OIL SEARCH LIMITED Good Oil Conference, 7th September 2005
A New Beginning Oil and Gas Industry in PNG has undergone a renaissance in last 3 years Driven by local control of industry Significant new investment Helped by high oil prices Investment bringing returns Oil industry growing…
Oil Search The Last 18 Months Completed acquisition of ChevronTexacos PNG assets Successful transition to significant operator New approach to delivering maximum value: Focus on mature fields and new developments Investment for…
Oil Search The Last 18 Months Continued world class safety performance across operations Top quartile Total Shareholder Returns Driven by capturing value in PNG oil and gas assets 4
Focus Areas for Value Creation Maximise value of discovered resources Production optimisation Improved profitability Field and operating efficiencies Contract efficiencies Gas Commercialisation 1st and 2nd tier developments…
Revenue Growth USm 250 200 150 Minerals 100 Oil 50 0 1H 1H 1H 1H 1H 2001 2002 2003 2004 2005 43% CAGR over last four years Oil revenues up 37% on prior 1st half Realised oil price: US53 (1H04: US36.18) 6
Net Profit After Tax USm US cents 90 6 5.7 80 5 70 60 3.7 4 50 3.2 3 Net Profit 40 63.9 Expln Exp 30 1.8 2 41.7 EPS 20 36.5 1 10 17.9 0.2 3.2 0 0 1H 01 1H 02 1H 03 1H 04 1H 05 Net profit up 53% on restated…
Treasury Review 250 Gearing % 200 40 150 30 Debt Cash 100 20 Gearing 50 10 0 2002 2003 2004 Jun-05 US208million in cash at end June, debt at US147million Liquidity of over US300 million, including undrawn committed…
Share Price Performance 500 450 400 Relative Performance Index OSH ELECTED 350 OPERATOR OF ASSUMPTION OF PNG OIL FIELDS OPERATORSHIP 300 & ACQUISITION CPS OF CT ASSETS GAS 250 CONVERSION PROJECT FEED STRATEGIC 200…
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PNG Oil Field Optimisation Mature fields have been rejuvenated : Added 10,000 bopd to Kutubu, 5,000 to 8,000 bopd to Moran and over 3,000 bopd to Gobe fields production levels through new initiatives and more focused field…
Kutubu Improvement Reservoir History Plot - Kutubu including Agogo 50,000 Before Oil Search After 45,000 40,000 35,000 30,000 Rate (bopd) 25,000 20,000 Oil Search has added 15,000 10,000 bopd to Kutubu…
SEG Wedge Development 807500 810000 812500 815000 817500 0 90 -1 00 SEG 11 drilled in May 2005, - 15 0 80 00 -1 -1 6 0 70 9245000 9245000 -1 0 20 proved a 61m oil column in 0 -1…
NW Moran EPT Development Summary Completed installation of NW Moran flowline, production facilities at NWM Boundary of 3D image and APF, commissioning underway Project cost = US 25 million, significantly delayed, impacted by…
SE Mananda Development Moran SE Mananda Agogo Processing Facility Field was discovered in 1991, deemed uncommercial by previous operator Oil Search developed innovative plan to bring SEM into production and negotiated…
SE Mananda Development Hegigio Gorge Bridge Site Artists Impression 16
SE Mananda Construction Progress South Abutment A-frame Tower Roll Up 17
SE Mananda Construction Progress SEM Bridge Cable Launching 18
SE Mananda Bridge Comparison Millau Road bridge France 19
Block 43 Nabrajah Field First Non - PNG Oil Production First oil from Qishan reservoir July 05 Discovered oil in Basement, tested up to 10,000BOPD 21
Nabrajah Basement Depth Mapping Oil Down To Oil in Structural Closure (mSRD) with Nab-5 HC Shows 22
Block 43 Nabrajah Field Block 43 Development Area Block 14 Prospects and Leads Map Nab-9 Nab-8 Nabrajah Nab-2 Nab-1 Nab-5 Al Haglah-1 N-2 gas test 15 Mscfg/d 2000 m SRD Gas/oil contact Block 43 N-5 2225 m SRD Area of…
Block 43 Nabrajah Facilities Under Construction Tie-in to Block 14 Separator at CPF Manifold at CPF Storage tanks 24
New Yemen Exploration Blocks Block S2: Masilah OMV Habban -1 Basin Play New Basement Fairway Discovery 120,000bopd Pipeline Marib-Shabwah Basin Play Fairway 250,000bopd Pipeline Blocks 3, 7 and 74 consolidate OSHs…
Arakubi Prospect Arakubi 2004 seismic has de-risked Arakubi Mean reserves 18 mmstb Arakubi sits above and NE of Usano Site underway May share common fluid contacts Information from well will aid in Structurally simpler 2006…
Juha Appraisal Currently 0.5 tcf Proven 10km gas-in-place (GIIP) Two wells being PRL2 x-section considered one appraisal of Juha discovery Mega-Juha - Exploration one exploration of mega-Juha prospect Juha Current 1P Target…
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A Long Time Coming PNG Project has taken a step change towards commerciality over the past 12 months Alignment of key stakeholders for risk mitigation and growth FEED entry a pivotal point Front End Engineering and Design almost…
A Generational Change Gas Supply fundamentals for East Coast Australia are changing The Cooper Transition Maturity brings higher expense A struggle to remain competitively priced A healthy and growing CSM supply Significant…
Project Scope Joint venture between ExxonMobil 39.43% Oil Search 54.15% MRDC/State 3.02% Merlin (JPP) 3.39% Gas Sales with condensate export Conversion of Kutubu oil fields to gas production Development of Hides Gas Field…
PNG Gas Project Configuration 600 mmscfd Sales Gas HIDES PRODUCTION New CENTRAL Full Condensate Recovery Condensate Gas GAS CONDITIONING FACILITY pipeline pipeline PLANT (CGCP) KUTUBU CPF 700mmscfd Oil production & 165 mmscfd…
Project Scope Final pipeline configuration and route being determined by customer demand Abundant competitively priced gas to NT, Queensland and southern markets Interconnected pipeline system promoting competition and…
Project Activities Focus on Successful Project Delivery FEED Final design and facilities configuration Pipeline design Cost optimisation Operating parameters Government and Fiscal Licencing submissions and regulatory approvals…
Project Activities Focus on Successful Project Delivery Marketing Focus on confirming gas sales agreements Present indicative agreements for 190 to 200 PJ/a, with further markets targeted Possible integration of in-country…
Project Timetable FEED activities due for completion late 05 Early works decision by year end Project Sanction 2Q 06 Commitment to long lead items etc. Financial Close 2H 06 Major construction commences year end First Gas…
Targeted Alignment The Key to Project Success Deliberate strategy to achieve stakeholder alignment Project FEED Decision Joint Venture Alignment Market / Customer and Downstream Alignment The importance of AGL Largest east coast…
Targeted Alignment The Key to Project Success Landowners in PNG Excellent production reliability in oil projects, based on oil equity ownership and business development partnerships Mature process for ownership Lessons for…
Clear need for gas in Eastern Australia Wood Mackenzie analysis suggests even with PNG, Coal Bed Methane & Yet-to-Find (YTF) gas there is a clear need for new sources of gas supply to meet demand Eastern Australia - Supply &…
Gas Commercialisation Oil Search a leader in in-country gas development World Scale Petrochemical Plant in Port Moresby Final feasibility stage Indicative Terms Sales Agreement 80PJ/a Timing parallel to PNG Pipeline Project…
Investment in PNG Delivering Returns Since taking operating control in 2003 : Oil Search has invested over US400m in oil and gas business in PNG Delivered : Increased production Record revenues Record profits Excellent…
Investment in PNG Delivering Returns Investment bringing unprecedented growth opportunities Measured diversification provides good risk reward balance Early success at Nabrajah Major new oil play being pursued Further…
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