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Oil & Gas Services M & A Prepared for 9th Annual Excellence In Oil & Gas Conference, 12th March 2014 Resourceful Events Nicholas A. Assef LLB (Hons), LLM, MBA

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Workbook Contents

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1. Macro Sector & Regional Drivers - Upstream 2. Deal Environment & Drivers 3. Valuation Arbitrage? Cross Border Observations 4. Strategic Due Diligence: Current Deal Challenges 5. Northern Hemisphere Deals: Samples of Specialists 6. Opportunities & Trends

LCC is a specialist M & A Firm that is skilled at leading Directors and Senior Management through the complex Strategic, Financial, Governance & Project Management requirements of Public Transactions Since 2011 LCC has advised on c. A$500m in closed M & A transactions, c. A$300m in associated deal financings and is currently advising on a range of complex M & A and advisory transactions including the renegotiation of a multi decade royalty arrangement with Life of Royalty value c. A$1.5b LCCs weekly market research updates include M & A activity in the Engineering & Contracting sector in Australia

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Macro Sector & Regional Drivers - Upstream

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Macro Picture Looks Attractive, But Many Challenges..

0

5000

10000

15000

20000

25000

30000

Australian Energy Exports

LNG Crude Oil

Announced 9%

Feasibility 21%

Commi7ed 66%

Completed 4%

LNG, Gas, Oil Major Project Pipeline

$294 Billion in Notional Projects

Multiple Gas precincts c. Australia Capital deployment priority cheaper taxing nations ?

South East Asia demand effects Fukushima ? US an advanced cheap producer of Oil & Gas (gas glut ?)

Government desire royalties / cashflows Australian track record hitting timetable / budget ?

Source : BREE, LCC Calculations

Gas Exports Trending Up

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Company Ticker Market Cap ($A) TEV / EBITDA (A) Deal Count^

SeaDrill NYSE : SDRL 18,381$ 12.80x 10Jacobs Engineering NYSE : JEC 9,194$ 11.00x 15 Acquisition in 2013 of SKM Consulting for A$1,300mQuanta Services NYSE : PWR 7,690$ 9.20x 6 Acquisition of NACAP for A$100mChicago Bridge & Iron NYSE : CBI 8,940$ 11.00x 4 Included US$4.9bln merger with Shaw Group in 2012McDermott International NYSE : MDR 2,146$ 9.00x 2 Last - DEEPSEA Group offshore Oil & Gas ServiceEmcor Group NYSE : EME 3,400$ 10.50x 6 Acquisition of USM from TSE for $225m in June 2011

10.58xUnweighted Mean

Specialist Offshore Driller. US$1,06m merger with Scorpion Offshore in 2010

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Deal Environment & Drivers

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Cross Border / Foreign Direct Investment Capitalise on market imperfections & expanding market

opportunities Follow local Upstream client cross border Seek higher margin markets Enter / expand on sustainable Projects Deal with Regulatory & Union issues efficiently Valuation Arbitrage Abundance of Capital in North America Overall Deal Momentum Lifting

Domestic M & A Rationale Geographic balancing (West & East Coast) Institutional Investor sentiment (O & G exposure ?) Seek higher margin sub markets (not commoditised) Diversify Revenue & Client Base Liquidity Events For Smaller Players Valuation arbitrage Limited Debt Financing for M & A Bidder Valuations Depressed vs Northern Hemisphere Opportunism vs Strategic Valuations Prevail Strong Balance Sheet The Priority PE rotated away from sector for moment

Mining Boom Over ?

Large Diversified Engineering & Contractors Value in A$m ^ Deal Count since 1 January 2010 Source : Company Data, LCC Research

Just Corporate : Also high interest from Offshore PE / Pension Funds M & A back in vogue : In Australia many Toehold deals

Distressed Deals

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Valuation Arbitrage? Cross Border Observations

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North American Public Company Sample

Australian Public Company Sample Company Ticker Market Cap ($A) TEV / EBITDA (A)

Southern Cross Electrical ASX : SXE 130 3.10x Specialist Electrical Player. Valuation multiple skewed because c$30m Cash (Low Debt)WDS ASX : WDS 164$ 3.90x Valuation multiple skewed because c. $45m Cash (No Debt). LCC assumes circa A$32m EBITDA FY14AJ Lucas ASX : AJL 260$ - Exploration & Production Drilling, Pipeline. division focussed CSGDecmil Group ASX : DCG 362$ 4.20x Acquired Eastcoast Development Engineering for A$30.12m in Feb 2013Tox Free Solutions ASX : TOX 446$ 7.30x Upstream & downstream Oil & Gas waste & industrial servicesMermaid Marine ASX : MRM 554$ 5.50x Marine Logistics. Itchtys Gas project 2 Platform Supply Vessel deal @ $145m contractSkilled Group ASX : SKE 740$ 10.20x Historically Labour Hire, but acquired Broadsword Marine Contracting in Darwin for A$72m in June 2013Monadelphous ASX : MND 1,615$ 6.10x Recently won large Gas FM project - A$150m @ Woodside's Karratha Gas PlantWorleyParsons ASX : WOR 4,082$ 9.70x Strong Off shore & Onshore presence in Hydrocarbons Division

Unweighted Mean 5.86x

Company Ticker Market Cap ($A) TEV / EBITDA (A) Deal Count^

SeaDrill NYSE : SDRL 18,381$ 12.80x 10Jacobs Engineering NYSE : JEC 9,194$ 11.00x 15 Acquisition in 2013 of SKM Consulting for A$1,300mQuanta Services NYSE : PWR 7,690$ 9.20x 6 Acquisition of NACAP for A$100mChicago Bridge & Iron NYSE : CBI 8,940$ 11.00x 4 Included US$4.9bln merger with Shaw Group in 2012McDermott International NYSE : MDR 2,146$ 9.00x 2 Last - DEEPSEA Group offshore Oil & Gas ServiceEmcor Group NYSE : EME 3,400$ 10.50x 6 Acquisition of USM from TSE for $225m in June 2011

10.58xUnweighted Mean

Specialist Offshore Driller. US$1,06m merger with Scorpion Offshore in 2010

Source : Company Data : LCC Research

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EMCOR Group Inc. (NYSE : EME)

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Source : Company data, LCC Calculations, CapitalIQ, Bloomberg

Consistent M & A activity since 2010, including acquisition USM from TSE for c. $230m

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Jacobs Engineering Group Inc. (NYSE : JEC)

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11 of 15 deals executed when TEV / EBITDA Multiple Higher than 8.0x (A)

TEV

/ EBI

TDA

x (A)

Rapid Fire Deal Window 7 Deals in c. 8 Months Deal Momentum

Source : Company data, LCC Calculations, CapitalIQ, Bloomberg

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Strategic Due Diligence: Current Deal Challenges

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Each Deal Is Different : On High Alert For Areas That Can Cause Margin Collapse

Client Lists

Recent CAPEX Spend

Contract Waterfall

Technology vs Plain Vanilla

Union & Personnel Issues

Health & Safety Issues

Variations & Claims

Outstanding

Spread of Clients Project Lifecycle Client Pedigree

CAPEX Starved ? CAPEX Bubbles Current Competitiveness

of Kit Technology Shift

Term of Contracts Style of Contract

- Fixed - Open Book - Cost Reimburse

How Technical Work ? Competitors for Work ? Cost of Technology ? How Easy To Replace

Contractor on Site ?

1

2

3

45

6

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Delays in Payment % of Actual Claim or

Variation Track record of Sponsor in

Resolving Who the Sponsor is

Safety Standards Effect On Insurances Harmonisation of Work

Standards

Union Presence On Site Key Personnel - Roles Relationships With Client Employee Benefits - Accommodations

Schedules where FIFO

1

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International Deals : Samples of Specialists

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Natural Gas Partners LLC www.msenergyservices.com 6.86x **

Onshore gas field Horizontal Directional Driller (USA)

Alta Disposal www.altadisposal.com 7.00x ** Oilfield Waste Disposal including

Fracing Water (Canada)

Intertek Group PLC www.int-inspec.com 6.17x

Onshore & Offshore Non Destructive Testing & Inspection Services

(Norway)

EQT Partners AB www.akersolutions.com 6.9x Well intervention services including

well casing, testing, metering & wireline services (Norway)

** Minority Interest Deals

Business Growth Fund PLC www.spex-innovation.com 6.14x

Offshore recovery, severing & explosives operator

(Scotland)

HitecVision AS www.reefsubsea.com 7.81x Offshore Construction, trenching &

cabling Fleet Operator (Norway)

Onsh

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Offs

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CSG, Shale & LNG Driven Demand ACQUIRER TEV / EBITDA

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Opportunities & Trends

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Deal Activity Will Continue In Particular Cross Border Deal Activity In Marine & Unconventional Gas

Planets are aligned for ongoing Cross Border activity Weak AUD compared to 12 months ago Ongoing strong Onshore & Offshore Project Pipeline Unconventionals (CSG, Shale Oil) High International Valuations M & A Activity Warming Up In Northern Hemisphere High Access To Capital In Northern Hemisphere Good Pipeline of Potential Projects Weak Domestic Valuations Difficulty in Deal Financing (Debt and Equity) Reasonable Public Domestic Balance Sheets (Targets ?) Deal Challenges May Go To Value/Structure or Kill Deals

Baytex Energy acquires Aurora Oil & Gas for A2,316m. Assets include Eagle Ford Shale Belt in South Texas

(Both complex service delivery areas)

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PHILANTHROPY lincolncrownefoundation.org The Lincoln Crowne Foundation is an extension of the Firms corporate social responsibility arm that director, Nicholas Assef initiated.The foundations main purpose is to support and extend partnership development to grass roots charities. GOVERNANCE unglobalcompact.org We are governed by our commitment as a signatory to the UN Global Compact. The UN Global Compact is a strategic policy initiative for businesses that are committed to aligning their operations and strategies to ten universally accepted principles in the areas of human rights, labour, environment and anti-corruption. ACADEMIA bond.edu.au LCC and Bond University has established a relationship around the importance of success, academic integrity and outstanding performance. To this end, LCC has sponsored various faculty awards in both the Business and Law Schools. SPORT lincolncrownesailing.com.au LCC has sponsored 12 and 16ft skiffs in Sydney, over numerous sailing seasons and championships. In partnership with Variety the Childrens Charity, Nicholas Assef proudly supported the Variety Port Jackson 12ft Skiff Championships. This event marked the launch of a series of projects committed to raising support for Alopecia Areata, which is a medical condition of which there is no known cure.

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LCCs Community Focus

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Contact us

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AUSTRALIAN OFFICE Suite 1, Level 30 Governor Phillip Tower 1 Farrer Place Sydney NSW 2000 Australia Correspondence GPO Box 4154 Sydney NSW 2001 T: +612 9262 2121 F: +612 8088 1239

PRESENTER Nicholas Assef naa@lcc.asia T: +612 8288 8688

HONG KONG REP OFFICE 20/F One International Finance Centre 1 Harbour View Street Central Hong Kong HONG KONG T: +852 3960 6532 F: +852 3669 8008

AFSL 278054 ACN 105 807 645

www. l cc .as ia

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Important Information

This presentation (Presentation) has been drafted by Lincoln Crowne & Company Pty Limited and/or its affiliates (together, LCC) for the exclusive use of the party to whom LCC delivers this presentation (the Recipient) using information provided from a variety of sources, including publicly available information and potentially information from the Recipient. You acknowledge and agree LCC has not independently verified the information contained in this Presentation, nor does LCC make any representation or warranty, either express or implied, as to the accuracy, completeness or reliability of the information contained in this Presentation. This Presentation should not be regarded by the Recipient as a substitute for the exercise of its own judgment, and the Recipient is expected to rely on its own due diligence, including separate legal, tax and accounting, if it wishes to proceed further in relation to any transaction concept outlined in this Presentation. The indicative valuations, forecasts, estimates, opinions and projections contained in this Presentation involve elements of subjective judgment and analysis. They are based on facts and data that are often subject to rapid change. Any opinions expressed in this material are subject to change without notice. This Presentation may contain forward-looking statements, included those reported by various Companies. LCC undertakes no obligation to update these forward-looking statements for events or circumstances that occur subsequent to such dates or to update or keep current any of the information contained in this Presentation. Any estimates or projections as to events that occur in the future (including projections of revenue, expense, net income and stock performance) are based upon the best judgment of LCC from the information provided by the Recipient and other publicly available as of the date of this presentation. Any statements, estimates or projections as to LCCs fees or other pricing are accurate only as at the date of this presentation. There is no guarantee that any of these estimates or projections will be achieved. Actual results will vary from the projections and such variations may be material. Nothing contained in this Presentation is, or shall be relied upon as, a promise or presentation as to the past or the future. LCC, its affiliates, directors, employees and/or agents expressly disclaim any and all liability relating or resulting from inaccurate or incomplete information and the use or reliance of all or any part of this Presentation or any of the information contained within this Presentation. By accepting this Presentation, the Recipient acknowledges and agrees that LCC will at all times act as an independent contractor on an arms-length basis and will not act in any other capacity, including in a fiduciary capacity, with respect to the Recipient. LCC may provide services to any member of the same group as the Recipient or any other entity or person (a Third Party), engage in any transaction (on its own account or otherwise) with respect to the Recipient or a Third Party, or act in relation to any matter for itself or any Third Party, notwithstanding that such services, transactions or actions may be adverse to the Recipient or any member of its group, and LCC may retain for its own benefit any related remuneration or profit. This Presentation has been prepared solely for informational purposes and is not to be constructed as a solicitation or an offer to buy or sell any securities or related financial instruments. The Recipient should not construe the contents of this presentation as legal, tax, accounting or investment advice or a recommendation. The Recipient should consult its own counsel, tax and financial advisors as to legal and related matters concerning any transaction described in this Presentation. This Presentation does not purport to be all-inclusive or to contain all of the information that the Recipient may require. No investment, divestment or other financial decisions or actions should be based solely on the information in this Presentation. This presentation has been prepared on a confidential basis solely for the use and benefit of the Recipient. Distribution of this presentation to any person other than the Recipient and those persons retained to advice the Recipient, who agree to maintain the confidentiality of this material and be bound by the limitations outlined herein, is not authorized by LCC. LCC specifically prohibits the redistribution or reproduction of this material in whole or in part without the written permission of LCC and LCC accepts no liability whatsoever for the actions of third parties in this respect Lincoln Crowne & Company holds a series of registered trademarks in the United States of America and Australia to protect its intellectual property. Those trademarks are Lincoln Crowne & Company: Reg. No. 4,107,955 with the United States Patent & Trademark Office and the following with the Australian Government as certified by the Registrar of Trade Marks : Lincoln Crowne (Trade Mark No. 1423960); Lincoln Crowne & Company (Trade Mark No. 1423961); LCC (Trade Mark No. 142116) and lincolncrowne (Trade Mark No. 1424175).