#1Geothermal Power for Tasmania Flexible, Reliable, Renewable. Photo: region of proposed test hole, Tasmanian Midlands Investor Presentation October 2020 SPA*ARK Energy Commercial-in-Confidence#2INTRODUCTION The earth's environment is the defining issue of our time and most of the world is working to reduce the emission of greenhouse gases, primarily CO2. Globally, the electricity and heating sectors account for a quarter of all emissions. And the world is looking for new and better ways to produce abundant, affordable and reliable, emission-free energy. Tasmania is aiming to assist Australia's transition to renewables by exporting at least 10,000GWh of electricity per year to the mainland by 2040, to become the renewable energy Battery of the Nation. This will require doubling of the State's current generation capacity*. Some of this will come from pumped hydro and some from wind, but much more reliable power will be needed to meet this commitment. Thus providing an excellent opportunity for Tasmania's large geothermal resources. Geothermal energy, the natural heat of the earth, has been used for electricity generation for more than a century. It is now gaining increased attention as the world seeks reliable, renewable energy. However, Australia has been a notable exception to the global expansion of geothermal power. The country focussed on geothermal for nearly a decade starting around 2003. Large sums of money were spent but no power plants resulted and geothermal was effectively removed from Australia's list of renewable energy options. The main reason geothermal 'didn't work' in Australia was that the wrong target was being pursued. Or, more correctly, Australia's geothermal efforts were ahead of their time. This is explained in more detail later but in brief, globally, nearly all current geothermal plays are 'wet'; i.e., water and/ or steam from a hot reservoir is brought to the surface to drive the turbines. However, Australia mostly focused on unconventional 'dry' plays which required heat exchangers to be engineered at depth. Whilst technical successes were achieved, no viable flow rates were obtained. The Lemont geothermal play in Tasmania was different from inception, with an equal focus on heat and permeability. A very large inferred resource was defined but for several of the reasons ascribed to geothermal's lack of success in Australia" there were insufficient funds to drill and the licence was subsequently relinquished. The founders and backers of Spa*ark Energy Pty Ltd believe that Lemont is too good to ignore: an opinion supported by recent independent modelling. When developed, Lemont will provide an additional source of renewable and dispatchable power to Tasmania and the National Energy Market, plus heat for a variety of flow-on industries. All monetary values are in AUD unless otherwise stated. # https://www.state growth.tas.gov.au/__data/assets/pdf_file/0011/241112/TREAP.PDF http://www.ga.gov.au/ausgeonews/ausgeonews 201306/geothermal.jsp Geothermal power plant, California Spa*ark Energy_2#3GLOSSARY/DEFINTIONS Words and phrases defined here are coloured in Capacity Factor: the ratio of actual output to nameplate output. Geothermal has the highest factor of any form of electricity generator. Dispatchable Power is flexible and predictable and can be rapidly ramped up or down to meet demand: e.g., hydroelectric, gas, geothermal. In contrast to base-load only (e.g., coal) and variables such as wind and solar. Firming Capacity: a power source such as gas, geothermal or battery. used to smooth out (or firm) varying supply from (e.g.) wind and solar. Frequency Control and Auxiliary Services (FCAS): a group of services used to maintain grid stability. Increasingly required with increasing VRGs. (Mass) Flow Rate is the amount of water and/or steam delivered to a power plant. Usually expressed in kg/sec (or litres/sec) per well. Hydrothermal Geothermal System (HGS): High temperature with plentiful water; heat source is usually of (shallow) volcanic origin: see figure. Heat Flow: the amount of heat (in milli-Watts per m²) leaving the earth's near-surface. Used to locate high temperatures at depth. Average continental heat flow is ~65mW/m² (Lemont recorded 118mW/m²). LCOE: Levellised cost of electricity is the break-even price (usually per kWh) over the life of the project. Used to compare different types of generators. Steam Plant reservoir HGS Existing 'WET' Boiling HEAT Spa*ark Energy_3 Binary Plant Depth (km) Thermal Blanket PGS 2- Man-made "enhanced" 'DRY' 3 reservoir 5- 250G HEAT Geothermal systems can be broadly classified into two types: Hydro- thermal (HGS) and Petrothermal (PGS). The former are (usually) very hot and shallow with plentiful water to transfer energy to the surface. The latter are deeper with lower temperature and permeability. Previous Australian projects were PGS. Lemont is interpreted to be closer to (non-volcanic) HGS with moderate to high temperature and permeability. The USA's Energy Information Agency (EIA) assigns geothermal the lowest of all LCOES, largely due to its very high capacity factor. LGCS (large scale generation certificates): cash incentive for renewable energy. Due to be phased out in 2030. MT (magnetotellurics): a geophysical method which maps the earth's electrical resistivity to depths of several km. A high permeability (non-uniquely) produces a low resistivity. Permeability is the ease with which water can flow through rock. Porosity is the amount of space occupied by the water. Petrothermal Geothermal System (PGS): (usually) moderately hot rocks with low permeability; heat source is usually deep and granitic. The system has to be stimulated to obtain a viable water flow. Includes Enhanced Geothermal Systems (EGS). See figure. (Electrical) Power, (= volts x current); usually expressed in Mega-Watts (MW). (Electrical) Energy = power x time; usually expressed in Mega-Watt- hrs (MWh). The average volume-weighted Tasmanian spot price for the 2018-19 financial year was $88 per MWh (= 8.8c per kWh). Temperature: a measure of energy in the form of heat. The earth's near-surface temperature gradient averages ~25-30°C/km VRGS: variable renewable energy generators (sometimes referred to as VRES); mostly wind and pv_solar in Australia.#4OPPORTUNITIES / BENEFITS Spa*ark Energy_4 5350000 Spa*ark Energy has the sole rights to ELA15/2016 which covers the most prospective part of the large Lemont Inferred Geothermal Resource. As shown in the supplementary DATA slides, Lemont appears to be exceptionally prospective and has the potential to:- • • • • • * Provide an alternative source of reliable, renewable, clean and flexible power for Australia * Improve Tasmania's energy security against drought and interconnector outages Materially assist Tasmania's stated aim to become Australia's renewable energy Battery of the Nation by increasing capacity and broadening its base of renewable energies# Support the transition to renewables by providing fast response, dispatchable base-load power to balance intermittent wind and solar generation Provide a low levellised cost of energy for many decades Promote regional development in Tasmania by providing stable, affordable power and heat for new satellite industries. The Australian Energy Market Operator (AEMO) has estimated that Australia will need at least another 30GW of variable renewable energy and up to 20GW of dispatchable energy within the next two decades. https://www.aemo.com.au/-/media/Files/Electricity/NEM/Planning_and_Forecasting/ISP/2019/Draft-2020-Integrated-System-Plan.pdf # In the five years to 2016, Tasmania was a net exporter of electricity for two years, a net importer for two years and balanced for one year. Hydro Tasmania currently has limited potential to increase its output with new dams and is investigating the potential for 'pumped hydro'. LAKE 530000 530000 540000 $550000 $560000 540000 550000 Map Area MOUNT BURY T CONERATION MEA FOREST ROYALT RIDGE 10km BUCKLAND MILITARY Inferred resource 560000 ELA15/2016 covers the most prospective part of the Lemont Inferred Geothermal Resource in Eastern Tasmania. ELA SEA#5THE RESOURCE Granite Spa*ark Energy_5 Lemont's exceptionality largely lies in its geological attributes. They include:- • • • Extensive 'hot' granites give rise to high surface heat flows (upper right image). A thick cover of insulating rocks leads to high temperatures at depth: 200°C inferred at 5km. Intersecting deep-rooted faults within the resource are zones of high permeability. Their presence is supported by extensive areas of low resistivity (main figure) defined by geophysical (MT) surveys. Thus Lemont is expected to meet the two essential criteria of having useful values for both temperature and flow rate. Independent modelling by Hot Dry Rock Pty Ltd (upper left image) indicates a resource* with sufficient energy to run a power plant of several hundreds of Megawatts for at least 30 years. * The resource outline is the inferred 150°C isotherm at 4km depth projected to the surface. The resource volume of >1000km³, was defined using an arbitrary cut off at 5km depth but it goes much deeper. Note that the separate zones of <1 ohm.m resistivity are enclosed by one envelope of ~5 ohm.m. This envelope is largely within the granite, suggesting there have been one or more significant hydrothermal events in this region. Unit A PreCambrian Mathinna Lower Parmeener Upper Parmeener -Dolerite 530000 540000 650000 560000 3750 7500 11250 15000 18750 0.1 1.0 10 100 Resistivity (Q.m) 570000 1000 10000 110 -9000 -8000 -3000 Granite Roof Elevation (m a.s.l.) Main Figure: Oblique view looking SE, showing a sliced resistivity block model superimposed on the interpreted granite surface. Also shown are the major structures and zones of low resistivity (<1 ohm.m: in grey within the granite and pink above it). The thin black line is the coast and the blue pin is a possible location for a test well into one of the low resistivity zones within the resource outline (thick black line). Upper Left: A 3D resource model invokes an unknown heat source (in green) to match the observed heat flows (by Hot Dry Rock Pty Ltd). Upper Right: Some of Australia's highest heat flows (max 118m W/m²) were recorded over Lemont.#6THE LOCATION The resource is well served by the existing Distribution Network (below), being effectively 'under the wires'. It is anticipated that ~3MW could be added to the lines in their current condition (TasNetworks, pers comm.)*. . The land is mostly pasture or forest and easily accessed by road and rail. Tasmania's ambient temperature of ~11°C would increase plant output by ~12% compared to Central Australia. * A plant of up to 10MW can be connected to the Distribution Grid when the lines and other associated equipment are all in excellent condition and there are no other generators feeding into that part of the Grid. Lemont resource outline superimposed on Tasmania's low-voltage Distribution Network Legend CONNECTION POINTS (45) ZONE SUBSTATION (17) Major Urban Areas 6.6 kV Distribution Route 11 kV Distribution Route SWER Distribution Route 22 kV Distribution Route 33 kV Sub Transmission Route 44 kV Sub Transmission Route 6.6 kV CORNER ARTHURS LAKE WADDAMANA AVOCA TRIABUNNA EADOWBANK GRETNA BRIDGEWATER RICHMOND NEW NORFOLK ZONE NEW NORFOLK ⚫ SORELL CAMBRIDGE SUMMERLEAS KINGSTON KNIGHTS ROAD HUON RIVER ELECTRONA ST MARYS Spa*ark Energy_6 'Marinus Link' proposed 1500MW interconnector from NW Tasmania and Bay PORT LATTA SMITHTON Basslink 500MW interconnector Basslink ☑ HAMPSHIRE EMU BAY BURNIE ULVERSTONE SCOTTSDALE DERBY WESLEY VALE DEVONPORT Palcona RAILTON Devils Gate SHEFFIELD 4 SAVAGE RIVER WARATAH TEE Cethana Wilmot QUE Lemonthyme Fisher Mackintosh Reece FARRELL Rowallan 7 Bastyan Tribute ROSEBERY NEWTON Lake Margaret QUEENSTOWN DERWENT BRIDGE John Butters Legend Power Station (32) Private Substation (4) SUBSTATION (49) SWITCHING STATION (6) 110 kV Transmission Route 220 kV Transmission Route GORDON Gordon 400 kV DC Transmission Route "A" class roads d PALMERSTON Poatina Tods Commer ARTHURS LAKE Bullere Gorge WADDAMANA BUTLERS GORGE TEE Tungatinah Lake Echo TUNGATINAH Tarraloan Lapootah LIAFOOTAH Wayalinah WAYATINAH TEE Catagunya Repulse Cluny Meadowbank MEADOWBANK AVOCA TRIABUNNA BRIDGEWATER BOYER SORELL NEW NORFOLK KINGSTON KNIGHTS ROAD, HUON RIVER ELECTRONA CASTLE FORBES BAY KERMANDIE 100km ST MARYS LINDISFARNE RISDON CHAPEL STREET CREEK ROAD MORNINGTON NORTH HOBART Lemont resource outline superimposed on Tasmania's high-voltage Transmission Network. Any generation above 10MW (and possibly above 3MW) would have to go to this grid. ROKEBY#7FLOW-ON INDUSTRIES 'Waste' water from the power plant will still be hot and can supply energy for other activities such as:- • • • Spas/wellness centres Greenhouse industries Aquaculture • Timber drying • ⚫ Fruit and vegetable drying • Mineral extraction • A similar enterprise is envisaged to Iceland's Resource Park or New Zealand's Kawerau Industrial Symbiosis, where different industries use the geothermal energy co-operatively, maximising efficiency and minimising waste. Leading to new industries and employment opportunities in regional Tasmania. 370°C Flash & Dry Steam Geothermal 200°C Power Plants & Mineral Recovery Clean Steam Production Spa*ark Energy_7 Ethanol, Biofuels 150°C Binary Geothermal Power Plants Refrigeration & Icemaking Production Pulp & Timber Drying Cement & Aggregate Drying Fabric 100°C Dyeing Paper Processing Building Heating & Cooling Fruit & Vegetable Drying Concrete Drink & Food Cooking 50°C Green Housing Block Processing Curing & Water Heating & Pasteurisation Aqua Culture Snow Bathing 25°C 10°C 4°C Melting & De-icing Biogas Production Geothermal Heat Pumps Soil Warming Iceland's Resource Park uses waste water from the Svartsengi power plant for several applications including spas, greenhouses, fish processing, biotechnology, etc. ~900 employees generate revenue of more than $300m. https://www.resourcepark.is/. Geothermal energy has numerous uses, many of which are applicable to Tasmania#8ADDITIONAL UPSIDE....... Spa*ark Energy_8 • • • Hybrid energy systems, combining two or more sources of energy, are becoming commonplace. Using geothermal fluid as feed for (e.g.) a thermal power plant, or alternatively, further heating of geothermal fluid have both been used to increase efficiency and output. For example, the large multi-renewable generator ENEL, recently added a biomass facility to a geothermal power plant, increasing plant capacity by nearly 40%*. Tasmania has a large resource of under-utilised forest biomass with more than 3Mt per year of residues potentially available. The idea of using this for energy applications is actively promoted by the Tasmanian Government#. Regardless of the reservoir temperature at Lemont, further heating of the geothermal fluid should significantly increase the output. Tasmania has a large timber industry which generates ~3Mtpa of residues, much of which is currently under-utilised. * http://www.thinkgeoenergy.com/enel-inaugurates-combined-biomass-and-geothermal-plant-in-italy/ # https://www.cg.tas.gov.au/__data/assets/pdf_file/0003/123465/Tasmania_Delivers_-_Biomass_2017.pdf#9Spa*ark Energy_9 LEMONT IS DIFFERENT To date, Australian geothermal targets have been mainly petrothermal plays; i.e., hot rocks with low permeability. Some good temperatures were obtained, but the difficulties in achieving viable flow rates were under-estimated: see figure. Lemont started as a conceptual play centred on the Tamar Fracture Zone, where high permeabilities and high. temperatures were anticipated. A good target was defined (see supplementary DATA slides), but for many of the reasons described by Geoscience Australia*, insufficient funds were available to drill it. Recent independent financial modelling by Rockwater Pty Ltd# suggests a likely net output of circa 6.5MW per well, after parasitic and pumping loads (or ~9MW if incorporating a hybrid heating scheme such as described in the previous slide). 270 260 * http://www.ga.gov.au/ausgeonews/ausgeonews 201306/geothermal.jsp 250 # Preliminary Business Case for Electricity Generation from SPA*ARK Energy's Lemont Geothermal Prospect in Tasmania (Rockwater, 2018). 240 230 220 210 200 Resource Temperature Range of previous Australian projects 190 180 Rockwater modelling ---- ------- 30 M 28 MW 26 MW 24 MW 22 MW 20 MW 18 MW 16 MW 44 MW 12 MW 10 MW Target zone for Lemont 8MW per well IIIII&MW- 6MW per well 4 MW Power plant output, expressed here in MW per well, is a function of reservoir temperature and flow rate. Previous plays in Australia failed to achieve a viable flow rate (grey shaded area). Lemont is more akin to a conventional (albeit non-volcanic) hydrothermal play and much higher flow rates are anticipated (green shaded area). The 6MW dashed line illustrates the ~12% extra energy which would be required if Lemont was located in Central Australia. 170 160 150 T 140 80 degree rejection temperature 130 11 degree 120 ambient temperature 110 (C. Huddlestone-Holmes, pers comm.) 20 40 2MW 60 80 100 120 140 160 Flow Rate (kg/s)#10ROUGH FINANCIALS Spa*ark Energy_10 Perth-based consultants Rockwater P/L produced a high-level financial model for Lemont using the likely parameters arising from the Inferred Resource model. It is emphasised these are preliminary assumptions, which will almost certainly be modified following a test well. A 26MW plant was chosen as the base case with the intention of incrementally increasing plant size as the resource becomes better understood. Using the parameters and assumptions given below, the modelling obtained: LCOE 9.8e/kWh 1,200 IRR 20% / 11% (with/without LGCs) NPVs & Capex: 13-104MW 1,000 . NPV $256M / $64M (with/without LGCs) NPV with LSCS Capex 800 NPV_no LSCS Key Parameters and Assumptions# • Base case net productivity of 6.5MW/well $[000,000s] 600 Capex. $172M for a 26MW (net) plant: drilling costed at $3415/m and insurance at 15% of basic drilling cost*; surface plant at USD$1500/kW Opex. Surface: 1% of capex; subsurface: 1.6% of capex; plus staffing and a State royalty of 2.75% Revenue. A starting price in 5 years time of $90/MWh (the average Tasmanian NEM spot price in 3Q18); with & without LGCs (then $80/MWh). No premium for firming or auxiliary services was assumed (but is likely to become significant) A 4 year construction period for 4 production wells and 2 injection wells plus surface plant, with a management budget of 3.5% of capex Potential revenue from flow-on activities (Slide 7) not included Discount factor of 7.5% (IRENA, 2018) and CPI of 2.5%. # See Rockwater model: SPAARK 18-01 Memo spreadsheet model.xlsx. * 400 200 Number of Production Wells 0 0 5 T 10 15 20 Rockwater's base case model (highlighted) assumed 4 production wells and a (fixed) ratio of 1 injection well for every 2 production wells. A range of NPVs and Capex was obtained by (only) changing the number of wells; i.e., no allowance was made for economies of scale. If available, would see cost of drilling returned to investors for an unsuccessful well#11INCENTIVES Energy Incentives: The Australian Government has had an inconsistent approach to renewable energy with various schemes proposed, introduced and scrapped. Currently the only direct government incentive for commercial generators is the Large Scale Generation Certificates (LGCS) scheme¹ which is scheduled to close in 2030. However, other schemes are expected to replace it. The figure on the right shows both previous and projected LGC prices. (One LGC equates to one 1MWh of electricity.) 1 http://www.cleanenergyregulator.gov.au/RET/About-the-Renewable-Energy- Target/How-the-scheme-works MWh $90 $80 $70 $60 $50 $40 Investor Tax Incentives: Spa*ark Eenergy is expected to qualify as an Early Stage Investment Company (ESIC)2. In which case: Investors would be entitled to a 20% tax offset to a maximum of $200,000 in each income year; i.e., for an investment of $1M or more. Investors would not pay any capital gains tax (CGT) if exiting within ten years of entry 2 https://www.ato.gov.au/Business/Tax-incentives-for-innovation/In-detail/Tax- incentives-for-early-stage-investors/ $30 $20 $10 LGC spot price $- Jan-2018 Apr-2018 Jul-2018 Spa*ark Energy_11 Cal19s Cal20s Cal21s Cal22s Oct-2018 Jan-2019 Apr-2019 Jul-2019 Large scale Generation Certificate (LGC) previous and forward prices to October 2019 http://www.cleanenergyregulator.gov.au/RET/Pages/About%20the%20Renewable%20Energy%20Target/How%20the%20scheme%20works/Large- scale%20generation%20certificate%20market%20update%20by%20month/Large-scale-generation-certificate-market-update---October-2019.aspx Corporate Tax Incentives: Given that Lemont is a new type of geothermal target, Spa*ark has been (informally) advised that many of the project steps would be eligible for the ATO's Research and Development Tax Incentive³ which would provide a 43.5% cash refund of eligible expenditure. Thus as a first step, Spa*ark would expect to receive nearly one half of the cost of its test drilling program back as a cash refund regardless of the results. 3 https://www.ato.gov.au/business/research-and-development-tax-incentive/about-the-program/#12COST COMPARISONS Spa*ark Energy_12 . • In early 2018 the International Renewable Energy Agency (IRENA) reported on the costs of renewable energy up to 2017. These images show the cost of generation (upper figure: in USD/kW) and associated LCOES (lower figure: in USD/kWh) for global geothermal power plants categorised by type and size. Binary generation technology would be used at Lemont. Binary plants account for nearly half of all geothermal power installations, but being individually smaller in capacity, currently total less than 20% of global generation. Comparison of the results from Rockwater's modelling* with the global database, shows that Rockwater's projected LCOE and cost per kW generated are mid-range in the spread of numbers for binary plants in IRENA's database (see figures), using an FX rate of 0.74. (Lower FX rates would result in lower costs for Lemont in USD). 2016 USD/kW 8 000 6 000 4000 2000 2007 2008 2009 Binary 2010 2011 2012 Direct steam Capacity MWe 1 <100 Source: IRENA Renewable Cost Database and Global Data, 2016. * Note, this modelling is a theoretical exercise and more constrained, confident numbers will follow the initial test well. 0.15 Fossil fuel power cost range 2013 2014 2015 2016 2017 2018 2019 2020 Enhanced geothermal Flash types 200 z 300 n.a Lemont Rockwater model Upper: The cost per kW generated obtained from high-level modelling by Rockwater is close to mid-range of the values for binary plants (circled) in IRENA's (2018) global database. Lower: The LCOE obtained from high-level modelling by Rockwater is close to mid-range of the values for binary plants (circled) in IRENA's (2018) global database. (Rose-coloured background shows the range of costs for fossil-fuelled power.) 2016 USD/kWh 010 0.05 0% Lemont 5 °8 Rockwater model 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Binary Direct steam Enhanced geothermal ⚫Flash types Capacity MWe 1 100 200 ≥ 300 n.a#13RISK ANALYSIS Spa*ark Energy_13 • Resource risk. Geothermal generators have a wide range of outputs: from sub-megawatts to several tens of megawatts per well. Almost certainly Lemont has sufficient extractable energy to produce electricity, but prior to drill-testing, the extractable rate of energy is difficult to predict. In the unlikely event there is insufficient energy to profitably produce electricity, there will almost certainly be more than enough to develop thermal hot springs -something Tasmania sadly lacks -plus other direct applications such as greenhouses, etc. Drilling risk. In a global study covering 2,613 geothermal boreholes, 78% were judged to be 'successful'; i.e., they produced electricity, and the average success of exploration holes was close to 70% (IFC, 2013; Sanyal & Morrow, 2012). Given the well-defined target at Lemont, there is a low risk of an unsuccessful confirming test hole. Design/build risk. Plant construction, including heat-exchangers, turbines, generators, piping, etc. will use standard off-the-shelf equipment. On- going expansion is likely with incremental improvements. This is regarded as a very low risk activity. Project Risk High Moderate Low Pre-Survey Exploration Test Drilling F/S Planning Drilling Bankability Construction Cost Start-up Operation & Maintenance Risk 0 Risk-cost curve for geothermal energy (ESMAP, 2012). Lemont is at the stage of major de-risking by test drilling. 100% 50% Cumulative Cost Revenue risk. Australia has a history of inconsistent incentives for renewable energy. The current 'LGCs' (previously worth nearly as much as the NEM spot price) are due to be phased out; however, it seems likely some kind of carbon abatement incentive will replace them. Also, synchronous generators such as geothermal are expected to earn increasingly larger premiums as the need for firming supply and FCAS increases with increasing market penetration by VRGS such as wind and pv_solar. Further on price, State-owned Hydro Tasmania has been, until recently, the sole significant operator and price setter in Tasmania, but is now finding increasing competition from VRGs. A proposed second interconnector to Victoria, the 1500MW Marinus Link, has been declared a priority project and this will allow Tasmania to realise its goal of becoming Australia's main supplier of reliable, renewable energy. Thus demand for Lemont's power is regarded as a low risk, with price a moderate risk in the short-term, but a long-term low risk. Lemont is being developed as a conventional, hydrothermal play; however, even conventional projects sometimes use hydraulic stimulation to improve productivity, and it is worth noting that whilst the Tasmanian government has announced a moratorium on fracking, it specifically excludes geothermal.#14THE NEXT STEPS Spa*ark Energy_14 A test hole using a slimline rig will be used to prove the resource and confirm temperature and permeability. Some further geophysics is required to best site the hole which will likely go to circa 2km vertical depth. The modelling and cost estimates to date have been 'high level' and a scoping study with tighter costings and incomes, including those from potential flow-on industries, is planned prior to a commitment to drill. The scoping study may also look at the merits of a demonstration plant which, depending upon the test hole results, might be able to generate ~0.3MW from two slimline holes. A full size rig will be required to extract hotter geothermal fluid from greater depths to supply the main plant, which would likely be staged with modules added as demand and finances dictated. The chart on the next slide gives estimated costs and times required to complete the necessary studies and build (e.g.) a 26MW plant. Om- Etc. N Fish farms Spas Protected Power cropping plant Mineral extraction Timber drying Boreholes Upper Parmeener sediments Jurassic Dolerite Permian Lower Parmeener sediments Siluro-Devonian Mathinna metasediments Geothermal reservoir within fracture zone Hot water extraction Cool water re-injection Naturally permeable fracture zone Heat from buried granite Devonian granite A schematic section through the Lemont Geothermal Resource. Lemont_1 (projected) A cross-section through the 3D resistivity model. The proposed test hole will be targeted on a low resistivity zone (in red), interpreted to be a hot brine-filled fracture, within 2km of the surface. -1000m- -2000m- -3000m- -4000m- -5000m- 0 5 S Ohm.m 2000 1089 593 323 176 96 52 28 15 8 5 2 1 10 10 15 20 20 25 30 Distance km 35 40 45 50 55#15TIMELINES Spa*ark Energy_15 This Gantt chart presents estimated times and costings to construct a power plant using assumptions which will almost certainly be modified following the findings of the initial ~2km test hole. Eighteen months have been estimated to drill and log this hole, and included in this time-frame is a scoping study designed to tighten both costs and potential incomes. Following completion of the test hole, informed planning for the initial plant capacity can take place. The 26MW plant used below is an arbitrary size, originally chosen for the high-level financial modelling, since a sub-30MW plant may have less stringent requirements to join the NEM. A total of four years has been allowed to complete the drilling, install the turbines, generators, etc, and connect to the grid. Activity Project Management Lemont Geothermal Project Draft Budget (AUD millions) 1H_yr_1 2H_yr_1 1H_yr_2 2H_yr_2 1H_yr_3 2H_yr_3 1H_yr_4 2H_yr_4 0.50 $1.0 $1.0 $1.0 $1.0 $1.0 $1.0 $1.0 $7.5 26MW Total Scoping Study 0.15 $0.2 Title, permits, legals, stakeholders 0.15 $0.2 $0.4 Detailed geophysics & site works 0.50 $0.5 $1.0 Slimline test hole ~2km $2.0 $2.0 Well testing (temp, flowrate, structure) $0.5 $0.5 Definitive Feasibility Study $2.0 $3.0 $5.0 Direct to Initial Plant Build of (e.g) 26MW $40.0 $45.0 $30.0 $30.0 $30.0 $175.0 Contingency $28.5 $28.5 Continued plant development Spas, glasshouses, fish farming, mineral extraction, vegetable drying, etc Half-yearly Spend $1.3 Cumulative Capex $1.3 $1.7 $3.0 $5.5 $44.0 $46.0 $31.0 $31.0 $59.5 $8.5 $52.5 $98.5 $129.5 $160.5 $220.0 $220.0 As previously mentioned, the scoping study may include costings for a demonstration plant. A rough estimate indicates a ~0.5MW (gross) plant might cost $20M for a low temperature plant using two slimline holes, one being the initial test hole, and would take perhaps 3 years to complete. Some direct use applications would be able to commence as soon as two holes; i.e., one production hole and one reinjection hole, had been completed and cased.#16ABOUT SPA*ARK ENERGY Spa*ark Energy_16 Spa*ark Energy / CEO Dr John Bishop, Chairman • • . Spa*ark Energy Pty Ltd (ACN: 629 075 618) was created specifically to hold the licence covering the Lemont Inferred Geothermal Resource. It has no others assets, and no liabilities. Its current sole director is Dr John Bishop. As of October, website, domain names, etc are underway. The licence application, ELA15/2016, is currently held by J.A. & J.R. Bishop. Spa*ark has a binding agreement to purchase 100% of the rights. Immediately following initial funding, Spa*ark will be seeking a technically-oriented CEO with expertise in large-scale project management to take this enterprise through from concept to completion. Dr John Bishop is a geophysicist with more than 40 years experience and owner of Mitre Geophysics advising the international mining and exploration industries. John is experienced in most metallic commodities, plus coal and unconventional gas, as well as geothermal energy in a variety of geologic settings. John has been a director of several private and public resource and energy companies; including Icon Resources (ASX: III, founding MD); Riverside Energy (unlisted, exec. Chair, which successfully spun out a large UK coking coal project); Kula Energy with geothermal interests in PNG; and KUTH Energy (ASX: KEN, founding Chairman) which explored for and defined the resources comprising Spa*ark's current assets. John is a previous federal treasurer and councillor of the AIG, and a past branch president of the AusIMM. Dr Fiona Holgate, Consultant • • Dr Fiona Holgate is a geoscientist of nearly 20 years standing, specialised in the discovery and evaluation of geothermal resources. With a background in minerals, mining and exploration, she has extensive experience in the application and use of geological and geophysical techniques including drilling and borehole evaluation. Formerly a Senior Geologist with Geoscience Australia's Geothermal Energy Group, Fiona holds a PhD in geothermal exploration from the ANU. She has extensive on-ground experience in corporate management and leadership, including four years as Exploration Manager for KUTh Energy Ltd. Fiona was a founding member of the Australian Geothermal Code Committee and is recognised as a Competent Person under the Australian Code for Reporting of Exploration Results, Geothermal Resources and Geothermal Reserves. Fiona is acting as a technical consultant to Spa*ark.#17Supplementary Slides Spa*ark Energy_17 SPA*ARK Geothermal is the only generator capable of delivering renewable, dispatchable electricity without the need for large, expensive storage systems.#18Geothermal Energy 101 1 Spa*ark Energy_18 • The earth gets hotter with depth. On average, temperature increases by ~30°C/km in the upper crust and continental heat flow is ~65mW/m². This is partly due to primordial heat from the earth's formation and partly due to the decay of naturally occurring radioactive isotopes such as potassium (K), uranium (U) and thorium (Th). Surface heat flow is highest along the earth's plate boundaries via extrusive volcanos, but anomalous heat flows also occur in the vicinity of intrusive rocks containing high levels of radio-isotopes. Basin and Range/Walker Lane Mammoth 170°C 40 MW Yukon-Tanana Plateau Chena 72°C 0.4 MW Beowawe 205°C 17.7 MW Blue Mountain 193°C 49.5 MW Desert Peak 190°C 19 MW Brady Hot Springs 175°C 25 MW Steamboat 170°C 133 MW McGinness Hills 166°C 72 MW Soda Lake 165°C 23 MW Jersey Valley 165°C 23.5 MW Tuscarora 160°C 32 MW Stillwater 158 °C 33 MW Patua 155°C 18 MW Salt Wells 140°C 14 MW San Emidio 138°C 11 MW Wild Rose 129°C 27 MW Florida Canyon Mine 108°C 0.1 MW Wabuska 104°C 1.2 MW Imperial Valley Heber 166°C 44 MW East Mesa 155°C 72 MW Caribbean Plate Extension Platanares 175°C 35 MW Cove Fort 165°C 26 MW Thermo 160°C 10 MW Raft River 140°C 16 MW Neal Hot Springs 138°C 11 MW Klamath Falls 91°C 2 MW Lightning Dock 155°C 4 MW Mid-Atlantic Divergent Boundary Husavik 120°C 2 MW Alpine/Alpine Foreland Extension Insheim 165°C 5 MW Landau 159°C 3 MW Sauerlach 140°C 5 MW Dürrnhaar 138°C 5.6 MW Kirchstockach 138°C 5.6 MW Bruchsal 135°C 0.6 MW Unterhaching 122°C 3.3 MW Neustadt-Glewe 97°C 0.2 MW Soultz-sous-Forets 157°C 1.5 MW Bad Blumau 110°C 0.25 MW Aegean-West Anatolian Extensional Province Gumuskoy 180°C 13.2 MW Hidirbeyli 180°C 92 MW Pamukoren 178°C 45 MW Tuzla 174°C 8 MW Salavatli 170°C 51 MW Umurlu 155°C 12 MW Gerali-Sarakoy 124°C 3 MW Yadong-Gulu Rift Kamchatka Volcanic Arc Yangbajain 135°C 10 MW Nagqu 116°C 11.3 MW Shan-Thai Highlands Fang 125°C 0.3 MW Total 1032 MWe (7.5% of mid 2017 13,660 MWe global capacity) Regions where <210°C geothermal reservoirs have been developed for power generation Showing average reservoir temperature and installed capacity Paratunka 81°C 0.68 MW Japan Volcanic Arc Kirishima 127°C 0.1 MW <235°C -160° >85°C Temperature at 5km Depth (°C) Near-surface temperatures are highest near plate boundaries (red zones) and most geothermal power plants are located here. The blue text identifies only those plants operating with reservoir temperatures below 210°C (Febrianto et al, 2018); i.e., similar to expectations for Lemont which is interpreted to lie on a paleo-plate boundary. Estimated temperatures at 5km depth. Hot zones mostly occur where granites rich in radio-isotopes are buried beneath a thick cover of insulating sediments. (Image from Gerner and Holgate, 2010; black dots are the data points. Recent Tasmanian data not included.)#19Geothermal Energy 101 2 Spa*ark Energy_19 • . Geothermal 'plays' occur in a broad spectrum of geological conditions, reflecting the different underlying temperatures, rock types, structures and depths. Plays can be broadly classified as 'wet' (hydrothermal) or 'dry' (petrothermal). The former are typically found near recent volcanos where young rocks are permeable and saturated: e.g., Iceland and New Zealand. The latter are typically associated with older, less-permeable rocks: e.g., Germany and Australia. Wet plays have a higher energy density. Dry plays require stimulation to increase permeability and are more expensive to develop, but constitute the bulk of the world's potential geothermal resources. Australian efforts to date have concentrated on dry plays. Lemont is not a dry play. It sits on a major (paleo-plate) boundary separating East and West Tasmania and is considered to be more akin to a wet resource, albeit a non-volcanic one. Number of wells 160 140- 120 100- 80 60- 40 20 0 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Gross capacity (MWe) Globally there is a wide range of outputs per well. This graphic omits outputs above three standard deviations from the average which is 7.3MW. The maximum recorded value is 52MW (IFC, 2013) There are several types of geothermal power generators. Lemont would use a binary system (as shown here), which as well as base-load, is capable of operating as a load-follower. An attribute that will be increasingly required as variable generators such as wind and solar increase market share. Turbine Generator Condenser Waste Heat Working Fluid (vapor) Working Fluid Hot Brine Condensate Pump Pump Heat Exchanger Cool Brine Production Well Injection Well Geothermal Zone 04750510#20Geothermal Energy 101 3 • • • Geothermal energy extracts an infinitesimally small proportion of the earth's heat and is 'renewable'. Individual Geothermal plants have been producing electricity for >50 years: the power is sustainable. Binary geothermal plants such as planned for Lemont have zero emissions. (Some other types have near-zero emissions.) Geothermal power is dispatchable with both base-load and rapid load-following capabilities. Like wind and pv_solar, but unlike coal and nuclear, geothermal is scalable: i.e., it can start small and expand as demand and finances dictate. Like coal and nuclear, but unlike wind and pv_solar, geothermal generators are synchronous, providing stability to the grid. Geothermal has the highest capacity factor of any electricity generator; i.e., it is reliable. https://www.eia.gov/outlooks/aeo/pdf/electricity_generation.pdf In part because of its 24/7 output, geothermal in California is forecast to be the most affordable of all generators; it is already more profitable than solar. http://cacurrent.com/subscriber/archives/30936 MINUS Spa*ark Energy_20 Projected LCOE in the USA by 2020 (EIA, 2015 & 2018) 400 350 300 250 200 150 100 50 0 Geothermal Solar Thermal Wind offshore Natural Gas Conventional Combustion Solar PV Turbine IGCC Integrated Coal- Gasification Combined Natural Gas Biomass Advanced Conventional Nuclear Hydro Coal Wind onshore Advanced Combined Cycle eathermal Cycle) Minimum 174 170 107 98 106 90 92 87 69 55 69 44 Average Maximum 240 197 142 125 116 101 95 95 $4 74 73 48 383 270 156 193 136 117 101 119 107 82 82 $2 Geothermal has the lowest projected Levellised Cost Of Electricity since, like hydro, wind and solar, the energy is 'free' but unlike them, has a very high capacity and does not need storage. 20,000 18,000 16,000 Global Geothermally Generated Electricity Added capacity for plants with announced completion dates m²/GWh 4000- 3500 3000- 2500- 2000 1500 1000- 500- Coal Solar Thermal Solar PV Wind Geothermal 0 (sq. MYGWH Coal 3842 Solar Thermal 3561 Photovoltaics 3237 Wind- Geothemal 1335 404 Source: GEA Geothermal power plants have the smallest footprint. Globally, ~15GW of geothermal power is installed across 25 countries, with steady growth. MW 14,000 12,000 10,000 8,000 8,000 4,000 2,000 Added capacity for plants under construction 1950-2013: Earth Policy Inst. (after IEA-GIA) 2010-2021 GEA 0 1950 1980 1970 1980 1990 2000 2010 2020#21THE GEOLOGIC SETTING Several heat-producing granites were (mostly) emplaced in eastern Tasmania during a period of tectonic compression ~400Mya, which joined Eastern and Western Tasmania terranes along the largely concealed Tamar Fracture Zone (TFZ): upper figure. ~50Mya Tasmania became part of an extensional regime associated with the separation of Australia and Antarctica, with a number of grabens developing. In the Lemont region the bounding faults "..form a complex transfer zone that is expected to have high fracture permeability" (Berry, 2019: lower figure). Lastly, Tasmania is located over an interpreted hot spot, the East Australia Plume System (upper figure), which may explain some of the legacy high heat flow measurements scattered across the State. (Continental crust averages 65mW/m².) Spa*ark Energy_21 TFZ Eastern Terrane 159 104 83 Western Terrane 87 Upper Figure: Radio-isotope enriched granites were emplaced during the Devonian, associated with a compressional regime bringing Tasmania's Western and Eastern Terranes together. (Eastern outcropping granites in pink: Western ones not shown). High heat flow legacy measurements support the hypothesis of a 'hot spot' beneath Tasmania (green dashed line from Davis et al, 2015). The TFZ marks the approximate location of the paleo-plate boundary, Depth contours from 1km to 9km show the granite deepens rapidly to the west (Leaman, 2012). Lemont outline included for reference. Devonport Port Sorell. Sub-basin Lower Figure: Major Tertiary faults (from Berry, 2019). Tasmania was an extensional regime during this period with several grabens opening up. Berry (2019) regards the "complex transfer zone" within the Lemont outline as likely to have high permeability. Tamar Graben Macquarie Harbour Graben Tiers 94 Longford Sub-basin N Oyster Bay Upper Derwent Graben Graben 50 km Lower Derwent Graben#22THE DATA 1 KUTH Energy Ltd listed on the ASX in 2007 and began a systematic heat flow survey where the cover over the granites was considered thick enough to generate high temperatures at depth. The measurements, from a regional ~20km x 20km grid of holes (black dots in the figure), recorded some of the highest heat flows in Australia (max: 118mW/m²). This data was then modelled by Hot Dry Rock P/L to produce the Lemont Inferred Geothermal Resource. The outline is the 150ºC isotherm at a depth of 4km. KUTh also carried out detailed aeromagnetics to better define the structure and more gravity readings to better constrain the depth to the granite (lower figures), plus other techniques, such as passive seismic, not pictured here. Total expenditure by KUTH was circa $5M. Upper Figure: Some of Australia's highest heat flow measurements were recorded over heat- producing granites in eastern Tasmania. Modelling of these data were used to produce Lemont's Inferred Geothermal Resource (outlined). Lower Figures: A. Detailed aeromagnetics with interpreted major and secondary structures. Also showing heat flow data points (black stars) and values. B. Residual Bouguer gravity: Low values (cold colours) reflect the presence of (low density) granites in NE Tasmania. Some regional structures are also evident. These data were used to refine the topography of the granite surface and its depth of several km. C. Some of the Tertiary structures described by Berry (previous slide) can be seen in the digital terrain model (DTM). Spa*ark Energy_22 Heat Flow mWm-2 118 90 SEL 26/2005 80 94 103 118 96 92 70 50 A C B#23THE DATA 2 Spa*ark Energy_23 Line A KUTh commissioned a number of MT surveys to map the 3D resistivity distribution within ~5kms of the earth's surface in the vicinity of the Lemont resource. A number of very low resistivity (<1 ohm.m) zones were defined at depths below ~2.5km; i.e., at temperatures above 100°C assuming the calculated geothermal gradient of 40°C/km is correct. The top figure shows a slice of the 3D modelled resistivity distribution at a depth of 3km. Recently, combined 3D modelling of the KUTH MT with data from the regional AusLAMP survey has been completed, resulting in a new model with less error, higher resolution and greater depth penetration (Ostersen, UTas PhD, 2020): middle figure. Ostersen (2020) writes "Interpretation.... gives high credibility to the existing conceptual model for the Lemont geothermal resource. Low resistivity structures in the new preferred model were found to be highly spatially correlated with recently active upper crustal fault networks, a result that was less clear in previous modelling. Minimum resistivities appear to manifest at the intersection of Devonian granite roof topography with inferred fault planes. Critically stressed faults at the granite contact likely result in high pore space fluid content with thermally enhanced conductivities." Zones of <1ohm.m shown in the middle figure (also see next slide). Modelling of the AusLAMP-only data shows that the Lemont low resistivity zone extends to depths below 10km (Ostersen, 2020: bottom figure); i.e., it is reasonable to infer a major structure with rapid recharge and minimal draw down in temperature. Top Figure: Depth slice of KUTH MT data at 3km below surface. A large zone of low resistivity correlates with a major east-west structure within the resource outline. Middle Figure: Combined modelling of KUTH MT data and adjacent regional AusLAMP stations resulted in a better resolved, shallower but extending to deeper, target. Bottom Figure: Modelling of the deeper-penetrating AusLAMP-only data indicates the low resistivity zone within Lemont extends to a depth of more than 10km below surface. Ohm.m 2000 Line B 1089 593 Line C 323 176 96 200000 0000055 300000 400000 Depth Slice: 10.06 - 11.11 km 688852- 15 1 300000 500000 700000 0000095 00000PS 0000015 0000025 200000 300000 400000 500000 600000 700000 Resistivity (ohm.m) Map Projection: GDA94 UTM 255 Km 80 120 160 ° 10 100 1000#24THE DATA 3 Upper Figure: an oblique view looking NNW showing:- Pseudo-coloured roof topography of the heat-producing granite with depths ranging from outcrop in the northeast to +9km in the west. Interpreted major faults (black lines) plus Tas Geol 3D structures (buff ribbons). Pseudo-coloured heat flow data points (on an approximate 20km x 20km grid) ranging from <50mW/m² to a maximum value of 118mW/m². Zones of low resistivity (<1 ohm.m) defined by 3D inverse modelling of MT data. Portions within the granite coloured grey; portions above in light brown. Outline of the Lemont Inferred Geothermal Resource (defined by the 150°C isotherm at a depth of 4km). Lower Figure: an oblique view looking SE showing:- Pseudo-coloured roof topography of the heat-producing granite with depths ranging from outcrop in the northeast to +9km in the west. Tas Geology 3D structures (buff ribbons). MT Resistivity block model, western portion removed to reveal the low resistivity (<1ohm.m) zones which are coloured grey within the granite and pink above. Outline of the Lemont Inferred Geothermal Resource (defined by the 150°C isotherm at a depth of 4km). Portion of Tasmania's distant east coast in thin black line. The blue pin is the location of possible test hole to confirm temperature gradient and high permeability: depth ~2km. (Both figures after Tom Ostersen's PhD thesis, 2020.) Spa*ark Energy_24 50 60 70 80 90 100 110 Heat Flow (mWm-2) -9000 -3000 -6000 Granite Roof Elevation (m a.s.l.) 0.1 1.0 10 100 1000 10000 -9000 Resistivity (Q.m) -6000 Granite Roof Elevation (m a.s.l.) -3000 0#25CASE HISTORY EXAMPLE Spa*ark Energy_25 Project Name: United Downs Location: Cornwall, UK Capacity: 1 to 3MW (possibly constrained by the current condition of the Distribution Network) Temperature: ~193°C Flow rate (L/sec): Targeting 80; achieved 66 to date "at only 8.2MPa❞ Hole Depth: 5275m production hole and 2393m injection hole, both completed. Drill rig: Has Innova; also used in the St1 Otanieme Project, Finland http://www.angers-soehne.com/?page_id=4793&lang=en Status: Drilling completed; well testing underway; turbine generator not yet installed Website: https://www.uniteddownsgeothermal.co.uk/ Reason for inclusion: A very similar concept to Lemont; namely a permeable fault adjacent to a granitic heat source Comment: United Downs evolved from an EGS project in the 1980s. It is targeting a wide, permeable fault which will allow unstimulated circulation. Final power figures will depend on temp and flow rate, but the principle of a non-volcanic, (moderate-temp, moderate-flow) 'wet' geothermal play will have been proven. Total cost estimated at ~£23M. Drill time was ~8 months to complete both holes, drilling 24/7. Perspective diagram of a project in the UK nearing completion. The production well will draw hot water from a fault zone at a depth of ~4.8km. The return water from the turbine will be re-injected at ~2.2km. Heat source is an adjacent granite; i.e., a similar geology to Lemont. 1000m 2000m 3000m 4000m 5000m -300m Power Plant Injection Well Water passes through natural fractures in the faulted rock Production Well Granite#26Australia's National Electricity Market Spa*ark Energy_26 The NEM covers five interconnected States: Qld, NSW (including the ACT), Vic, SA and Tas, which also act as separate pricing regions (inset). It is a wholesale market in which generators sell electricity and retailers buy in order to on-sell to consumers. The price is determined by (a) offers from generators to supply specified amounts of electricity at set times to retailers and industrials, and (b) the demand. A half-hourly averaged price, referred to as the Spot Price, is used as the basis for settling transactions which are made through the Australian Energy Market Operator (AEMO). There is a maximum cap price, currently set at $15,000/MWh and a minimum floor price of $-1,000/MWh. Generators may negotiate a power purchase agreement (PPA) with a retailer or industrial user or may sell on the spot market. Typically they do both, with the fixed PPA providing revenue certainty and the spot market, the opportunity to benefit from periods of high prices. The Tasmanian spot price for the last two years has averaged AUD88/MWh. Lemont is expected to be connected to the NEM. There is currently one ~500MW interconnector between Tasmania and Victoria (Basslink) with a second proposed 1500MW interconnector, Marinus Link, recently announced as a priority infrastructure project. https://www.marinuslink.com.au/ The four easternmost states plus South Australia and the ACT are interconnected and form Australia's National Electricity Market. Inset: Each of the States has its own pricing arrangement. The brown dots (which move in the direction of transfer) show the amount of power being exchanged via each interconnector at that particular five minute segment. ADELAIDE MELBOURNE HOBART Red Dolphin Systems Current Dispatch: 15:55 $ 90.99 $ 82.36 93 $ 76.42 SYDNEY 32; 9 180 $ 89.41 $ 90.48 300 BRISBANE#27Geothermal Quotes* Spa*ark Energy_27 "Flexible dispatch and regulation capabilities are becoming increasingly valuable as the proportion of load met by VRE increases and the proportion of load served by base-load resources declines. "I ... geothermal energy is underutilized and under-procured for two reasons. First, the misconception that geothermal energy can only provide base-load service is prevalent and utilities, regulators, system operators... have been slow to recognize the full suite of generation attributes that geothermal possesses. Second, renewable energy procurement processes have tended to compare renewable energy resource alternatives against one another on a cost per kilowatt-hour basis without considering the attributes that competing technologies offer or the full range of system costs that the competing technologies impose. ... "Geothermal projects also avoid system costs that some competing generation technologies impose. For example, as VRE market penetration increases additional infrastructure or additional flexible generation resources (are needed) to ensure system reliability is maintained. While significant effort is underway to transition the electric system to a much more flexible and robust electric system so that the costs of integrating large quantities can be mitigated, the fact is that today the system is not flexible or robust enough to handle large penetrations of VRE without significant, incremental system expenses. Further, it should be noted that the need for a more robust and flexible system is partly driven by the transition toward high penetrations of VRE. "Another cost that seems to be overlooked in integration studies is the opportunity cost of transmission. Each type of renewable resource has different transmission capacity requirements for the delivery of a specified amount of energy. For example, wind capacity factors are typically in the 35% range, Solar PV in the 25% range and geothermal in the 85% range. Therefore it takes about three times the transmission capacity to deliver the same amount of energy from a solar PV resource than from a geothermal resource. ... "A geothermal plant can ramp up and down very quickly ... multiple times per day to a minimum of 10% of nominal power and up to 100% of nominal output power. For comparison, gas turbines ... kept warm and rotating at minimum power for use as available power resource for the grid ... ramp up 10% of their nominal power per minute. Geothermal ORC# can do 15% as normal dispatch rate, and 30% in Flexible Operation Mode, (without burning any fuel for stand-by operation)." * Quotations from: The Value of Geothermal Energy Generation Attributes, Aspen Environmental Group 2013 report to Ormat Technologies http://geo-energy.org/reports/Values%20of%20Geothermal%20Oct%202013%20appendix.pdf # ORC: Organic Rankine Cycle. Used in binary geothermal power generators such as would be employed at Lemont#28CONTACT SPA*ARK John Bishop e: [email protected] m: +61 418 373 429 Spa*ark Energy_28 Disclaimer This Presentation has been prepared by Spa*ark Energy Pty Ltd (Spa*ark) to provide an overview of the Lemont geothermal resource. The document is not a prospectus and should not be considered an offer or an invitation to acquire shares in Spa*ark. The Information does not constitute advice of any kind and no responsibility or liability is accepted by Spa*ark for any action taken by the recipient on the basis of the Information. Any forward-looking statements, opinions and estimates included in this document are based on assumptions and possibilities which are subject to change without notice, as are statements about market and industry trends. They are provided as a general guide only and should not be relied upon as a guarantee or indication of future performance. Whilst every effort has been made to ensure the accuracy of the information in this Presentation, no responsibility or liability is accepted by Spa*ark or any of its officers, employees, agents or associates, for any of its contents. Further, Spa*ark undertakes no obligation to update or revise any statements in the document. Statements contained in the document are of a summary nature and are qualified in their entirety by the references provided. 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