Galilee Energy : AGM Managing Director’s Presentation 28 November 2019

Annual General Meeting 2019

Managing Director's Presentation

ASX: GLL

28 November 2019

ASX: GLL

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Company Snapshot

Directors

Ray Shorrocks

Non-Executive

Chairman

Peter Lansom

Managing Director

Dr. David King

Non-Executive Director

Stephen Kelemen

Non-Executive Director

Gordon Grieve

Non-Executive Director

Corporate Information

Share Price	A$0.86
No of Shares	239M
Market Cap	A$205M
Cash	A$11M
Debt	No Debt
Enterprise Value	A$194M

Share Price

1.20

0.80

0.40

0.20

2019

Project Portfolio

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A year of achievements

• Drilled three wells at Glenaras safely and within budget with the pilot on production and producing strongly.
• Expanded the asset portfolio to three basins with successful tender awards in both the Surat and Bowen basins.
• Management team bolstered, high quality team now in place leveraging experience across the Galilee, Surat and Bowen basins.
• MOU signed with Clarke Energy and continued progress with Jemena on the channel to market.
• Balance Sheet strengthened through strong capital markets support - funding in place for growth and no debt.

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Key Investment Themes

Major Gas

Resource

Material Contingent Gas Resource in the Galilee and Surat basins.

Well

Capitalised

Galilee is well funded to convert Resources to Reserves and accelerate future exploration programs.

Market Demand

For Gas

Market structurally short and maturation of Contingent Resources to Reserves required to meet long term demand.

Significant	Low Cost
Upside	Development
Galilee has an	Staged
extensive	development
portfolio of gas	at Glenaras
at 100% equity	with
levels across	Kumbarilla and
three different	Springsure
gas basins in	adjacent to
Queensland.	existing gas
	infrastructure

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Glenaras Gas Project - The Asset

• Over $90 million spent to date.
• Clearly defined resource - twenty exploration wells, 700km of seismic & two multi well pilots.
• Existing assets - large $6M water storage facility (450 ML) & production gathering & flare.
• Expenditure has advanced the Project to its significant current +Contingent Resource position:

Contingent Gas Resource (PJ) +

1C2C 3C

308

2,508

5,314

• Multi-lateralpilot program converting Resources to Reserves is the remaining step for significant value creation.

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Glenaras Gas Project

• • The Asset
• Flat, open grazing country with large scale holdings of 50,000+ acres.
• Expected low field development costs:
• • Laterals have demonstrated high production rates per well.
  • Gas composition is sales spec with no processing required.
  • Low salinity water - minimal treatment cost.
• Strong stakeholder relationships:
• • Community consultation through industry
    Operator's forum.
  • Less than twelve landowners within the 2C Contingent Resource area.
• Numerous beneficial use options for the produced water given its excellent qualities.
• Has the ability to assist landowners who have been devastated by recent long term drought.

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Glenaras Gas Project - CSG Properties

		Successful CSG
		projects require three
		key parameters
1	Resource concentration
(thickness, gas content)
2	Productivity
(thickness, permeability)
		Pressure drawdown	?
3 in the coal

(well design)

Depth

900m - 1000m

Net Coal

19m

Gas Content

5.3m3/t

Permeability

45md

Resource Concentration

5.2 bcf/km2

Coal

Permeability

Barrier

Water bearing

units

R1

R2

R3

R4

R5

R6

R7

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Glenaras Gas Project

• • Enhanced Pilot
• Three lateral well program delivered safely, on time and within budget. New design has greatly improved well density and shielding.
• Now have a well designed, five lateral well pilot in excellent coal - providing strong platform to draw down large area of coal below critical desorption pressure.
• All five wells on continuous production with higher capacity pump recently installed at Glenaras 15L.
• The strong productivity of Glenaras 15L and 16L have greatly improved reservoir understanding.
• All wells are now near maximum drawdown. Water rates are back on decline and the aggregate gas rate for the pilot is rapidly recovering to pre-shut in levels.
• Produced gas now being utilised as generator fuel providing significant opex savings.

High productivity and pressure drawdown - a strong indicator for robust field economics

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Exploration

Areas

Glenaras Pilot Area

Future Exploration Potential

• Important to appreciate the scale of the permit area, over 80 km N-S and 70km E-W.

2C Contingent Resource + by area

PJ

10km

	Muttaburra 2			Mount Myth
				1
Acacia
North		Vera Park /
50+ PJ
	Mount Myth
	Acacia 1
		150 PJ
Crossmore 1	Crossmore
650 PJ
	Crossmore South 1
			Vera Park 1
	Glenaras 9
Glenaras	Glenaras 7	Glenaras 8
		Laugharne
	West
			Creek
	250 PJ	Glenaras	Rodney Creek
	Pilot
	Pilot	150 PJ
		Glenaras
			900 PJ	Laugharne Creek
			1

• The majority of the permit area has Contingent Resources coverage. 16+ Petroleum Lease applications, depicted on the left, would be required to cover the current Resource booking.
• Acreage area is similar in size to the respective Spring Gully/Fairview and Undulla nose developments.
• Currently, the only production testing in the permit has been in a 5km band.
• Primary focus for future exploration and appraisal activities are Glenaras, Crossmore and Glenaras West where greater subsurface data control exists.

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Surat Basin - Kumbarilla Gas Project

• 384km2 of high-value exploration acreage targeting both coal seam gas and conventional oil.
• Close proximity to top tier production assets.
• Existing pipeline tie-ins less than 10km.
• The nearby Ironbark CSG field - purchased by APLNG in 2019 for $231 million.
• 2D seismic reprocessing near complete and three well corehole programme accelerated to Q1 2020.

Contingent Gas Resource (PJ) +

1C 2C 3C

266 504 895

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Bowen Basin -

Springsure Gas Project

• 1,425km2 of high-quality exploration acreage - Denison Trough region:
• • Multiple coal seam gas and stacked conventional gas targets;
• Excellent location with short-rangetie-in potential to both existing gas networks and future developments including:
• • Jemena's proposed Galilee to Yellowbank pipeline;
  • Mahalo Development;
  • Northern Denison gas fields.
• Considerable resource growth potential presenting opportunities to create a new, major gas

infrastructure hub.

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Summary

Focus on high growth

east coast gas

Glenaras Pilot producing strongly and remains the key focus. Now have 100% positions across 3 Queensland basins to service east coast gas market.

Recent awards of new

acreage

Exclusively targeted high value exploration plays with multiple targets. Provides a portfolio of opportunities, spreading risk and resource maturity.

Experienced

management team

High quality people in place at Board

and Management level with

experience and track record of success

in these basins.

Channel to market

Jemena have made significant progress with all stakeholders and have lodged EIS for proposed Galilee Gas Pipeline providing a clear pathway to the east coast gas market.

Structurally short gas

market

East coast gas market continues to remain short in supply with strong demand and high gas prices.

Strong financial position

Strong support from shareholders, well funded to progress both Glenaras and new exploration projects and no debt.

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Disclaimer

This presentation may contain forward looking statements that are subject to risk factors associated with oil and gas businesses. It is believed that the expectations reflected in these statements are reasonable but they may be affected by a variety of variables and changes in underlying assumptions 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. Investors should undertake their own analysis and obtain independent advice before investing in GLL shares. All references to dollars, cents or $ in this presentation are to Australian currency, unless otherwise stated.

+Competent Persons Statement & Listing Rule 5 Additional Reporting on Oil & Gas Activities

The estimates of contingent resources for both ATP 2043 and ATP 2019 as they appear in this presentation, are based on, and fairly represents, information and supporting documentation determined by Mr Timothy L. Hower of MHA Petroleum Consultants LLC Inc Denver, Colorado, USA, an independent petroleum reserve and resource evaluation company, 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 5.41. His career spans over 30 years petroleum engineering evaluations experience including field development planning, unconventional reservoir assessment and reserves, reservoir simulation, enhanced recovery, and industry training courses. His qualifications and experience meet the requirements to act as a Competent Person to report petroleum reserves in accordance with the Society of Petroleum Engineers ("SPE") 2018 Petroleum Resource Management System ("PRMS") Guidelines as well as the 2011 Guidelines for Application of the PRMS approved by the SPE. Mr Hower has consented to the publication of the contingent resource estimates for Galilee Energy's 100% interest in ATP 2043 and ATP 2019 in the form and context in which they appear in this presentation . The contingent gas resource estimates for ATP 2019 provided in this presentation were originally released to the market in the Company's announcement of 1 September 2015, and were estimated using the Deterministic Method with the estimate of contingent resources for ATP2019 not having been adjusted for commercial risk. The contingent gas resource estimates for ATP 2043 provided in this presentation were originally released to the market in the Company's announcement of 1 August 2019 and were estimated using the Deterministic Method with the estimate of contingent resources for ATP2043 not having been adjusted for commercial risk. Galilee Energy confirms that it is not aware of any new information or data that materially affects the information included in the announcements of 1 September 2015 and 1 August 2019 and that all of the material assumptions and technical parameters underpinning the estimates in that announcement continue to apply and have not materially changed.

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REGISTERED OFFICE

Level 6,

167 Eagle Street,

Brisbane QLD 4000

GPO Box 1944

Brisbane QLD 4006

Phone: [phone]

Email: [e-mail]

galilee-energy.com.au

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