PTR MINERALS LTD — Investor Presentation 2009

Oct 13, 2009

ASX Release

PETRATHERM LIMITED ABN 17 106 806 884

Presentation given to the recent Geothermal Resources Council 2009 Annual Conference in Reno, Nevada

Please find attached a copy of a recent presentation (and associated abstract) that was delivered by Raul Hidalgo (Petratherm's Spanish Manager), Pierre Ungemach (Chairman – GPC Instrumentation) and José Sánchez Guzmán (TRT) to the recent Geothermal Resources Council 2009 Conference held in Reno, Nevada.

The presentation focussed on deep geothermal energy potential in the Madrid Basin.

Refer attached presentation.

14 October 2009

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: admin@petratherm.com.au 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

Deep Geothermal Energy potential in Madrid Basin

Raúl HidalgopetrathermPierre UngemachJosé Sánchez Guzmán

Reno GRC October 2009

Geological setting and potential

An oil well drilled by Shell 1980 intersected two zones with anomalous temperatures showing the geothermal potential of the basin.

A low temperature zone, 88ºC at 1.750 m associated to tertiary sandstones.

A medium temperature zone, 150ºC at 3.400 m associated to cretaceous sediments and to basement rocks contact.

¿Where's the heat source at Madrid?

Central System (CS) has thermally anomalousgranites

A conventional granite produces 2.65 µWm-3. CS granites produces between 4.05-6.5 µWm-3.

Those values create anomalous heat flow values of around 100 mWm-2

Another hypothesis is the SBT ( southborder thrust) structure acting as a trapand as "deep heat circulation fluids channel" (De Vicente et Al 2008)

Granitic Landscape Pedriza de Manzanares

CS alpine macrostructure (De Vicente 2007)

GRC Reno 2009 Deep Geothermal energy potential in Madrid Basin

A very valuable drilling information

Basin structure interpretation

Basin structure interpretation

CS Gravity 3D model showing the SBT (A. Martin 2004)

Potential deep mid temp. reservoir

• • Some temperature tests were done at 3,400m within the cretaceous formation (150-200mts) obtaining extrapolated temperatures of 150º and low permeability.
• • Due to the fact Pradillo was an oil well, no drilling was undertaken within the basement.
• • No information about temperatures and permeability on the basement available.
• • Great potential associated to the Cretaceous formation or to the fractured granitic basement.

()RESULTSIGME1981
blkdii93Ptermeamy:,
ldE150ºCttttxrapoaeemperaure:
/liiS60Tt>anyg

Potential deep mid temp. reservoir

Seiismic Line M-7916 from Shell reinterpreted (G. De Vicente et al 2008)

Conclusions medium temp reservoir

Detailed Structural model definition

Location of areas of higher depth on the basin 3500-4000m depth.

To be addressed

Definition of a detailed thermo-mechanical 3D model

Launch of a demonstration project in Madrid to proof of concept

• –Definition of the target areas
• –Geothermal exploration well
• –2ndGeothermal well
• –Circulation test
• –Pilot plant
• –Initial estimated investment 30m €

Low temperature reservoir potential

• • Pradillo well identified temperatures of 88ºC at 1750 m depth alongside fair permeability. Several flow tests( DSTs ) were undertaken within the sandstones inferring production flow rates above 150 m3/h
• • This potential, detected on an oil exploration well, led IGME to carry out a detailed plan aimed at investigating the potential of the low enthalpy reservoir north of Madrid.

IGME 1980-1985

• • From 1981 to 1982 an IGME-ENADIMSA JV completed two geothermal wells ca 2000 m deep, displaying promising results regarding formation temperatures and well performance:
  • •Average temperatures 80ºC
  • •Average production flow rates 200m3/h
  • •Average depths 1700-2000 mts
• • In 1985 a tentative feasibility study for a geothermal district heating grid was undertaken.
• • Energy prices and institutional support not favourable to develop a project

Geomadrid project 1990-1993

• • From 1988 to 1993 was initiated a new GDH project promoted by the Madrid Regional government
• • A study of the resource to demand adequacy was launched in order to optimise the best project location
• • The area selected was Autonoma University campus due to the high heat demand of the surrounding buildings and favourable( access, lengths ) distribution grid requirements .
• •Geomadrid 1 well was completed in 1990
• • Geomadrid 2 was abandoned in 1993 further to severe drilling failure( stuck BHA ) at 1200 mtsdepth.Geomadrid 1 section

GEOTHERMAL RESOURCE CLASSIFICATION VS DEPTH, TEMPERATURE & AQUIFER OCCURENCE

Figure 3. Resource classification vs. depth, temperature and aquifer occurrence

Location of Target Assessment Areas

NO-SE CROSS SECTIONAL SKETCH

(Adapted from European Geothermal Atlas & Racero 1988)

Preliminary Geothermal resources clasification

Item	GdMdidranar	NEMdidar
18Hil(HIP)J10teanpace	181	22
18(C)RblhRH10Jt75ecoveraeeayrs	25	35
1()()7EliblhdEXH10J75ttxpoaeeaanpoweryrs	37	17
-217(f)Hli90Whldi10Jtttearesuppyassumngmmeaowensy	309	033
/C()EXHRHi%trao	3	5

From Ungemach et al 2008

Geomadrid Pre-feasibility Study

• • In 2008, after granting the mining exploration licenses in late 2007 and using, as an example the Paris basin experience, Petrathermcarries out a pre-feasibility study to define the technical and economic viability of a GDH project to the north of Madrid to produce heat, cold and sanitary hot water
• • Among the various prospects investigated, Geomadrid and S.S. de los Reyes proved the most favourable due to the potential heat demand and local reservoir performance
• • A thorough feasibility study has been launched for the Geomadridsite in order to appraise full project, the first GDH project in Madrid could be in operation at the end 2011

Resource Parameters vs Demand

llWe	dilTttesenerva()blmg	iiiTtransmssvy()dm	hlBttoomoe(°C)ttemperaure	llWedlibiliteeravy3/()hm
dllPirao	A16001800tm-	46.6	70º-80º	150
TCtresanos	16002400m-	20.3	70º-90º	150
bdSSitaneasanelRoseyes	16002100m-	35.3	75º-90º	250
didG1eomar	1550-	44.4	70º-78º	200

	ldHteaoa	ldldCooa	lSHWsuppy	lldTtoaoa
jPtroec	/(h)MWtyr	/(h)MWtyr	/(h)MWtyr	/(h)MWtyr
()blddCGitanoancoeomar	38400,00	5050,00	13430,00	56880,00
bdlSSiRtaneasaneoseesy	44785,00		7353,20	52138,20

Geomadrid well logging inspection program

• • A detailed well inspection program was conducted in July 2008 corroborating all the well parameters measured in 1990.
• • Logging inspection confirmed the Geomadrid well is in good shape and can be integrated to the new doublet thus achieving a significant cost saving.

Geomadrid well logging inspection program

Conclusions Geomadrid GDH Prefeasibility study

•A realistic projection over the specific northeast Madrid area would estimate at ten the number of GDHC doublets which could effectively be operated locally (Geomadrid: 2; San Sebastian de los Reyes:3; Tres Cantos:2-3;other locations:2-3).

•Assuming a unit doublet production of 40,000 MWht/yr (144,000 GJ/yr), total heat withdrawn from the tertiary sandstone aquifer over 75 years would amount to 30 TWht (i.e # 110 PJ) for the specific area alone.

Feasibility Study Phase

In July 2008 after the detailed well logging at Geomadrid, a decision was taken to undertake a full feasibility study program.

• • Detailed heat demand study of the potential users of the energy
• •Engineering design of the most favourable solution
• •Establishment of an economic business plan.
• • Secure the demand (long term contract commitment form the final users)

The study has being almost finalised in june 2009 with positive results

The federal gov, reg gov and Petratherm signed an agreement last July to promote what will be the first geothermal district heating grid in Spain.

GRC Reno 2009 Deep Geothermal energy potential in Madrid Basin

Heat demand study

Ptunosdfiiitenc	dedaos:	consumo
	iiUnversddiMar	ódddAtaunomae
	diResencNStra.ra.	diiAaencanoslDCearmen
	láHiPiiittospasqurcodífRLorguezaora
	ddCiEau	lscoar
	diResencálGonze	diiADaencanosr.Bzueno
	liCSoego	dFanernano
	dPozoeliaguaca	dódiprouccneGEOMADRIDtene

Duration load Curve and demand

Technical solution

• • Power plant : solution GPC IP – SAI
  • Geothermal well
  • –Heat pump
  • Gas Boilers
• • Hot water production at variable temp in function of the external temperature, transported by a grid to cover SHW and heat necesities form the buildings includded in the study
• • Working Ratios :
  • – 6700 h /year production primary heat exchanger: low temp production and low power neccesities
  • – 1300 h/year production primary heat exchanger+anciliary equipment : low temp production and power neccesities above geothermalwell power.
  • – 136 h/year production primary heat exchanger+anciliary equipment: Heat exchanger temperature below the demand
  • 28 h/ año producción pozo geotérmico + auxiliares: Heat exchanger temperature amd power below the demand
• •Primary heat exchanger covers one third of the total heat demand

Design Basic engeniering solution

USERS INVESTIGATION

GENERAL PLAN

	LEGEND
$\circ$	THERMAL USER AREA AND ITEM
TU 1	UNIVERSIDAD AUTONOMA MADRID (1)
TU 2	UNIVERSIDAD AUTONOMA MADRID (2)
TU 3	UNIVERSIDAD AUTONOMA MADRID (3)
TU 4	SAN FERNANDO
TU 5	HOSPITAL PSIQUIATRICO
TU 6	ACADEMIA DE POLICIA LOCAL DE MADRID
TU7	NUESTRA SENORA DEL CARMEN
TU8	CENTRO ESCOLAR
TU9	RESIDENCIA DOCTOR GONZALES BUENO

Geomadrid project key parameters

• •Resource Temp. 75ºC
• • Reservoir depth 1500-1800m
• • flow 200m3/h
• •Installed power 8MWt
• •Power production 38,000MWth/a
• •Distribution grid 4 Km
• •Substations 9
• • Investment 12-14M€
• • District heating and HSW equivalent to 5.000 dwellings
• •save 3.000 TOE/a
• •Reduction de 6.000 CO2 Tn/a
• •To be in production in 2011

Thanks for Your Attention

Deep geothermal energy potential in the Madrid Basin

R. Hidalgo1 , J Sánchez2 , P. Ungemach3

1 PETRATHERM ESPAÑA, Avenida Doctor Arce n°14, 28002 MADRID ESPAÑA. E-mail : r\_hidalgo@petratherm.es

2 TECNOLOGÍA Y RECURSOS DE LA TIERRA SA - Pza. Castilla, 3 28029 Madrid, Spain E-mail : trt@mi.madritel.es 3GPC INSTRUMENTATION & PROCESS(GPC IP), Paris-Nord 2, 14, rue de la Perdrix, Lot 109. BP 50030. 95946 ROISSY CDG CEDEX. FRANCE. E-mail : pierre.ungemach@geoproduction.fr

Key words: Madrid, geothermal, low temperature, thermal uses

Abstract

The Madrid Basin geothermal potential was discovered in 1980 thanks to an oil exploration well drilled by Shell-Campsa which showed temperatures of 88ºC and 156ºC degrees at 1700 mts and 3400 mts depth respectively. That low enthalpy geothermal reservoir was further assessed by four exploratory wells. The latest well was drilled in 1990.

These wells have identified a dependable geothermal resource, hosted in a Tertiary, clastic, consolidated sandstone reservoir consisting of a thick multilayered sequence (200- 800m) with temperatures ranging from 70º to 90ºC and depths of 1500 to 2150 m., overlying a Mesozoic sequence, suitable to be exploited for thermal uses in several district heating grids around Madrid in areas displaying adequate heat loads.

A medium-enthalpy reservoir was also identified at the contact between Mesozoic Cretaceous limestones and fractured basement granites at 3400m depth, with measured temperatures of 156ºC, that could be developed and exploited using a combined power and heat production (CPH) scheme within the Madrid suburban areas.

Introduction

The low enthalpy geothermal reservoir was assessed thanks to four exploratory wells drilled in the 1980s at the Pradillo (original's Shell oil well), San Sebastian de los Reyes, Tres Cantos and Geomadrid 1 locations. They enabled to identify a dependable geothermal resource, hosted in a Tertiary, clastic, consolidated sandstone reservoir consisting of a thick multilayered sequence (200-800m) with temperatures ranging from 70º to 90ºC, overlying a Mesozoic sequence. The reservoir is located under the city of Madrid and surrounding localities.

The Madrid northern suburban areas enjoy one of the most favourable geothermal environments identified to date in Metropolitan Spain. The four exploratory wells drilled in the area (see locations in fig. 1 map) namely:

• El Pradillo 1 (Shell, 1980) 3400 m
• Tres Cantos (IGME, 1981) 2400 m
• San Sebastian de los Reyes (ENADIMSA, 1982) 2100 m
• Geomadrid 1 (ENADIMSA, 1990) 2000 m,

alongside geophysical investigations (mainly seismic lines) and well tests, led to the local geothermal potential, portrayed in fig. 1which maps the features of the Tertiary clastic deposits set as a priority development target, given (i) its higher than normal subsurface temperatures (75 – 90 °C at ca 1800 to 2400 m depths), and (ii) its dependable reservoir properties (# 100 m net thickness, 20 to 45 dm transmissivities) eligible to 200 – 250 m3 /h well productive capacities.

Figure 1.-Madrid Basin N-S section, modified from IGME showing the position of the geothermal wells

Geology

The Madrid Basin constitutes the central sector of the Tajo Basin one of the largest Tertiary undeformed basins of the Iberian Peninsula. It shows a triangular shape bounded to the north by the Sierra de Guadarrama, to the south by the Toledo Mountains and to the east by the N-S trending Altomira range (figure 2).

It exhibits a wedge shape morphology; thicknesses are maximum to the north where sediments reach 4,000m and are bounded by the crystalline basement rocks, mainly granites and gneisses. Sediments are thrust by basement rocks to the north, delineated by the North Madrid Sierras (Central System Mountain Range). Those thrust structures are evidenced by deep parallel faults trending SSW-NNE (SANCHEZ GUZMAN 2007) (fig. 1)

Figure 2.- Madrid Basin structure modified from Calvo et al (1989)

Basin Stratigraphy

The Madrid basin is bounded by a Variscan crystalline basement (granites, shales, schists and gneises) filled with fluvial and lacustrine Mesozoic and Cenozoic deposits.

Cretaceous.- with a variable thickness between 100 to 250m, it is formed by sandstones limestones and mudstones , laid unconformable on top of the Paleozoic basement.

Paleogene.- Composed of lagoon deposits, marls and limenstones with thicknesses of about 200mts.

Upper Paleogene-Neogene.- it constitutes the major portion of the northerm part of the basin and comprises two major units (i) the lower detritic unit formed by agglomerates and sandstones moving laterally to the south to sandstones and mudstones, (ii) and the upper detritic zone located in the northernmost area , formed by agglomerates and sandstones.

These continental sediment facies are varying significantly within the basin from north to south; the northern side is mainly detritic, while the southern part is evaporite-lacustrine dominated.

Low enthalpy geothermal potential of the Tertiary detritic units.-

Pradillo oil well (SHELL-CAMPSA, 1980) identified a main hot aquifer unit consisting of a thick multilayered sequence of Tertiary detritic, consolidated, sandstones overlying the cretaceous unit (ADARO 1981).

The geothermal discovery in the Pradillo well stimulated new research programmes in the mid 1980's to evaluate this potential within different areas of the basin. As a result three new geothermal wells were drilled, Tres Cantos, San Sebastian de los Reyes and Geomadrid 1, covering an area of ca 150 km 2 and demonstrating the continuity of the reservoir down deep over the whole area.

These geothermal wells provided valuable information regarding formation temperature, reservoir structure, permeability and water quality further to logging and bottomhole testing and sampling.

Apart from drilling data, the seismic lines carried out by Shell in the 1970's, initially aimed at investigating the potential of the Cretaceous gas-oil reservoir confirmed the continuity of the hot Tertiary clastic aquifer from the northern basin boundary at least to the south of Madrid City (ENADIMSA 1983)(see fig. 3).

	Tested Intervals				Estimated
Well	(Depth)	Transmissivity	TemperatureºC	Salinity	flow
Pradillo	At 1600-1800 m	46.6 dm	70º-80º	20-30 g/l	150 m3/h
Pradillo	At 3400 m		150º
Tres Cantos	1600-2400 m	20.3 dm	70º-90º	12-90 g/l	3150 m/h
San Sebastian de los
Reyes	1600-2100 m	35.3 dm	75º-90º	12-30 g/l	3250 m/h
Geomadrid 1	1550-2000 m	44.4 dm	70º-78º	20-25 g/l	3200 m/h

The highlights of the low enthalpy reservoir are summarised hereunder

Table 1.- Madrid Geothermal well summary sheet.

Figure 3. – Tertiary clastic, low enthalpy reservoir isotherms.

Geomadrid District Heating Projects.

As a result of these promising resource Characteristics matching a significant energy demand in such densely populated areas, Petratherm España applied for geothermal mining rights on the area.

A thorough prefeasibility study was further undertaken in early 2008 in order to evaluate the geothermal resource, existing well deliverabilities and the heat demand structure within the vicinities of the existing wells.

The prefeasibility analysis led to select the Cantoblanco/Valdelatas district nearby the Geomadrid1 well (see locations in fig. 4), which exhibits a 8 to 10 MWt installed capacity, as the best candidate and to commission a detailed feasibility survey aimed at assessing whether the local resource to heat, cold and sanitary hot water demand adequacy would be met at technically feasible, economically viable and environmentally safe conditions, given the important heat & cold (H & C) / sanitary hot water (SHW) load (institutional, educational, medical and old people residence buildings) existing nearby the Geomadrid 1 well.

Simultaneously to the foregoing, a log inspection of well Geomadrid1 (UNGEMACH et AL 2008) carried out, using CIC (casing inspection calliper), CBL/VDL (cement bond variable density logs) and CCL (casing collar locator) tools, in late July 2008, concluded to well integrity. Actually, casing, cementing and slotted liner sections shaped well. . Therefore, it was assumed it could be recovered as an injector unit serving the needs of a future geothermal district heating and cooling (GDHC) doublet scheme according to the load distribution grid sketched in fig. 4.

Figure 4- Planned Cantoblanco/Valdelatas district heating grid

Conclusions

Summing up, it could be stated that the Madrid basin hosts a dependable geothermal resource capable of contributing (i) to a significant share of heat-cold and sanitary hot water market an area exhibiting fast growing urbanisation trends, and (ii) to the power demand of a city depending in more than 90% from external regional energy sources, by fostering Enhanced Geothermal Systems (EGS) at the basement-Tertiary rock interface displaying higher than 150°C source temperatures.

REFERENCES

ADARO (1981) "Estudio Geotérmico Cuenca de Madrid, Sondeo Pradillo 1" Estudio para el Plan Energético Nacional.

CALVO, J.P., ORDÓÑEZ, S., GARCÍA DEL CURA, M.A., HOYOS, M.,ALONSO-ZARZA, A.M., SANZ, E. & RODRÍGUEZ ARANDA, J. P. 1989. Sedimentología de los complejos lacustres miocenos de la Cuenca de Madrid. Acta geológica Hispánica, 243(4): 281-298.

ENADIMSA. (1983) "Evaluación de Recursos Geotérmicos en la Cuenca de Madrid " Estudio para El plan energético Nacional"

SANCHEZ GUZMÁN J. (2007) "Síntesis de datos Geotérmicos del Yacimiento Detrítico-Terciario de la Cuenca de Madrid", informe interno realizado para Petratherm España s.l. (Unpublished)

UNGEMACH, P., and ANTICS, M. (2008). Petratherm España Nord Madrid Basin Cantoblanco/ Valdelatas geothermal area assessment of Geomadrid 1&2 well status; log inspection report (Unpublished).