Pa resources farm out and review-presentation 29 may_final
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Transcript of Pa resources farm out and review-presentation 29 may_final
Successful Tunisian farm-out and strategic review
PA Resources update
Philippe Probst, CEO
Tomas Hedström, CFO
Stockholm, 29 May 2013
New management team
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Philippe Probst, President & CEO
• Geologist with more than 30 years' experience from
the international oil industry of which 20 year within
Shell Exploration and Production.
• Senior Executive (Head of New Ventures) with the
Swiss-based oil company Addax Petroleum
• Advisor to international oil companies, financial
institutes and investors in upstream mainly in Africa
and the Middle East.
Tomas Hedström, CFO
• Previous position as CFO at Rottneros AB
• Senior Vice President Finance SCA, CFO SCA
North America and other management positions in
Finance and General Management within the SCA
Group
Farm-out of Zarat and Didon
Q1
Farm-out transaction summary
• Upfront cash consideration of USD 23 million
• Additional cash payment of USD 93 million for a Zarat development
• Contingent payment of up to USD 133 million
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<<<<<<<<<<<<<<
+ • EnQuest as operator makes it possible
for PA Resources to realize value from
these assets
• Possible field life extension of Didon
• Retains significant upside potential through
remaining 30% interest
• Reduction of estimated USD 150 million
down to USD 45 million of commitments
and firm work program
• PA Resources share of Zarat development
to a large extent funded through EnQuest
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• Loss of Operatorship
• Production reduced by ca 1,000
bopd
• Reduction of the company’s reserves
and resource base
• Book loss of SEK 110 million
PA Resources farms-out 70% interest in the Zarat permit
and Didon concession and operatorship to EnQuest PLC
With 100% interest PA Resources was never in a position
or intended to pursue development without a partner
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• Located in the Gulf of Gabes within reach of existing
infrastructure (Ashtart, Miskar, Hasdrubal & Al Jurf)
• Extensively appraised discoveries with 7 wells drilled
• Zarat field the largest remaining field to be developed in
Tunisia
• Total gross recoverable hydrocarbons of c. 123 mmboe
(c. 40% liquids)
Zarat AshtartJenein NordHasdrubalAdam Fields
Za
rat
fie
ld
• 2 additional undeveloped discoveries and additional
prospects and leads
• Potential tie-back to existing/planned infrastructure
Zarat and Elyssa Fields
Overview: Offshore Tunisian Assets
Zarat Permit
• Onstream since 1998, 31 mmbbl oil produced to date
• Current production of approx. 1,400 bopd
• Infill production wells and ESP’s evaluated as technically
feasible, to extend field production life cycle BRING
MAP
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Producing Didon Field
Top 10 remaining liquids fields in Tunisia
Farm-out further details (1)
6
• Structured as two separate transactions, effective date 1 January
2013
» Didon concession – closing expected H2 2013
» Zarat permit (Zarat and Elyssa fields) – closing expected by year-end
2013
• Upfront cash consideration of USD 23 million payable at closing
of Didon transaction
• Additional cash payment of USD 93 million payable as a contribution
to the development of the Zarat field, EnQuest is therefore funding
a large part of PA Resources’ share of development
• Participating interests and payments are subject to ETAP (Tunisian
state oil company) back-in rights (up to 55%)
Facts about the transaction
Farm-out further details (2)
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• Contingent payments are intended to share upside between
PA Resources and EnQuest
• Contingent payments of up to USD 133 million following successful
project developments relating to achieving certain targets
» Development cost of 2P reserves not greater than USD 18 per boe
» With top end of the range achievable if such development costs are
USD 13 per boe or less
» Payments conditional on achievement of certain project revenue targets
(i.e. oil and gas price effects)
Facts about the transaction
Farm-out further details (3)
8
• The farm-out will reduce
» 2P reserves from 56 to 24 mmboe
» Contingent Resources from 142 to 78 mmboe
» Production from the Didon field by approx. 1,000 boepd (net),
from 1,400 boepd to 400
• Farm-out leads to book loss of SEK 110 million
• Completion of transaction subject to a number of conditions
precedent e.g. approval by relevant authorities
• PA Resources retains significant upside potential in the offshore
assets through its remaining 30% interest and maintains its present
interest of Tunisian onshore assets and DST fields
Effects and conditions for the transaction
EnQuest operator with strong track record
• EnQuest PLC is the largest UK independent producer in UK North Sea
• Significant experience in acquiring and developing stranded
and mature assets
• Large organisation with strong capabilities, around 1,300 employees
and contract staff, highly skilled in innovative and cost efficient
developments
• Key persons with previous experience of building and operating similar
portfolios internationally, including in Tunisia
• Financially solid partner with strong track record in operating its
North Sea assets
• Market capitalisation of approx. GBP 1,032 million, shares trading on
both London Stock Exchange and the NASDAQ OMX Stockholm
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EnQuest in brief
Strategic review
Q1
Strategic review initiated
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• New board of directors
• New managment
• Review of assets and strategy
• Considering long-term financing alternatives
Review of strategy, assets and long term financing
Thank you
Q1 Thank you!