2. CAUTION REGARDING FORWARD-LOOKING STATEMENTS
These slides and the accompanying oral presentation contain certain “forward-looking information” within the meaning of Canadian
securities laws, which may include, but is not limited to, statements with respect to future events or future performance,
management’s expectations regarding our growth, results of operations, estimated future revenues, requirements for additional
capital, production costs and revenue, future demand for and prices of electricity, business prospects, opportunities and estimates of
recoverable geothermal energy “resources” or “reserves” or energy generation capacities (at either P90 or based on the Geothermal
Code for Public Reporting). Such forward-looking information reflects management’s current beliefs and is based on information
currently available to management.
A number of known and unknown risks, uncertainties and other factors, may cause our actual results or performance to materially
differ from any future results or performance expressed or implied by the forward-looking information. Such factors include, among
others, those discussed in the section of our prospectus entitled “Risk Factors”. These factors should be considered carefully. The
forward-looking information is also based upon what management believes to be reasonable assumptions, including, but not limited
to, assumptions about: the success and timely completion of planned exploration and expansion programs, including expansion and
improvements to operations in Iceland and to our Soda Lake Operation in Nevada; the growth rate in net electricity consumption;
support and demand for non-hydroelectric renewables; government initiatives to support the development of renewable energy
generation; the accuracy of resource and reserve estimation methodology and probabilistic analysis used to estimate the quantity of
potentially recoverable energy; geological, geophysical, geochemical and other conditions at our properties; the reliability of technical
data, including extrapolated temperature gradient, geophysical and geochemical surveys and geothermometer calculations; capital
expenditure estimates; availability of capital to fund exploration, development and expansion programs; the differences in financial
results reported under IFRS and Canadian GAAP; and general economic conditions. Forward-looking information and statements
are also based upon the assumption that none of the identified risk factors that could cause actual results to differ materially from the
forward-looking information and statements will occur.
There can be no assurance that the forward-looking information will prove to be accurate, as actual results and future events could
differ materially from those anticipated in such information. Accordingly, prospective investors should not place undue reliance on
forward-looking information. Other than as required by applicable securities laws, we assume no obligation to update or revise such
forward-looking information to reflect new events or circumstances.
2
3. MAGMA ENERGY - STRATEGY & VALUE CREATION
Geothermal power can be the lowest cost and cleanest form of electricity generation
Potentially a great cash generator without incentives
Incentives (USA, Europe, Chile) greatly improve margins
Magma’s mission: to build a leading pure play geothermal power company
Magma’s strategy:
broad asset portfolio and scale =
“discovery returns” and
“utility returns”
Reduces drilling risk and high front-
end capital risk
Improves margins with lower cost of
capital
Better multiples
We are a power company and an energy resource company
3
DISCOVERY
RETURNS
UTILITY
RETURNS
ACQUISITION
EXPLORATION
FEASIBILITY
PERMITTING
FINANCING
CONSTRUCTION
OPERATIONS
TIME
PROJECTVALUE$
4. BALANCED PORTFOLIO: GLOBAL EXPLORATION & OPERATIONS
ICELAND:
2 power plants with 175 MW capacity
80 MW of expansions underway
Additional 150 MW of defined expansion plans
USA:
23 MW power plant with expansion potential
Steady, predictable and long-life cash flow
Excellent government support for geothermal projects
12 other exploration properties
CHILE / PERU:
Huge (320 MW) inferred resource discovered at low cost
Positioned in emerging world-class geothermal markets
Growing government support for geothermal projects
4
5. Mission: To build a leading pure play geothermal power company
Strong team of explorers, builders and operators
Execution: From 2008 startup, the world’s fastest growing geothermal power company
Growing financial strength
$(10)
$(5)
$-
$5
$10
$15
$20
$25
JAN - JUN /08 JULY/08 -
DEC/09
JAN - DEC/10
MILLIONSUSD
EBITDA
11
84
190
0
25
50
75
100
125
150
175
200
2008 2009 2010
INSTALLEDCAPACITY(MW)
POWER GROWTH
$-
$10
$20
$30
$40
$50
$60
Jan - Jun /08 July/08 -
Dec/09
Jan - Dec/10
MillionsUSD
REVENUE
MAGMA ENERGY - CORPORATE SUMMARY
5
199
555
99060
181
11
86
195
0
200
400
600
800
1000
1200
1400
2008 2009 2010
MW1
GEOTHERMAL RESERVES
& RESOURCES GROWTH
Inferred Indicated Reserves
1
Geothermal Reporting Code verified MW
2
2008 and 2009 actuals (2009 reflects Magma’s equity portion in HS Orka)
3
2010 is an estimate and reflects Magma's equity and newly consolidated portion in HS Orka
2
33
2
2 2
6. 0
100
200
300
400
500
600
700
Ram Power U.S. Geo NGP MAGMA Ormat
MW
Operating Development through 2013
DEVELOPERS
NORTH AMERICAN PRIMARY GEOTHERMAL COMPANIES
(1)
Geothermal Reporting Code verified MW
Source: Jacob Securities Inc
6
(1)
7. $-
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
STP MXY CLL OPC
CDN$/BOE
EV/BOE RESERVES & RESOURCES
EV/BOE Reserves EV/BOE Resources
(1,500)
(1,000)
(500)
-
500
1,000
1,500
STP MXY CLL OPC
MEGATONNES
CO2 CREDITS (PENALTIES) FROM
RESERVES & RESOURCES
-
500
1,000
1,500
2,000
2,500
STP MXY CLL OPC
MMBOE
BOE RESERVES & RESOURCES
BOE Reserves BOE Resources
MAGMA IS AN UNDERVALUED ENERGY COMPANY
7
. . . . . @ $15/tonne
≈ $14 billion credit
over 30 years
TSX symbols:
STP Southern Pacific
MXY Magma Energy
CLL Connacher Oil & Gas
OPC OPTI Canada
Assumptions:
0.62 bbl/MWh(th)
0.1 MW(e) / MW(th)
30 years of assumed project life
430 kg CO2 emitted per BOE
8. CREATING VALUE
OUR PROGRESS
Existing Iceland infrastructure allows for
rapid, low cost expansions
Now the 2nd largest North American based
primary geothermal developer
Major discovery in Chile
NEXT STEPS
Complete expansions at HS Orka, Iceland
Fulfill potential at Soda Lake, NV and
develop other US assets
Develop Mariposa, Chile and explore other
Chile/Peru assets
VALUE PROPOSITION
Non-declining assets providing steady
production and cash flow (forever)
Strong inventory of development prospects
Sufficient resources to increase existing
company proved reserves six-fold
Growing portfolio size reduces risk
Large team of geothermal experts - core
asset
8
248
11
84
190
307
443
643
198
InstalledCapacity(MW)
11. MAGMA ENERGY - GLOBAL PROJECT PIPELINE
STAGE PROPERTY
AREA RESERVES RESOURCES
(HA) PROVED INDICATED INFERRED
Operations Soda Lake - Nevada
1
2,881 20 41
HS Orka - Iceland
2
31,067 175 140 500
Advanced Mariposa - Chile
3
104,000 320
McCoy - Nevada4
4,621 170
Early Stage Argentina [2] 38,311
Chile [2] 158,000
Peru [7] 7,900
USA [11] 34,977
381,757 195 MW 181 MW 990 MW
Plant
Property
11
(1) Reporting Code Estimate GeothermEx
(2) Reporting Code Estimate Mannvit Engineering
(3)
Reporting Codes Estimate SKM
(4)
Independent estimate P90 Geo Hills Associates
McCoy
12. HS ORKA ACQUISITION - OVERVIEW
Magma gains:
Large producing asset base creates
strong income statement & balance sheet
Significant expansion potential
World class geothermal team
Iceland’s largest private energy
company
12
Magma acquired 98.5% of HS Orka
3 separate deals (2009 - 2010)
Cost for HS Orka:
$133 million cash and share
subscriptions
$ 90 million vendor bonds1
$2.4 M/MW2
for 175 MW in production
plus other opportunities
1
Bonds indexed to price of aluminum with an average
coupon rate of 2.4% and 2016 maturity
2
Includes $171.2 million HS Orka non-recourse to
Magma long term debt*
* Basket of foreign currency with an average coupon
rate of 2.8% and maturities ranging from 2016-2031
PROPERTY RESERVES RESOURCES COMMENT
PROVED INDICATED INFERRED
SVARTSENGI 75 MW No further expansions planned
REYKJANES 100 MW 90 MW
45 MW of steam behind pipe for expansion
phases; 50 MW turbine arrived May 2010;
further production drilling underway
ELDVÖRP 50 MW Steam behind pipe from 1 production well
KRÝSUVÍK 500 MW
4 MW of steam behind pipe from 2
production wells that are candidates for
stimulation; 9 slim wells; 19 temperature
gradient wells
TOTAL MW 175 140 500
Delivery of 50 MW turbine units - May 2010Delivery of 50 MW turbine units - May 2010
13. HS ORKA EXPANSION HIGHLIGHTS
Potential to expand from 175 MW to 405 MW
PPA discussions with Nordural and Others on-going
CapEx for full 230 MW expansion is ~$560 M; will be staged
50 MW phase expansion commenced; significant equity already invested
Next 30 MW phase requires no additional drilling
~46% of HS Orka’s revenue currently indexed to aluminum price
Future PPA’s with smelters and/or other power off-takers will impact HS Orka’s on-going sensitivity
to aluminum prices
13
CONCEPTUAL
PRODUCTION GROWTH
14. PRODUCTION - SODA LAKE, NEVADA
Ramping up to capacity of 23 MW
Current installed throughput is 84,000 GWh/yr
Phase 2 expansion - achieve reservoir capacity
61 MW
14
15. 320 MW Inferred Resource discovered
by Magma in 2009
50 MW Phase 1 exploitation plan
approved in April 2010
$15M resource confirmation program
underway to drill additional slim holes
>$100/MWh power rates and drilling
incentives available
<25 km from 2 transmission lines under
development
ADVANCED DEVELOPMENT - MARIPOSA, CHILE
MP- 03 DRILL SITE
MP- 01MP- 02
15
MP- 03
16. WORLD CLASS MANAGEMENT TEAM
Dick Benoit: USA
Exploration Manager
Over 35 years experience in the geothermal industry both
nationally and internationally
Mark Kumataka: USA
Chief Engineer
Professional Engineer with over 30 years experience in
geothermal resource management in U.S. & Latin America
Ásgeir Margeirsson: ICELAND
President & CEO
An extensive career in geothermal power development both
within Iceland and internationally
Monte Morrison: USA
Country Manager & VP Operations
Professional Engineer with 25 years experience managing the
operations and maintenance of geothermal power plants
John Selters: CHILE & ARGENTINA
Country Manager
Mining engineer with over 40 years experience in Latin
America
Lyle Braaten: Secretary & General Counsel
Lawyer. Extensive experience negotiating commercial
agreements and implementing large infrastructure
projects
Annette Cusworth: Chief Financial Officer
Chartered Accountant with over 20 years experience in
the public and private sectors
Dr. Catherine Hickson: VP Exploration & Chief Geologist
World renowned volcanologist with over 25 years
experience in Canadian and international geosciences
Alison Thompson: VP Corporate Relations
Masters of Chemical Engineering and Queen’s MBA;
Extensive experience in the energy industry; Chair of
CanGEA
Andrea Zaradic: VP Operations & Development
Mechanical Engineer with 20 years experience in
engineering design, construction, commissioning and
operations with large international mining projects
Ross Beaty: Chairman & CEO
Geologist and resource company entrepreneur with 38 years experience in the international minerals industry.
Founder and chair of Magma Energy Corp and Pan American Silver Corp. (TSX: PAA, NASDAQ: PAAS) and
several other resource companies that were successfully built and divested.
MAGMA ENERGY GLOBAL OPERATIONSMAGMA ENERGY CORP
16
17. INSTITUTIONAL QUALITY BOARD OF DIRECTORS
Ross Beaty - Chairman and CEO
David W. Cornhill - [Independent] Member Audit, Compensation and Governance Committees
Mr. Cornhill is the founder, Chairman and Chief Executive Officer of AltaGas Income Trust, one of Canada’s largest
energy infrastructure groups, focused on gas and power infrastructure and renewable energy (wind and hydro).
With more than 25 years of experience in the energy industry, Mr. Cornhill also sits on several private and public
boards including AltaGas Utility Group and Ivey Business School.
Robert Pirooz - [Independent] Chair Corporate Governance Committee, Member Compensation Committee
Mr. Pirooz studied commerce at Dalhousie University and received a Juris Doctor degree from the University of
British Columbia in 1989. From May 1990 to February 1998, Mr. Pirooz practiced law primarily in the areas of
corporate, commercial and securities law. Mr. Pirooz' extensive legal and business background spans over 20
years and includes the role of General Counsel for the BCR Group of companies and Pan American Silver Corp, a
role in which he currently serves, and as principal in the Lumina group of resource companies. Currently a director
of 5 public companies, Mr. Pirooz has worked with Ross Beaty since early 1998.
Donald Shumka - [Independent] Chair Audit Committee, Member Governance Committee
Mr. Shumka is Managing Director of Walden Management Ltd., a financial consulting firm. Mr. Shumka received
his Bachelor of Arts degree from the University of British Columbia and a Master of Business Administration from
Harvard University. From 1966 -1979 he worked in a variety of positions in the forest industry, from 1979 -1989 he
was Vice President and Chief Financial Officer of West Fraser Timber Co. Ltd. and from 1989 - 2004 he headed
the Forest Products Group for two Canadian investment banks. Mr. Shumka is active in the not for profit sector and
is currently the Chair of the British Columbia Arts Council.
Paul Sweeney - [Independent] Chair Compensation Committee, Member Audit Committee
Mr. Sweeney has over 30 years experience in financial management of mining and renewable energy companies.
He is currently Executive Vice-President, Business Development, of Plutonic Power Corporation, a run-of-river
hydro developer. He has served as CFO of a number of successful mineral resource companies including Canico
Resources and Sutton Resources and is a Director of several resource companies including Pan American Silver
Corp. where he chairs the audit committee.
17
18. NEWS-FLOW CATALYSTS
LOCATION GOAL TARGET DATE
Peru Exploration results On-Going
Mariposa, Chile Slim hole drilling results Q-4
Soda Lake, Nevada Phase 1 expansion complete Q-4
McCoy, Nevada Slim hole drilling results Q-1 / 2011
Soda Lake, Nevada New PPA with NV energy Q-1 / 2011
Reykjanes, Iceland PPA negotiations with Nordural and others Q-2 / 2011
18
19. 11%
51%5%
13%
20%
REGIONAL REPRESENTATION
OF SHAREHOLDERS
(JULY 2010)
U.S.A.
Canada
Europe
Other
Retail (Unknown Location)
OWNERSHIP, CAPITAL STRUCTURE & COVERAGE
19
CAPITAL STRUCTURE: AS OF SEPT 31/2010
ISSUED & OUTSTANDING 288.9 M
OPTIONS 3.3 M
LONG TERM DEBT US $275.0 M
CASH US $ 46.2 M
SHAREHOLDERS’ EQUITY US $240.5 M
ANALYST COVERAGE CONTACT
Cormark Securities MacMurray Whale
Jacob Securities John McIlveen
Mackie Research Capital Matthew Gowing
National Bank Financial Jeremy Mersereau
Pritchard Capital Partners Veny Aleksandrov
Raymond James Securities Steven Li
Salman Partners Mike Plaster
Stifel Nicolaus Dilip Warrier
Wellington West Capital Mgmt Sean Peasgood
INDEX COVERAGE
Ardour Global Alternative Energy Index
S&P/TSX Clean Technology Index
43%
6%20%
31%
MAGMA ENERGY SHAREHOLDERS
(July 2010)
Board and Management
Strategic Partner (AltaGas)
Estimated Retail
Estimated Institutional
