2007 Interims Presentation FINAL - Premier · PDF fileexploration plays in Pakistan ... Asia...
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Transcript of 2007 Interims Presentation FINAL - Premier · PDF fileexploration plays in Pakistan ... Asia...
2007 Interim Results Presentation 20th September 2007
Page 3 | 2007 Interim Results Presentation
Forward looking statements
This presentation may contain forward-looking statements and information that both represents management's current expectations or beliefs concerning future events and are subject to known and unknown risks and uncertainties.
A number of factors could cause actual results, performance or events to differ materially from those expressed or implied by
these forward-looking statements.
Page 4 | 2007 Interim Results Presentation
Highlights
Page 5 | 2007 Interim Results Presentation
Highlights
• 42 mmboe of reserves and resources added at ~$2.0/bbl
• Scott acquisition will have one year payback
• Completion of acquisitions in UK and Indonesia
• Steady progress in defining development projects
• Zamzama Phase 2 startup• Progress on Gas sales in Indonesia• Engineering & project planning progressing
in Vietnam, Indonesia & Norway
• 1H production up 5% from 2H 2006 with current run rate of 37,000 boepd
• 50,000 boepd by end 2010 and rising
• Rising production profile – on track to meet targets
• Continuing to build high impact exploration pipeline
• Testing in India• Anne well to spud in September 2007• Norway, Congo and Vietnam wells planned
for 2008 and 2009
20000
Daily Production(boepd)
0
10000
40000
30000
50000
2008
70000
80000All projects earlierAll projects laterBase producing fields
2009 2010 2011
60000
Page 6 | 2007 Interim Results Presentation
Asia• Optimise Natuna
Sea position• Build new core areas
in Vietnam and North Sumatra
• Fully exploit exploration play in Vietnam
Regional strategies
Middle East / Pakistan• Continuing growth in
Pakistan gas business• Seeking new
exploration plays in Pakistan
• Progressing new JV in the region
West Africa• Pursue high impact
exploration in Congo and elsewhere
• Exit Mauritanianposition
North Sea• Add to existing
producing fields• Exploit Norwegian
development projects• Pursue high impact
exploration
Page 7 | 2007 Interim Results Presentation
Exploration strategy
• Drill up programme of high impact new plays (Congo)
• Fully exploit plays as follow-ons to success (Vietnam)
• Maintain focus on new areas for future drilling (Eastern Indonesia, Barents Sea)
• Through commercial activity, ensure operating cash flow more than twice covers exploration spend
Page 8 | 2007 Interim Results Presentation
Financial results
Page 9 | 2007 Interim Results Presentation
Financial performance
• Balance sheetMaintained balance sheet strength pre-funding investment programme
• Operating profit Reduced by exploration write-down and non-cash charges
• Operating cashflowbefore working capital
Strong underlying cashflows driven by rising production and high prices
• Operating costsUnderlying costs stable at $6.90/bbl (including certain one-off items)
108.8
69.7 82.8
147.6 155.2 143.3
5.06.5 6.9
-26.2
43.8
-24.1
Page 10 | 2007 Interim Results Presentation
North SeaWytch FarmScottKyleOthers
AsiaAnoaKakap
PakistanQadirpurBhitZamzamaKadanwari
West AfricaChinguetti
Total production
kboepd (net)FY 2006
6.93.20.42.01.3
11.67.93.7
12.13.92.94.11.2
2.42.4
33.0
kboepd (net)1H 2007
8.33.01.92.21.2
11.87.93.9
12.54.02.94.31.3
1.41.4
34.1
Production
Page 11 | 2007 Interim Results Presentation
Scott acquisition
Scott Economics
• Pre-emption purchase price $60m
• Adjusted final price (including inventory of $26m) $53m
• After-tax cash flow (May 19th-August 31st) $38m
5.16%5.16%Maersk
10.47%10.47%ExxonMobil
0.00%20.95%Hess
20.64%20.64%Petro-Canada
41.89%40.99%Nexen
21.84%1.79%Premier
AfterBeforeCompany
Scott Field • Anticipate cash pay-back within 12 months of acquisition
• Further in-fill drilling opportunities
• Expected field life 2020
Page 12 | 2007 Interim Results Presentation
Production and income statement
Working Interest Production (mboepd)Realised oil price ($/bbl)Realised gas price ($/mcf)
Sales and other operating revenuesCost of salesGross profitExploration/New BusinessGeneral and administration costsOperating profit Financial ItemsProfit before taxationTaxationProfit after taxProfit/loss from discontinued operationsProfit for the period
12 months to31 Dec 2006
6 months to30 June 2006
33.064.90
5.11
$m358.8
(126.6)232.2(37.1)(16.6)178.5(5.7)
172.8(86.7)
86.1-
(18.5)
32.566.50
5.26
$m196.2(65.6)130.6(13.8)
(8.0)108.8(18.5)
90.3(53.7)
36.6(2.9)33.7
Highlights
Including Guinea Bissau writeoff of $25.7 million
Non cash mark to market hedging loss of $9.9m
3% premium to Brent oil prices
6 months to30 June 2007
34.165.00
5.03
$m239.4
(114.4)125.0(34.4)
(7.8)82.8
(14.3)68.5
(48.0)20.5
-20.5
50% effective rate on profits pre-exploration writeoffMauritanian assets maintained at fair value estimate of $83.5m
Page 13 | 2007 Interim Results Presentation
143.3(22.3)(34.3)86.7
(188.5)(7.9)
(109.7)
Cashflow
Operating cash flowWorking capital movementsTaxation paidNet cash from operating activitiesCapital expenditurePre licence exploration costsNet cash flow before financing
6 months to30 June 2006
$m
12 months to31 Dec 2006
$m
302.858.2
(116.2)244.8
(156.5)(19.2)69.1
147.676.9
(50.0)174.5(95.9)(6.8)71.8
2007 2006
Development
188.5 95.9
Exploration 39.939.0
Acquisitions 17.089.637.961.0
6 months to30 June 2007
$m
Before working capital movements
Cargo proceeds of $42.0m received on 3 July
Expenditures ($m)
Page 14 | 2007 Interim Results Presentation
Balance sheet
Cash and equivalents
Bank debtConvertible BondsNet (debt)/cash
Net assets
Balance sheet gearing
Undrawn facilities
As at31 Dec 2006
$m
As at30 Jun 2007
$m
240.8
(68.0)(196.9)(24.1)
582.5
4.6%
207.0
40.9
--
40.9
449.1
-
275.0
Invested at an average 5.28%
As at30 Jun 2006
$m
43.8
--
43.8
412.4
-
275.0
$250 million issue in May at 2.875% coupon, $51.9 million attributed to equity reserve
Page 15 | 2007 Interim Results Presentation
Development update
Page 16 | 2007 Interim Results Presentation
Middle East – Pakistan – Producing fields
• Zamzama Phase-2 first production is imminent– Incremental 150 mmscfd of production capacity– On time and on budget
• Badhra first production at year end– Initial development of 30 mmscfd
• Qadirpur capacity expansion in April 2008– Plant capacity increasing from 500 to 600 mmscfd
• Qadirpur Power Generation Project in 2009– Further 70 mmscfd of gas to a new power station
• Further potential projects exist with Badhraextension and Qadirpur Deep
20000
Pakistan Production Graph(boepd net)
18000
16000
14000
12000
100002006 2007 2008 2009 2010
Further potentialDevelopment projectsProducing fields (including development drilling)
The historical picture of reliable production growth looks set to continue:
Page 17 | 2007 Interim Results Presentation
Other key producing fields
Scott• In 2006/7 a successful infill drilling
campaign reinvigorated production– Production increased from
18 to 35 kboepd gross– Added 11 mmbbls reserves at
$10/barrel
• After further study work a new campaign is being planned for late 2008/9
• Upgrades to power generation and water injection will increase production
Kyle• Completion of the gas lift project has
significantly increased production
Page 18 | 2007 Interim Results Presentation
Asia – Vietnam – Blackbird / Dua
• First production targeted for 2010 but 2009 may be possible• Market survey of FPSOs completed• Development team in place in Ho Chi Minh• Reservoir studies and development cost estimating are ongoing• Gas options under review
Q12008
Q2 Q32009 2010
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4Q42007
RAR FDP
PV Approvals
FPSO
Specify
Tender
Convert
Install
Wellhead Platforms
Specify
Tender
EPCI - Blackbird
Install - Blackbird
EPCI – Dua
Drilling
Drill Blackbird Wells
Tieback Blackbird Wells
Drill Dua Wells
First Production
Page 19 | 2007 Interim Results Presentation
Asia – Indonesia – West Natuna Block A GSA 2
• Confident of Indonesian ministerial approval to export gas
• A further expansion of the JurongPetrochemical complex has been announced
• Evaluating the possibility of an offer from Sembgas (GSA1 Buyer) as an additional buyer to ExxonMobil
• Development planning continues– Pre-FEED work is ongoing
• First production target of Q4 2010
Page 20 | 2007 Interim Results Presentation
Asia – Indonesia – North Sumatra Block A
• Targeting POD approval at end of October– Gas sales negotiations with PIM (fertilizer
manufacturer) are progressing – POD has been submitted to BPMigas for review– Tendering process for FEED is underway
• First production targeted for Q4 2010
• Early production project of 15 mmscfd to an IPP for late 2009
• Study work on re-development of the old oil fields has commenced
Page 21 | 2007 Interim Results Presentation
North Sea – Norway – Frøy
• Development concept has been selected– Jack-Up with Drilling, Production, Storage & Offtake– Either a converted rig or a purpose built jack-up– Installation in autumn 2010 or 2011– First production will be three months later
• EPCIC contract has been tendered– 5 potential bidders with responses due in October– Facility will be leased
• Expecting POD submission in Q1 2008
Page 22 | 2007 Interim Results Presentation
2007 2008 2009 2010
PakistanBlackbird / DuaWNBA GSA-2NSBAFrøyRatna
Field developments schedule
NB: Projects are shown at “earlier” case start dates, for “later” case dates add one year
ProjectInitiation
ConceptSelection
ProjectSanction
FirstProduction
Study Design ExecuteOperated
Non-operated
Page 23 | 2007 Interim Results Presentation
Production forecast
20000
Quarterly Production (boepd)
0
10000
40000
30000
50000
Q32009
70000
80000All projects earlierAll projects laterBase producing fields
60000
Q42009
Q12010
Q22010
Q32010
Q42010
Q12011
Q22011
Q32011
Q42011
Q12012
15,00010,0006,0008,000Net rates (boepd)FrøyNSBAWNBA GSA2Blackbird/DuaField
Page 24 | 2007 Interim Results Presentation
Exploration update
Page 25 | 2007 Interim Results Presentation
North Sea
Page 26 | 2007 Interim Results Presentation
North Sea – Norway – PL407 – Bream
• Undeveloped Brent age oil field discovered 1971• First well planned 2008• Operator estimate of 80 mmbbls• Premier 20% equity share
PL407 Bream Appraisal
PL406 Bream Exploration
Yme Field Re-development
10km
Gardrofa prospect
Page 27 | 2007 Interim Results Presentation
Lomond field
NW SE
North Sea – UK – 23/22b – Sparrow Prospect
Page 28 | 2007 Interim Results Presentation
West Africa
Page 29 | 2007 Interim Results Presentation
West Africa – Guinea Bissau
Page 30 | 2007 Interim Results Presentation
West Africa – Guinea Bissau – Espinafre Map
Page 31 | 2007 Interim Results Presentation
West Africa – Guinea Bissau – Espinafre interpretation
Pre-drill Post-drill
Page 32 | 2007 Interim Results Presentation
West Africa – Guinea Bissau – Eirozes map
Tied to Sinapa-2
Page 33 | 2007 Interim Results Presentation
Themis Marin PSCPremier 18%• Rig contracted for 4Q 2007 • Admiral-1 planned for Dec 2007
West Africa – Gabon – Themis – Admiral-1
Page 34 | 2007 Interim Results Presentation
Tertiary (Turbidite Channel) Play• ~ 14 BBO Reserves & Growing• ~ 100 Expl. Wells since 1994
Cretaceous (Albian-Cenomanian Raft) Play• ~ 5 BBO Reserves• Significant Producer: Congo & Angola
Pre-Salt (Syn-rift Sand) Play• ~ 2.6 BBO Reserves • Under Explored - MPN Block (1 Well)• Most of Wells: Pre-1980• Recent Seismic Pre-Salt Imaging has
rejuvenated this play
(From third party analysis using IHS and in-house reserve estimates)
West Africa – Congo – Block Marine IX
Page 35 | 2007 Interim Results Presentation
Marine IX Block (Premier 58.5%)• Significant reserve potential • 3D reprocessing and interpretation in 2007• Largest prospects – Frida and Ida• Exploration well 2008/9
Frida Miocene Channel
Frida Prospect
Ida Prospect
Moho110 mmbbls
N’Kossa280 mmbbls
Kitina & Kitina Sud150 mmbbls
Frida Structure
Ida Structure
West Africa – Congo – Block Marine IX
Page 36 | 2007 Interim Results Presentation
Middle East / Pakistan
Page 37 | 2007 Interim Results Presentation
Middle East / Pakistan – Offshore Indus – Anne-1
Anne-1• Spudding September 2007• Targeting 300 mmbbls• First well in offshore Indus delta• 1,300 metres water depth• Premier 12.5%
SW NES N
Page 38 | 2007 Interim Results Presentation
Asia
Page 39 | 2007 Interim Results Presentation
Asia – India – Cachar – Masimpur-3
Masimpur-3ASurface Location
Page 40 | 2007 Interim Results Presentation
SC43 – Ragay GulfPremier 21%• Monte Cristo-1 Well planned for Dec 2007• Well costs carried, farmed out equity to Pearl Energy
Monte Cristo Reef ProspectOffshore target drilled from shoreline
Asia – Philippines – Ragay Gulf – Monte Cristo
Page 41 | 2007 Interim Results Presentation
Asia – Indonesia – Kakap – Pancing
Kakap, 18.75% • Discovery announced
23rd August 2007• Tested and flowed oil
to surface• Opens up
prospectivity of Lama reservoir across the Natuna Sea
Page 42 | 2007 Interim Results Presentation
Asia – High impact pipeline – North Sumatra Block A
Page 43 | 2007 Interim Results Presentation
• Buton Island has a highly active oil generative petroleum system. Oil seeps to the surface are abundant and prolific
• Carbonate reservoirs have been mapped as closed structures in the subsurface
Asia – High impact pipeline – Indonesia – Buton
Page 44 | 2007 Interim Results Presentation
• Seismic shows excellent indications of oil-prone source rocks
• Direct Hydrocarbon Indicators (DHIs) confirm working petroleum generative system
Asia – High impact pipeline – Indonesia – Tuna
DHIs
Page 45 | 2007 Interim Results Presentation
Asia – Vietnam Block 12W
Page 46 | 2007 Interim Results Presentation
Block 12WJay ProspectPremier 37.5%• Exploration Candidate
for 2008
10 km
Mang Cau
Mid Dua
2.5km
NESW
Dua sands
10km
Jay
Asia – Vietnam Block 12W – Jay
Page 47 | 2007 Interim Results Presentation
Block 12WGo Kien ProspectPremier 37.5%• Exploration Candidate
for 2008
10km
WSW ENE
Mang Cau
Mid Dua
Dua sands
2.5km
Go KienDua
Asia – Vietnam Block 12W – Go Kien
Page 48 | 2007 Interim Results Presentation
Block 12WFalcon ProspectPremier 37.5%• 3D seismic programme completed Q2 2007• Exploration Candidate for 2008
10km
Asia – Vietnam Block 12W – Falcon
Page 49 | 2007 Interim Results Presentation
Peacock Prospect
Block 12WFalcon ProspectPremier 37.5%
• 3D seismic programme completed Q2 2007
• Exploration Candidate for 2008
Peacock Prospect
Peacock Prospect
Asia – Vietnam Block 12W – Peacock
Page 50 | 2007 Interim Results Presentation
Late Middle Miocene Carbonate
Top Upper Dua
Top Cau
Basement
Silver Sillago
NW
10 km
Asia – High impact pipeline – Vietnam – Block 07/03
10 km
Red Grouper
Silver SillagoBlue Marlin
Mang Cau
SE
Page 51 | 2007 Interim Results Presentation
Exploration drilling schedule
Contingent wells
M/East & PakistanEgypt : NW Gemsa Gemsa Well-1Pakistan : Indus Anne-1
West AfricaCongo: Marine IX Frida
IdaGabon : Themis Admiral-1
AsiaIndonesia : Tuna
ButonNorth Sumatra Block A
Vietnam : Block 12 Falcon-1 Jay-1Go-Kien-1Peacock-1
Block 07/03Philippines : Ragay Gulf Monte Cristo
North SeaNorway : PL407 Bream Appraisal
PL406 GardrofaUK : 23/22b
2007SEP OCT NOV DEC FEB
High impact wellsFirm wells
2008JAN MAR APR JUNMAY JUL AUG SEP
2009OCT DECNOV
Page 52 | 2007 Interim Results Presentation
Summary
Page 53 | 2007 Interim Results Presentation
Impact of major projects on Premier group production
20000
Daily Production(boepd)
0
10000
40000
30000
50000
2008
70000
80000All projects earlierAll projects laterBase producing fields
2009 2010 2011
60000
Page 54 | 2007 Interim Results Presentation
Forecast development expenditures
50
($millions)
0
150
100
200
2008
300
350All projects earlierAll projects laterBase
2009 2010 2011
250
Page 55 | 2007 Interim Results Presentation
Summary
• Delivering a rising production profile
• Key developments are moving forward, which are capable of an additional 30,000 boepd
• High impact exploration programme over the next two years exposing shareholders to more than one billion barrels
• Low cost funding in place for our entire forward investment programme
• Completed two successful value-adding acquisitions during the period
Page 56 | 2007 Interim Results Presentationwww.premier-oil.com September 2007