COMET RIDGE LIMITED — Investor Presentation 2018

Jul 18, 2018

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Comet Ridge
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www.cometridge.com.au

ASX Code : COI ASX Code : COI

Important Notice and Disclaimer

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Disclaimer

This presentation (Presentation) has been prepared by Comet Ridge Limited (ABN 47 106 092 577) (Comet Ridge). The Presentation and information contained in it is being provided to shareholders and investors for information purposes only. Shareholders and investors should undertake their own evaluation of this information and otherwise contact their professional advisers in the event they wish to buy or sell shares. To the extent the information contains any projections, Comet Ridge has provided these projections based upon the information that has been provided to Comet Ridge. None of Comet Ridge or its directors, officers or employees make any representations (express or implied) as to the accuracy or otherwise of any information or opinions in the Presentation and (to the maximum extent permitted by law) no liability or responsibility is accepted by such persons.

Summary information

This Presentation contains summary information about Comet Ridge and its subsidiaries and their activities current as at the date of this Presentation. The information in this Presentation is of general background and does not purport to be complete. It should be read in conjunction with Comet Ridge’s other periodic and continuous disclosure announcements lodged with the Australian Securities Exchange (ASX), which are available at www.asx.com.au.

ASX Releases

Investors are advised that by their nature as visual aids, presentations provide information in a summary form. The key information on detailed Resource statements can be found in Comet Ridge’s ASX releases. Resource statements are provided to comply with ASX guidelines but investors are urged to read supporting information in full on the website.

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”. Forward looking words such as, “expect”, “should”, “could ”, “may”, “plan”, “will”, “forecast”, “estimate”, “target” and other similar expressions are intended to identify forward-looking statements within the meaning of securities laws of applicable jurisdictions. Indications of, and guidance on, future earnings and financial position and performance are also forward-looking statements. 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. Such forward-looking statements, opinions and estimates are not guarantees of future performance.

Forward-looking statements including projections, guidance on future earnings and estimates are provided as a general guide only and should not be relied upon as an indication or guarantee of future performance. This presentation contains such statements that are subject to known and unknown risks and uncertainties and other factors, many of which are beyond the control of Comet Ridge, and may involve significant elements of subjective judgement and assumptions as to future events which may or may not be correct. It is believed that the expectations reflected in these statements are reasonable, but they may be affected by a range of variables which could cause actual results or trends to differ materially, including but not limited to: price fluctuations, actual demand, currency fluctuations, drilling and production results, reserve estimates, loss of market, industry competition, environmental risks, physical risks, legislative, fiscal and regulatory developments, economic and financial market conditions in various countries and regions, political risks, project delay or advancement, approvals and cost estimates. Such forward-looking statements are relevant at the date of this Presentation and Comet Ridge assumes no obligation to update such information.

Investment risk

An investment in Comet Ridge shares is subject to investment and other known and unknown risks, some of which are beyond the control of Comet Ridge. Comet Ridge does not guarantee any particular rate of return or the performance of Comet Ridge. Persons should have regard to the risks outlined in this Presentation.

ASX Code : COI

www.cometridge.com.au 2

Corporate Overview

Capital Structure – ASX: COI

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12 Month Share Price Performance

Share Price and Volume Last 12 months to 17 July 2018

Share price (17 July 2018 close)	$0.385
Shares on issue	676.7m
Performance rights	4.4m
Market capitalisation	$260.5m
Cash (31 March 2018)	$13.4m

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• 30 years in business

• James McKay (commerce/law background) Non-Exec Chairman ▪ Considerable public company experience including Sunshine Gas

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• Tor McCaul ▪ Petroleum engineer with 30 years Managing Director in oil & gas ▪ Previously Head of Commercial for Cairn plc in India

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• 30+ years in Finance & Resources

• ▪ Former Chair of WA Council of Chartered Sec.

Gillian Swaby Non-Exec Director

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• Geologist with 12 years in oil & gas

• Chris Pieters ▪ Previously Chief Commercial

• Commercial Director Officer, Sunshine Gas

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• 20 years experience in M&A and Finance

Mike Dart

Non-Exec Director

• Director of Dart Capital Partners, private venture capital fund

ASX Code : COI

www.cometridge.com.au

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Comet Ridge - Summary

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✓ Mahalo - Southern Bowen (Mahalo) – CSG

• Significant net 2P[+ ] (172PJ) & 3P[+ ] (374PJ) reserves located 240km west of Gladstone

• Comet targeting being FID ready 2018/19

• JV with Santos and APLNG

✓ Galilee – CSG, Sandstone and Shale

• Appraisal well, Sandstone target - June 2018 First measured gas flow

• Significant resource base northwest of Gladstone (over 2200 PJ 3C)[+]

• Opportunities for early commercialisation

• Target to drill CSG pilot late 2018

✓ Gunnedah – CSG – NSW

• Assets cover ~17,000km[2 ] located north of Santos Narrabri development

• Longer term hold-then-follow strategy

ASX Code : COI

+Chapter 5 ASX Listing Rules disclosure Page 22

www.cometridge.com.au

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Its been a busy 12 months…..

• ✓ 2017 work programme resulted in significant Reserves and Resources Upgrade for Mahalo – 172 PJ 2P net to Comet Ridge

• ✓ Re-appointed Exploration Agent for Mahalo by Santos, 2018 work programme signed off by JV

• ✓ Mira 6 (short single lateral) well hitting 1.4 mmcf/d, exceeding all expectations

• ✓ Farmout 15-30% of Galilee Sandstones to Vintage

• ✓ First Measured Gas Flow from Lake Galilee Sandstone Reservoir – 230,000 scf/d

• ✓ Strong Value Growth

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ASX Code : COI

+Chapter 5 ASX Listing Rules disclosure Page 22

www.cometridge.com.au 5

Comet Ridge - Strategic East Coast Gas Portfolio

Mahalo QLD Galilee QLD Gunnedah NSW Total Assets East Coast Australia	+Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 18 172 374 224 385 389 +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 67 1,870 Sandstone 56 153 417 +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 562 COI Total +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG + Sandstone 18 172 374 280 605 3,238	+Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 18 172 374 224 385 389 +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 67 1,870 Sandstone 56 153 417 +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 562 COI Total +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG + Sandstone 18 172 374 280 605 3,238	+Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 18 172 374 224 385 389 +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 67 1,870 Sandstone 56 153 417 +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 562 COI Total +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG + Sandstone 18 172 374 280 605 3,238	+Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 18 172 374 224 385 389 +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 67 1,870 Sandstone 56 153 417 +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 562 COI Total +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG + Sandstone 18 172 374 280 605 3,238	+Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 18 172 374 224 385 389 +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 67 1,870 Sandstone 56 153 417 +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 562 COI Total +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG + Sandstone 18 172 374 280 605 3,238	+Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 18 172 374 224 385 389 +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 67 1,870 Sandstone 56 153 417 +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 562 COI Total +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG + Sandstone 18 172 374 280 605 3,238	+Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 18 172 374 224 385 389 +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 67 1,870 Sandstone 56 153 417 +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG 562 COI Total +Reserve (PJ) +Contingent Resource (PJ) Type 1P 2P 3P 1C 2C 3C CSG + Sandstone 18 172 374 280 605 3,238
Total Assets East Coast Australia	COI Total	+Reserve (PJ)			+Contingent Resource (PJ)
	Type	1P	2P	3P	1C	2C	3C
	CSG + Sandstone	18	172	374	280	605	3,238

+Refer to the Competent Persons Statement at Page 22 and the ASX announcement dated 6 March 2018 for further information on COI’s Reserves and Contingent Resources

ASX Code : COI

www.cometridge.com.au

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ASX Code : COI
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www.cometridge.com.au
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Well productivity has exceeded expectations

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• The Mira 6 / 2 horizontal-vertical well combination was brought on-line in December 2017 and commenced producing gas after only two days (fully saturated)

• Gas rate has risen to over 1.4 mmcf/d (late June) from 924m horizontal well in Castor seam

• Mira 6 performance has exceeded expectations and assisted in maiden 1P reserve

• Development wells could be twice as far in coals as Mira 6, and have horizontal well paths in two or more coals = significantly more productivity for low incremental cost

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ASX Code : COI

www.cometridge.com.au 8

Mahalo – Current Work Programme

Current work programme includes:

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• Environmental and other studies – to support a Petroleum Lease and Pipeline Licence application

• 7 well bores - 3 vertical wells and 2 dual lateral intercept wells into 2 of the vertical wells (see image below)

• Production testing for gas and water

• Dual lateral wells to extend knowledge of the deeper sections of the field

Expected outcomes :

• ✓ Extend the area and scale of the development

• ✓ Ready to lodge application for Petroleum Lease and Pipeline Licence

• ✓ Additional 2P/3P conversion at very modest cost

• ✓ Development concept validated – dual lateral well concept

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ASX Code : COI

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Mahalo likely to be at low end of cost curve

Mahalo will get development priority because:

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• ❑ Shallow

• ✓ Only 225 to 400 metres to coal

• ✓ Lower drilling and completion costs

• ❑ Permeable

• ✓ Mahalo 7 and Mira 6 flowed 1200 to 1500 scfd per metre of coal intersected

• ✓ Higher flowrates means less wells

• ❑ Less Water

• ✓ Low water-gas ratio on both Mahalo 7 and Mira 6

• ✓ Lower water handling capex and opex

• ❑ Low maintenance

• ✓ No coal fines minimising workovers

• ❑ Gas Quality

• ✓ No expensive CO2 or H2S removal to get to sales gas spec

• ✓ Use basic carbon steel in wells, flowlines and plant

• ❑ Close to infrastructure

• ✓ 14 km - nearest pipeline connection ✓ 60 km - Mira Pilot to Jemena pipeline ✓ 63 km - Mira Pilot to GLNG pipeline

ASX Code : COI

www.cometridge.com.au

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Development Concept

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Comet Ridge to Target FID ready 2018/19

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*Development Concept: possible option displayed

Development concept – Targeting 120 TJ/d production

• ❖ Phase 1

• 60 TJ/d modular plant targeting the northern part of the block

• 12 inch Gas Export Pipeline (120 TJ/d capability)

• Water treatment

• Wells and gathering system

❖ Phase 2 – following quickly

• Second 60 TJ/d modular plant targeting remaining resources, increasing production to 120 TJ/d

Minimum gas processing required – only separation, compression and dehydration

• Increased water treatment

• Wells and gathering system

*Comet Ridge internal concept. Development remains subject to approval of Joint Venture.

ASX Code : COI

www.cometridge.com.au

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ASX Code : COI

www.cometridge.com.au

Galilee Basin – Australia’s next significant basin

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• Basin covers a large part of central western Queensland (~250,000km[2] )

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• Comet has a massive position in the east portion of the Basin

• Land use is grazing on very large stations

• Historic oil exploration (1964 & 1995) includes gas flows from Sandstones at 2800 metres

• Comet has multiple Sandstone, CSG and Shale opportunities

• Non-binding MOU with APA Group for Pipeline

• Jemena announced plans to fast track extension of Northern Gas Pipeline from Mt Isa to Roma

• Planned Galilee coal mine(s) just to the east, potential gas buyer(s)

Significant Scale, Multiple Targets

ASX Code : COI

www.cometridge.com.au 13

Galilee Sandstone – Large Number of Potential Targets

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• Significant gross 3C[+] resources certified in

conventional Sandstones (417PJ) in one structure (Albany)

• Previous gas flows from oil exploration wells in Comet blocks

• Seismic is sparse, therefore likely other unidentified structures

• Basin has up to 140m of gross sandstone targets

Significant number of sandstone leads and prospects identified from relatively sparse seismic data set in the eastern Galilee

ASX Code : COI

www.cometridge.com.au

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+Chapter 5 ASX Listing Rules disclosure Page 22

Galilee Sandstone – Albany 1 well

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• ✓ Initial 13 metre section of Sandstone produces stabilised gas flow of 230,000 scf/d

• ✓ Drilling suspended due to wellbore difficulties

• ✓ Approximately 100 metres of sandstone yet to be tested in Albany 1

• ✓ Pre-drill objectives of improving flow through underbalanced drilling and confirming the reservoir as an excellent stimulation candidate have been met

• ✓ Compositional analysis of the hydrocarbon stream from the rig laboratory indicates approximately 94.23% C1, 3.92% C2, 1.24% C3, 0.45% C4, 0.16% C5+

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• ✓ Based on analysis of samples from Carmichael 1 in 1995, the expectation is for no H2S, very little to no CO2 and approximately 5% N2

First Measured Gas Flow from Lake Galilee Sandstone Reservoir

ASX Code : COI

www.cometridge.com.au

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Galilee Sandstone - work program Vintage Energy

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• Vintage Energy farm-out for up to 30% of the Sandstone reservoir sequence (“Deeps”) of Comet Ridge’s ATP743, 744 and 1015 (Galilee Permits) – Proven JV Partners.

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• Current Sandstone targets have been identified from a few, widely spaced 2D seismic lines, more work to be done.

• Forward work programme to include:

• Seismic – 2D and/or 3D

• Completion of Albany 1

• Drilling of Albany 2

• Outcome Sought

• Drill ready targets

• Conversion of Resources to Reserves

• MOU leading to Gas Sales Agreement

ASX Code : COI

www.cometridge.com.au

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Galilee Basin CSG

www.cometridge.com.au

ASX Code : COI

Galilee CSG – recoverable gas over 1,865 km[2]

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• Gunn Project area and ATP 1015 area (COI 100%) coals contain recoverable gas over an estimated 1,865 km[2 ]

• 6 individual coal seams

• Depth to coal 700 - 1,000m

• 16 to 24m net coal deposited over large area

• Average gas content 4.3 m[3] /t (high 7.3 m[3] /t)

• Good to excellent permeability within target coals

• Significant CSG resource independently certified at over 1.8 Tcf in ATP 744

• COI working towards CSG pilot drilling 2H 2018

ASX Code : COI

www.cometridge.com.au

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Chapter 5 ASX Listing Rules disclosure Page 22

Comet Ridge – Value Curve

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New Exploration Acreage

Gunnedah – Exploration & Development Galilee Shale - ???

Galilee CSG – Exploration & Development Galilee Sandstone – Exploration & Development

Mahalo – Reserves build, FID, Development

Time

ASX Code : COI

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Comet Ridge – Key take away messages

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▪ Mahalo is one of the east coast’s largest, most productive and proximal to market gas fields not currently in production

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• Significant upside from Galilee – Proof of concept with successful flow of gas from Albany 1. CSG target for pilot drilling late in 2018

• East coast gas market continues to tighten due to moratoria on gas exploration, shut-down of coal fired generation and increasing LNG demand

• Comet Ridge well placed to form part of the supply solution for the east coast gas market

ASX Code : COI

www.cometridge.com.au

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Contact Telephone: +61 7 3221 3661 Facsimile: +61 7 3221 3668 Email

www.cometridge.com.au

www.cometridge.com.au

ASX Code : COI

ASX Listing Rule 5 Disclosure

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Competent Person Statement and ASX Listing Rules Chapter 5 - Reporting on Oil and Gas Activities

The Contingent Resource for the Albany Structure located ATP 744 are taken from an independent report by Dr Bruce McConachie of SRK Consulting (Australasia) Pty Ltd, an independent petroleum reserve and resource evaluation company. The Contingent Resources information has been issued with the prior written consent of Dr McConachie in the form and context in which they appear in this Annual Reserves Statement for 2016. His qualifications and experience meet the requirements to act as a qualified petroleum reserves and resource evaluator as defined under the ASX Listing Rule 5.42 to report petroleum reserves in accordance with the Society of Petroleum Engineers (“SPE”) 2007 Petroleum Resource Management System (“PRMS”) Guidelines as well as the 2011 Guidelines for Application.

The estimate of Reserves and Contingent Resources for the Mahalo Project as part of ATP 1191P provided in this presentation, is based on, and fairly represents, information and supporting documentation determined by Mr Timothy L. Hower of MHA Petroleum Consultants LLC Inc (MHA) in accordance with Petroleum Resource Management System guidelines. Mr Hower is a full-time employee of MHA, and is a qualified person as defined under the ASX Listing Rule 5.42. Mr Hower is a Licensed Professional Engineer in the States of Colorado and Wyoming as well as being a member of The Society of Petroleum Engineers. Mr Hower has consented to the publication of the Reserve and Contingent Resource estimates for Mahalo in the form and context in which they appear in this presentation.

The reserve and contingent gas resource estimates for ATP 1191P provided in this presentation were originally released to the Market in the Company’s announcement of 28 August 2014, updated in an announcement dated 2 December 2015, and further upgraded in an announcement dated 6 March 2018 and were estimated using the deterministic method with the estimate of contingent resources not having been adjusted for commercial risk.

The contingent resource estimates for the unconventional gas located in ATP 744 provided in this presentation are based on and fairly represent, information and supporting documentation determined by Mr John Hattner of Netherland, Sewell and Associates Inc, Dallas, Texas, USA, in accordance with Petroleum Resource Management System guidelines. Mr Hattner is a full-time employee of NSAI, and is considered to be a qualified person as defined under the ASX Listing Rule 5.42 and has given his consent to the use of the resource figures in the form and context in which they appear in this presentation.

The contingent gas resource estimates for ATP 744 provided in this statement were originally released to the Market in the Company’s announcement of 25 November 2010, and were estimated using the deterministic method with the estimate of contingent resources for ATP 744 not having been adjusted for commercial risk.

COI confirms that it is not aware of any new information or data that materially affects the information included in any of the announcements relating to either ATP 1191P or ATP 744P referred to above and that all of the material assumptions and technical parameters underpinning the estimates in the announcements continue to apply and have not materially changed.

The contingent resource estimates for PEL 6, PEL 427 and PEL 428 referred to in this presentation were determined by Mr Timothy L. Hower of MHA Petroleum Consultants LLC in accordance with Petroleum Resource Management System guidelines. Mr Hower is a full-time employee of MHA, and is a qualified person as defined under the ASX Listing Rule 5.42. Mr Hower consented to the publication of the resource figures which appeared in the announcement of 7 March 2011 made by Eastern Star Gas Limited (ASX:ESG) and any reference and reliance on the resource figures for PEL 6, PEL 427 & PEL 428 in this presentation is only a restatement of the information contained in the ESG announcement.

The contingent resource estimates for PEL 6, PEL 427 and PEL 428 were estimated using the deterministic method with the estimate of contingent resources for PEL 6, PEL 427 and PEL 428 not having been adjusted for commercial risk.

COI confirms that it is not aware of any new information or data that materially affects the information included in the ESG announcement of 7 March 2011 and that all of the material assumptions and technical parameters underpinning the estimates in the announcements continue to apply and have not materially changed.

ASX Code : COI

www.cometridge.com.au 22