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ASIAN ROADSHOW – Oil Search Limited

Oil Search Limited · May 14, 2008 · 35 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. ASIAN ROADSHOW – Oil Search Limited – slide 1
    OIL SEARCH LIMITED Oil Search Asian Roadshow May 2008 1
  2. ASIAN ROADSHOW – Oil Search Limited – slide 2
    Oil Search Location Map 2 Operating Environment 3
  3. ASIAN ROADSHOW – Oil Search Limited – slide 3
    Profile Established in Papua New Guinea (PNG) in 1929 Operates all of PNGs producing oil and gas fields. Current gross production 46,000 boepd, net share 24,000 boepd As operator, responsible for generating 22% of PNGs export…
  4. ASIAN ROADSHOW – Oil Search Limited – slide 4
    Total Shareholder Returns (TSR) Ranked No.5 TSR Performer amongst current ASX 100 for 5 year period to Dec 2007 (53%pa on an annualised basis) 70% 60% 53% 50% 40% CAGR 30% 20% 10% 0% Macquarie Communica.…
  5. ASIAN ROADSHOW – Oil Search Limited – slide 5
    Setting a New Course Strategic Review recently completed Highlighted value potential and actions required to transform Company value Review has set strategy for next five years: Continue to deliver top quartile returns Transform…
  6. ASIAN ROADSHOW – Oil Search Limited – slide 6
    Key Conclusions of Review Gas Commercialisation the Key to Growth PNG LNG will dominate A robust economic project ranking well relative to other possible developments ExxonMobil led, with strong alignment and commitment OSHs…
  7. ASIAN ROADSHOW – Oil Search Limited – slide 7
    Key Conclusions of Review Re-focus MENA Oil Search successfully built up diversified, value accretive portfolio in MENA, but some assets were sub-material Recommendation to refocus on assets with material value potential relative…
  8. ASIAN ROADSHOW – Oil Search Limited – slide 8
    Key Conclusions of Review Management of Cash to Fund LNG Financial position is strong (net cash of 320 million post recent tax payment) Funding of PNG LNG capex (OSH share US3bn) will consume large proportion of operating cash flow…
  9. ASIAN ROADSHOW – Oil Search Limited – slide 9
    Delivery of Strategy Focus is now on delivery of Strategy Achieve superior value growth performance versus peer group over the next five years by: Ensuring a positive Final Investment decision for the PNG LNG Project Optimising PNG…
  10. ASIAN ROADSHOW – Oil Search Limited – slide 10
    Primary focus - PNG LNG PNG LNG Project is Oil Searchs primary focus This development will represent PNGs cornerstone gas development and will underpin Oil Searchs production and profits for 30+ years PNG LNG will commercialise…
  11. ASIAN ROADSHOW – Oil Search Limited – slide 11
    The Environment is right for LNG Burgeoning demand for LNG from Asia Pacific region, as well as globally Tight supply: demand equation. Large number of potential new projects in the region, only a few will reach commerciality in…
  12. ASIAN ROADSHOW – Oil Search Limited – slide 12
    LNG Pricing LNG (/mmbtu) 20 15 Crude Oil Parity NWS Recent Contracting 10 5 Traditional Contracting 0 10 20 30 40 50 60 70 80 90 100 JCC (/b) 22 Source: FACTS Global Energy Recent AsiaPac LNG deals Sept…
  13. ASIAN ROADSHOW – Oil Search Limited – slide 13
    PNGs Competitive Advantage Large number of potential new projects in this region (NW Australia, CSM) Screening economics indicate the PNG LNG Project is robustand stacks up favourably against other projects in the region…
  14. ASIAN ROADSHOW – Oil Search Limited – slide 14
    PNG LNG Capex Estimate EM Project Execution Performance ExxonMobil historically has delivered projects on time and 125 Actual vs. Funded (%) on budget Cost Schedule First phase capex (2008 2014) expected to be between US10…
  15. ASIAN ROADSHOW – Oil Search Limited – slide 15
    Delivering PNG LNG Imminent events: Execution of Gas Agreement (Prime Minister announced agreement of fiscal terms in last week of April) Commencement of FEED FEED deliverables: Securing market off-take (2008/09) Securing debt…
  16. ASIAN ROADSHOW – Oil Search Limited – slide 16
    PNG LNG Financing Debt: Joint debt financing approach, led by a Finance Committee co-ordinated by ExxonMobil. Soc Gen appointed financial advisor. OSH share of project finance around US3 billion, nominal, including fees,…
  17. ASIAN ROADSHOW – Oil Search Limited – slide 17
    Economic Importance of PNG LNG ACIL Tasman Report 6 February 2008 Affects economy of PNG and its balance of trade situation profoundly GDP will more than double (K8.65bn (2006) to K18.2bn average during production phase) Oil & Gas…
  18. ASIAN ROADSHOW – Oil Search Limited – slide 18
    Oil Operations Providing Cash for Growth Since Oil Search took over operatorship of PNG oil fields in 2003, fields have produced 45 mmbbl in excess of previous operators expectations and field life extended Aim is to optimise PNG…
  19. ASIAN ROADSHOW – Oil Search Limited – slide 19
    2008 PNG Development Focus Areas Moran: 2 development wells & 1 workover Agogo: Kutubu: 2 workovers 4 workovers Usano: 4 development wells 36 PNG Gross Oil Production 80,000 Oil Search Added over P50 Hides…
  20. ASIAN ROADSHOW – Oil Search Limited – slide 20
    PNG Net Production (Life Of Field) 10,000 9,000 8,000 7,000 NET Production 6,000 (Mstb) 5,000 4,000 Hides GTE 3,000 SEM SE Gobe 2,000 Gobe Main 1,000 Moran Kutubu 0 2008* 2009 2010 2011 2012 Activities 6…
  21. ASIAN ROADSHOW – Oil Search Limited – slide 21
    Cost control - Opex Cost inflation of 9 PNG Controllable Costs / Barrel 10%, higher in 8 specific areas 7 Other Focus areas for cost Marine Telecommunications Catering Services Services & Fees reduction: 6 Fuels, Chemicals,…
  22. ASIAN ROADSHOW – Oil Search Limited – slide 22
    Gas Growth Opportunities PNG LNG Project sets the stage for additional gas-based growth opportunities. OSH seeking to: Increase contractible gas for threshold developments Plan infrastructure for gas hubs and corridors Capture…
  23. ASIAN ROADSHOW – Oil Search Limited – slide 23
    Gas Growth Opportunities Highest value use for gas is for PNG LNG Project debottlenecking (+10-15% above nameplate capacity), expansion and/or developing other LNG plants: Significant field, pipeline and plant synergies can…
  24. ASIAN ROADSHOW – Oil Search Limited – slide 24
    Exploration 46 PNG Exploration Portfolio optimisation Data room being prepared for farm down of some exploration exposures in PNG Seeking to build on gas portfolio (already outlined) Oil exploration High grade remaining…
  25. ASIAN ROADSHOW – Oil Search Limited – slide 25
    PNG Exploration NW Paua Wasuma Cobra 48 NW Paua PPL219 PPL233 PPL 233 WI % NW PAUA Oil Search 52.5 PDL6 PDL5 Esso Highlands 47.5% Moran Paua Highly prospective structure SE Mananda adjacent to Moran APF…
  26. ASIAN ROADSHOW – Oil Search Limited – slide 26
    Cobra PDL4 PPL219 PPL 190 WI % Gobe Main Oil Search 62.6 SE Gobe Wasuma Murray Petroleum 26.5 COBRA Cue PNG Ltd 10.9 Near-field exploration opportunity PDL3 PDL4 adjacent to the SE Gobe oil field Cobra 1a will test the…
  27. ASIAN ROADSHOW – Oil Search Limited – slide 27
    MENA Exploration Sale of MENA assets to Kuwait Energy recently announced for US200 million & WC Allows OSH to re-focus on MENA assets that have potential to make a material contribution eg Libya Area 18, Yemen Blocks 3 & 7,…
  28. ASIAN ROADSHOW – Oil Search Limited – slide 28
    Area 18 Offshore Libya Area 18 WI % Oil Search 30 Petrobras 70 (Operator) Area 18 is located in Pelagian Basin, offshore Libya Pelagian Basin contains 11% (7 bn boe) of Libyas total recoverable reserves, considered…
  29. ASIAN ROADSHOW – Oil Search Limited – slide 29
    Financial Overview 56 Financial Performance 2003 - 2007 USm 800 EBITDAX 718.6 700 664 644.5 600 554.3 544.8 598.2 Revenue Operating 500 Cash Flow 416.3 399 400 357.7 350.8 330 326.8 300 239.1 276.7 207.5…
  30. ASIAN ROADSHOW – Oil Search Limited – slide 30
    Performance in 2007 Total production of 9.78 mmboe, just 4% lower than in 2006 despite PNG oil field maturity Realised oil price of US77.78/bbl, 16% above 2006 Record revenue of US718.8 million, up 12% on 2006 Record EBITDAX of…
  31. ASIAN ROADSHOW – Oil Search Limited – slide 31
    Treasury Review US344 million in cash at year end, no debt Current cash position of US320 million (post tax payment) Work underway to refinance corporate facility increasing funding commitment to US400 million and group liquidity…
  32. ASIAN ROADSHOW – Oil Search Limited – slide 32
    Outlook 62 Oil Search The Next 5 Years The Company at a cross roads Potential to multiply value by delivering PNG LNG and other Gas Opportunities Three distinct phases over the next 5 years Phase I PNG LNG to FID 2008-09…
  33. ASIAN ROADSHOW – Oil Search Limited – slide 33
    The Immediate Focus Phase I PNG LNG to FID 2008-2009 Support for Operator Oil Search specific value delivery Oil operations synergies, oil fields gas FEED Government and landowner management Financing Reorganisation to deliver…
  34. ASIAN ROADSHOW – Oil Search Limited – slide 34
    The Long Term Phase III First Gas and Beyond 2013 Further growth opportunities Debottlenecking New train development Other gas developments off new infrastructure Major cash generation Legacy Asset Delivery A New Oil Search…
  35. ASIAN ROADSHOW – Oil Search Limited – slide 35
    Summary Latent value in existing portfolio of assets is sufficient to deliver superior value to shareholders over the next 5 years Opportunities are well defined Challenges can be managed Company is well positioned to deliver…

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