OIL SEARCH LIMITED Investor Field Trip 2010 15 17 November 2010 1
Investor Field Trip 15 - 17 November 2010 OSH PARTICIPANTS Peter Botten Managing Director Gerea Aopi Exec Gen Mgr PNG Phil Bainbridge Exec Gen Mgr, Gas Growth Phil Caldwell Exec Gen Mgr, PNG LNG Project Richard Robinson Exec Gen Mgr,…
Field Trip Route DAY 1 HIDES Ambua Lodge DAY 2 6S DAY 3 MORO CPF 8S PORT MORESBY 100km LNG Plant 144E 147E 3
Key Oil and Gas Fields, PNG Pnyang Madang LEGEND Proposed Hides Conditioning Plant Juha North Wabag Oil Field Hides Gas Field Huria Angore Mt. Hagan Juha Prospect 6S Proposed Moran Kundiawa Juha Goroka Lead Facility Mendi…
DAY 1 5
Visit to PNG Plant Site and POM Tech training facility 6
PNG LNG Plant LNG facility to be located on State Portion 152 near Port Moresby 2 x 3.3 MTPA LNG trains LNG storage tanks at the facility LNG loading jetty off the coast for tanker ships to berth and load Supporting facilities and…
LNG Facility Location Schematic of LNG facility site and loading terminal 8
Port Moresby Construction Training College Being constructed at site of the existing Port Moresby Technical College (POM Tech) 9
Operations & Maintenance Trainees Trainees selected from across PNG Training to include 12 months of Advanced Skills Training overseas 10
Training the construction workforce First class of 48 trainees graduated in June Class included 8 women Two more groups of 48 have begun training Construction continues on Juni and PomTech training facilities 11
DAY 2 12
PNG LNG Project Update 13
PNG LNG Project Overview 6.6 MTPA, 2 train development, operated by ExxonMobil Over its 30-year life, PNG LNG expected to produce over 9 tcf of gas and 200+ million barrels of associated liquids Initial Equities: ExxonMobil - 33.2% Oil…
PNG LNG Project Overview Main EPC contracts awarded in 2009/10: LNG Plant: Chiyoda/JGC Offshore Pipeline Saipem Hides Gas Plant CBI/Clough JV Onshore Pipeline Spiecapag Infrastructure McConnell Dowell/CCC JV Early Works…
PNG LNG Project Construction Activities Planned/Underway Work to date has focused on: Opening supply routes (north, south, air bridge) Building/improving roads, bridges, camps, site preparation and training facilities Ordering…
Offshore Pipeline 450 km Subsea gas line 200,000 tonnes of steel Less than 100 metres deep Offshore pipeline route designed to avoid shipping and critical wildlife habitat 17
Omati and Kopi Base Kopi Wharf Offshore and Onshore pipelines meet at Omati 18
Pipeline Elevation: Omati to Hides Route aims to avoid: inhabited areas sacred areas archaeological sites critical wildlife habitat 19
Hides Plant and Wellpads 20
PNG LNG Fields PDL9 JUHA NORTH PDL1 PDL8 JUHA HIDES Power Plant Proposed PDL7 Nogoli Hides Camp Juha Facility HURIA ANGORE 6S PDL7 Proposed Hides Conditioning Plant PDL8 PDL6 PDL5 MORAN PDL2 APF AGOGO…
Northern Logistics Route 22
Timetable Continued early works Complete AG Detailed design Commence Order long leads and onshore pipe lay place purchase orders (Kutubu to Omati) Open supply routes Complete offshore Contractor mobilisation pipe lay First Gas…
PNG LNG Project Overview Schematic Juha Field 4 new wells 3 new wellpads Hides Gas Plant 7 km DN 300 & DN 250 Spinelines DN 50 MEG Line Hides Field 25 km DN 50 MEG Line 2 existing wells Juha Production Facility 8 new wells…
Mananda-5 Growth Opportunities 25
PNG Gas Growth Key strategic priority for Oil Search is to grow gas business in PNG, with LNG the optimum commercialisation route PNG LNG will provide infrastructure to facilitate expansion and provide excellent cost structure: Use of…
Asian LNG Markets Outlook LNG Uncontracted Demand (mmtpa) 80 Likely 70 New Markets India 60 Likely uncontracted demand including China 50 contract renewals Taiwan 40 Korea 30 20 Japan 10 2009 2010 2011 2012 2013 2014…
Sources and Timing of Gas Resource Maturation Resources required to underpin LNG expansion being considered at present: Studies underway Potential sources of gas PNG LNG dedicated fields Existing discoveries outside PNG LNG dedicated…
PNG LNG Dedicated Fields Potential upside in PNG LNG fields Near term focus on: Associated Gas Fields (Kutubu/Moran/Gobe/Agogo) Recent wells and additional production history indicate increased gas resource. Recertification required…
Onshore Exploration and Appraisal Huria (PRL 11/PDL 8) ExxonMobil (Op) & Oil Search Seismic completed over Huria prospect and Angore, currently being interpreted Further dip line being acquired Potential drilling in 4Q11 Barikewa…
Huria Prospect PPL260 Huria Prospect PRL 11 WI % PRL02 PDL9 Oil Search 52.50 PDL1 PDL8 PRL11 Exxon 47.50 PRL02 PDL7 PRL11 PPL239 PRL02 Near field opportunity located PDL7 adjacent to Angore and Hides gas PDL8 PPL219 PPL233…
Gulf Area LNG Strategy Oil Search has high graded Foldbelt and selected Gulf of Papua licences Gulf Area (offshore and near shore) has relatively untested prospectivity and hence high risk Oil Searchs strategy is to secure broad licence…
PPL 276 Farm-in Oil Search earns initial 30% stake from Rockwell Energy for funding 3D seismic survey in licence Seismic to be acquired in 1Q11 If seismic is promising, Oil Search will earn PPL 276 additional 50% equity, fund a well,…
PPL 312 Farm In PPL260 Oil Search earns initial 30% stake from Hillsborough for funding 3D seismic survey in licence Seismic to be acquired in 1Q11 On title from beginning, subject to Ministers approval If seismic is promising,…
PPL 338 & 339 Farm In Oil Search earns initial 30% stake from Dabajodi International Exploration PPL339 for funding 2D seismic survey 338 338 6S 339 339 Seismic to be acquired in PPL 339 1Q11 338 339 PPL 338…
Gulf Area LNG Strategy 8S Proven gas bearing area (Pandora, Uramu & Pasca) 4,700km2 3D seismic acquisition to identify and de-risk prospects. First phase complete, second phase acquisition in 4Q10 Targeting multi well drilling…
CSG Mineral Exploration Licences OSH holds seven MELs, each approximately 2,400 to 2,550 sq km. Total area 17,500 sq km EL 1724 CSG effort run as Ningerum 1 Simipen 3 small low cost team EL 1723 First of three firm EL 1725 wells to…
MENA Exploration Tajerouine + Le Kef K42 & Shakal Tunis Office - Recently completed 600km 2D - Recently completed 200km of - 2 commitment wells by 2Q 2012 2D in K42 and 50km of 2D in Shakal - Interpretation underway Dubai…
Visit to Hides Gas Conditioning Plant (HGCP) 41
DAY 3 42
Visit to CPF and Associated Gas & Related Projects (AGRP) Oil Search, as Oilfield Operator, is responsible for development and operations of facilities required to deliver oilfield gas into PNG LNG Project and receive Project Condensate…
CPF Scope Of Work Associated Gas Delivery Enhanced dehydration by replacing existing gas driers to improve gas quality and reduce emissions Enhanced gas cooling for spec commissioning gas to LNG Plant AG Gas Management System by…
Facilities Basis - CPF 45 45
Construction Progress New Ridge accommodation units handed over and partially occupied EPCM Contractor, Aker Solutions, on site and undertaking pre- mobilisation activities Majority of key Construction Management personnel in place…
Production Summary 47
World Class Safety Performance Total Recordable Incidents (TRIs) of 1.71 in 1H 2010 14 12.7 12 10.6 10.7 TRI / 1,000,000 Hours 9.8 10 Australian Companies 9.4 (APPEA) 9.1 9.3 8.5 8 8.2 7.8 7.3 6.8 6.0 7.0 6.3 5.7 6…
Production Summary Oil Search Net Production (mmboe) 6.0 MENA Hides GTE 5.0 SE Mananda SE Gobe 4.0 Gobe Main Moran Kutubu 3.0 2.0 1.0 0 1H 07 2H 07 1H 08 2H 08 1H 09 2H 09 1H 10 49
2010 Performance to date Strong production performance to September 2010 only 2% below 2009 levels 5.8 mmboe (5.9 mmboe in Jan Sept 09) Kutubu and Agogo Production enhanced by 1,500 bopd from ADT2 ST3 (Agogo Deep) well Sustained…
2010/11 Development & Near- Field Appraisal Drilling Activity PPL260 PRL02 Hides PPL239 PDL1 PRL11 Juha Angore PRL 12 6S Moran: PRL12 PDL6 PDL5 2010 : 1 well PPL233 APPL350 2011: 1 well PPL219 PPL233 Kutubu: SE Mananda…
Production Outlook 2010 - 2011 2010 production likely to be slightly above previous 7.2 7.4 mmboe guidance range Recent and planned drilling and work-over activity expected to reduce decline curve in 2011 2013, offset by planned shut-in…
Operational Outlook Following PNG LNG sanction, particular focus being placed on oil export system which will also be used for PNG LNG Project condensate storage and export Strong portfolio of near field production opportunities…
Long Term Production Outlook PNG LNG transforms production profile, adding 18 mmboe pa to OSH at plateau in 2015 onwards. 30 year Project life T3 could add an additional 9 mmboe pa, with T4 of similar magnitude 90,000 80,000 Net…
Strategic Review and Financial Summary 55
Strategic Review Major strategic review nearing completion Undertaken by dedicated review team plus external experts Aim is to optimise growth path and prepare for substantial production and revenue growth Review has resulted in a range…
Strategic Review Seven key value drivers : Optimise PNG operating performance to sustain production and cash flows to first LNG Deliver PNG LNG T1&2 within time and cost estimates Deliver Gas New Business (T3 & T4) with underwriting…
LNG Funding and Liquidity Update OSH total share of PNG LNG capex, including fees & capitalised interest, is US5bn of which US1.2bn has been spent to date. Capex being funded 70% debt and 30% equity. At end September 2010, OSH had drawn…
Revenue Update at 30 September 2010 9 mths 9 mths Total Revenue YTD Pleasing production to Sept 10 to Sept 09 performance, only 2% Oil & Gas lower than in first three production (mmboe) 5,794 5,899 quarters of 2009. 2010 realised…
Active Cost Management 1H10 costs/boe flat mainly due to limited work programmes 1H10 1H09 2H10 costs benefitting from USm USm charge out of facilities to LNG Field Costs contractors. - Oil: PNG 29.6 32.1 US/boe Total cash costs…
2010 Earnings Outlook Production likely to be slightly above previous 7.2 7.4 mmboe guidance range Charge out of services to LNG contractors benefitting opex, partly offset by strong A impact on corporate and operating costs. Opex…
Summary PNG LNG T1/2 construction progressing steadily, timing and budget estimates unchanged. Project is in good hands With PNG LNG underway, new OSH strategic objective is LNG expansion: De-risking/appraisal of existing gas…
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