Upload
others
View
1
Download
0
Embed Size (px)
Citation preview
2009 Half-Yearly Results Presentation 27th August 2009
27th August 2009 | Page 2
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.
27th August 2009 | Page 3
Agenda
2009 highlights Simon Lockett
Finance Tony Durrant
Operations update Neil Hawkings
Exploration update Andrew Lodge
Summary Simon Lockett
27th August 2009 | Page 4
2009 highlights – a transformational first half
• Oilexco: a favourable price and a step change in North Sea• Additional equity in Block 12W; material interest in key project• Reserves and resources increased by 17%
Acquisitions
Exploration• Success in Vietnam on Block 07/03• Premier’s first well in Norway also a success• Focus in 2010 returns to South-East Asia
• Production up 4% at 39,700 boepd• Step up following Oilexco acquisition, Shelley now on-stream• Record Pakistan production and strong performance from Anoa
Production
Development• Asian developments progressing well• Lower cost estimates as result of re-tendering/re-designing• Huntington – concept selection targeted by end 2009
• Extended debt facilities and successful rights issue• Fully funded forward development plan• Flexibility to take advantage of further opportunities
Finance
• OGP survey results: Premier best performing company for TRIF* in Drilling• Production TRIF* performance in top quartile• Premier TRIF* <1 per million man hours, 350% improvement over 5 years
HSE
* Total Recordable Injury Frequency
27th August 2009 | Page 5
Strategy
Strategy
• Targeting production growth to 75,000 bopd by end 2013
• Exploration programme within disciplined spend
• Acquisitions focus on our three core areas
• Conservative financing plan
Progress
• Projecting 60,000-65,000 boepd at end 2011 post start up of Gajah Baru and ChimSao
• Up to 15 exploration and appraisal wells over next 15 months
• Oilexco and Block 12 (Vietnam) completed; non-core divestitures underway
• Demonstrated ability to access debt and equity markets
90
Production forecast(kboepd net)
50
40
20
10
02009 2010 2011
30
60
20142012 2013 2015
70
80North Sea developmentsAsian developmentsExisting production
27th August 2009 | Page 6
Half-yearly financial results
27th August 2009 | Page 7
Production and income statement
Working Interest Production (kboepd)Entitlement Interest Production (kboepd)Realised oil price ($/bbl)Realised gas price ($/mcf)
Sales and other operating revenuesCost of salesGross profitExcess of fair value over purchase considerationExploration/New BusinessGeneral and administration costsOperating profit Financial ItemsProfit before taxationTaxationProfit after tax
6 months to30 Jun 2008
38.033.1
110.06.6
$m386
(139)247
-(32)(11)204(13)191
(119)71
6 months to30 Jun 2009
39.737.053.0
5.0
$m214
(117)9760
(25)(7)
125(52)
73(46)
27
Average gas pricing ($/mcf)1H 2009 1H 2008
Singapore $8.94 $16.16Pakistan $3.86 $3.28
Average Brent oil price was $52 (1H 2008: $110/bbl)
Operating costs per barrel ($/bbl)2009 2008
UK $16.1 $21.7Indonesia $ 7.6 $ 6.5Pakistan $ 1.6 $ 1.3Average $ 8.2 $ 9.6
Includes mark to market adjustment on hedging of $44.2 million (pre-tax)
Includes write-off of $17.9m for PSC B, Mauritania
Includes $22.7m of additional depreciation in respect of Chinguetti downgrade
27th August 2009 | Page 8
Oilexco acquisition accounting (at completion)
$million
501
10
511
Nil
569
144
(10)
(126)
577
66(6)
60
Purchase consideration
Acquisition expenses (external)
Cost of Acquisition
Allocation:Exploration and evaluation assets
Oil and gas properties
Deferred tax assets
Net current assets
Decommissioning obligations
Fair value
Excess of fair value over purchase considerationLess acquisition expenses (internal)
Net effect on the income statement
27th August 2009 | Page 9
Hedging
• Policy remains to underwrite value of projects by putting inlow cost floors
• 2009 Hedging Transactions:
– Existing $40/$100 floor/cap revised to $50/$80 for 2010and 2011 for half existing oil production
– New hedging in place for Oilexco acquisition; 50% production at floor of ~$53/bbl for 2H 2009-2011
• Hedging impact$m
Cash premia paid 12.5
Mark-to-market movement (non-cash) 31.7
Charge to income statement 44.2
• Group-wide ~25% of 2009-2011 oil and gas production hasan average floor of $52/bbl (oil) and $45/boe (gas) production
– Pakistan gas is unhedged
27th August 2009 | Page 10
Cash flow
260
(69)
191
(74)
-
-
(7)
110
Cash flow from operations
Taxation
Operating cash flow
Capital expenditure
ONSL acquisition cost
Finance charges, net
Pre-licence expenditure
Net cash flow
6 months to30 Jun 2009
$m
H1 2009 H1 2008
Development
Exploration
Estimated Capex split ($m)
6 months to30 Jun 2008
$m
142
(29)
113
(111)
(511)
(18)
(7)
(534)
51
23
74
70
41
111
Forecast full-year 2009 spend of $230m (development) and $140m (exploration)
Development Exploration
Asia
MEP
Estimated 2009 Regional Capex split ($m)
32
0
9
19
15
36North Sea
4170
27th August 2009 | Page 11
Net debt and funding programme
$m
117
(534)
237
(3)
(183)
Current balance sheet
Opening net cash
Net cash out flow
Equity issued
Non cash movements
Closing net debt*
Forward plans
• ONSL bridge facility ($175m) being extended in size and maturity to match main facility
• On completion of financing, expected cash and undrawn facilities of around $500million
• Available funding and covenant headroom to meet capex requirements at $45/bbl
* Includes $71m of restricted cash
600
Development capex forecast (2P reserves)($m)
200
100
02009 2010 2011
300
20142012 2013 2015
400
500
North Sea developmentsAsian developmentsExisting production
27th August 2009 | Page 12
Operations update
27th August 2009 | Page 13
Production update
50000
Production (Working Interest)(boepd)
30000
25000
10000
5000
02006 2007 2008
15000
20000
35000
North SeaAsiaMiddle East-Pakistan
Forecast fullyear 2009
• Deliveries from expanded plants meeting strong Pakistan gas demand
• Good production performance from Anoameeting strong Singapore gas demand
– Kakap production impacted by gas compression issues
• Balmoral area production currently impacted by acceleration of shutdowns and system bottlenecks
• Shelley now on-stream
• Good performance on Wytch Farm and Kyle but Scott impacted by plant issues
• Average full year production projected to be around 46kboepd
40000
45000
27th August 2009 | Page 14
MEP – Pakistan – producing fields
• Capitalising on completed plant expansions to take advantage of strong local gas demand
• Ongoing infill development drilling and compression projects to maintain rates
• Qadirpur (27.2 mmscfd, net)– Plant capacity enhancement (end 2008)– Compression project and tie-in to local
power plant planned for 2010
• Kadanwari (7.6 mmscfd, net)– K-14 successful and tied in
• Zamzama (41.5 mmscfd, net)– Infill wells 6 and 7 onstream and tie-in of
Zamzama North
• Bhit/Badhra (20.3 mmscfd, net)– Improved production from phase 2 plant
• Kadanwari gas price capped at $8.50/mmbtu; licence extended to 2022 from 2017
KadanwariBhitZamzamaQadirpur
16000
Pakistan Production (boepd)
12000
10000
4000
2000
02006 2007 2008
6000
8000
14000
1H 2009
27th August 2009 | Page 15
Asia – Indonesia – West Natuna Block A
• Continued strong demand from Singapore market• Consistent overperformance on Anoa allowing 3 well
development programme to be postponed to 2010• FEED work underway on Anoa compression project• Conceptual studies commenced on future GSA1 field
developments
27th August 2009 | Page 16
Gajah Baru• Delivering significant cost reductions:
– Latest capital expenditure estimate $196mm net to Premier– Positioned to capture lower rig rates and development drilling costs
• First gas 2011 meets contractual obligations with gas buyer in Singapore• Overall project progress around 20%• Transportation agreements supporting Batam GSAs targeted for H2 2009
Asia – Indonesia – West Natuna Block A
27th August 2009 | Page 17
• FEED completed in February, further optimisation studies ongoing• Latest cost estimate $210mm net to Premier• EPCI and rig tenders being prepared with bids targeted for year end• PSC signature for North Sumatra Block A delayed awaiting Indonesian government• First gas expected from Alur Rambong in 2011 and from Alur Siwah in 2012
Asia – Indonesia – North Sumatra Block A
27th August 2009 | Page 18
Chim Sáo
• Petro-Vietnam announced intention to back in for 15%
• Acquisition of additional 21.25% from Delek for $72 million
• Construction work on jacket 37% complete at 30 June
• Latest capital expenditure estimate $450mm net
• Two FPSO solutions, both with finance available, are in final stages of negotiations
• First oil targeted for mid-2011
Block equities (post PV back-in)Premier Oil plc 53.125%PetroVietnam 15.000%Santos 31.875%
Asia – Vietnam – Block 12W
27th August 2009 | Page 19
North Sea – UK – Balmoral Area
• Average daily contribution of 12,600 boepd
• Riser renewal work accelerated from 2010 into 2009
• Debottlenecking work nearing completion– Gas lift system– Produced water system– Subsea Pump
• Infill drilling now planned for 2010
• Burghley development progressing– Commercial arrangements completed– Well being drilled– Platform tie-in work under way– Opex-sharing commences in 2010
27th August 2009 | Page 20
North Sea – UK – Shelley
• Development stalled by Oilexco administration
• Post-acquisition:– Contract re-negotiated with Sevan– Innovative short duration risk sharing
contract– Hook up completed and onstream
August 6th– Since start-up production has averaged
over 8000 bopd with some well downtime– Reservoir performance is uncertain
27th August 2009 | Page 21
• Successful infill wells 2 and 3 leading to fourth well
• Expect full plant availability in H2 2009 • Partnership actively developing long term
3rd party business strategy• Near term satellite developments include:
– Bugle– Rochelle– Blackhorse
North Sea – UK – Scott Area
27th August 2009 | Page 22
North Sea – UK – Huntington
• Premier equity in Block 22/14b is 40%
• Concept selection process ongoing:– targetted for end 2009– tie backs to hosts eg ETAP– FPSO/FPV options
• First production forecast for 2012
• Unitisation process underway to establish:– equity in unit area / voting arrangements /
unit operatorship
27th August 2009 | Page 23
North Sea pre-development portfolio
Grosbeak
Frøy
Bream
Moth
Fife
Huntington
Scott satellites
Caledonia
• North Sea pre-development portfolio has significantly increased due to:– Exploration success in Norway– Acquisition of Oilexco
• Contingent resource base of75 mmboe
27th August 2009 | Page 24
Reserves and resources
500
Reserves and resources(mmboe)
2005
450
400
350
0
150
200
250
300
2006 2007 2008 Proforma30 June 2009
2C reserves2P reserves
100
50
181
265
27th August 2009 | Page 25
Production and development forecast
90
Production forecast(kboepd net)
50
40
20
10
02009 2010 2011
30
60
20142012 2013 2015
70
80North Sea developmentsAsian developmentsExisting production
600
2P reserves development capex forecast($m)
200
100
02009 2010 2011
300
20142012 2013 2015
400
500
North Sea developmentsAsian developmentsExisting production
27th August 2009 | Page 26
Exploration update
27th August 2009 | Page 27
Exploration strategy
• Currently focused on the growth of the company’s resource base through “Greenfield” discoveries in areas of expertise.
• In 2009/2010 this Greenfield focus is on three basins:
– Asia: Nam Con Son Basin (Vietnam and Indonesia)
– North Sea: Northern North Sea (Norway)
– West Africa: Congo Basin (Congo)
• In addition to Greenfield drilling, “Nearfield” exploration wells are planned in Premier’s existing core areas.
27th August 2009 | Page 28
Asia – Vietnam – Block 07/03
• First well completed in June 2009
• Flow test from two zones 3,265 bopd plus 8.1 mmscfdthrough 48/64” choke
• Premier 30% equity and operator
• Discovery in sandstone reservoirs of the Thong MangCau, Upper Dua and Cau formations
Cau
Middle Dua
Approx Basement
NCS carbonate
2.5 km
NW SE
M MioceneUnconformity
Wellbore
TMC & UpperDua Sandstones
CauSandstones
27th August 2009 | Page 29
Tuna • 65% operated interest• Discovery in Vietnam has reduced the risk on
Tuna acreage• 3D seismic planned for Q4 2009• Two-well programme beginning Q3 2010
NW SEGajah Laut
10km
Asia – Indonesia – Tuna
27th August 2009 | Page 30
West Africa – Congo – Marine IX
Frida• Operated by Premier• Well spudded 23 July 2009• Target depth reached on 22 August 2009; no
hydrocarbons encountered• Well will be plugged and abandoned• Results being integrated to determine potential
of Ida (contingent well Q4 2010)Frida
27th August 2009 | Page 31
MEP – Pakistan – Bado Jabal
• Vertical well spudded Q1 2009 • Targeting the deeper Lower Goru (Early Cretaceous)
and Chiltan (Jurassic) Limestone horizons • Reserves target 1 tcf• Premier’s equity 6%
27th August 2009 | Page 32
North Sea exploration and appraisal portfolio
Grosbeak
Moth
• Evaluation of acquired Oilexcoportfolio ongoing
• Two licences awarded from the 25th Licensing Round:– Block 15/23e is adjacent to the
Bugle area, near the Scott Field– Block 29/7b includes a pre-existing
discovery near the Kyle Field
• Active programme:– Grosbeak/Gnatcatcher– Bream/Gardrofa– Greater Luno– Blåbaer– Bugle North– Moth
Gardrofa
Greater Luno
Blåbaer
Bugle North
Bream
27th August 2009 | Page 33
North Sea – UK – Bugle North
Bugle North (15/23d, 15/23e)• Premier 41% equity and operatorship• Nearfield exploration opportunity• Reserves estimate 5-7-10 mmboe• Adjacent Bugle discovery flowed 7,398 bopd and 9.06 mmscfd gas• Drilling planned for Q2 2010
27th August 2009 | Page 34
Moth
• 50% equity in 23/21
• 57.5% operated equity in 23/22b
• 70% operated equity in 7/7d and 7/10a
• Moth discovery max flow rate 24.4 mmscfd gas and 2460 bopd
• Appraisal of Moth and potentially a deep pre-Cretaceous target are under evaluation
• Timings subject to partner approvals
North Sea – UK – Moth
Moth Appraisal(Planned)
27th August 2009 | Page 35
North Sea – Norway – Block 35/12, 36/10
Grosbeak/Gnatcatcher• Successful Grosbeak well completed in July 2009• Operated by Wintershall• Close to nearby infrastructure• Hydrocarbons in both Upper Jurassic and Middle
Jurassic sandstones• Estimated 35-190mmboe• Premier 20% equity
Gnatcatcher
SW NE
27th August 2009 | Page 36
North Sea – Norway – Bream/Gardrofa
Bream (17/12)• Brent age oil discovered 1971, close to Yme Field• 17/12-4 and its sidetracks wells appraised this
discovery, testing 2,516 boepd• Operated by BG• Estimated reserves 39-50-63mmboe
Gardrofa (8/3)• Premier’s first operated licence in
Norway• Maersk Guardian will drill well in 2010• Estimated reserves 20-40-90 mmboe• Potential value-add opportunity to the
Bream discovery
27th August 2009 | Page 37
Blåbaer Jordbaer
34/2-434/2-334/2-2
Blåbaer (34/2,5)• Premier 15% equity• Operated by BG• Reserves estimate 15-30-75 mmboe• Drilling planned for late 2009/early 2010
North Sea – Norway – Blåbaer
27th August 2009 | Page 38
North Sea – Norway – Greater Luno
Greater Luno (16/1[part], 16/4)• 30% interest• Operated by Lundin• Targeting Jurassic sandstones related to the
Luno discovery (95mmboe) on adjacent Lundin-operated block; Luno extension currently drilling
• Statoil farm-in to Lundin equity in April 2009• Estimated reserve range 30-150-250 mmboe• Drilling planned for Q4 2009
27th August 2009 | Page 39
Exploration outlook
2009Q3 Q4
2010AsiaVietnam: 07/03
104-109/05
Indonesia: Tuna
Natuna Sea Block A
N. Sumatra A
Buton
West AfricaCongo: Marine IX
North SeaNorway: PL359 (16/1,4)
PL374S (34/2,5)
PL406 (8/3)
UK: 15/23d, 15/23e
28/9, 28/10c
Middle East/PakistanPakistan: Badhra
Kadanwari
Contingent WellsFirm Wells: Rig Contracted Firm Wells: Rig TBC Seismic Programme
All well timings are subject to revision for operational reasons
Q1 Q2 Q3 Q4Beta
Anoa Deep
Ida
Gardrofa
Greater Luno
Blåbaer
Bugle North Appraisal
Catcher
Bado Jabal (Badhra Deep)
K-19
27th August 2009 | Page 40
Summary
27th August 2009 | Page 41
What next?
Tactics and execution
• North Sea Business Unit– Build on capability now organisation is integrated
• Progress Asian programme– Development projects proceeding– Capturing cost reduction opportunities
• Drill out significant exploration programme– Follow up on Vietnam success– Actively explore in Indonesia and Norway
• Seek new greenfield opportunities
• Take advantage of active acquisition market in North Sea and Asia– Selective focus to ensure value– Asset sales to focus portfolio
• Maintain liquidity in cash or undrawn facilities – Underwritten by hedging
Strategy
• Targeting production growthto 75,000 bopd by end 2013
• Exploration programme within disciplined spend
• Acquisitions and divestitures; focus on core areas
• Continue to operate conservative financing strategy
27th August 2009 | Page 42
Appendix
27th August 2009 | Page 43
HSE performance
• Recordable Incident Rate has been declining
• Performance is top quartile in the industry
• Challenge is sustainability
• TRIF = Lost Time Injury (LTI) + Reduced Work Day Case (RWDC) + Medical Treatment Case (MTC) frequency per million man-hours
• There was 1 LTI and 0 RWDC incidents in 2008• There have been no LTI or RWDC in the first half of 2009
Association of Oil and Gas Producers Benchmarking Survey, H1 2009
20
Total recordable injury rate - ProductionPer million hours worked by company with contractors
18
1416
121086420
20
Total recordable injury rate - DrillingPer million hours worked by company with contractors
18
1416
12108
46
20
6
Total recordable injury frequency (TRIF)
5
4
3
2
1
02003 2004 2005 2006 2007 2008 1H 2009
Premier TRIF
27th August 2009 | Page 44www.premier-oil.com 27th August 2009