Macquarie conference beach petroleummay2007

May 2007

Beach Petroleum Limited

Macquarie Securities Australian Conference

Reg Nelson – Managing Director, Beach Petroleum

2

Summary

Company profile

Five year performance

Key projects

Growth opportunities and outlook

May 2007


Company Profile

4

Company Attributes

High quality, balanced portfolio of assets with solid Australian reserves baseStrong, long term cash flow potential Reserves:Production ratio of ~ 10 yearsProven value manager of assetsStable workforce – key people long term employeesDiversified portfolio – geographic & commodities:

Oil, gas, gas liquids, geothermalOffshore & onshore

Solid growth profile and expansion strategy:232% organic three-year reserve replacement ratio

5

Corporate Structure & TSR

Admitted to ASX 200 in September 2006Market capitalisation of $1.15 billion @ $1.30/sh

8.1 million employee options EX$1.406

884.0 million ordinary shares

Issued Shares & OptionsShareholder Return

86.00%64.00%

35.00%50.00%

0%10%20%30%40%50%60%70%80%90%

100%

1yr 2yr 3yr 4yr

Tota

l Sha

reho

lder

Ret

urn

6

Key Revenue Earning Projects

Cooper Basin:Oil, gas and liquids – over 200 fieldsLong-term gas contractsOil production forecast to increase through Cooper Oil ProjectMoomba hub connects to eastern seaboard pipeline systemLiquids pipeline to Port Bonython

Basker-Manta-Gummy (BMG) Project:Oil production commenced Dec 2006Development planned for gas and condensate resource

Tipton West Project:Large coal seam gas resourcePhase 1 production commenced Jan 2007

BRISBANEMOOMBA

ADELAIDE SYDNEY

MELBOURNE

BALLERAJACKSON

~300 PJ 11 mmb

70 PJ

20 mmb

500 KM

190 PJ / 9 mmb

MT ISA

GLADSTONE

TAMWORTH

LITHGOW

7

Reserves -- 30 June 2006

101368731TOTAL

1270--Surat

20--20Gippsland

70298711Cooper

Oil Equivalent (mmboe)

Sales Gas (PJ)

Gas Liquids

(mmboe)

Oil(mmb)

Proved and Probable Reserves

Area

BRISBANEMOOMBA

ADELAIDE SYDNEY

MELBOURNE

BALLERAJACKSON

~300 PJ 11 mmb

70 PJ

20 mmb

500 KM

190 PJ / 9 mmb

MT ISA

GLADSTONE

TAMWORTH

LITHGOW

8

Reserves & Upside Potential

Beach has upside exposure to c.65mmboe of additional

reserves in existing projects/developments

0

20

40

60

80

100

120

2P Reserves

OSH

BPTAWE

ROCAZA

HDRAED

IPMTAP

AMUARQ

Beach PetroleumOil Search

AWE

ROCHardman

May 2007


Proven Ability to Perform

10

Historical Growth: 2002 to 2006

0

20

40

60

80

100

120

140

160

FY02 FY03 FY04 FY05 FY06

Gross Revenue

0

5

10

15

20

25

30

35

40

45


Net Profit AfterTax

0

10

20

30

40

50

60


Earnings BeforeInterest & Tax

$ million

$ million

$ million

0

0.25

0.5

0.75

1

1.25

1.5


BMGOnshore

Production

May 2007


Key Development Projects:BMG (Offshore Gippsland) Oil & Gas

Cooper Oil, Gas & Gas LiquidsQueensland Coal Seam Gas

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Basker-Manta-Gummy (BMG)Beach 50%

Oil Reserves (gross)

1P: 13 mmb2P: 39 mmb3P: 77 mmb

Contingent Resource (gross)*

Low 122 PJ & 6 mmb ~ 26 mmboeBest 380 PJ & 19 mmb ~ 82 mmboeHigh 820 PJ & 47 mmb~ 184 mmboe

* Based on latest certification by Gaffney Cline and Associates (August 2006)

Significant increase in reserve estimates following development drilling:Oil 2P reserves nearly double original estimateGas-condensate resource nearly quadrupledEstimated field life nearly trebled to 17 years

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BMG: Increase in Reserves

Basker Field appears to be much larger than first prognosed

Implications are more oil & much more gas-condensate than expected

Wells drilled to date tend to be nearer the crest of the field than intended

Oil-water contact inferred prior to drilling of Basker wells 3 to 5

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BMG: Current Status

Current Status

Production Commenced 17 December.

Higher than expected GOR (~2,000 actual vs1,200 expected) –probably due to wells located higher on a much larger structure.

Operational issues, primarily with compression facilities have largely been addressed.

Conditional Gas Sales Agreement with Alinta executed

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BMG: Current Status

Status at 19 April 2007

Producing from Manta-2A, Basker 2, 3 & 5.

Gas being injected into Basker-4 (~32 mmcfd)

Medium term target 15-20,000 bopd

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BMG: Further Oil Development

Up to 3 further Basker Wells addressing ~15mmb of undeveloped 2P reserves

Cost – $250 to $300 million*

Drilling ….. Basker-6 Late 2007 (remainder mid 2008)

Online early 2008

Gas development program will help maximise oil production

All numbers are for 100% of project

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BMG: Gas Development Plans

Conditional Gas Sales Agreement with Alinta for Tasmanian power generation (225 PJ over 15 years)

Aiming for Project sanction 2nd

Quarter ’07 - startup 2009

Drill up to 3 wells in Manta & Gummy Fields in 2008

Gas Pipeline to Shore +Gas Processing Facility (prob offshore)

Cost estimate ~$500 million*

Possible new (leased) FPSO*All numbers are for 100% of project

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Cooper-Eromanga Projects

Bodalla BlockBeach 100%

Oil to Brisbane

Naccowlah BlockBeach 38.5%Christies/Sellicks

Beach 75%CB JVs

Beach ~21%

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Cooper-Eromanga Basin:Strong Profitability

High Netback Oil Production

Production for the first half year of FY07 was 0.9 mmbbl (approx. 50% from Beach-operated and 50% from Santos-operated)

Chart shows netback per barrel sensitivity for various oil prices

Average realised price for 1H FY07 was AUD 86.90/bbl

Average netback of AUD53.73/bbl at oil price of AUD86.90/bbl

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Cooper-Eromanga Basin: Highlights FY07 to Date

Callawonga Oil DiscoveryOnline in Nov @ 1,000 bopd (net) Reserves ~1 mmb (net to Beach)

Cooper Oil Project Success

(18 wells drilled, 16 successful - ~89% success rate)

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Cooper Oil Program (COP)

Development & Appraisal Program operated by Santos in existing oil fields

Average Beach equity is ~25% (but 38.5% of Naccowlah Block)

Targeting reserves replacement (net to Beach) of ~ 13 mmb over 3 to 5 years

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COP NETBACK SENSITIVITY ANALYSIS

COP economics are robust with prevailing oil prices …

31.0023.0015.00Netback

13.00

10.00

22.00

60.00

20.00

10.00

22.00

75.00

AUD/bbl

27.00Royalties*

10.00Production Costs

22.00Finding & Development

90.00Oil Price

* Includes Delhi royalties

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COP Rationale

~700 mmb Original Oil In Place (OOIP) in existing Cooper Basin fields

Ultimate recovery expected from existing wells ~200 mmb (28% recovery factor)

Aim to increase recovery factor by 5-15% >> additional 35-100 mmb

Low risk/high success rate (~75 to 80% to date)

Requires many wells to be drilled in a 3 to 5 year project

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COP Projections for 2007

Beach participating in drilling 130+ wells at an average interest of ~25%

Potential to yield reserves increase of 3 - 6 mmb p.a. from:

Naccowlah Block-(Beach 38.5%)24 wells (13 exploration, 11 dev & appraisal)Programme commenced March 2007Cost $21 million (net)Expected Reserves ~1 mmb (net)Expected Initial Production 1,000 BOPD (net) Expected Value $15-25 million (net)

Rest of Cooper Basin J.V. (Beach ~ 21%)

~100 Wells in other tenements in 2007Expected net reserves 2-5 mmbExpected initial production net to Beach of 3500 BOPD (1.25 million bbls per year)

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Tipton West Coal Seam Gas

Beach 40%

Proved & Probable (2P) reserves: 174 PJ

Very large resource:

Upside potential of 2,300 PJ

Close to markets & pipelines

High Exploration Potential

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Tipton West Coal Seam Gas

Phase 1 Development – 82 wells

Development Drilling CompletedGas Sales Commenced in FebruaryTarget Rate 30 TJ/dayFirm commitment recently upgraded to 10 PJ/yr for 15 years, with a further 7.3 PJ/yr put option

Exploration Potential

Taroom Coal MeasuresDalby South Block Corehole Program

May 2007


High Impact Exploration Projects

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High Reward Exploration

Carnarvon (BPT 10%)Hurricane-2, Q2 ‘07

Offshore Otway Basin (BPT 50%)

Production TestingChampagne Creek (Surat)

Offshore New Zealand

Hurricane-2

3D Seismic

Barque-1

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Present Drilling Targets FY07-08

Drill FY07Demonstrate commercial hot rock energy resource

21%Paralana Project (South Australia)

Geothermal

Drill FY 086 TCF of gas + 500 million barrels of condensate

20%Barque-1Offshore NZ

3D Seismic Q1 FY07

Drill FY 08

Target >1 TCF gas potential

50%Fermat-1Offshore Otway

May 2007Target 40-50 mmbbl oil potential

10 %Hurricane-2Offshore Carnarvon

TimingCommentsBPT %TargetsProject Area

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Hurricane-2 Hurricane-1

Beach 10%

Offshore Carnarvon Basin - Oil

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Offshore Otway Basin - Gas

Approx. same scale

Fermat Prospect

Casino Gas FieldTarget size:

approx. 1 TCF gas

Beach 50%

32

Large Gas Liquids Potential – New Zealand

Beach 20%

Lightly explored

Sub-commercial gas/condensate discovery (Galleon-1)

Significant upside potential

Barque Prospect potential for 6 TCF of gas + 500 million barrels of condensate

Barque

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Large Gas Liquids Potential – Browse

Beach 10%

Close to Brecknock, Scott Reef and Brewster discoveries

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Geothermal Exploration

Beach farming in to earn 21% interest in 4 geothermal exploration licences in SAContribute up to $10 million to drill 1 -2 wells to demonstrate hot rock energy resourceCan contribute a further $20 million to earn a total 36% - install 7.5 Mw plant to supply power to Beverley Uranium Mine

May 2007


Growth Opportunities & Outlook

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Strategies

Build gas portfolio around eastern seaboard pipeline network

Entry into projects with LNG potential at ground floor

Greater exposure to high reward exploration – Australia and international

Geothermal project assessment – both for long term revenue potential and for carbon credits

LNG Potential

LNG Potential

LNG Potential

Build gas portfolio around eastern

seaboard pipeline network

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Production

Cooper Oil Program expected to build oil production significantly from 2008-2010Beach-operated Cooper oil expected to continue to produce at ~ 1mmbbl p.a. or better over the next 3-5 years - with good likelihood of continued reserves replacementBMG oil production ~15,000-20,000 bopd (gross) pending oil develoipmentprogram in late 2007Cooper gas expected to continue to decline over the next decade, but tight gas resources offer longer term potentialSubstantial coal seam gas potential beside pipelines at Tipton West for future contractsBMG gas development plan ~2008-09

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Exploration

Good medium to long term potential for low risk exploration in Cooper regionPotential discoveries at Glenaire (onshore Otway) and Champagne Creek (Surat)Offshore Carnarvon Hurricane play could have significant follow-up potentialLarge gas prospects offshore from Portland, VictoriaLarge gas-condensate plays offshore South Island, NZNew geothermal potentialExperienced professionals dedicated to searching for and evaluating new opportunities both in Australia and internationally

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What Sets Beach Apart?

Reserves BaseAt top of mid capsStable mix of oil, gas & liquidsGeographic spread – offshore & onshoreLong life production potential (10 years reserves:production ratio)

AttitudeCommitment to reward shareholders (consistent record of TSR)Commercially astute management – aggressive expansion strategyLong term view of emerging trends and opportunitiesGood, stable professional workforce

FundedRobust operational cash flow and finance facilities to fund projects

Highly activeStrong exploration & development program

Potential for high impact discoveries

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Important Notice & Disclaimer

Beach Petroleum has prepared this presentation based on information available to it. No express or implied representation or warranty is made as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions contained in this presentation.

To the maximum extent permitted by law, neither Beach Petroleum or its related or affiliated companies (together the ‘Beach Group’) nor their respective directors, employees, agents or advisers (together the ‘Officers’), accepts any liability (including, without limitation, any liability arising from fault or negligence) on the part of any of them or on the part of any other person (whether referred to in this presentation or not), for any direct or indirect loss or damage arising from the use of, or reliance on, this presentation or any discussion or commentary in respect of it, by the Beach Group or any of the Officers (together the ‘Presentation’).

The Presentation is not an advertisement, inducement, offer, invitation, solicitation or other recommendation to subscribe for or purchase any securities of any member of the Beach Group. The Presentation will not form the basis of any contract or commitment to subscribe for or purchase any securities of any member of the Beach Group. Any offer or invitation to subscribe for or purchase any announced or pending security issue by any member of the Beach Group which requires the issue of a disclosure document under the Corporations Act 2001, will only be made under and in accordance with the terms set out in the disclosure document issued at the time the offer or invitation is formally made. Anyone who is entitled to, and wishes to, subscribe for or purchase such securities will need to complete the application form for the securities that will be in or will accompany the disclosure document.

The Presentation may contain forward looking statements that are subject to risk factors associated with oil and gas businesses. While it is believed that the expectations reflected in these statements are reasonable, there can be no guarantee that actual results and trends will be in accordance with the forward looking statements. Actual results or trends may be affected by a variety of variables as well as changes in underlying assumptions which could cause actual results or trends to differ materially for those in the Presentation. The variables include, but are not limited to, resource and commodity price fluctuations, actual demand fluctuations, currency and interest rate fluctuations, drilling and production results and their impact on reserve estimations, loss of markets, industry competition, environmental risks, physical risks, legislative and any related fiscal and regulatory changes, economic and financial market conditions in various countries and regions, political risks, project delay or advancement, ability to obtain or delays in obtaining approvals from regulatory authorities and other third parties, and changes in cost estimates as a result of changes in other variable factors. This list is not exhaustive.

All references to dollars, cents or $ in this presentation are to Australian currency unless otherwise stated. The distribution of this presentation outside Australia may be restricted by law and it is the responsibility of the recipient to observe any and all such restrictions.

NOT FOR DISTRIBUTION TO THE UNITED STATES WIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

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Macquarie conference beach petroleummay2007