and Distribution	� Australia’s largest gas pipeline owner, present in each mainland state and territory � APA manages and operates all its major gas transmission and distribution assets � Gas transmission pipelines: – Approximately10,000 km of high pressure gas transmission pipelines across Australia – Transports more than half of the natural gas used in Australia annually � Gas distribution networks: – 2,800 km of distribution network – More than 75,000 gas users in Queensland and New South Wales � Gas storage: – Mondarra gas storage facility (WA) and Dandenong LNG storage facility (Victoria)	83%
	Asset Management	� APA provides commercial and operating services and/or asset maintenance services to all its investment enterprises, under long term contracts	7%
	Energy Investments	� Envestra Limited (30.6% interest) – ASX‐listed, one of Australia’s largest natural gas distribution companies – 20,100 km of distribution networks and 1,100 km of transmission pipeline, serving 1.1 million customers � SEA Gas Pipeline (33.3% interest) – An unlisted 680 km pipeline, transporting over half of Adelaide’s natural gas requirements � Energy Infrastructure Investments Pty Limited (19.9% interest) – Unlisted infrastructure company, holding various low growth annuity‐style assets � Ethane Pipeline Fund (6.1% interest) – ASX listed, with sole operating assets the 1,375 km Moomba Sydney Ethane Pipeline	5%

(1) FY2009 EBITDA includes contribution from assets sold into Energy Infrastructure Investments (5%)

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Disclaimer

The information contained in this presentation is given without any liability whatsoever to Australian Pipeline Trust or APT Investment Trust or any of its related entities (collectively “APA Group”) or their respective directors or officers, and is not intended to constitute legal, tax or accounting advice or opinion. No representation or warranty, expressed or implied, is made as to the accuracy, completeness or thoroughness of the content of the information. The recipient should consult with its own legal, tax or accounting advisers as to the accuracy and application of the information contained herein and should conduct its own due diligence and other enquiries in relation to such information.

The information in this presentation has not been independently verified by APA Group. APA Group disclaims any responsibility for any errors or omissions in such information, including the financial calculations, projections and forecasts set forth herein. No representation or warranty is made by or on behalf of APA Group that any projection, forecast, calculation, forward-looking statement, assumption or estimate contained in this presentation should or will be achieved.

Please note that, in providing this presentation, APA Group has not considered the objectives, financial position or needs of the recipient. The recipient should obtain and rely on its own professional advice from its tax, legal, accounting and other professional advisers in respect of the addressee’s objectives, financial position or needs.

This presentation does not carry any right of publication. This presentation is incomplete without reference to, and should be viewed solely in conjunction with, the oral briefing provided by APA Group. Neither this presentation nor any of its contents may be reproduced or used for any other purpose without the prior written consent of APA Group.

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Delivering Australia’s energy

For further information visit APA’s website www.apa.com.au

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ASX RELEASE

24 September 2009

For further information please contact:

Investor enquiries: Media enquiries: Chris Kotsaris Matthew Horan Investor Relations APA Group Cato Counsel Telephone: (02) 9693 0049 Telephone: (02) 9212 4666 Mob: 0402 060 508 Mob: 0403 934 958 Email: chris.kotsaris@apa.com.au Email: matthew@catocounsel.com.au

About APA Group (APA)

APA Group (ASX: APA) is Australia’s largest natural gas infrastructure business, owning and/or operating more than $8 billion of gas transmission and distribution assets. Its pipelines span every state and territory in mainland Australia, delivering more than 50% of the nation’s gas usage. Unique among its peers, APA has direct management and operational control over its assets and investments. APA also holds minority interests in energy infrastructure enterprises including Envestra, SEA Gas Pipeline and Energy Infrastructure Investments (EII). For more information visit APA’s website www.apa.com.au.