ASX Release

23 November 2012

ASX Code: PTR

ABN 17 106 806 884

Level 1, 129 Greenhill Road Unley SA 5061

T: +61 8 8274 5000 F: +61 8 8272 8141 W: www.petratherm.com.au/ E: [email protected] PETRATHERM LIMITED ABN 17 106 806 884

AGM Presentation

Petratherm's Managing Director, Terry Kallis and Exploration Manager, Peter Reid, will present later today at the company's Annual General Meeting.

The attached presentation focuses on the Company's flagship Paralana project and outlines key areas of differentiation the Company believes it has in the Australian geothermal energy sector, including:

Business model based on JVs with right projects, partners and people – securing key skills and funding
Project portfolio several projects across geothermal technology spectrum to manage risks
Track record of success drilled, cased, fracced and flowed Paralana 2 well, confirmed economic temperature and existence of natural fracture network
Extraction model for a pumped, deep engineered geothermal systems well that is technically valid/optimal for target temperature
Clear commercialization path, for both the local off grid and long term on grid and growing power markets

Yours faithfully

Terry Kallis Managing Director

MEDIA CONTACTS: Terry Kallis Petratherm Ltd 08 8274 5000

Kieran Hall / Tim Hughes Hughes Public Relations 08 8412 4100

Petratherm Annual General Meeting

Company and Projects Update

Managing Director Terry Kallis

Exploration Manager Peter Reid

23 November 2012

Disclaimer and competent persons statement

Disclaimer

This presentation has been prepared by Petratherm Limited (Petratherm). The information contained in this presentation is a professional opinion only and is given in good faith.

Certain information in this document has been derived from third parties and though Petratherm has no reason to believe that it is not accurate, reliable or complete, it may not have been independently audited or verified by Petratherm.

Any forward-looking statements included in this document involve subjective judgment and analysis and are subject to uncertainties, risks and contingencies, many of which are outside the control of, and maybe unknown to, Petratherm.

In particular, they speak only as of the date of this document, they assume the success of Petratherm's strategies and they are subject to significant regulatory, business, competitive and economic uncertainties and risks. Actual future events may vary materially from the forward looking statements and the assumptions on which the forward looking statements are based. Recipients of this document ("Recipients") are cautioned not to place undue reliance on such forward-looking statements.

Petratherm makes no representation or warranty as to the accuracy, reliability or completeness of information in this document and does not take responsibility for updating any information or correcting any error or omission which may become apparent after this document has been issued.

To the extent permitted by law, Petratherm and its officers, employees, related bodies corporate and agents ("Agents") disclaim all liability, direct, indirect or consequential (and whether or not arising out of the negligence, default or lack of care of Petratherm and/or any of its Agents) for any loss or damage suffered by a Recipient or other persons arising out of, or in connection with, any use or reliance on this presentation or information.

All amounts in Australian dollars (AUD) unless stated otherwise.

The information in this presentation that relates to Exploration Results, is based on information compiled by Peter Reid, who appears on the Register of Practicing Geothermal Professionals maintained by the Australian Geothermal Energy Group Incorporated at the time of the publication of this report. Peter Reid is a full time employee of the Company. Peter Reid has sufficient experience which is relevant to the style and type of geothermal play under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the Second Edition (2010) of the Australian Code for Reporting Exploration Results, Geothermal Resources and Geothermal Reserves. Peter Reid has consented in writing to the inclusion in the presentation of the matters based on his information in the form and context in which it appears.

Petratherm's Five Key Areas of Differentiation

1. Business model

Project selection clearly filtered through resource, market and permitting
JV partners with complementary skills/capabilities, funding capacity and risk appetite
Project viability is project specific and an optimization process of key parameters

2. Project portfolio

Several projects to manage risks of projects not proceeding
Projects across the geothermal spectrum volcanic, district heating, HSA and EGS
1. Track record of success
Successfully drilled, cased, fracced and flowed 4km deep Paralana 2 EGS well confirmed economic temperature and existence of natural fracture network

Petratherm's Five Key Areas of Differentiation

4. Extraction model for EGS

Optimization of key parameters for a pumped EGS geothermal well drill depth/cost, temperature and target flow (HEWI) – technically valid/optimal approach
Focus on utilizing known and standard technologies and plant to mitigate risks surface and subsurface (multi-zone fraccing, pumping, ORC/binary plant, pipework)
1. Commercialization path unique in Australia
Local off grid and willing customer at just 11 kms away, distant from built up areas and enabling viability at small scale (3.5 MW net initial power production)
Long term path for large scale geothermal via unique Clean Energy Project (gas, wind and solar) that aims to secure large and growing market from mining projects

Project Milestones

› Drilled Paralana 2 to depth 4003m (G.L. A.H.D.)
› Confirmed optimum bottom hole temperatures ~ 190^oC at 4000m
› High pressure geothermal brines intersected and natural fractures intersected from 3680m – may assist flows
› Fracture stimulation produced a large complex fracture cloud extending (1100m)
› Initial injection rates of 27 l/sec with scope to increase to commercial rate
› Successful flow test produced 1.3 million litres due to natural overpressure

Extraction model for a pumped EGS well

**Sanyal (Geothermex) et. al. 2007* independent expert paper reports :**

Standard industry pump operating temperature limit is ~ 190^oC
Max MW per well ~7.3MW (unless pumps improve on setting depth and pump rate)

Paralana Extraction Model :

Targeting optimal temperature parameters to maximize output of a pumped EGS well
Temperatures of 190^oC confirmed at 4,000m
JV decision not to drill deeper than 4km based on cost/depth trade-off – validated
Remaining uncertainty is to test flow rate (Productivity Index (PI))
Paralana target flow is 75 litres/sec or PI ~ 4 achieving a net capacity of 3.5 MW

Net MW Capacity of a Pumped Well vs Temperature

* Sanyal 2007 paper available for download at www.geothermal-energy.org/pdf/IGAstandard/SGW/2007/sanyal3.pdf

Paralana Independent Resources Statement – Nov 2011

Depth Interval (metres)	Inferred (PJ ) th	Indicated (PJ ) th	Measured (PJ ) th	Total (PJ ) th
<3,500	2,400	1,100		3,500
3,500 - 4,000	4,900	4,400	41	9,300
4,000 - 4,500	5,900	5,700		12,000
4,500 - 5,000	6,900	6,700		14,000
Total (PJ ) th	20,000	18,000	41	38,000

Paralana Joint Venture: Petratherm 79%, Beach Energy 21%. If remaining staged equity investments are met, Beach Energy may earn up to 36% .

Initial stimulated rock volume = 5.4 MWe power potential for 30 years
Paralana Resource at the 3500–4000 metre depth interval is estimated a 9,300 PJth which is sufficient to generate 1,300 MWe of electrical power for 30 years

The information on this slide that relates to Geothermal Resources is an extract from a report compiled by Dr Graeme Beardsmore, who appears on the Register of Practicing Geothermal Professionals maintained by the Australian Geothermal Energy Group Incorporated at the time of the publication of this Slide. Dr Beardsmore is employed by Hot Dry Rocks Pty Ltd, an independent consulting group that provides professional services to Petratherm Ltd. Dr Beardsmore has sufficient experience which is relevant to the style and type of geothermal play under consideration and to the activity which he/she is undertaking to qualify as a Competent Person as defined in the Second Edition (2010) of the 'Australian Code for Reporting Exploration Results, Geothermal Resources and Geothermal Reserves'. Dr Beardsmore has consented in writing to the inclusion on the slide of the matters based on his information in the form and context in which they appear.

Clean Energy Precinct

Plan to deliver 600 MW into a large growth market driven by Mining Developments
It is the only site where Gas, Wind, Solar and Geothermal converge
Key enabler for delivery of large scale geothermal energy into the SA Power Grid
Exclusive access to over 1,800 square kilometres of land for power generation
Initial 300MW gas and wind development followed by solar and geothermal

Clean Energy Precinct - Preliminary Wind Assessment

Preliminary wind assessment for a 150MW and 300MW wind farm by Garrad Hassan (GH) – world's leading wind consultants
Wind speeds in northwest area is assessed as being 7 to 8 metres/sec at 100 metre height
Capacity factors modeled to range between 33.2% (good) and 42.8% (excellent).
Expected to be well suited to a Class 2 turbine (large blade with 100 metre hub height)

Paralana - Project Funding

› Next stage of works budgeted at around \$26 million
› Covers drilling Paralana 3, fracture stimulation and demonstration of commercial flows. This work is the immediate precursor to building a 3.5 MW pilot plant.
› Petratherm has lodged a \$13 million grant application under the Australian Renewable Energy Agency (ARENA) \$126 million Emerging Renewable Program (ERP) to fund up to half of the total costs.
› Beach Energy's Paralana JV partner- have 21% equity share.
› Petratherm project equity share is 79% if ERP grant is successful the PTR funding need for next stage of works is around \$10 million.
› Petratherm could receive up to \$7.2 million in cash rebates* for eligible expenditures under the R&D Tax Incentive scheme (* post eligible spend & assessment)
› Potential net cost to Petratherm to achieve Commercial Demonstration of Commercial Flows could be around \$3 million

Fracture Stimulation – Key Statistics

› 3.1 million litres injected
› Injection rates: 3.2 27 l/sec
› Equilibrium WHP prior and post operation 3940 psi.
› Acid treatments allow higher pumping rates.
› Sand proppant successfully placed at end of the treatment. Photo: courtesy Advertiser, July 2011

Fracture Stimulation – pressure and flow rate

Paralana – Pumping Day 2 – 2 nd Acid Injection – 100 bbl 1% HCL

Micro-seismic events – main fracture

› MEQ array successfully recorded micro-seismicity:
› 11,000 events triggered and located by MIMO
› 4,351 events handpicked
› Ground motion acceleration and velocity – always within the safe limits established in the risk management plan.
› Good correlation between pumping rates and microseismic events