APA GROUP — Investor Presentation 2015

May 28, 2015

==> picture [720 x 157] intentionally omitted <==

Connecting opportunities Connecting resources to markets through a sustainable strategy

Mick McCormack, Managing Director Annual Stockbrokers Conference, Sydney 29 May 2015

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.

APA Group │ Annual Stockbrokers Conference May 2015 │  2

Australia’s largest gas pipeline owner by pipeline length, capacity and volume

length, capacity and volume
APA G APA assets and investments Under development Acquisition - financial close pending APA operated assets Other natural gas pipelines Gas production Australian gas transmission pipeline ownership	APA Overview	(Ticker: APA AU)
	Market capitalisation ASX rank(1) Rating	A$10.1 billion (as at 25 May 2015) S&P/ASX 50 Moody’s: Baa2 (outlook Stable) S&P: BBB (outlook Stable)
	Assets owned/ operated	Over $12 billion(1)
		Gas transmission 14,744(2)km transmission pipelines Underground & LNG gas storage Gas distribution 27,100 km gas network pipelines 1.3 million gas consumers Other energy infrastructure 585 MW power generation 244 km HV electricity transmission Gas processing plants
	Employees	More than 1,600
	roup │ Annual Stockbrokers Conference May 2015 │3 (1) Does not include QCLNG Pipeline – financial close pending (2) Includes QCLNG Pipeline (543 km) – financial close pending Does not include Eastern Goldfields Pipeline (292 km) – under construction

APA Group │ Annual Stockbrokers Conference May 2015 │  3

Stable and predictable cashflows

• Customers associated with many contracted assets provide essential services:

• Regulated gas distribution systems

• Major power generation facilities

Counterparty credit ratings by contracted volumes[(1)] for major contracted assets - Illustrative Post QCLNG

==> picture [314 x 194] intentionally omitted <==

----- Start of picture text -----

Not rated 5% Sub-investment grade 1%
Investment
grade JV
2%
A– rated
BBB– to BBB+
or better
rated
50%
42%
(1) Based on Maximum Daily
Quantity (“MDQ”)
----- End of picture text -----

1H 15 Revenue split by contract type

==> picture [232 x 169] intentionally omitted <==

----- Start of picture text -----

Other 1%
Regulated
(revenue subject to price
regulated tariffs)
18%
Contracted
(regulated assets with
negotiated tariffs)
14%
Contracted
(light regulation and
non-regulated assets)
67%
----- End of picture text -----

Contracted (regulated assets with negotiated tariffs) 14%

Stable and predictable cash flow from regulated assets and long term contracts with quality customers APA Group │ Annual Stockbrokers Conference May 2015 │  4

APA’s long term strategy

Consistent execution of a sustainable growth strategy since listing in 2000

==> picture [612 x 224] intentionally omitted <==

----- Start of picture text -----

Continuing to grow our
Leveraging our asset
ownership interests in
management,
transmission pipelines through
development and
further expanding the east and
operational capabilities
west coast grids
Delivering responsive,
Growing other energy
valuable solutions to our
infrastructure midstream assets
customers
Maintaining financial flexibility
----- End of picture text -----

strong industry fundamentals, drive growth opportunities APA Group │ Annual Stockbrokers Conference May 2015 │  5

APA assets upon listing - June 2000

==> picture [324 x 301] intentionally omitted <==

==> picture [319 x 150] intentionally omitted <==

15 years ago, APA had assets worth circa $1 billion with no operatorship

APA Group │ Annual Stockbrokers Conference May 2015 │ 

Responding to market demands - May 2015

==> picture [280 x 307] intentionally omitted <==

Largest gas infrastructure portfolio in Australia in terms of scale and geographic diversity APA Group │ Annual Stockbrokers Conference May 2015 │  7

Where to from here – strategic development

==> picture [378 x 300] intentionally omitted <==

Continue to connect resources to markets, by working with our customers

 New pipelines and expansions are underwritten by customer contracts  Provision of new services responding to customers’ needs and developing new opportunities

• Can only be achieved by having a solid balance sheet

Unrivalled, interconnected footprint with sustainable growth opportunities APA Group │ Annual Stockbrokers Conference May 2015 │  8

Key initiative – east coast grid innovation

• Transformational change

in service provision - seamless, flexible, new options/solutions

• Ongoing development and growth opportunities

APA Group │ Annual Stockbrokers Conference May 2015 │  9

APA’s east coast grid is responding to the dynamic eastern gas market, providing flexibility for customers

Production vs Consumption in the east

==> picture [23 x 30] intentionally omitted <==

----- Start of picture text -----

One GTA
----- End of picture text -----

==> picture [288 x 222] intentionally omitted <==

----- Start of picture text -----

800 PJ
Gas Consumption
TAS
by Eastern States
SA
Gas Production
by Eastern regions
Otway / Bass / Gippsland VIC
Sydney NSW
Cooper
Bowen / Surat QLD
2010 2010 2011 2012 2013 2014
2010 2011 2012 2013 2014
Source: EnergyQuest quarterly reports (Feb ‘11, Feb ‘12, Feb ‘13, Feb ‘14, Mar ‘15)
----- End of picture text -----

==> picture [86 x 74] intentionally omitted <==

 demand encouraging new supply APA Group │ Annual Stockbrokers Conference May 2015 │  10

QCLNG Pipeline acquisition

==> picture [152 x 34] intentionally omitted <==

----- Start of picture text -----

 adds 543 km and
 access to Gladstone
----- End of picture text -----

Creation of 7,500 km of interconnected grid with access to export market and new creditworthy customers APA Group │ Annual Stockbrokers Conference May 2015 │  11

Emerging opportunity – NT Link

Options

• Short/quick - Mount Isa: 600 km

• Long/ $$$ - Moomba: 1,175 km

• …or somewhere in between

Why link?

• NT has >200,000 PJ of gas resources[1 ]

 Seamless transport between Timor Sea, Bass Strait, Sydney and Gladstone

 Long term additional security of supply for both the east coast and the Northern Territory

• (1) NT Government media release 19 February 2014. Potential reserves of approximately 240 TCF across 6 basins

APA is one of four shortlisted entities - final bids due September 2015 APA Group │ Annual Stockbrokers Conference May 2015 │  12

Opportunities in the west

==> picture [424 x 318] intentionally omitted <==

• GGP expansion projects complete

• Eastern Goldfields Pipeline

• greenfield

• long term GTAs with AngloGold

• using 3 interconnected

APA pipelines

• replace diesel with gas

• completion due by Jan 2016

• Customers that take long term

• view of their energy needs continue to have discussions with us

Continue to pursue opportunities and developments in WA - benefits of a diverse asset footprint APA Group │ Annual Stockbrokers Conference May 2015 │  13

Further growth – Australian midstream sector

APA will actively pursue increased investment opportunities in the midstream sector

• North American oil and gas industry has distinct upstream and midstream sectors

• Opportunities for the Australian upstream sector to pursue a similar approach

• APA already has a long involvement in owning and operating gas midstream assets

• Moomba and Wallumbilla compressor facilities

• Mondarra Gas Storage Facility

• Gas processing plants at Tipton West and Kogan North

==> picture [631 x 90] intentionally omitted <==

----- Start of picture text -----

Mondarra Gas Storage Facility
----- End of picture text -----

Midstream sector is a potential area of additional opportunities for APA APA Group │ Annual Stockbrokers Conference May 2015 │  14

Operational excellence - IOC

APA’s new Integrated Operations Centre will provide seamless services to our customers on the East Coast Grid

• Better response to market changes

• Holistic management of the Grid

• Standardised and consistent processes and procedures

• Real-time environment

• Single point of contact for customers  Currently controls pipelines in Qld and NT

==> picture [352 x 146] intentionally omitted <==

----- Start of picture text -----

APA’s Integrated Operations Centre, Brisbane
----- End of picture text -----

• Other pipelines to be transitioned over the next 12 months

APA continues to pursue efficiency and integration across our divers portfolio APA Group │ Annual Stockbrokers Conference May 2015 │  15

Maintaining a strong balance sheet

APA’s Distribution Policy

Growth needs to be sustainably funded with appropriate capital structure

• Fully covered by OCF

• Sustainable over the long term

• Grow generally in line with OCF

• Regard for capital needs of the business and economic conditions

	Capital Management	31 Dec 2014	30 Jun 2014
	Gearing(1,2,3)	44.5%	64.2%
	Interest cover ratio	2.48x	2.31x
	Average interest rate applying to drawn debt(2)	7.07%	7.12%
	Interest rate exposure fixed or hedged	84.6%	72.8%
	Average maturity of senior facilities	5.3 years	5.4 years

• Soft target of 60 - 70% payout

• Balance between maintaining BBB/Baa2 rating metrics and funding growth by appropriate mixture of debt and equity

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

(2) Includes $515 million of Subordinated Notes.

(3) After receipt of $958 million proceeds from Institutional and Early Retail Entitlement Offer.

APA Group │ Annual Stockbrokers Conference May 2015 │  16

Long term, diverse debt portfolio

• March 15 issuance – ongoing access to global markets: – EUR700m 7yr notes @1.375% coupon

• – EUR650m 12yr notes @2.0% coupon

• – GBP600m 15yr notes @3.5% coupon

• – USD1,100m 10yr notes @4.2% coupon

• – USD300m 20yr notes @5.0% coupon

• Weighted average interest rate applying to drawn debt reduced to 5.6%[* ]

• Average maturity of senior drawn facilities extended to 8.8 years[* ]

• USD obligations translated, for the purposes of the calculation and the chart below, at the spot exchange rate on 16 March 2015 of A$=US$0.7642

Maturity Profile of Drawn Debt as at 16 March 2015

==> picture [683 x 159] intentionally omitted <==

----- Start of picture text -----

A$1,600m
Bank borrowings Australian MTN
A$1,200m First Call Date – Japanese MTN
60 yr Sub Notes Canadian MTN
A$800m Euro MTN US 144a Notes
USPP notes Sterling MTN
A$400m
A$0m
962 1,439
1,159
515 735 894
536
295 318 289 300 296 393
186 86 175 126 96
Jun-15 Jun-16 Jun-17 Jun-18 Jun-19 Jun-20 Jun-21 Jun-22 Jun-23 Jun-24 Jun-25 Jun-26 Jun-27 Jun-28 Jun-29 Jun-30 Jun-31 Jun-32 Jun-33 Jun-34 Jun-35
----- End of picture text -----*

Strong balance sheet and prudent capital management is integral to continued growth APA Group │ Annual Stockbrokers Conference May 2015 │  17

APA – Connecting Resources to Markets

==> picture [62 x 65] intentionally omitted <==

Largest gas infrastructure portfolio in Australia in terms of scale and geographic diversity

Unrivalled, interconnected footprint with sustainable growth opportunities

==> picture [61 x 66] intentionally omitted <==

Stable and predictable cash flow from regulated assets and long term contracts with quality customers

Quality assets with long expected lives requiring a relatively low level of maintenance capital expenditure

==> picture [62 x 65] intentionally omitted <==

Strong balance sheet and prudent capital management

Integrated in-house management and experienced executive management team

APA Group │ Annual Stockbrokers Conference May 2015 │  18

==> picture [720 x 157] intentionally omitted <==

For further information contact Delivering Australia’s Energy Yoko Kosugi Head of Investor Relations, APA Group Tel: +61 2 9693 0049 E-mail: yoko.kosugi@apa.com.au

or visit APA’s website www.apa.com.au

APA Group │ Annual Stockbrokers Conference May 2015