INTERVIEW WITH PETER BOND, CHIEF EXECUTIVE OFFICER OF LINC ENERGY LIMITED (LNC)

“Linc Produces First GTL Liquids at Chinchilla Site”

http://www.brr.com.au/event/52314

TUESDAY, OCTOBER 14, 2008, 11:30 AM.

            BRR    This morning we welcome Peter Bond, Chief Executive Officer of Linc Energy. Peter, thanks for joining us.

10        LNC     My pleasure, Cameron.

            BRR    Peter, the business seems to be going from strength to strength at the moment with your announcement yesterday for signing another contract for a project in Vietnam. Can you tell us a little bit about this project and how it

15                    came to Linc?

            LNC     Cameron, this is the project where Linc signed an MOU with Vinacomin from Vietnam some months ago. We’ve worked through a couple of stages to get to this point where we are now signing the (inaudible) (0:00:32) Contract -- what they call the (inaudible) (0:00:34) Contract, and that basically means

20                    that Vietnam and our partner, Marubeni, will be paying for the trial in Vietnam, and on the basis that the trial is successful, we will move quickly to a light commercial UCG operation that’ll be producing power and then maybe later on gas-to-liquids. It’s a big step forward. It means we’ll be basically in production in Vietnam next year.

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            BRR    Now Peter, what you’re doing in Vietnam is really a replica of what you’re doing in Australia, is that right?

            LNC     Well, it is. It is on the basis of the underground coal gasification only. We won’t be building a GTL plant over there or building any of the support

30                    structure, but we will. But certainly it is in terms of the gasification as a trial.

            BRR    So Peter, there are a number of phases that you’ve outlined in your announcement. Give us an idea of what the first couple of phases involve and the timeframes.

35        LNC     Well, with Vietnam, that’s based around us basically getting onto site. We’ve got to wait on Vietnam coming back with final approval for site location and there’s a small environmental report that has to be done by them, but that will just take its normal course. We’re basically aiming that by end of the first quarter next year, we’ll be on site, and by the end of the second quarter, we’ll

40                    be constructing and then probably three to four months later producing.

            BRR    What about human resources? Will you move some of your men from Queensland across to Vietnam?

            LNC     No. Well, the answer is yes but we’ll only move one or two. We won’t be

45                    moving a lot. The bulk of our local labourers will be sufficient for what we want. The engineering will be done out of Australia and the project management will be done in Australia with the relevant person on the ground, of course, and then probably the key manager over there and our key support person will be out of Australia. The rest will be local.

            BRR    Peter, as you’ve said in your announcement, the global applications, how far down the track are you in exploring other countries using UCG?

            LNC     We’re a long way down the track in terms of that. We’re talking with a lot of

5                      countries and we’re doing a lot of work in North America, in China and a few places, so I think the trend you’re seeing is what we’ve had in Vietnam, and of course now on the back of our announcement today of producing liquids from the GTL plant, that announcement today will take the Company forward significantly on the back that now we can take a billion of tonnes of coal stuck

10                    in the back of Vietnam or Queensland or South Australia and turn it into 1.5 billion barrels of oil. So it’s a significant change to the way we view emerging energy.

            BRR    Yes, I was going to get onto the other announcement made today which you

15                    alluded to, your first gas-to-liquids at Chinchilla site. It’s obviously a huge milestone for the Company.

            LNC     Yes, it’s a massive milestone, as you can imagine. It’s what we’ve been working for the last couple of years. When you think about it, from first engineering to this event, it’s probably around two years and construction has

20                    probably been less than a year. So, it’s actually been quite timely and it’s a great first result. It’s a great milestone for the Company, and indeed, the community at large.

            BRR    Peter, I probably asked you this question before, but when do you expect to

25                    see some significant cash flows from Chinchilla?

            LNC     Look, it’s going to take about probably 12 months before we can break the ground on a commercial facility, and on the back of that, it takes about two years to construct the facility. So, depending on what we do in other parts of the world, which of course we’ll probably produce some earlier cash flow

30                    timelines, but I guess it’d be two to three years before we can start to see the significant cash flows and I think 24 to 36 months is probably a reasonable horizon.

            BRR    Well, it’s an exciting project. It’s been a good ride for your shareholders, that’s

35                    for sure. So, if our listeners would like to ask you a question, by all means, forward it through to us at brr@brr.com.au and we’ll forward them on to Peter for an answer at a later stage. Peter, thanks for your time. Good luck and we look forward to speaking with you soon.

            LNC     Thanks, Cameron. I appreciate the call.

INTERVIEW CONCLUDED

Contact brr@brr.com.au for more information

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