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Page | 1
Oil & Gas Services M & A

Prepared for 9
th
Annual Excellence In Oil & Gas Conference, 12
th
March 2014

Resourceful Events



Nicholas A. Assef LLB (Hons), LLM, MBA
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Workbook Contents
Page | 2
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
Page | 3
Macro Picture Looks Attractive, But Many Challenges..
0
5000
10000
15000
20000
25000
30000
Australian Energy Exports
LNG Crude Oil
!""#$"%&'
)*
+&,-./.0.12
34*
5#66.7&'
88*
5#690&1&'
:*
LNG, Gas, Oil Major Project Pipeline
$294 Billion in Notional Projects
! Multiple Gas precincts c. Australia ! Capital deployment priority cheaper taxing nations ?
! South East Asia demand effects Fukushima ? ! US an advanced cheap producer of Oil & Gas (gas glut ?)
! Government desire royalties / cashflows ! Australian track record hitting timetable / budget ?
Source : BREE, LCC Calculations
Gas Exports Trending Up
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!"#$%&' ()*+,- .%-+,/ !%$ 1234 (56 7 589(:3 134 :,%; !"<&/=
Seaurlll n?SL : Su8L 18,381 $ 12.80x 10
!acobs Lnglneerlng n?SL : !LC 9,194 $ 11.00x 13 !"#$%&%'%() %) +,-. (/ 012 3()&$4'%)5 /(6 !7-8.,,9
CuanLa Servlces n?SL : W8 7,690 $ 9.20x 6 !"#$%&%'%() (/ :!3!; /(6 !7-,,9
Chlcago 8rldge & lron n?SL : C8l 8,940 $ 11.00x 4 <)"4$=>= ?07@ABC4) 9>65>6 D%'E 0EFD G6($H %) +,-+
McuermoLL lnLernaLlonal n?SL : Mu8 2,146 $ 9.00x 2 IF&' J KLL;0L! G6($H (//&E(6> M%4 N GF& 0>6O%">
Lmcor Croup n?SL : LML 3,400 $ 10.30x 6 !"#$%&%'%() (/ ?02 /6(9 P0L /(6 7++Q9 %) R$)> +,--
>?@ABC D&E,)FG/,H .,%&
0H>"%F4%&' M//&E(6> K6%44>6A ?07-8,S9 9>65>6 D%'E 0"(6H%() M//&E(6> %) +,-,
12 March 2014
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Deal Environment & Drivers
Page | 4
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$m
^ Deal Count since 1 January 2010
Source : Company Data, LCC Research
Just Corporate : Also high interest from Offshore PE / Pension Funds M & A back in vogue : In Australia many Toehold deals
Distressed Deals
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Valuation Arbitrage? Cross Border Observations
Page | 5
North American Public Company Sample
Australian Public Company Sample
!"#$%&' ()*+,- .%-+,/ !%$ 1234 (56 7 589(:3 134
SouLhern Cross LlecLrlcal ASx : SxL 130 3.10x SpeclallsL LlecLrlcal layer. valuaLlon mulLlple skewed because c$30m Cash (Low uebL)
WuS ASx : WuS 164 $ 3.90x valuaLlon mulLlple skewed because c. $43m Cash (no uebL). LCC assumes clrca A$32m L8l1uA l?14
A! Lucas ASx : A!L 260 $ - LxploraLlon & roducLlon urllllng, lpellne. dlvlslon focussed CSC
uecmll Croup ASx : uCC 362 $ 4.20x Acqulred LasLcoasL uevelopmenL Lnglneerlng for A$30.12m ln leb 2013
1ox lree SoluLlons ASx : 1Cx 446 $ 7.30x upsLream & downsLream Cll & Cas wasLe & lndusLrlal servlces
Mermald Marlne ASx : M8M 334 $ 3.30x Marlne LoglsLlcs. lLchLys Cas pro[ecL 2 laLform Supply vessel deal [ $143m conLracL
Skllled Croup ASx : SkL 740 $ 10.20x PlsLorlcally Labour Plre, buL acqulred 8roadsword Marlne ConLracLlng ln uarwln for A$72m ln !une 2013
Monadelphous ASx : Mnu 1,613 $ 6.10x 8ecenLly won large Cas lM pro[ecL - A$130m [ Woodslde's karraLha Cas lanL
Worleyarsons ASx : WC8 4,082 $ 9.70x SLrong Cff shore & Cnshore presence ln Pydrocarbons ulvlslon
;&<,)=>/,? .,%& @ABCD
!"#$%&' ()*+,- .%-+,/ !%$ 1234 (56 7 589(:3 134 :,%; !"<&/=
Seaurlll n?SL : Su8L 18,381 $ 12.80x 10
!acobs Lnglneerlng n?SL : !LC 9,194 $ 11.00x 13 !"#$%&%'%() %) +,-. (/ 012 3()&$4'%)5 /(6 !7-8.,,9
CuanLa Servlces n?SL : W8 7,690 $ 9.20x 6 !"#$%&%'%() (/ :!3!; /(6 !7-,,9
Chlcago 8rldge & lron n?SL : C8l 8,940 $ 11.00x 4 <)"4$=>= ?07@ABC4) 9>65>6 D%'E 0EFD G6($H %) +,-+
McuermoLL lnLernaLlonal n?SL : Mu8 2,146 $ 9.00x 2 IF&' J KLL;0L! G6($H (//&E(6> M%4 N GF& 0>6O%">
Lmcor Croup n?SL : LML 3,400 $ 10.30x 6 !"#$%&%'%() (/ ?02 /6(9 P0L /(6 7++Q9 %) R$)> +,--
>?@ABC D&E,)FG/,H .,%&
0H>"%F4%&' M//&E(6> K6%44>6A ?07-8,S9 9>65>6 D%'E 0"(6H%() M//&E(6> %) +,-,
Source : Company Data : LCC Research
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EMCOR Group Inc. (NYSE : EME)
Page | 6
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)
Page | 7
11 of 15 deals executed when TEV / EBITDA Multiple Higher than 8.0x (A)
T
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V

/

E
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(
A
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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
Page | 8
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
4 5
6
7
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
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International Deals : Samples of Specialists
Page | 9
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)
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CSG, Shale & LNG Driven Demand ACQUIRER TEV / EBITDA
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Opportunities & Trends
Page | 10
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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WWW.LCC.ASIA | Lincoln Crowne & Company
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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Page | 11
LCCs Community Focus
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12 March 2014
Contact us
Page | 12
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. asi a
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Page | 13
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).