Summer 2007 - Linc Energy

LINC ENERGY NOW THE
WORLD LEADER
IN UCG
The Courier-Mail in Brisbane recently published a
double page spread on Linc Energy as part of its
reporting on the company’s ongoing expansion.
Linc Energy has acquired a 60% controlling interest in
Uzbekistan-based Yerostigaz, not only giving it control of
the 48 year old organisation but cementing Linc Energy’s
place firmly as the largest UCG company in the world.
Yerostigaz has been a vital part of the former Soviet
Union’s UCG program since the late 1950’s when
construction of the site first commenced.
Yerostigaz has been operating continuously since 1964
and boasts approximately 230 current employees,
which will boost Linc Energy’s total employee numbers
to approximately 270 employees.
Mr Peter Bond, Linc Energy’s Chief Executive Officer,
said Linc Energy is very excited about having the depth
and capability that this acquisition offers the company.
SHARE pRICE bREAkS $1
In just under eighteen months
since Linc Energy listed on the
Australian Stock Exchange, the
company has quadrupled its share
price to break $1 on 1 November.
Linc Energy launched on the
Australian Stock Exchange in
May 2006 at 25c per share and
peaked on 1 November at $1.05
per share.
The number of shareholders
has grown significantly from 600
shareholders in May 2006 to 3,213
shareholders in November 2007.
The Yerostigaz plant
7
MAY
2007
www.lincenergy.com.au
31
MAY
2007
IN THIS ISSUE:
Feature interview
SHAREHOLDER NEWSLETTER
Issue 5 Summer 2007-2008
The market has reacted very positively to Linc Energy’s purchase of a majority
interest in a former Soviet Union company, YEROSTIGAZ that has seen it emerge
as the world’s largest Underground Coal Gasification (UCG) company.
And the purchase has also excited the financial press.
“The Yerostigaz acquisition is a huge achievement for
Linc Energy. UCG is a key element in Linc Energy’s quest
to become a leading producer of ultra-clean diesel, jet
fuels and power generation and it allows Linc Energy
to have effective ownership of a significant piece of the
intellectual property and know-how of UCG. As well, it
adds significant depth of engineering capability and
history that only comes from an organisation as old
and distinguished as Yerostigaz,” Mr Bond said.
Yerostigaz is based in Angren, Uzbekistan and is the
only commercial UCG operation in the world. The UCG
gas produced is fed into a power station situated
adjacent to the Yerostigaz operation in Angren. The
company is cash flow positive and generated a modest
profit for the 2006 financial year.
The acquisition of Yerostigaz was financed via a
combination of shares and cash.
The total number of Linc Energy shares issued was
1,161,207 at 67c each and cash consideration of
29
JUN
2007
31
JULY
2007
31
AUG
2007
28
SEPT
2007
31
OCT
2007
$ 1
$0.78
$0.63
$0.50
$0.40
$0.31
$0.24
$A401,432.21 was also paid, giving an acquisition price
to date of approximately $A1,179,440.
Yerostigaz is a significant institution, which, for all intent,
has been the operating source of UCG know-how in
the world for over 40 years.
Linc Energy has already commenced a program of
swapping Yerostigaz experts to work at its site in
Chinchilla and has sent some of its own UCG staff
to Yerostigaz in Uzbekistan for information swapping.
Yerostigaz is capable of producing in excess of one
million cubic metres of Syngas per day, which is
currently used for power generation.
“Linc Energy can now go forward to expand UCG
operations in several locations around the world,
like China, India, USA and Australia, with the depth
of operational staff to handle a significant increase
in commercial operations around the globe,”
Mr Bond said.
Oleg Krzyzanowski gives us an insight into
Underground Coal Gasification - its history,
Linc Energy’s early successes and the global
prospects for the future.
$US5 million investment
Marubeni extends its confidence in Linc Energy
$A28.3 million placement
Linc Energy raises $A28.3 million via a placement
to institutional and sophisticated investors
Investor interview
As a civil engineer with a mining background,
the potential of Linc Energy has not been lost
on Linc Energy investor, William van Dongen.
Australia’s Leader in Clean Coal Technology
Uzbekistan based Yerostigaz

FEATuRE INTERVIEW
UNDERGROUND COAL GASIfICATION (UCG) IS KEY TO LINC ENERGY’S
QUEST TO BECOME A LEADING pRODUCER IN ULTRA CLEAN DIESEL,
JET fUELS AND pOWER GENERATION.
And at the ‘coal face’ of Linc Energy’s uCG field in Chinchilla is General Manager of
uCG, Oleg krzyzanowski. Investor Linc talks to Oleg krzyzanowski to learn more about
uCG - its history, Linc Energy’s early successes and the global prospects for the future.
What is the significance of
Linc Energy’s recent achievement
to produce gas from its newly
constructed Underground Coal
Gasification (UCG) field at its
Chinchilla site?
This is what we’ve been waiting for.
This truly is the first step of a very
exciting journey for Linc Energy and
I’m very proud to be a part of it!
The production of gas from our
UCG field in Chinchilla will allow
Linc Energy to aggressively take the
steps forward towards a number of
commercialisation opportunities.
The sky is the limit now that we
have proven UCG gas production.
How valuable is Linc Energy’s recent
acquisition of Yerostigaz in achieving
the company’s vision of becoming
a dominant player in the supply of
more environmentally friendly power,
diesel and jet fuel?
Extremely valuable.
Yerostigaz, which has been
operating continuously since 1964,
has been a vital part of the former
Soviet Union’s UCG program since
the late 1950’s when construction
of the site first commenced.
With an experienced and qualified
team of 230 current employees,
this acquisition is a huge
achievement for Linc Energy.
We now, effectively, have ownership of
a significant piece of the intellectual
property and know-how of UCG – and
this is key to our quest to become a
leading producer in ultra-clean diesel,
jet fuels and power generation.
With more than 40 years UCG
experience, the Yerostigaz acquisition
can only be seen as a huge positive
for Linc Energy, and one that will help
Linc Energy to promptly achieve its
goals and spread its wings further
with new commercial opportunities.
02
How would you describe the global
prospects for Linc Energy now
that it has emerged as the world’s
biggest UCG company at a time of
an international energy crisis?
It places Linc Energy in a very
privileged position from a business
perspective as UCG is a critical
part of our process in producing
an alternative energy – something
the world is crying out for.
The significance hasn’t been lost
on the international business
community and we’ve already been
approached by organisations all
over the world who are keen to
discuss joint venture opportunities.
We are well aware, however, as the
leader in UCG, our operations will be
closely monitored by many around
the world and we are dedicated to
making sure we deliver a safe and
effective means of unlocking a new
energy source for the 21st century.
Do you believe that the technical,
government and private sector
support for Linc Energy in Australia
will help further advance UCG
technology beyond that achieved in
Russia say over the last 40 years?
One has to understand that we are
witnessing the renaissance of UCG right
now, right here and Linc Energy is a
very important part of that resurgence!
UCG was developed in the former
Soviet Union over a period of many,
many years with great support
from many academics, engineers
and technicians.
As with everything in the Soviet Union,
UCG has enjoyed strong political
support as well. Many sites with
various coal geology were established.
All of them were a great success,
which allowed them to study the
process and draw conclusions.
Unfortunately oil and gas fields are
so prevalent in Russia and the former
Soviet Union that they didn’t need
to continue to develop new UCG
sites, and the UCG’s faculties at the
universities subsequently deteriorated.
Now, to answer the question. With
advanced Australian technology and
our commercial approach, I have no
doubt that we will advance UCG more
rapidly than what was done in Russia.
Please remember that in my team
I have the best UCG specialists
from Yerostigaz in Uzbekistan,
which also correlates to the best
UCG specialists in the world!
UCG is a true alternative source of cleaner
energy in an environment where natural gas
and oil reserves are rapidly shrinking.
Is the UCG process a strong
positive in terms of companies
interested in carbon credits?
Yes it is. UCG is a true alternative
source of cleaner energy in
an environment where
natural gas and oil reserves
are rapidly shrinking.
What is the level of
international interest
in UCG?
We have already received
strong interest from all
corners of the globe.
As Linc Energy’s UCG
specialist, I have already
had a string of meetings
with many interested
officials from countries
like China, India
and Korea.
Oleg Krzyzanowski,
General Manager UCG, Linc Energy
Age: 50
Qualifications:
Electronic engineering and
mining engineering
Experience:
More than 20 years experience
in hard coal and hard rock mining
Commenced with Linc Energy:
November 2006
Even though countries like Russia
have been using UCG for decades,
is the UCG technology itself at a
mature stage or has it still got a
way to go in terms of making the
technology more efficient, more
cost effective and more adaptable?
This is a good question. We have
already learned that there are ways
to further develop UCG technology
in terms of efficiency and cost
effectiveness. One shall always be
sure he/she uses the latest available
sub-technologies, and has the
scientific support to improve the
existing UCG and make it comfortable
and relatively easy to run. Once in
place, the success is guaranteed
and no extra costs are involved.
The UCG process is unique for each
project - even for a small block of
coal. The parameters should be
designed and changed accordingly
and as needed during production.
The uniqueness of each individual
UCG project is why the extensive years
upon years of experience we have
acquired with Yerostigaz is so valuable.
Whilst UCG is a proven process,
there is still a huge opportunity
for us through R&D to fine tune
it and improve it further.
Australia’s Leader in Clean Coal Technology
Linc Energy’s UCG team on site

Mr Nguyen Thanh Son,
Head of the VINACOMIN Delegation
(Front row fourth from right)
Mr Tokusaburo (Nobby) fukui,
Director of Marubeni Coal
(Front row third from right)
Mr Jungi Morinaga,
Assistant General Manager
of Marubeni Coal
(Front row second from right)
LINC pLACEMENT RAISES $A28.3 MILLION
Linc Energy announced late October it had
raised $A34million via a placement of 37,260,000
fully paid ordinary shares to institutional and
sophisticated investors.
Linc Energy’s Chief Executive Officer, Mr Peter Bond,
said there was oversubscribed demand from
sophisticated and institutional investors.
“We believe the result demonstrates investor confidence
in the successful roll-out of our strategic plan and the
market’s interest in clean coal technology,” Mr Bond said.
SHAREHOLDER NEWSLETTER
Issue 5 Summer 2007-2008
$US5 MILLION INVESTMENT
FROM MARUBENI COAL
LINC ENERGY’S EffORTS TO ATTRACT HIGH LEVELS Of OVERSEAS INVESTOR INTEREST ARE STARTING TO SEE TANGIBLE RESULTS.
Marubeni Coal Pty Ltd (a wholly owned subsidiary of Japanese based Marubeni Corporation) has shown confidence in its relationship
with Linc Energy by taking up a placement of $US5 million in the ASX listed company.
In June 2007, Marubeni Corporation and
Linc Energy signed a Memorandum of
Understanding (MOU) to explore mutual
opportunities.
This was followed by Linc Energy’s signing of a joint
venture in August with Marubeni Corporation and the
Vietnam National Coal-Mineral Industrial Group
(VINACOMIN). The joint venture was formed as a means
to develop the Red River Delta Coal Basin in Vietnam
via the application of Linc Energy’s Underground Coal
Gasification (UCG) process, and to use that UCG gas
for feeding a proposed combined cycle gas fired
power station.
The funds generated from the $US5 million Marubeni
investment will be utilised by Linc Energy for the
company’s upcoming twelve month expansion program.
LINC ENERGY RAISES A TOTAL Of $A34 MILLION
The funds will primarily be used for:
• A bankable feasibility engineering study
for the commercial Coal to Liquids facility
at Chinchilla
•
•
The purchase and installation of a nitrogen
rejection plant to improve the Underground Coal
Gasification (UCG) gas quality
The completion of 5mW gas fired turbine
power generator
“The investment of Marubeni in Linc Energy is
a great result for both groups and is a reflection of the
confidence and strong relationship between the two
companies.
“It is also a natural progression on the back of our
recent MOU with Marubeni Corporation signed in June
this year,” said Mr Peter Bond, Chief Executive Officer
of Linc Energy.
• The expansion of the engineering team
• Increased drilling of coal tenements
• General working capital
“A total of $34 million has been raised between this
placement and that of Marubeni Coal, and together
this will allow us to progress our current business
plan to develop UCG projects more aggressively,”
Mr Bond said.
www.lincenergy.com.au 03

What is your experience trading
on the stock market?
I do not usually trade on the stock market.
I usually buy stocks for mid to long term
investments and look for stocks that give
some capital appreciation and growth.
I usually spread the portfolio of my
investments with medium risk.
I prefer to invest in mineral mining
companies (preferably new start-ups
with potential). I also do lots of research
on the background of the companies
and their management.
How did you hear about Linc Energy
and what attracted you to investing?
I was introduced to Linc Energy by my
friends Peter Bond, and Brian Johnson
Linc Energy Ltd
Level 7, 10 Eagle St
GPO Box 1315 Brisbane
QLD Australia 4001
P +61 7 3229 0800
F +61 7 3229 6800
E jcv@lincenergy.com.au
SHAREHOLDER NEWSLETTER
Issue 5 Summer 2007-2008
As a civil engineer with a mining background, the potential of
Linc Energy has not been lost on William van Dongen.
Born and educated in the Netherlands and now living in Jakarta,
Indonesia for the past 25 years, William is one of Linc Energy’s top
50 shareholders.
Investor Linc spoke to William van Dongen to find out why he
invested in Linc Energy, how he thinks the company is travelling
and his views for the future.
whom I have known for a long time and
have done many other businesses before
with. I felt that this is the “business of
tomorrow” and as such I thought why
not be a part of it.
In the last 18 months, you would have
seen Linc Energy’s share price climb
to over $1 from an issue price of
25c in May last year. Are you happy
with the return on your investment
to date?
Well comparing to stocks from some
other countries and industries, I think
Linc Energy is giving a reasonable rate
of return on my investment.
There will be constant pressure for better, cheaper and
efficient technologies to be developed and this is where
Linc Energy can be the forerunner
What do you believe is Linc Energy’s
potential for even higher return,
given Linc Energy’s position now as
the world’s largest UCG company,
following its acquisition of Yerostigaz?
CHINCHILLA SITE IMAGES
PROGRESS IS MOUNTING AT LINC ENERGY’S CHINCHILLA SITE.
A PEEK AT JUST SOME OF THE ACTIVITY TAKING PLACE
First pressure vessel arrives on site for GTL plant
INTERVIEW WITH WILLIAM VAN DONGEN,
LINC ENERGY SHAREHOLDER
GTL slab pouring
Structural steel work
CONTACT DETAILS ON THE WEB
Personally at the rate things are going
and the system that is in place, I feel
that the potential is great and the shares
are capable of rising further in the
near future and once fully operational.
That’s why I am keen to be a part of this
success and have been encouraging my
other business partners as well.
In the last six months, Linc Energy has
established itself as an international
energy force, with significant
Memorandums of Understanding
for joint ventures in Vietnam, China
and other countries. How important
is Linc Energy’s ability to utilise its
intellectual property offshore as
opposed to restricting its operations
to the Australian market?
Across border ventures have their own
uniqueness, opportunities and obstacles.
Whilst it’s always better to “go global”,
Linc Energy has to pay careful attention
and tread the waters on these new
territories. Once this is overcome,
Linc Energy will be very successful.
The next few months will see the first
strong tangible signs of Linc Energy’s
technology at work at its Chinchilla
UCG Compressor Shed
GTL procurement items arriving on site
Linc Energy is gaining Australian and
International media coverage.
To view more go to
www.lincenergy.com.au/mediacoverage.php
facility in south-east Queensland.
How important is this milestone for
you and do you expect this to further
boost investor interest in Linc Energy?
This pilot project is very important for
the growth of Linc Energy. Being the
1st of its kind and a successful one
would definitely rocket investor interest
in Linc Energy. Once again Peter Bond’s
vision is put to the test and it should pay
off well for the investors of Linc Energy.
Since Linc Energy first listed, Australia
and the rest of the world have been
over taken by the imperative for clean
coal technology, which of course is
a cornerstone of Linc Energy’s UCG
process. Do you think the market
will continue to embrace this sort
of innovation?
Definitely yes. Now we are talking about
carbon credits, which was hardly heard
of a few years ago. Perhaps the next
step would be to further reduce the
pollution as a result of coal usage. There
will be constant pressure for better,
cheaper and efficient technologies to be
developed and this is where Linc Energy
can be the forerunner.
Australia’s Leader in Clean Coal Technology
www.lincenergy.com.au 04
Disclaimer: Whilst all care has been taken to ensure the accuracy of particulars in this document, no warranty can be given and interested parties must rely on their own enquiries
Age: 61
Employment:
A qualified civil engineer by
profession, William van Dongen
has been involved in the mining
industry since 1982.
Hobbies:
Horse show jumping, diving
and skydiving.
MERRY CHRISTMAS
WISHING YOU ALL A FANTASTIC
CHRISTMAS.
Enjoy this festive time with family and friends.
We look forward to helping make 2008 another
memorable and successful year for Linc Energy
and its investors!
Warmest regards Peter Bond and the
Linc Energy team.