Alterra Presentation August 2012

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Transcript of Alterra Presentation August 2012

  • 1. Page | 1 2012AUGUSTCOMPANY TSX : AXY

2. Forward-Looking Information This Presentation contains certain forward-looking information within the meaning of Canadian securities laws, which may include, but is not limited to, statements with respect to future events or future performance, managements expectations regarding Alterras production capacity, results of operations, cash flows, revenues and requirements for capital, future demand for and prices of electricity, and Alterras business prospects and opportunities. These statements reflect the current views of Alterra with respect to future events and are necessarily based upon a number of assumptions and estimates that, while considered reasonable by Alterra, are inherently subject to significant business, economic, political and social uncertainties and contingencies. Many factors, both known and unknown, could cause Alterras actual results, performance or achievements to be materially different from the results, performance or achievements that are or may be expressed or implied by such forward-looking statements contained in this presentation, and Alterra has made assumptions based on or related to many of these factors. Such factors include, without limitation: fluctuations in currency markets (particularly with respect to the Icelandic krona, the U.S. dollar and Canadian dollar); risks related to the technological and operational nature of Alterras business; changes in national or regional governments, legislation, regulation, permitting or taxation; political or economic developments in Canada, the United States, Iceland or other countries where Alterra may carry on business; risks and hazards associated with the business of renewable energy generation; risks relating to the creditworthiness and financial condition of suppliers and other parties which Alterra will deal with; inadequate insurance or inability to obtain insurance to cover these risks and hazards; employee relations; relationships with and claims by local communities and First Nations; availability and costs of equipment and labour; litigation; the success and timely completion of planned expansion and development programs; the growth rate in net electricity consumption; support and demand for renewable energy; government initiatives to support the development of renewable energy generation; the reliability of technical data and capital expenditure estimates; and availability of capital to fund development and expansion programs. Forward-looking information and statements are also based upon the assumption that none of the identified risk factors that could cause actual results to differ materially from the forward- looking information and statements will occur. Although Alterra has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated, described or intended. There can be no assurance that the forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, prospective investors should not place undue reliance on forward-looking information. Other than as required by applicable securities laws, Alterra does not assume any obligation to update or revise such forward-looking information to reflect new events or circumstances.Page | 2 TSX : AXY 3. Alterra PowerAlterras mission: to be a leading global renewable energy company through Continued excellence in production and safety as premier asset operator /manager Successful origination and development of new utility-scale projects Opportunistic acquisitions of other renewable power projects and developmentassetsOur assets today:ManagedOwnedAlterra totals:Managed:567 MW Wind 144 MW51% Owned:298 MWManaged Assets: $1.5 BillionHydro 235 MW40%Alterra Revenue: $110 MMAlterra EBITDA: $ 55 MM(a)Geothermal187 MW69%2015E EBITDA: $105MM(a) Reflects 66.6% of HS Orka and 100% of Soda Lake assets.Page | 3 TSX : AXY 4. Alterra: Recent Growth and Performance Decrease reflectsAlterras recent growth ... partial sell-down of 2H 2011 Performance:(net interest) HS Orka interest (net interest)CAPACITY (end of year)PRODUCTION350 1,8001,600 $54.9 million revenue3001,4002502001,200 $23.3 million EBITDAGWhMW1,000150 800100 600 778 GWh electricity produced400 50 2000 - 102% of forecast02009 201020112012e 2009201020112012e 1Q 2012 Highlights: (net interest)REVENUE EBITDA $120 $60 $100 $50Millions USD$40 Production to 99% of forecast Millions USD $80$30 $60 $40$20$10 Increase in cash from $20$- $32.0 million to $50.9 million $- $(10)20092010 2011 2012e 20092010 20112012ePage | 4 www.alterrapower.caTSX : AXY 5. Alterra: Planned Internal Growth Current plan would almost double EBITDA by 2015Current AssetsOperating by 2015GrowthManaged567 MW 927 MW +64%Net Owned298 MW 494 MW +66%Net 1,380 GWh2,200 GWh+59%ProductionAXY Revenue $110 MM$180 MM +63%AXY EBITDA $55 MM$105 MM +91%Projects Dokie 1 144 MW Dokie 1 144 MW Toba Montrose 235 MW Toba Montrose 235 MW Reykjanes 1+2 100 MW Reykjanes 1+2 100 MW Svartsengi 72 MW Svartsengi 72 MW Soda Lake15 MW Soda Lake15 MWDokie 2 156 MWUpper Toba124 MWReykjanes 3+480 MWABW Solar50 MW 20%+ implied annual growth rate Mariposa, Eldvrp and other projects online post-2015Page | 5 www.alterrapower.caTSX : AXY 6. Assets and Pipeline Globally diversified across technology types and renewable power marketsWind and hydro: primarily concentrated in North AmericaGeothermal: located in overlap of resource and strong markets / power demand Power Plant Capacity Technology Operating (2012)Gross AXY Share Reykjanes 1 + 2 100 MW67 MW Geothermal Svartsengi 72 MW48 MW Geothermal Soda Lake16 MW16 MW Geothermal East Toba & 235 MW94 MW Hydro Montrose Dokie 1 144 MW73 MW Wind Total Capacity567 MW298 MW Annual Net Generation 1,425 GWh Planned (2016) ABW Solar50 MW5 MWSolar Upper Toba124 MW 62 MWHydro Reykjanes 3 + 480 MW 54 MWGeothermal Dokie 2 156 MW 80 MWWind Mariposa 50 MW 25 MWGeothermal Eldvrp50 MW 34 MWGeothermal McCoy15 MW 15 MWGeothermal BC, Chile, Peru, Italy200 MW 200 MW Geothermal Planned Total725 MW475 MW Total Capacity 1,292 MW773 MW (a) Project design currently being optimized; final capacity amount may vary.Page | 6 TSX : AXY 7. BC Opportunity British Columbias demand for power is expected to grow significantly in the next 3-5 years LNG plants in Kitimat Mining growth General population growth Clean renewable power sourced from IPPs is expected to be a critical source of new supply Alterra is uniquely positioned to benefit from this new demand Built and operate largest wind farm and run-of-river plants in British Columbia History of delivering on-time and on-budget Established reputation with First Nations Large portfolio of expansion and development projects Currently growing this portfolio Largest IPP in the provincePage | TSX : AXY 8. Outstanding Developer Track Record Successful developer track record across renewable technologies Proven ability to develop and deliver large assets at greenfield locations Development teams from all these projects remain substantially intact Recent project successesWindDokie144 MW2011 CODHydro Toba Montrose235 MW2010 CODGeothermalReykjanes100 MW2006 COD Near term organic growth - all near existing operationsWind Dokie 2 up to 156 MW COD 2014EHydroUpper Tobaup to 124 MW COD 2015EGeothermal Reykjanes 3/480 MW COD 2013-14EPage | 8www.alterrapower.caTSX : AXY 9. Geothermal Development: The Right ApproachEarly mover: moving into promising power markets with strong geothermal potentialStrong development skills: resource assessment, community relations and project de-riskingUtilize value-add partners: sharing capital outlays and further de-risking projects CHILE PERU ITALY Negotiating definitive agreement Negotiating agreement with Early-stage discussionswith prospective partner prospective partner 48,000+ ha of concessions in 320 MW resource and 158,000+ 157,000+ ha of concessions,established geothermal fieldha of concessions1000+ MW potential Strong clean power tariffs Mid-stage development project Rapid growth in economy and in Easy year-round site access, power demand Emerging clean power market close to transmission,with world-class potential Established relationships with established contractor base government and communities Page | 9 TSX : AXY 10. Leading Growth ProfileAlterra has one of Canadas largest clean energy development pipelines2,500 6002,000 500 203153 1,500Net MW 400GWh 153 156 3001,000 7373 15694500 200 9494243185 165131131 1000 2012e 2013e2014e2015e2016e GEOTHERMAL HYDRO WIND SOLARExisting GenerationCapacity Additions Soda Lake MariposaHS Orka Reykjanes 3Reykjanes 4 Eldvrp Toba Montrose Upper TobaDokie 1 Dokie 2 ABW SolarPage | 10 TSX : AXY 11. Recent News Recent positive events: $37.5 MM infusion into HS Orka business perexercise of partner option, increasing partnerstake to 33.4% Cash earmarked for Reykjanes expansion Toba Montrose back online after planned1Q 2012 penstock warranty repairs Generation at 132% of plan for stub period in April $2.1 MM US treasury grant received at Soda Lake Dokie 1 bump in PPAs firm energy; 1.2% increase to annual revenue anticipated All projects for ABW solar farm received their permitsPage | 11 www.alterrapower.caTSX : AXY 12. Alterra: Headwinds / TailwindsHeadwindsTailwinds Growth of natural gas reserves BC growth: move the gas Disappearance / uncertaintycleanlyaround programs that benefit High supply of capital forrenewable powerenergy projects Gas acceptance by some as a Attractiveness of Canadacleaner thermal source of Technology prices driven downenergy Tough times create Current investment cycle opportunitiesattri