APA GROUP — Investor Presentation 2014

Sep 7, 2014

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APA investor information and FY14 highlights

September 2014

About APA Group

APA is Australia’s largest gas infrastructure business

 Gas transmission pipelines and storage

• Owning and operating two thirds of Australia’s onshore pipelines

• Interconnected pipeline networks

• Transporting approximately half the gas used domestically

 Gas distribution networks

• Operating approximately a third of the nation’s gas distribution networks

 Other related energy infrastructure

• Developed and acquired complementary energy infrastructure

Australian gas transmission pipeline ownership

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Jemena 1,770 km
DUET 2,098 km
SEA EII 13,236 km [(1) ]
APA APA Gas GDI ENV 14,360 km [(2) ]
0 5,000 10,000 15,000
Pipeline length (km)
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APA (29 August 2014)

Market A$6.6 billion capitalisation USD 6.2bn; GBP 3.8bn; EUR 4.7bn; CHF 5.7bn

S&P/ASX 50 MSCI All World Index; FTSE All World Index

836 million securities on issue Assets owned/ Over $12 billion operated

Gas transmission

14,360 km transmission pipelines Underground and LNG gas storage

Gas distribution

27,160 km gas network pipelines 1.3 million gas consumers

Other energy infrastructure 430 MW power generation 239 km HV electricity transmission Gas processing plants

More than 1,600

Employees

Operator Operator of APA’s assets and investments

(1) APA pipelines and 100% of the pipelines which form part of its Energy Investments

(2) Pipelines operated by APA, including Envestra

Source: APA & AER State of the Energy Market 2013

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APA Investor Presentation – September 2014

APA’s long term strategy

Strategy is focused on our core business of gas pipeline infrastructure

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Facilitating development
Enhancing APA’s portfolio of gas
of gas related projects
infrastructure assets in Australia’s
that enhance APA’s
growing energy market
infrastructure portfolio
Pursuing opportunities that
Capturing revenue and operational
leverage APA’s knowledge and
synergies from APA’s significant asset base
skills base
Strengthening financial capability
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APA’s unrivalled asset portfolio across Australia and internal expertise, together with strong industry fundamentals, drive growth opportunities

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APA Investor Presentation – September 2014

Strategic development of pipeline grids

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NT link to east coast grid:
Feasibility study
 East coast grid
–
APA’s east coast grid: Interconnected transmission
Darwin > 7,000 km of pipelines pipelines operating as one
APA’s WA infrastructure: 5 major pipelines
system
5 states and territories
Servicing mining regions
–
Seamless service capability
Gas transport and storage for Perth
across 30 receipt points and 100
delivery points
–
Attractive growth and revenue
opportunities
Gladstone
 West Australian infrastructure
–
Interconnected gas storage and
transportation to Perth
Brisbane
Moomba
–
Pipeline infrastructure serving
mining regions
Perth  NT link – APA feasibility study
Sydney – Connecting APA’s infrastructure
Adelaide to facilitate gas flow across
APA natural gas pipelines Other natural gas pipelines regions
Melbourne
under development Gas production
NT link
Gas resource
Gas storage
LNG export facility
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• Seamless service capability across 30 receipt points and 100 delivery points

• Attractive growth and revenue opportunities

• Interconnected gas storage and transportation to Perth

• Pipeline infrastructure serving mining regions

• NT link – APA feasibility study

• Connecting APA’s infrastructure to facilitate gas flow across regions

Transformational change in gas delivery and storage services

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APA Investor Presentation – September 2014

Australian gas industry – abundant supply

Supply fundamentals remain strong

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981 PJ
17,384 PJ
44,495 PJ
70,386 PJ
181
PJ
1,801 PJ
35
PJ
2,353 PJ
APA natural gas pipelines investments
Other natural gas pipelines
221
PJ Natural gas 2P reserves (proved and probable) 722 PJ PJ 3,442 PJ
Source: APA data; EnergyQuest August 2014
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• Proven and probable gas reserves total 142,000 PJ[(1) ]

  • Domestic gas use for 2013 was 1,110 PJ[(1) ]

  • A further 1,090 PJ[(1)] of gas was used for LNG export

  •  More than 50 years of gas available at current levels of domestic use and export

• Identified gas resources exceed 430,000 PJ[(2) ]

  •  Almost 200 years of gas available at current levels

• (1) 2012 gas production, LNG production and gas reserves: EnergyQuest, August 2014

• (2) As at January 2011: BREE Gas Market Report, July 2012,

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APA Investor Presentation – September 2014

Australian gas industry – domestic and export demand

• Australia’s gas production, consumption and exports are all projected to grow over the period to 2034–35

• Domestic use forecast to increase by one third, or 1.3%/a

 Growth underpinned by:

• Gas-fired electricity generation, increasing from 26% to 34% of electricity generation

• Increased consumption in the mining sector

 On-shore gas supply for east coast LNG

• Surat-Bowen basin supply for east coast LNG projects to be supplemented by gas sourced from other inland basins (e.g. Cooper)

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Primary energy consumption in Australian primary gas use by sector
Australia (2010-2011) (2011-12)
Renewables
4.32%
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Australian gas consumption and LNG export projections

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Australian Eastern Market LNG demand

Source: BREE Gas Market Report, July 2012 and October, 2013; “Gas Statement of Opportunities”, November 2013, AEMO

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APA Investor Presentation – September 2014

Revenue security and diversity

FY14 Revenue split

• Revenue secured by long term take-or-pay contracts or regulatory arrangements

• Diversified revenue base – single assets supply no more than 20% of revenue

Revenue by business segment[(1) ]

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$1,000m
7%
Energy Investment 10%
$800m
Asset Management
Energy Infrastructure: WA & NT
26%
Energy Infrastructure: Vic & SA
$600m
Energy Infrastructure: Qld
Energy Infrastructure: NSW 16%
$400m
27%
$200m
18%
24%
14%
58%
$0m
FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14
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• (1) Excludes pass-through revenue and divested businesses

Contracted (light regulation and non-regulated assets) 60% Other < 1% Regulated (revenue subject to price regulated tariffs) 23% Contracted (regulated assets with negotiated tariffs) 16%	Contracted (light regulation and non-regulated assets) 60% Other < 1% Regulated (revenue subject to price regulated tariffs) 23% Contracted (regulated assets with negotiated tariffs) 16%	Contracted (light regulation and non-regulated assets) 60% Other < 1% Regulated (revenue subject to price regulated tariffs) 23% Contracted (regulated assets with negotiated tariffs) 16%
	Regulated assets	APA’s contracted assets
Term	Life of the asset	Often in excess of 5 years Average contract term > 10 years
Counterparty credit	Broad population	For APA’s 4 major contracted assets, 85% of the contracted capacity is with investment grade counterparties
Volume risk	Assets exhibit little volume risk	Approximately 90% of contracted revenue is capacity based (i.e. ‘take or pay’) therefore relatively unaffected by volume variability
Competition	Natural monopoly(2)	Some degree of competition

• (2) Asset that can satisfy reasonable foreseeable demand at lower cost than if demand were to be satisfied by more than one asset

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APA Investor Presentation – September 2014

Proven growth and value creation

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$ million Operating cash flow
500
$440m
400
300
200
100
0
FY1 FY2 FY3 FY4 FY5 FY6 FY7 FY8 FY9 FY10 FY11 FY12 FY13 FY14
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$440m
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$ million EBITDA
800 $747m
600
400
200
0
FY1 FY2 FY3 FY4 FY5 FY6 FY7 FY8 FY9 FY10 FY11 FY12 FY13 FY14
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APA Investor Presentation – September 2014

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Operating cash flow per security
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cents
60
52.6 c
50
40
30
20
10
0
FY1 FY2 FY3 FY4 FY5 FY6 FY7 FY8 FY9 FY10 FY11 FY12 FY13 FY14
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52.6 c
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cents Distribution per security
40
36.25c
30
20
10
0
FY1 FY2 FY3 FY4 FY5 FY6 FY7 FY8 FY9 FY10 FY11 FY12 FY13 FY14
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Maximising value for securityholders

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1400 Total securityholder returns since listing
APA TSR: 1,113%
1200 APA CAGR: 19.2%
1000
Total annual returns
50%
800 43%
40%
600
31%
29%
30%
23%
22%
400
18%
20%
200
10%
0 0%
2009 2010 2011 2012 2013 2014
-10%
APA total securityholder returns S&P/ASX 200 accumulation index Utilities accumulation index
-20%
APA Total Securityholder Return
S&P/ASX 200 Accumulation Index
-30%
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Indexed to 100 from listing date, 13 June 2000 to 29 August 2014 Source: APA based on IRESS data

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APA Investor Presentation – September 2014

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FY14 result highlights

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APA Investor Presentation – September 2014

FY 14 result: Value creation and innovation

FY14 highlights

 Developing opportunities in a dynamic industry

• Expanding and extending our infrastructure portfolio

• Grid services in the east and west providing tailored gas transportation and storage services

• Flexibility and service options transforming how customers manage their portfolios

• $1 billion of organic projects completed or in progress

• New multi-pipeline revenue agreements

• Installing bi-directional capability across the east coast grid

• Implementing capacity trading services

 Industry leading expertise

• Comprehensive internal expertise and skills – infrastructure development, engineering, operations, commercial

• Enhancing and improving operations and maintenance

• Adopting global industry best practice

• National infrastructure focus across pipeline and network operations

• New skills brought in-house as required – gas storage and power generation

Continued successful execution of our long term strategy

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APA Investor Presentation – September 2014

FY14 result: Another solid financial performance

$ million	2014	2013(1)	Change	Change
Normalised results(2)
EBITDA	747	662	up	13 %
Net profit after tax	200	175	up	14 %
Operating cash flow(3)	440	433	up	2 %
Operating cash flow per security (cents)	52.6	56.0	down	(6) %
Statutory results
EBITDA	747	764	down	(2) %
Net profit after tax	344	295	up	16 %
Operating cash flow(3)	432	374	up	15 %
Operatingcash flowper security (cents)	51.6	48.5	up	6 %
Distributions
Distribution per security (cents)	36.25	35.5	up	2 %
Distributionpayout ratio(4)	68.9%	68.2%

• (1) APA has adopted revised AASB 119 during the year. As the revised standard must be applied retrospectively, comparative numbers have been restated.

• (2) Normalised results exclude one-off significant items, reflecting APA’s core earnings from operations .

• (3) Operating cash flow = net cash from operations after interest and tax payments.

• (4) Distribution payout ratio = total distribution payments as a percentage of normalised operating cash flow.

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APA Investor Presentation – September 2014

FY14 result: EBITDA by business segment

$ million	2014(1)	2013(1,2,3)	Change
Energy Infrastructure
Queensland	212.8	163.7	30.0 %
New South Wales	106.6	112.1	(4.9)%
Victoria & South Australia	116.9	124.7	(6.3)%
Western Australia & Northern Territory	186.7	147.7	26.4%
Energy Infrastructure total	623.0	548.3	13.6%
Asset Management	56.2	41.9	34.1%
Energy Investments	68.1	51.2	33.1%
Continuing business EBITDA	747.3	641.3	16.5%
Divested business(3)	-	20.6	nm
Total EBITDA	747.3	661.9	12.9%

FY14 EBITDA by business segment

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Energy
Investments
Asset
9.1%
Management
7.5%
Queensland
28.5%
Western
Australia &
Northern
New South
Territory
Victoria & Wales
25.0%
South 14.3%
Australia
15.6%
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Energy Infrastructure
83.4%
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Reporting segments

• Energy Infrastructure : APA’s wholly or majority owned energy infrastructure assets

• (1) Normalised results .

• (2) APA has adopted revised AASB 119 during the year. As the revised standard must be applied retrospectively, comparative numbers have been restated.

• (3) Moomba Adelaide Pipeline System sold May 2013.

• Asset Management : provision of asset management and operating services for the majority of APA’s investments

• Energy Investments : minority interests in energy infrastructure investments

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APA Investor Presentation – September 2014

FY14 result: Fully covered distributions

51.9 52.6 52.5 56.0 52.6 32.8 34.4 35.0 35.5 36.25 0 10 20 30 40 50 60 FY10 FY11 FY12 FY13 FY14 cents Operating cash flow per security Distribution per security (2)	51.9 52.6 52.5 56.0 52.6 32.8 34.4 35.0 35.5 36.25 0 10 20 30 40 50 60 FY10 FY11 FY12 FY13 FY14 cents Operating cash flow per security Distribution per security (2)	51.9 52.6 52.5 56.0 52.6 32.8 34.4 35.0 35.5 36.25 0 10 20 30 40 50 60 FY10 FY11 FY12 FY13 FY14 cents Operating cash flow per security Distribution per security (2)	51.9 52.6 52.5 56.0 52.6 32.8 34.4 35.0 35.5 36.25 0 10 20 30 40 50 60 FY10 FY11 FY12 FY13 FY14 cents Operating cash flow per security Distribution per security (2)	51.9 52.6 52.5 56.0 52.6 32.8 34.4 35.0 35.5 36.25 0 10 20 30 40 50 60 FY10 FY11 FY12 FY13 FY14 cents Operating cash flow per security Distribution per security (2)	51.9 52.6 52.5 56.0 52.6 32.8 34.4 35.0 35.5 36.25 0 10 20 30 40 50 60 FY10 FY11 FY12 FY13 FY14 cents Operating cash flow per security Distribution per security (2)	51.9 52.6 52.5 56.0 52.6 32.8 34.4 35.0 35.5 36.25 0 10 20 30 40 50 60 FY10 FY11 FY12 FY13 FY14 cents Operating cash flow per security Distribution per security (2)
		51.9 52.6 52.5 56.0 52.6 32.8 34.4 35.0 35.5 36.25
		FY10 FY11 FY12 FY13 FY14 Operating cash flow per security Distribution per security (2)

 FY14 distribution payout ratio[(1,2) ] of 68.9%

• Distribution components:

35.61 cents profit distribution 0.64 cents capital distribution 36.25 cents 0

 2.1% growth in distributions

• (1) Distribution payout ratio = distribution payments as a percentage of operating cash flow.

• (2) Based on normalised operating cash flow.

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APA Investor Presentation – September 2014

Developing growth capital projects across Australia

 Continued expansion and enhancement of APA’s gas infrastructure portfolio, with many growth opportunities unique to APA – $1 billion capital projects completed or in progress in FY14

• Committed projects underwritten by long term revenue contracts and/or regulatory arrangements

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FY 2014 FY 2015 FY 2016
Moomba Sydney Southern lateral expansion for northern
Pipeline gas flow
Victorian Capacity expansion of southern and northern sections of the transmission system;
Transmission System Other capital expenditure as approved under the current access arrangement
Diamantina and
Leichhardt
Goldfields
Pipeline expansions Power Stations
Gas Pipeline Goldfields Gas
Pipeline
Eastern Goldfields Capacity expansion Wallumbilla
New 292 km gas pipeline in the Goldfields region, WA
Pipeline Compression
Capacity expansion
South West
Easternhaul and bi-directional capability
Queensland Pipeline
Compression for eastern haul
Moomba compression transportation Moomba South West
Compression
Queensland Pipeline
Wallumbilla Compression at Wallumbilla hub for Capacity expansion Bi-directional
compression deliveries to Gladstone LNG capability
Eastern Goldfields
Pipeline
Mondarra Gas New 292km pipeline
Storage Facility
APA Assets and investments Victorian Transmission Moomba Sydney Pipeline
southern lateral
Diamantina 242 MW gas fired power station APA Operated assets System Capacity expansion
Capacity expansion
Power Station 60 MW back up generation Other natural gas pipelines
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APA Investor Presentation – September 2014

Capital expenditure

Capital expenditure
$ million	$0m $100m $200m $300m $400m 2014(1) 2013(1) 65.5 22.6 206.6 80.8 13.2 23.8 73.4 208.9 23.8 29.0 317.0 342.6 382.5 365.2 45.1 24.7 19.1 7.5 446.7 397.4 126.1 330.8 572.8 728.2	Committed growth capex
Growth capex
Regulated- Victoria	65.5 22.6 206.6 80.8 13.2 23.8 73.4 208.9 23.8 29.0 317.0 342.6
Major Projects Queensland
New South Wales
Western Australia
Other
Total growth capex
Stay in business capex	45.1 24.7 19.1 7.5 446.7 397.4 126.1 330.8
Customer contributions
		FY14 FY15 FY16 FY17 Guidance Committed
Total capex
Investments and acquisitions
Total capital & investment expenditure

(1) Capital expenditure represents cash payments as disclosed in the cash flow statement for 2014 and 2013.

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APA Investor Presentation – September 2014

Capital management

 Maintain strong BBB/Baa2 investment grade ratings

 Maintain funding flexibility – internal cash flows plus additional equity and/or debt

 Cash and committed undrawn facilities of around $800 million at 30 June 2014

Debt maturity profile

(30 June 2014)

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$1,200m
$1,000m
$200m
$40m
$800m
$225m $120m
$600m
$510m $280m
$425m
$400m
$515m
$735m
$536m
$200m $414m
$271m $295m $289m $300m $296m
$126m
$0m
FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25
Sterling MTN US 144a Notes Canadian MTN
Japanese MTN Australian MTN US Private Placement Notes
First Call Date - 60 year Sub Notes Bank borrowings Headroom (bank borrowings)
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Metrics	30 Jun 2014	30 Jun 2013
Gearing(1,2)	64.2%	62.8%
Interest cover ratio	2.31 x	2.30 x
Average interest rate applying to drawn debt(2)	7.12%	7.35%
Interest rate exposure fixed or hedged	72.8%	83.2%
Average maturity of	5.4	6.2
senior facilities	years	years

(1) Ratio of net debt to net debt plus book equity

(2) Includes $515 million of Subordinated Notes

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APA Investor Presentation – September 2014

East coast grid services creating value

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Gladstone
Wallumbilla
Brisbane
Moomba
Sydney
Adelaide APA natural gas pipelines
Other natural gas pipelines
Bi-directional capability
Gas storage
Melbourne
Gas production
Developing bi-directional capability
Forward haul  Requires modification of
existing (or new)
compressor stations with
pipework and valves
Backward haul 
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 Customer take-up of grid services

• New short and longer term gas transportation agreements across multiple pipelines

• Storage services available throughout the grid, close to source or end use

• Flexibility services to manage shifts in gas supply and demand portfolios

• Capacity trading services added

 Expanding and optimising grid infrastructure and operation

• Increasing capacity to move gas between Victoria and NSW

• Increasing compression capacity at Wallumbilla hub and Moomba

• Progressively configuring pipelines to operate as a single network system

• Progressively installing bi-directional capability on pipelines across the grid

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APA Investor Presentation – September 2014

Developing an integrated Western Australian portfolio

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PILBARA PIPELINE
SYSTEM
Pilbara mining
region
GOLDFIELDS
GAS PIPELINE
Goldfields
mining region
EASTERN GOLDFIELDS
PIPELINE
MONDARRA GAS
STORAGE FACILITY
Perth
APA natural gas pipelines
Other natural gas pipelines
Gas storage
Gas production
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 Gas supply security and flexibility

• Mondarra Gas Storage Facility expansion commenced commercial operation July 2013

• Underpinned by 20 year contract with Synergy (electricity generator/retailer)

• Additional customers utilising storage capacity under shorter term agreements

• Serving mining operations in the Pilbara and Goldfields

• Goldfields Gas Pipeline increased capacity available for Rio Tinto and Mt Newman JV

• Murrin Murrin Operations 15-year contract renewal

• Pilbara Pipeline System lateral expansion for onshore LNG

 Development of the Eastern Goldfields Pipeline

• New 292km pipeline supplying mining operations in the Goldfields region

• Capital cost of $140 million underpinned by new long term gas transportation agreements with AngloGold Ashanti

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APA Investor Presentation – September 2014

Focus on safety and operational excellence

 Health and safety

• Long-term safety goal of Zero Harm –

• a program of continuous improvement

• Decrease of LTIFR[(1)] to 0.7, down from 2.1

 Enhancing infrastructure operations and maintenance

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LTIFR
7.3
6.1
4.9
2.2 2.1
0.7
FY09 FY10 FY11 FY12 FY13 FY14
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• Consolidating pipeline control and monitoring operations to better manage grid operations

• Improving asset maintenance management systems and processes across the portfolio

• Progressively adopting global industry best practice

These and other initiatives are focused on improving service safety and reliability, operational efficiency and extending the economic life of the assets

• (1) Lost time injury frequency rate (LTIFR) is measured as the number of lost time injuries per million hours worked.

Damian Both, Network Operations, Queensland

 20

APA Investor Presentation – September 2014

Well positioned and equipped for growth

 Organic growth

• Capacity expansions in line with customer requirements

• Grid enhancement and service developments

 Brownfield and greenfield developments

• Eastern Goldfields Pipeline

• NT – east coast grid pipeline link

 East coast LNG

• East coast grid transportation and storage services

• Potential pipeline ownership and operation

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Darwin
Gladstone
Brisbane
Moomba
Perth
APA natural gas pipelines
Sydney
under development
Other natural gas pipelines Adelaide
Gas storage
Gas production
Melbourne
Gas resource
NT link potential pipeline routes
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Diverse and interconnected portfolio

National infrastructure development and operational capability

Balance sheet strength

 21

APA Investor Presentation – September 2014

Outlook and guidance for FY15

Outlook

• Continued development of expansion projects and east coast gas grid

• Northern Territory – east coast interconnection feasibility study

Guidance

• Statutory EBITDA expected within a range of $1,170 million to $1,190 million

• Normalised continuing business EBITDA $740 million to $760 million (6% to 9% increase)

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($50 m)
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• Net interest cost – expected within a range of $315 million to $325 million

• Distributions at least equal to FY14 total distributions per security of 36.25 cents

• (1) Excluding significant items and Envestra equity earnings.

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APA Investor Presentation – September 2014

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Supplementary information

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APA Investor Presentation – September 2014

APA asset and investment portfolio

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APA Investor Presentation – September 2014

APA Group structure

• APA is a stapled entity comprising two registered managed investment schemes:

APA Group Securityholders

• Australian Pipeline Trust (ARSN 091 678 778)

• APT Investment Trust (ARSN 115 585 441) is a tax pass-through trust

• Australian Pipeline Limited (ACN 091 344 704) is the responsible entity of the Trust and APT

• APA is listed on the Australian Securities Exchange

• The units of the Trust and APT are stapled and must trade and otherwise be dealt with together

• APT Pipelines Limited (ABN 89 009 666 700) is APA’s borrowing entity, a company wholly owned by APT

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Australian Pipeline Trust APT Investment Trust
(APT) (APTIT)
100%
100%
APT Pipelines Ltd
100%
Infrastructure
Australian Pipeline assets and
Limited
investments
(Responsible Entity)
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• Reporting segments

• Energy Infrastructure : APA’s wholly or majority owned energy infrastructure assets

• Asset Management : provision of asset management and operating services for the majority of APA’s investments

• Energy Investments : minority interests in energy infrastructure investments

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APA Investor Presentation – September 2014

Reconciliation – statutory and normalised results

$ million		2014			2013(1)		Change
	Normalised	Significant	Statutory	Normalised	Significant	Statutory	Normalised
		items			items
Revenue excluding pass-through(2)	992.5	-	992.5	919.5	-	919.5	7.9 %
EBITDA	747.3	-	747.3	661.9	101.7	763.6	12.9 %
Depreciation and amortisation	(156.2)	-	(156.2)	(130.5)	-	(130.5)	(19.8) %
EBIT	591.1	-	591.1	531.5	101.7	633.2	11.2 %
Net interest expense	(325.1)	-	(325.1)	(299.6)	8.7	(290.9)	(8.5) %
Pre-tax profit	266.0	-	266.0	231.9	110.4	342.3	14.7 %
Tax	(66.4)	144.1	77.7	(59.5)	9.6	(49.9)	(11.6) %
Non-controlling interests	(1)	-	(1)	2.8	-	2.8	Nm
Net profit after tax	199.6	144.1	343.7	175.1	120.0	295.1	14.0 %
Operating cash flow	439.7	(8.2)	431.5	432.6	(58.3)	374.4	1.6 %

• (1) APA has adopted revised AASB 119 during the year. As the revised standard must be applied retrospectively, comparative numbers have been restated.

• (2) Pass-through revenue is revenue on which no margin is earned.

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APA Investor Presentation – September 2014

Energy Infrastructure

Queensland South West Queensland Pipeline  New short term agreements Moomba compression  Construction nearing completion Wallumbilla compression  Long-term agreement for compression services  Construction nearing completion  Eastern haul Berwyndale Wallumbilla Pipeline  Gas transportation agreement  Installing bi-directional capability $0m $40m $80m $120m $160m $200m $240m EBITDA	Queensland South West Queensland Pipeline  New short term agreements Moomba compression  Construction nearing completion Wallumbilla compression  Long-term agreement for compression services  Construction nearing completion  Eastern haul Berwyndale Wallumbilla Pipeline  Gas transportation agreement  Installing bi-directional capability $0m $40m $80m $120m $160m $200m $240m EBITDA	$213 million FY11 FY12 FY13 FY14	$213 million FY11 FY12 FY13 FY14	$213 million FY11 FY12 FY13 FY14	$213 million FY11 FY12 FY13 FY14
		$213 million

South West Queensland Pipeline Berwyndale Wallumbilla Pipeline Carpentaria Gas Pipeline Roma Brisbane Pipeline

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APA Investor Presentation – September 2014

Energy Infrastructure

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EBITDA
$120m
$107 million
New South Wales
 Three agreements to transport increased gas volumes
$80m
north from Victoria, commencing
Jan 2014, Jan 2015 and Jun 2015
Moomba
 A new 7-year grid services agreement, mainly utilising
Sydney
the Moomba Sydney Pipeline $40m
Pipeline
 Capacity expansion on southern lateral
$0m
Victoria & South Australia FY11 FY12 FY13 FY14
EBITDA
$117 million
 Decrease in regulated tariffs with commencement of
$120m
new access arrangement
 Reduced state volume due to milder weather offset by
increased gas flow north to NSW
$80m
SESA
 Capacity expansion of northern interconnect
commenced, underpinned by regulated and contracted
revenue
$40m
Victorian
 Nearing completion of Winchelsea compressor
Transmission
upgrade, southern Victoria
System
$0m
FY11 FY12 FY13 FY14
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APA Investor Presentation – September 2014

Energy Infrastructure

Western Australia & Northern Territory

Goldfields Gas Pipeline

	Expansion project nearing completion	EBITDA	EBITDA
Pilbara Pipeline System  12 months’ contribution		$200m					$187 million	Amadeus
	Additional revenue agreements							Gas Pipeline
Mondarra Gas Storage Facility		$160m						Emu Downs Wind Farm
	Expansion completed; commercial
	operation from July 2013	$120m						Other WA
Eastern Goldfields Pipeline								assets
	Long term gas transportation agreements to mines in the Goldfields region; seamless service across 3 pipelines	$80m						Mondarra Gas Storage Facility
	Construction of a new 292 km pipeline	$40m						Pilbara Pipeline
								System
		$0m						Goldfields Gas Pipeline
				FY11	FY12	FY13	FY14

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APA Investor Presentation – September 2014

Asset Management and Energy Investments

Asset Management

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EBITDA
$80m
Increase in one-off customer contributions for
relocating APA infrastructure $56 million
One-off
customer
$40m
One-off customer contributions
contributions
$30m
Contracted
$20m
services
Average $10m/a
$10m $0m
FY11 FY12 FY13 FY14
$0m
FY09 FY10 FY11 FY12 FY13 FY14
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 Increase in one-off customer contributions for relocating APA infrastructure

Energy Investments

 Increased contribution from Envestra investment

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EBITDA
$80m
$68 million
$40m
$0m
FY11 FY12 FY13 FY14
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APA Investor Presentation – September 2014

FY14 Balance sheet

$ million	30 June 2014 30 June 2013 Change
Current assets Property, plant and equipment Other non-current assets	203 280 (28) % 5,574 5,280 6 % 2,196 2,139 3 %
Total Assets	7,973 7,699 4 %
Current debt Other current liabilities Total current liabilities Long term debt	- 81 - 374 411 (9) %
	374 492 (24) %
	4,708 4,233 11 %
Other long term liabilities	394 460 (14) %
Total long term liabilities	5,102 4,693 9 %
Total Liabilities	5,476 5,185 6 %
Net Assets	2,496 2,514 (1) %

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APA Investor Presentation – September 2014

Debt facilities

Total committed debt facilities at 30 June 2014

$million(1)	Facility amount	Drawn amount	Tenor
2011 Bilateral borrowing	150	110	5 years maturing October 2016
2011 Bilateral borrowings(2)	400	280	5 years maturing December 2018
2014 Syndicated facilities(3)	1,250	625	2.25, 3.25 and 5.25 year trances maturing September 2016, 2017 and 2019
2003 US Private placement	281	281	12 and 15 year tranches maturing September 2015 and 2018
2007 US Private placement	811	811	10, 12 and 15 year tranches maturing May 2017, 2019 and 2022
2009 US Private placement	185	185	7 and 10 year tranches maturing July 2016 and 2019
2010 AUD Medium Term Notes	300	300	10 year tranche maturing July 2020
2012 JPY Medium Term Notes	126	126	6.5 year tranche maturing in June 2018
2012 CAD Medium Term Notes	289	289	7.1 year tranche maturing in July 2019
2012 US144a/Reg S Notes	735	735	10 year tranche maturing October 2022
2012 GBP Medium Term Notes	536	536	12 year tranche maturing in November 2024
2012 Subordinated Notes	515	515	60 year term, first call date March 2018
Total	5,578	4,793

• (1) Australian dollars. Any foreign notes issued have been hedged into fixed-rate Australian dollar obligations.

• (2) Comprises four facilities of $100 million each. In December 2013, the terms of four existing $75 million 2011 facilities were extended to five years and their limits were increased by $25 million each.

• (3) Comprises three facilities, one of $400 million and two of $425 million. The drawn amount includes $50 million under another facility (now cancelled) which was refinanced on 8 July 2014 utilising the 2014 syndicated facilities.

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APA Investor Presentation – September 2014

Regulatory update

APA’s major price regulated assets

• Regulatory resets over the next five years

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• Victorian Transmission System access arrangement

• AER final decision (May 2013) reviewed by Australian Competition Tribunal, decision Sep 2013

• • Recovered approximately $20m in business value from AER decision

• Rate of Return Guidelines

• New Guidelines released on Rate of Return released by the AER, and the ERA in WA

• Adopting a broader approach to estimating the allowed return on capital

• Will first apply to Goldfields Gas Pipeline Access Arrangement Review that was lodged 15 August 2014

 AER Better Regulation Guidelines

• A series of Guidelines addressing methodologies for assessment of expenditure, benchmarking, confidentiality, incentive mechanisms, and customer engagement

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APA Investor Presentation – September 2014

Economic regulation of gas pipelines and networks

Regulator	The Australian Energy Regulator (AER) is responsible for the economic regulation of gas transmission and
	distribution networks and enforcing the National Gas Law and National Gas Rules in all jurisdictions except Western
	Australia
	The Economic Regulation Authority of Western Australia (ERA) is the independent economic regulator for Western
	Australia
Access	Apply for a fixed term, generally 5 years
arrangement	Set out the terms and conditions of third party access, including
	– At least one reference service that is commonly sought by customers – for pipelines, this is generally firm forward-haulage services
	– A reference (benchmark) tariff for the reference service
Reference	Provides a default tariff for customers but tariffs can also be negotiated
tariff	Determined with reference to regulated revenue, capacity and volume forecasts
Regulated	Determined using the building block approach to recover efficient costs
revenue	– Forecast operating and maintenance costs
	– Asset depreciation costs and
	– Return on asset capital (regulated asset base) based on WACC determination
	WACC based on 60:40 debt equity split
Regulated	Opening RABs have been settled with the regulator; there are no reassessments for approved RABs
asset base	RABs adjusted every access arrangement period
(RAB)	– Increased by capital added to the asset and reduced by regulatory depreciation costs
	RAB is maintained in real dollar terms
Regulatory	All distribution networks and some transmission pipelines are covered by economic regulation
coverage	Test of coverage is whether a pipeline is a natural monopoly bottleneck facility
	Coverage can be revoked
	Light regulation with no tariff regulation is also available for pipeline with lower levels of market power

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APA Investor Presentation – September 2014

Regulatory coverage of APA’s pipelines

• Reduced regulatory coverage

• Most pipelines on the east coast are uncovered due to interconnection of pipelines and increased supply options for markets

• Coverage of greenfield pipelines

• Apply for 15 year exemption from coverage

• Pipeline expansions may be covered

Source: AER State of the Energy Market 2011, 2012 and 2013

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APA Investor Presentation – September 2014

Disclaimer

This presentation has been prepared by Australian Pipeline Limited (ACN 091 344 704) the responsible entity of the Australian Pipeline Trust (ARSN 091 678 778) and APT Investment Trust (ARSN 115 585 441) ( APA Group ).

Summary information: This presentation contains summary information about APA Group and its activities current as at the date of this presentation. The information in this presentation is of a general background nature and does not purport to be complete. It should be read in conjunction with the APA Group’s other periodic and continuous disclosure announcements which are available at www.apa.com.au.

Not financial product advice: Please note that Australian Pipeline Limited is not licensed to provide financial product advice in relation to securities in the APA Group. This presentation is for information purposes only and is not financial product or investment advice or a recommendation to acquire APA Group securities and has been prepared without taking into account the objectives, financial situation or needs of individuals. Before making an investment decision, prospective investors should consider the appropriateness of the information having regard to their own objectives, financial situation and needs and consult an investment adviser if necessary.

Past performance: Past performance information given in this presentation is given for illustrative purposes only and should not be relied upon as (and is not) an indication of future performance.

Future performance: This presentation contains certain “forward-looking statements” such as indications of, and guidance on, future earnings and financial position and performance. Forward-looking statements, opinions and estimates provided in this Presentation are based on assumptions and contingencies which are subject to change without notice, as are statements about market and industry trends, which are based on interpretations of current market conditions.

This presentation contains such statements that are subject to risk factors associated with the industries in which APA Group operates which may materially impact on future performance. Investors should form their own views as to these matters and any assumptions on which any forward-looking statements are based. APA Group assumes no obligation to update or revise such information to reflect any change in expectations or assumptions.

Investment risk: An investment in securities in APA Group is subject to investment and other known and unknown risks, some of which are beyond the control of APA Group. APA Group does not guarantee any particular rate of return or the performance of APA Group.

Not an offer: This presentation does not constitute an offer, invitation or recommendation to subscribe for or purchase any security.

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APA Investor Presentation – September 2014

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For further information contact

Ian Duncan Capital Markets, APA Group Tel: +61 2 9693 0074 E-mail: ian.duncan@apa.com.au

Delivering Australia’s energy

or visit APA’s website www.apa.com.au