PTR MINERALS LTD — Investor Presentation 2009

Oct 13, 2009

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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), José Sánchez Guzmán (TRT) and Celestino García de la Noceda (IGME – the Spanish Geological and Mineral Institute who operates as the Main Earth Sciences Research Centre of Spain) to the recent Geothermal Resources Council 2009 Conference held in Reno, Nevada.

The presentation focuses on hot sedimentary aquifer, volcanic and EGS geothermal resources in Spain.

Refer attached presentation and associated abstract.

14 October 2009

Yours faithfully

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ASX Code: PTR

Terry Kallis Managing Director

ABN 17 106 806 884

MEDIA CONTACTS:

Level 1, 129 Greenhill Road Unley SA 5061

Terry Kallis Petratherm Ltd 08 8274 5000 Kieran Hall / Tim Hughes Hughes Public Relations 08 8412 4100

T: +61 8 8274 5000 F: +61 8 8272 8141 W: www.petratherm.com.au/ E: admin@petratherm.com.au

Geothermal resources in Spain (basin, volcanics and EGS)

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Raúl Hidalgo, Victor Guerrero, Petratherm Jose Sánchez Guzmán,TRT Celestino García de la Noceda, IGME GRC Reno October 2009

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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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Private initiative

The interest of the industry for the Spanish geothermal potential is reactivating a dormant activity during the last 15 years.

Within the last two years, companies are applying for at least 50 geothermal exploration and Investigation licenses, covering an area of approximately 7,500 km².

More than 10 M€ in early exploration programs to be expended accordingly by the companies within the next 3 years

Companies starting to develop data compillation, investigation activities and feasibility studies

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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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Geothermal knoledge Spain Knowledge of the geothermal Spanish potential is quite incomplete

Existing geothermal information is basically coming from the work undertaken by IGME from 70’s to 90’s; surface manifestations inventory, geochemistry, geophysics and drilling. Some information from the Oil exploration is also available

It is necessary to promote the development of public databases, grass roots investigation to be conducted by IGME and other searching institutions, with the input of the industry.

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Europe extrapolated temperatures

at 5 km depth, European Atlas

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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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Geology Map of Spain

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Source Gessal 2004

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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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Geochemical inventory IGME

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SiO 2 anomaly map for Tenerife (IGME 1983)

Spainsh inventory with more than 1000 samples (IGME 1976)

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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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Oil exploration and seimic data Spanish Hidrocarbon Database (ATDH)

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Detail of Guadalquivir Basin Hidrocarbons database ATHC)

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Oil well locations

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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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GeothermalWells

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The information generated mainly by IGME (geological survey) 1970’s1980’s was used to target up to 18 Geothermal wells developed during 1980’s to 1990’s

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	Source www.igme.es Depth m TempºC Betica-14 3300 123 Pradillo 3400 150 Samalus-6 1000 90 Serrablo-7 4271 192

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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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Geothermal potential Spain

POWER GENERATION:

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Conventional Geothermal

EGS HSA

Direct uses

Conventional Geotermal Volcanic Systems	Conventional Geotermal Volcanic Systems	Canary Islands:Tenerife, La Palma, Gran Canaria,Lanzarote
Hot Sedimentary Aquifers	Main Cenozoic Basins	Tajo Basin: Madrid D B i L ó B d uero as n: e n, urgos an Valladolid Guadalquivir Basin:Lebrija, Seville
	Small-Medium Basins	Catalonian Ranges:Vallés, Penedés, La Selva y Ampurdán Betic Range Internal Basins:Granada, Guadix, Baza, Pirinees Internal Basins: Jaca - Sabiñánigo
Enhanced Geothermal Systems		Associated to the crystalline granitic basement of the above described basins Hercinian thermal active granites associated to deep fault convective systems

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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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Some areas of study

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Volcanics
Big Basins
Medium basins
Fractured granites
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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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Conventional geothermalTENERIFE (Canary Is.)

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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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Conventional geothermalTENERIFE (Canary Is.)

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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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MADRID basin

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SC Granites
4-6 Wm [-3 ] Insulator
µ
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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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PIRINEES (North-East of Spain / France Border)

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SERRABLO AREA

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a profundidad medidos corregidos
Serrablo-1 2256m 70-73ºC 96ºC
3900m 106-130ºC 150ºC
Serrablo-4 3642m 132-136ºC >180ºC
4005m 117-122ºC 172ºC
Serrablo-7 3329m 105-144ºC 157ºC
4271m 134-145ºC 192ºC
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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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MEDITERRANEAN ARC

It is located in a favorable tecton c sett ng i i

It is an area with a significant heat flow anomaly T o a d t e th e e f d era governmen l t (IDAE) together with the geological surveys of Spain and Catalonia to investigate the geothermal potential of the area

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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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BARCELONA (Catalonia)

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85-95 º C
180-200 º C
A’ A
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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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Histórical information Valles basin

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Hot springs and spas are a very common feature within the Valles Valley

A pilot well drilled at 900 m depth to the north of Valles Basin showed temperatures of 100ºC and flows of 90 l/s, - t empera t ures o f 180 200ºC ex t rapo a l t e d t o 5000 m Geothermometer calcullations shown equilibrium temperatures of at least 130ºC of the water asociasted to the sediments

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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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GALICIA (North-West corner of Spain)

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N S econ d ary au F lt 65 º C
42º C
480
45º C
70 º C
Q
Q 5 Km.
45º C
470 -
68 70º C
1.5 a
q
53º C 2 Km. q
50º C
Tª 80-110 º C
75º C
Tª 180-200 º C
Long Deep Main Fault
460
Q: High Rate
q: Low Rate
0 100 200
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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)

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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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Future geothermal energy role New RES Directive . - sets the framework to achieve the target of a 20% share of renewable energy sources in the final energy consumption by 2020. This target will require the input of the geothermal energy

Spanish RES Law .-The RES Directive is being transposed to a new Spanish Renewable law which could be effective in 2010? The Renewable Action Plans (RAPs) that each Member State will have to submit in June 2010, will have to present the actions needed to foster the contribution of Geothermal Energy to the targets set in the directive proposal

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GRC Reno 2009 Geothermal resources in Spain (basin, volcanics and EGS)
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“THANKS FOR YOUR ATTENTION”

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Geothermal resources in Spain (basin, volcanics and EGS)

Raúl Hidalgo[ (1)] , Jose Sánchez Guzmán[(2) ] , Victor Guerrero[(1) ] , Celestino García de la Noceda[(3)]

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

2TECNOLOGÍA Y RECURSOS DE LA TIERRA SA - Pza. Castilla, 3 28029 Madrid, Spain E-mail : jsanchez@tecnotrt.es

• 3INSTITUTO TECNOLÓGICO Y MINERO DE ESPAÑA (IGME) - C/ Rios Rosas, 23 28003 Madrid, Spain E-mail: c.garcia@igme.es

Key words: Geothermal, Spain, EGS, basin, volcanics,

Abstract

This paper will evaluate the current state of the art for the definition ofgeothermal resources in different geothermal environments and applications in Spain, showing the current findings and the forthcoming challenges.

Spanish geothermal potential began to be investigated in the 1970’s by the Geological Survey of Spain (IGME) within the framework of the PEN (National Energy Plan) that tried to define alternative and local solutions to the 1970’s world energy crisis that was specially affecting to the Spanish economy due to the energy dependency from external sources.

As a result of the preliminary studies undertaken by IGME including basic geology, geochemistry, geophysics and in some cases geothermal wells, several areas with relevant geothermal anomalies in both, island and mainland environment were defined.

1. Introduction

Geothermal energy is reviving after several decades of low development in Spain. Since the late 1980´s to mid 2000’s there was no geothermal investigation and development. However interest from this sector has just recently restarted. Exploration Companies, Technological Institutes, Universities, regional and federal governments are becoming active in the last year and are starting to coordinate joint initiatives to promote the development of the geothermal energy in Spain. The main efforts are being driven at the moment to obtain a detailed definition of the geothermal resources, the validation of the technical and economic parameters that will make the geothermal resources viable, and the development of an appropriate legal and administrative framework for the development of the industry.

At least 50% of the country has very little deep geothermal information or remains almost unexplored (see Figure 1). New regional exploration programmes coordinated by the government, and with the input of the industry, are needed in order to increase the geothermal potential of the country and to provide new data to the companies to stimulate new detailed geothermal investigation.

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Figure 1.- Modified fron Geothermal Atlas of Europe (FERNANDEZ et Al 2002)

In the last two years several private company initiatives have begun to apply for exploration and investigation licenses covering areas with higher volumes of data. In these areas historical data has allowed the companies to do a quick data validation process from which detailed investigation programmes have been developed.

Some of the key areas which companies are working in include the Canary Islands, with potential to develop a conventional geothermal system, mainland Cenozoic undeformed basins and deep fault systems suitable to host convective and enhanced geothermal systems. (Figure 2)

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Figure 2. Location of the different potential geothermal areas in Spain

2. Canary Islands.

The Canary Islands constitute the only active volcanic area in Spain and include geothermal surface manifestations like Teide volcano fumaroles on the island of Tenerife, where the gas analyses at the summit are consistent with steam derived from a mature liquid dominated geothermal reservoir with temperatures in the range of 250 to 300ºC (HERNANDEZ ET AL 2000) (Figure 3). The Geological Survey of Spain (IGME) undertook an important campaign of exploration in collaboration with other institutions from late 1970’s to mid 1990’s. Their work was mainly focus in the ground water temperature and geochemistry but also some magnetotelluric (MT) campaigns were undertaken between 1977 and 1990 on Tenerife Island (IGME 1987, ITGE 1993).

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Figure 3.- CH4/CO2-H2/Ar Geothermometer calculated from Teide summit fumarole (Hernandez et al 2000)

During 2007-2008 Petratherm España s.l. was developing in conjunction with the Technological Institute of Renewable Energies (ITER) a full compilation of all existing geochemical, geological and geophysical data from Tenerife and Gran Canaria Islands. The main conclusion of this compilation study is the confirmation of a presence of a deep liquid reservoir supported by 18 2 3 13 34 18 isotope data like O, H, He, C, S, O exchange SO4 – H2O and a large, widespread CO2 flux.

Although the existence of hydrothermal systems in the Canary Islands, especially in Tenerife, is confirmed, the meteoric foot print of the ground water and the existing MT data suggests that these systems lie deep within the volcanic massif and seem to be largely hydrologically isolated from the surface by the thick pile of volcanic rock and cold groundwater.

As a conclusion, the Canary Islands hydrothermal systems will only be mapped using very deep penetrating geophysical methods like MT and that will form part of the next stage exploration strategy to be develop in the islands in order to define the drilling targets.

3. Mainland Tertiary Basins

Almost 50% of Spain is covered by undeformed Cenozoic basins associated in many cases with rich U, Th and K granitic rocks (ITGE 1991). The combination of low thermal conductive thick sediment cover with thermally active granite provides a good geological setting to produce sedimentary geothermal and enhanced geothermal systems.

The Iberian Peninsula hosts several important Tertiary basins, Guadalquivir, Tajo, Duero, Ebro with associated geothermal manifestations along the basin boundaries. In the Madrid and Pyrenees Basins, temperatures above 150 degrees have being measured from historical oil wells at depths from 3500 to 4000 m. Additionally most basins have associated hot aquifers that could be exploited for direct thermal uses in industrial processes and district heating grids, this such recorded in the Burgos (Duero Basin) and Madrid (Tajo Basin) areas respectively (ITGE 1990).

Detail basin structural reconstruction is being conducted in several zones utilising the drilling information together with the seismic profiles, gravity and MT data. This existing data is being used to build 3D geological models that allow defining of deep geothermal drilling targets.

4. Enhanced Geothermal Systems

EGS systems in Spain are associated with Thermally Active Granites. Several heat anomalies and surface manifestations like hot springs with temperatures higher than 75-80 ºC occur in conjunction with structural features like major faults in areas like Galicia and Catalonia (FERNANDEZ ET AL 1990). Deeper portions of these convective systems, below 3000 m may be suitable for the development of mid enthalpy (above 150ºC) enhanced geothermal systems. In low permeability areas stimulation of the pre-existing fracture systems within the granites may be required to develop a fluid circulation cell.

New regional exploration and investigation within these areas will be focussed on a better definition and correlation studies about heat flow and thermal conductivity associated to different granitic units, in order to discriminate thermal active from barren granites.

5. Conclusions

Spain presents several favourable environments with potential to hold volcanic convective hydrothermal, conductive sedimentary and enhanced geothermal systems suitable to generate electricity. There are also a lot of low temperature resources close to noticeable heat demand areas like Madrid and Barcelona cities, which makes them very favourable for the direct heat uses and the development of Geothermal district heating grids.

The progress of the geothermal energy in Spain will require further exploration drilling and the development of new investigation and exploration techniques to discover the geothermal potential in areas with very low volume of information. This will require a combined effort of both federal and regional governments and private companies.

Conventional Geotermal Volcanic Systems	Conventional Geotermal Volcanic Systems	Canary Islands
Hidrothermal Sdit	Main Cenozoic Basins	Tajo Basin: Madrid Duero Basin: León, Burgos and Valladolid Guadalquivir Basin
emenary Systems	Small-Medium Basins	Catalonian Ranges: Vallés, Penedés, La Selva y Ampurdán Betic Range Internal Basins: Granada, Guadix, Baza, Pirinees Internal Basins:Jaca-Sabiñánigo
Enhanced Geothermal Systems		Associated to the crystalline granitic basement of the above described basins Hercinian thermal active granites associated to deep fault convective systems: Galicia.

Table 1.- Classification of types of geothermal energy in Spain. Modified from GARCIA DE LA NOCEDA ET AL 2005.

References.-

Fernandez, M., and Banda, E.: Geotermal anomalies in the Valles-Penedes graben master fault: Convection through the horst as a possible mechanism, J. Geophys. Res., 95 , (1990), 4887-4894.

Fernandez, M., Garcia de la Noceda, C., Marzán, I., and Sanchez-Guzman, J.: Spain, Atlas of Geothermal Resources in Europe. (Eds: Haenel, R., and Hunter, S.), European Commission, Research Directorate-General , (2002), 56-57.

García de la Noceda, C., and Sanchez-Guzman, J. Geothermal Energy Development in Spain - Country Update Report, Proceedings World Geothermal Congress 2005,Antalya, Turkey, 24-29 April 2005.

Hernández, P.A., Pérez N.M., Salazar J., Sato, M., Notsu, K. & Wakita, H., 2000. Soil gas CO2, CH4, and H2 distribution in and around Las Cañadas caldera, Tenerife, Canary Islands, Spain. Journal of Volcanology and Geothermal Research , Vol. 103(1-4), pp. 425-438.

IGME, 1987. Investigación geotérmica en las islas Canarias y evaluación de recursos y reservas geotérmicas en España - Prospección geofísica, métodos magnetotelúrico y SOFREM

ITGE, 1993. Investigación geotérmica en el área central de la isla de Tenerife - informe final.

ITGE: Trabajos de medición e inventario de datos de flujo de calor en áreas seleccionadas del Macizo Ibérico Español. Instituto Tecnológico Geominero de España . Madrid (1990), 53 pp.

ITGE: Análisis de la utilización de recursos geotérmicos en España. Situación actual. Instituto Tecnológico Geominero de España . Madrid (1991), 111 pp.