London 15 January 2008 - Aker Floating Production – 2006 Vetco Aibel – Senior VP Tche and Prod....
Transcript of London 15 January 2008 - Aker Floating Production – 2006 Vetco Aibel – Senior VP Tche and Prod....
The FPSO Market according to IMA*.The underlying market fundamentals have never been stronger because floating production is a development option being studied in more than 100 projects in the planning stages.
The lure of $60/bbl crude is drawing capital into the FPSO sector.
Many of the projects coming on line during the next 5 years stem from exploration activity in the late 1990’s as well as the early part of the current energy cycle.
The number of active deepwater drilling rigs is projected to increase substantially during the next 2 years, and the FPSOs are undoubtly the best solution for producing many of the soon to be discovered fields.
We are in the beginning stages of a long lasting FPSO cycle.
* International Maritime Associates Inc. – Washington
3Part of the Aker group
FPSO in the value chain
Exploration
Production
Abandonment
Field Development
Installation
Drilling
Seismic
Platform supply & anchor handling
Engineering
Floatingproduction
Production & Operation
ExplorationDrilling
Decomis-sioning
Products & Technologies
Production Drilling
Assembly
Fabrication/ Construction
Sampling
Heavy Lift
Heavy Lift
Maintenance &Modifications
SubseaConstruction
4Part of the Aker group
Increased Worldwide E&P spendingE & P sp e n d i n g v s o i l p r i c e
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E & P s p e n d in g (U S D b i l l . ) W TI o i l p ric e (U S D /b a rre l)
S o u rc e : S m it h B a rn e y
There has been an increase in E&P spending the last five years.
The search for new resources has taken the oil industry out to the deepest waters to find unexplored oil reserves - This has the last years given an increased demand for FPSOs.
5Part of the Aker group
Aker Floating Production in BriefAker Floating Production`s business is to own, operate, and charter out converted tankers equipped for oil and gas production, storage and offloading (FPSO)Aker Floating Production will compete in the segment for benign waters with medium to small fields. Established 2006Market Cap: NOKm 1,848The company has so far purchased three tankers for conversion to FPSOsAker ASA owns 51,1% of the Aker Floating Production ASA
Credit Strengths:
Contract with Reliance ensures medium term visibilityGood relationship with other companies in the Aker groupStrong current FPSO market
December 2007 6Part of the Aker group
Aker Drilling44.9 %
AkerSeafoods
64.95 %
This is Aker
AkerBioMarine
76.3 %
AkerExploration
54.6 %Aker DOF
Supply
50 %
Aker ownership shown (in %)1 Held by Aker Holding
Aker OilfieldServices
51.7 %
Aker FloatingProduction
51.1 %
Aker Kværner40.8 %1
Aker PhiladelphiaShipyard
50.3 %Aker American
Shipping
53.2 %
7Part of the Aker group
AFP Management and Board of Directors
Svein Olsen - CEO
Ivan Borner CFO
Mikkel Martens EVP and Commercial Director
Arne Hygen Tørnkvist EVP and technical Director
Leif-Arne Langøy – Chairman
1998-2006 Bergesen Offshore, MD1994-1997 Fred Olsen Production, MD1992-1994 Offshore Production AS, MD
2005-2006 Aker American Shipping – Consultant in IPO1984-2004 Elkem – Controller/CFO in Norway and USA
2004 – 2006 Vetco Aibel – Senior VP Tche and Prod. Sys1991 – 2004 Project Director and Senior VP, Marine Offshore
1996-2006 Bergesen Offshore, Director of Engineering and Project Management1991-1996 DNV, Oslo and Korea
Chairman and CEO of Aker ASA
Nils Are K. Lysø - Director
Terje Andersen, Director
Head of Aker Capital
Former CEO of Farstad Shipping
Vibeke H. Madsen, DirectorCEO of HSH
Kristin K. Devold, DirectorFormer Minister of Defence
8Part of the Aker group
Key Investment ConsiderationsAker Floating Prod has acquired three High class suezmax vessels to be converted at Jurong
Reliance Industries Limited, India - bareboat charters Aker Smart 1 on a 10 year firm contract worth USD billion 1.1
Firm Long Term Contract with
Reliance, India
Low new-build risk
Management with a proven track record
Strong Aker Group
relationship
Jurong to deliver Aker Smart 1 FPSO – Q1 2008,
The yard is a world leading shipyard – with a world know track record
Known for their high experience on FPSO conversions and reliability due to delivery
Conversion of Aker Smart 1 is at > 90%
Aker ASA holds a total of 51,1% share in Aker Floating Production ASATop 5 shareholders hold over 65% of Aker Floating Production ASAManagement has a proven FPSO track record through 24 conversions
Aker Floating Production benefits from close relationship with the other Aker companies.
Aker Floating Production has a favourable access to resources
USD billion 1.1 contract with The Reliance Group exceeds the USDm 650 capex
The AKFP Smart#1 is tailor made for Reliance well – mutual dependant
Contract Bareboat 10 years
Firm Contract Exceeds Capex
Oil price hovers around USD 95/barrel.
High need for new oil producing fields – deeper depths and more harsh environment
Visible FPSO demand outlook the forthcoming years
Strong Market Environment
9Part of the Aker group
SHAREHOLDERS & EQUITY STORY PER JANUARY 7, 2008
Listed on OBX
Ticker: AKFP
Share price: NOK 80.50
High since March 2006 NOK 94.50
Low since March 2006 NOK 66.00
Average NOK 82.35
Company Shares %AKER ASA 11,241,806 51.10%UBS AG, LONDON BRANCH 1,794,000 8.15%CITIBANK N.A. LONDON 1,010,000 4.59%MORGAN STANLEY & CO INTL PLC 937,136 4.26%PICTET & CIE BANQUIERS 880,000 4.00%DEUTSCHE BANK AG LONDON 709,732 3.23%UBS AG, LONDON BRANCH 667,400 3.03%JPMORGAN CHASE BANK 587,017 2.67%DEUTSCHE BANK AG LONDON 515,000 2.34%DRESDNER BANK AG LONDON BRANCH 323,400 1.47%JPMORGAN CHASE BANK 263,500 1.20%VERDIPAPIRFOND ODIN NORDEN 245,000 1.11%BORGESTAD ASA 200,000 0.91%CREDIT SUISSE SECURITIES 178,700 0.81%PENSJONSKASSEN STATOILHYDRO 153,741 0.70%VERDIPAPIRFOND ODIN NORGE 149,100 0.68%SKANDINAVISKA ENSKILDA BANKEN 139,400 0.63%NORDEA BANK NORGE ASA MARKETS 120,000 0.55%PUMPØS A/S 119,900 0.55%DEUTSCHE BANK AG LONDON 105,368 0.48%Total 20 largest shareholders 20,340,200 92.46%
Aker Floating Production equity price
Top 20 shareholders
AKFP 5 largest shareholders
AKER ASA
234
5
Other
10Part of the Aker group
Benign waters providing significant growth
West Africa
Brazil
SE Asia
MexicoPG / India
11Part of the Aker group
FPSO Rate DevelopmentFPSO Lifting Cost per BOPD
1Q 06
Note that several factors influence the day rate level in addition to lease period, area and capacity
Market trends
?Oil
PriceRig
RatesSkilled
resourcesSpare
productioncapacity
FPSO Rates
FPSO Lifting Cost per BOPD
3Q 07
USD 3,00
USD 2,00
USD 4,00
USD 6,00
12Part of the Aker group
Aker responding to a growing FPSO demand
Increasing offshore drilling activity
Strong backlog of developmentprojects in benign waters
More mid-size operators
Close to 100% utilisation of FPSO fleet in the middle and upper segment
Limited sector capacity/Scarceresources
Response: Aker Smart FPSOsObservations
13Part of the Aker group
AFP’s Position in the Market Place
Harsh Weather
Medium & Independants
Small Independants and Indigenous
SBM, MODEC , Saipem, Prosafe, BWO,
MODEC ,Prosafe, BWO
F.O.P & Aker Floating Production
Sea Production, FPSOcean, Nortech, Bumi
Armada, Tanker Pacific, PetroProd, Oneoffs
Maersk, Petrojarl-Teekay, Bluewater
Benign to Moderate Weather
Majors:
Maersk, Petrojarl-Teekay, Bluewater
- Major growth area based on current drilling programs
- Needs re-fill following Prosafe & BWO movements
- High spec. and volume engineering driven
- There will be more competition
Sevan
14Part of the Aker group
FPSO Aker Smart 1, 2 & 3- Facility Description
•Oil Production Capacity 60 - 70.000 bopd - 120.000 bopd optional
•Water Production Capacity 50.000 bwpd - 100.000 bwpd optional
•Liquids Capacity 75.000 blpd - 150.000 blpd optional
•Gas Production Capacity 100 mmscufd - 200 mmscufd optional
•Gas Compression/Export Prepared for - Optional
•Water Injection Prepared for - Optional
•Mooring System Spread Mooring - Turret Mooring optional
•Crude Storage Capacity 1,3 million barrels
•Water Depths Shallow to Ultra Deep.
16Part of the Aker group
Customers
Reliance FPSO#1
Customer FPSO#2
Customer FPSO#3
Customer FPSO#4
T/C-rates
HSE and QA Systems track Record. Making use of the best of the maritime and offshore cultures”
Subsea systems and field lay-out
Marine Engineering, Utilitiesand design capabilities
Alliances with key suppliers
Jurong
Conversion yards
AMC
Subsea Systems
Process modules and Engineering Capabilities
Process and E & T
Extensive industrial platform& access to financial resources
Unique access to resources
In-house capabilities External capabilities
GEOReservoir expertise
Installation and hook-up capabilities
Subsea well intervention
17Part of the Aker group
Conversion at Jurong Shipyard
http://www.jspl.com.sg/
A subsidiary of SembCorp Marine Ltd with a Market Cap of SGD 7.260 million
Track record within repairs, new builds and conversion
The yard is known for their one-stop total service to the oil & offshore industry
Preferred partner in the oil & offshore industry
Jurong Shipyard Pte Ltd, Singapore is one of the world leading shipyards. Since 1975, Jurong Shipyard has
completed 39 FPSO/FSO conversions
Handling new builds, repairs, conversions and offshore engineering
18Part of the Aker group
Strong counterpart in Reliance Industries Ltd.
• The Reliance Group is India's largest private sector enterprise, with business in the energy and materials value chain. Group`s annual revenues are in excess of US$ 25 billion. The Company is a Fortune Global 500 company.
• The Group`s activities span exploration and production of oil and gas, petroleum refining and marketing, petrochemicals, textiles and retail.
• Rating: (S&P) BBB• Rating: (Moody's) Baa2
MA6 Development field (D6)• The SMART#1 FPSO will be used in production
on the MA6 Development field• Reliance Industries operates together with Niko
Resources Ltd.• Located in the Bay of Bengal in South East India. • The FPSO will operate on a depth of 1100 –
1400ft.• Discoverer 534 are drilling the wells on the D-6
block
Source: Reliance Ltd/Niko Resources Website
19Part of the Aker group
Reliance MA Development – Main Parameters• Operator - Reliance Industries Ltd.
• Water Depth - 1200 meters at FPSO location
• Environment - Typhoon Conditions
• Oil Production Capacity - 60,000 bopd (80,000 blpd)
• Gas Injection Capacity - 100 mmscufd (3 million cbm/d)
• Gas Export Capacity - 300 mmscufd (9 million cbm/d)
• Sub-sea Facilities - Well X-trees & Controls
- Risers & Umbilicals
- Infield Flowlines & Umbilicals
- Subsea Manifolds
• Installations - FPSO & Sub-sea facilities, excl. x-trees
• Production start - April 2008.
• FPSO Contract length - 10 years
20Part of the Aker group
Reliance – FPSO Aker Smart 1 – Key Milestones
• Letter of Intent – Order to Proceed January 2007• Charter Contract/Capex Component May 2007• Operation & Maintenance Contract October 2007• Sailaway from Jurong Shipyard March 2008• First Oil April 2008
29Part of the Aker group
Turret and Buoy Current StatusDelivery S.pore: 01.10.07Delivery S.pore: 05.15.07Delivery MA: 06.01.06
31Part of the Aker group
Cranes & Living Quarter Current StatusDelivery S.pore: 07.01.08Delivery S.pore: 19.01.08
32Part of the Aker group
• Cost to First Oil USD 650 million• Contract Duration 10 years• Debt Financing 85 – 90%• Debt Paid Down 10 years• Bare Boat Contract 10 years USD 1.1 billion• BB dayrate USD 294,000
Reliance Key Figures
33Part of the Aker group
AFP EBITDA Projection
Aker Floating Production EBITDA Projection per.quarter
4th q 07 1st q 08 2nd q 08 3rd q 08 4th q 08 1st q 09 2nd q 09 3rd q 09 4th q 09
Potential boat #2RIL in excess of OBPOriginal Business Plan
34Part of the Aker group
Balance Sheet 3 Q 2007
Actual Actual Actual31 Dec
Amounts in USD million 2007 2006 2006Property, plant & equipment 312.5 27.0 39.6 Goodwill 125.9 125.9 125.9 Interest-bearing long-term receivables 5.0 1.9 1.9 Inventory, work in progress, trade and other receivables 31.3 7.8 9.1 Cash and bank deposits 44.3 105.6 96.0 Total assets 519.0 268.3 272.5
Total equity 262.5 267.4 268.7 Pension liabilities 0.2 - 0.2 Interest-bearing loans 35.7 - - Other non current debt 0.0 - - Other current interest-bearing debt 203.0 - - Tax payable and trade and other payables 17.6 0.9 3.6 Total equity and liabilities 519.0 268.3 272.5
30.09
35Part of the Aker group
FINANCING STRUCTURE
Aker Smart 1 – Pre-delivery- total Capex USD650 m
Aker Smart 2 – Pre-delivery – total Capex TBD
Aker Smart 3 – Pre-delivery – total Capex TBD
Aker Smart 1 – Post-delivery
Aker Smart 2 – Post-delivery
Aker Smart 3 – Post-delivery
MUSD 270 Pre-delivery Financing
MUSD 200 Commercial Paper issue
MUSD 150 9M commercial paper
Secured bank loan MUSD 12.5 (hull)
[New secured bank loan (TBD)]
MUSD 150 9M commercial paper
Secured bank loan MUSD 12.5 (hull)
Secured bank loan USD 583 m
Secured bank loan (TBD)
[New secured bank loan (TBD)] Secured bank loan (TBD)
Equity$150 m
Aker Floating Production ASA has secured post-delivery bank financing of USDm 583,
subject to first oil from Aker Smart 1 (Reliance Project)
Included as short-term
part financing of Aker Smart
1 completion
Post delivery of Aker
Smart 1, proceeds of
Commercial Paper will be
utilised as part financing of
Aker Smart 2
Q1 2008 Q2 2008 Q2 2009
Sources & uses of the new commercial
paper
MUSD 25 Drawn bank debt
36Part of the Aker group
Strategy – Way Forward through to 2010
2007 2008 2009 2010
Aker Smart 1 at Jurong - Reliance
At JurongPreparations
At JurongPreparations
Preferably Jurong
Aker Smart 2 -
Aker Smart 3 -
Oil FPSOAker Smart 4 - Option 1
Option 2 LPG FPSO Preferably Jurong
Production Revenue
Production Revenue
Production Revenue
Concluding Remarks:
Aker Floating Production provide an attraction to a growing market through;• Having the broad expertise and resources of the Aker Group at hand in Norway and Internationally.
• Building up a resources basis with a long term view, i.e.; Predictability & Comfort.
• Providing a competitive edge through the ability to include complete sub-sea facilities; - total field development.
• Provides the opportunity for Fast-Track Field development.