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2006 HALF YEAR RESULTS – Oil Search Limited

Oil Search Limited · Aug 22, 2006 · 52 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. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 1
    OIL SEARCH LIMITED 2006 Half Year Results 22 August 2006 1
  2. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 2
    Programme Overview Peter Botten Financial Results Nigel Hartley Production Mark Wilson Exploration Mark Wilson Gas Commercialisation Peter Botten Outlook Peter Botten 2
  3. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 3
    2006 Half Year Results - Overview 3
  4. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 4
    Overview Record profit of US115.3m 81% increase on 1H05 Production remains strong despite sale of assets to AGL Record oil prices average realised price of US68.94 per barrel Highly competitive cost structure High activity levels…
  5. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 5
    Overview In recognition of strong first half performance and continued high oil price, the Board has recommended doubling the interim dividend from two US cents to four US cents per share. Payable on 13 October 2006 5
  6. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 6
    Financial Results 6
  7. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 7
    Net Profit After Tax 140 12 Net Profit 10.3 120 EPS 10 100 8 US cents 80 USm 5.7 6 60 3.7 4 3.2 40 1.8 2 20 0 0 1H 02 1H 03 1H 04 1H 05 1H 06 Net profit, excluding AGL profit, up 81% on prior first half 7
  8. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 8
    2006 Half Year Performance 1H05 1H06 Oil Sales (mmbbl) 4.12 4.49 Realised oil price (US/bbl) 53.00 68.94 (USm) Revenue 233.4 39% 323.3 Operating Expenses (45.1) (46.5) EBITDAX 188.3 47% 276.8 NPAT 63.9 81% 115.3* Record half…
  9. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 9
    1H 2006 Profit Drivers 180 10 160 20 (9) 140 72 120 115 (36) (6) 100 USm 80 64 60 40 20 0 e st x on es er 5 6 c Ta 0 0 re th ri al ti 0 0 P 2 2…
  10. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 10
    Cash Operating Expenses 1H05 1H06 Normalised PNG Oilfield US Costs per Barrel USm USm 8 Kumul Field Costs 1.31 7 - Oil: PNG 33.1 22.2 Tariffs - Oil: Yemen - 5.9 6 1.49 - Hides 1.4 2.3 Tariffs 5 0.75 Other Prodn Opex 4 Net…
  11. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 11
    Cash Flows USm 1H05 1H06 Operating 167.4 280.1 Investing Exploration/Development (107.8) (147.7) Sale of JV interest 3.8 380.3 Other (6.5) (6.3) Financing Dividends (33.5) (56.0) Debt Repaid (21.0) (126.0) Other (5.0) 0.7 Net…
  12. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 12
    Treasury Review US537 million in cash at end June, no debt 250 Cash Debt Gearing US126 million of debt % outstanding repaid in first quarter 2006. US term 200 40 loan commitment converted to a revolver Liquidity of US670 150 30…
  13. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 13
    2006 Capital Outlook Exploration expenditure for FY 2006 is expected to be in the range of US80-90 million (US110m previously) due to delay in drilling programmes Development and Gas Project expenditure is revised to US140 million…
  14. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 14
    2006 Half Year Results - Production 14
  15. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 15
    Oil Search Production for six months to 30 June 2006 % % All fields Change Change (PNG & Yemen) from 1H from 2H 05 05 Net Oil & Condensate 4.913 MMbbls -3.4% -17.4% Production (27,142 BOPD) 2.53 BCF Sales Gas Production…
  16. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 16
    Oil Search Production 1H06 PNG gross production benefited PNG (Gross) from strong performance from 80,000 Moran and SE Gobe fields, and 70,000 Trend Before Potential Oil Production (stb/d) Oil Search first production from…
  17. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 17
    Field-by-field Update Kutubu Kutubu (Gross) 1H06 gross production averaged 50,000 45,000 17,462 bopd, 2.6% lower than in Oil Production (stb/d) 40,000 Trend Before 1H05. Strong performance given 35,000 Oil Search…
  18. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 18
    Field-by-field Update cont. SE Mananda SE Mananda (Gross) Field came onstream in late March 10,000 9,000 2006 Oil Production (stb/d) 8,000 Commissioning was relatively 7,000 smooth 6,000 5,000 Reservoir issues have…
  19. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 19
    Field-by-field update cont. Nabrajah, Yemen Nabrajah (Gross) Production from Qishn and 14,000 Nabrajah-5 Basement/Kholan 12,000 Oil Production (stb/d) well averaged 10,398 bopd in 10,000 1H06 8,000 Expected to decline;…
  20. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 20
    2006 Half Year Results - Exploration 20
  21. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 21
    PNG Exploration 1H06 Activities 80 km of seismic data recorded over large gas structure, Mogulu, in PPL 239 2,000 km of seismic acquired offshore in Gulf of Papua, in PPL 234 Arakubi exploration well commenced drilling in July…
  22. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 22
    PNG Prospects Juha Appraisal 4Q 2006 Proposed NW Paua 1 1Q 2007 Proposed Mananda Attic 1 Proposed Mogulu 4Q 2007 3Q 2007 Arakubi 1 (Drilling) 2Q 2006 Kutubu Attic 1Q 2007 Usano Development 4Q 2006 Proposed Cobra…
  23. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 23
    Arakubi Prospect Arakubi commenced drilling July, but encountered hole problems. Arakubi 1A spud pending rig repair Located 5km east of Arakubi Kutubu, 2km from infrastructure May share common fluid contacts with Usano A…
  24. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 24
    Juha Appraisal Existing gas discovery, 60 km north west of Hides Three wells drilled on structure in 1980s Juha A Two wells planned to Juha 3 Juha 2 commence in 4Q06 Juha 1 appraisal of Juha Juha B discovery exploration of…
  25. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 25
    Cobra 1 Prospect defined on 2005 seismic 15km east of SE Gobe field First footwall prospect to be drilled specifically Cobra 1 (formerly known as Murray Deep) due to spud 4Q06 New play test Cobra target 42 mmbbl mean…
  26. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 26
    Kutubu Attic Kutubu Anticline Kutubu 2 proposed Kutubu 1x 15km east of Iagifu/Hedinia fields 1000 Drilled in 1988 Reached reservoir well down-dip with msl good shows Subsequent seismic confirms substantial updip -1000…
  27. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 27
    PNG Drilling Schedule 3 rigs running continuously 4th rig in country 2H 2007, 5th rig 1Q 2008 Oil production, oil exploration, gas appraisal and gas exploration activities 17 wells planned in 2007 2006 2007 3Q 4Q 1Q 2Q 3Q 4Q…
  28. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 28
    Middle East - North Africa Exploration 1H06 MENA Activities Yemen Acquired 440 sq km of 3D seismic in B43 Interpretation underway, will assist in locating future Nabrajah development wells and identifying exploration prospects B35…
  29. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 29
    Yemen Exploration Proposed Prospect B Proposed East Wadi Sana-1 Nov 2006 Jan 2007 NABRAJAH Proposed Shaibah-1 Nov 2006 Proposed Al Harsh-2 3Q 2007 Proposed Ataq-1 3Q 2007 Proposed Riyan-1 Jan 2007 Proposed…
  30. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 30
    Onshore Yemen Drilling Block 43 (OSH 28.3%) New seismic will be used to mature next exploration target, with drilling expected to commence in 4Q06 Range of prospects, with mean reserves ranging from 10 50 mmbbls Block 35 (OSH…
  31. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 31
    Offshore Yemen Drilling Block 15 Masilah-1X Oil and Gas shows Sarar-1X Ras Ghashwah-1X Recovered 1700 litres 45 API oil from Recovered 38 API oil from Cretaceous sands fractured Eocene limestone Hami-1X Heavy oil &…
  32. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 32
    Oil Search in Egypt Area A (OSH 100%) Commencement of multi-well exploration programme scheduled for 4Q06 Pool sizes range from 5 20 mmbbl Due to proximity to and capacity in infrastructure, any discoveries can be brought into…
  33. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 33
    MENA 20062007 Activity Schedule 2006 2007 3Q 4Q 1Q 2Q 3Q 4Q YEMEN Blk35 Farm-in Farm-in Blk35 Blk3 Blk3 Pros. B EWS-1 Harsh-2 Ataq-1 Onshore A Onshore B Blk43 Nab-11 Blk43 Shaibah-1 Blk43 Nab-12 Blk43 Nab-13 Blk43…
  34. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 34
    2006 Half Year Results - Gas Commercialisation 34
  35. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 35
    Gas Commercialisation Substantial change in oil and gas markets over past 3 years: Sustained high oil price Strong interest in gas development options Growing gap between world export pricing vs Australian East Coast energy…
  36. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 36
    Gas Commercialisation The Idealised Picture Oil Search has material discovered gas resource 1 billion boe Staged growth of gas business will optimise value of resources (gas and oil), leverages oil infrastructure and…
  37. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 37
    Gas Commercialisation PNG Gas Project Endeavouring to close a range of issues in the short term Confirmation of final loads and distribution Confirmation of pipeline route, likely capex and transportation arrangements Confirmation…
  38. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 38
    PNG Gas Project Recent announcements by AGL have stated that it does not wish to be a major pipeline owner or constructor APC reviewing the way forward with Project Participants Reviewing ownership options and ways of optimising…
  39. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 39
    PNG Gas Project Key project issues being worked to a conclusion in the short term Considerable pressure to move to Sanction from Government and key stakeholders Material impact on gas pricing in East and Southern energy markets,…
  40. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 40
    Gas Resources (Gross PNG) Recoverable Gas (bcf) Elevala 30,000 Ketu Pandora Recoverable Gas (bcf) 25,000 Uramu Kimu Barikewa 20,000 P'nyang Yet to Find Angore 15,000 Juha Hides 10,000 SE Gobe Gobe Main 5,000…
  41. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 41
    Gas Commercialisation Options Strong preference to secure PNG Gas Project Provides optimum base for sequential gas development Provides optimum portfolio valuation with integration of oil and gas business Significant number of…
  42. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 42
    In Country Development Options Petrochemicals (Methanol/DME) Mitsubishi/Itochu seeking to convert existing ITA for 86 PJ/yr to Gas Sales Agreement by end 2006 Gas supply from Kimu/Uramu/Barikewa or Kutubu/Gobe/forelands fields if…
  43. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 43
    In Country Development Options Ammonia/Fertiliser Oswal recently completed ITA for 50 PJ/yr Gas supply as for Petrochemicals Commenced detailed engineering Attractive economics with good netback pricing High equity share Initial…
  44. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 44
    Petrochemical Supply and Infrastructure If PNGGP does not proceed, likely gas source for methanol/DME and ammonia/urea plant in POM is Kutubu/Gobe and forelands gas fields Development cost c. US1.2 billion, incl US800 million for…
  45. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 45
    LNG Development Options Strong market conditions for supply into Asia and North America Number of developers have approached resource owners to partner Oil Search assessing various options for partners/structure Likely gas…
  46. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 46
    Juha Cycling Juha cycling comprises: Development of Juha field Production of gas and associated liquids Stripping liquids from gas stream, sold as part of oil stream Re-injection of gas into reservoir for future use (LNG)…
  47. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 47
    2006 Half Year Results - Outlook 47
  48. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 48
    Outlook - Production Gross production rates from PNG oilfields remain strong Oil Searchs net field interests reduced by sale of assets to AGL Nabrajah production remains a wildcard Egypt has potential to add to production in 2007,…
  49. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 49
    Outlook Drilling/Exploration Development drilling activity set to accelerate in 2H06 and 2007. Opportunities are very attractive due to high oil price Range of PNG exploration wells planned for second half and into 2007 First…
  50. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 50
    Outlook - Gas PNG Gas Project Pressure is on to resolve outstanding issues Economics of project remain strong Other gas commercialisation activities advancing Rationale for, and economics of, strong domestic and export gas…
  51. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 51
    Outlook - Financial Strong performance expected in second half, driven by solid production performance and continued strong oil price Expect to unwind underlift from first half 51
  52. 2006 HALF YEAR RESULTS – Oil Search Limited – slide 52
    OIL SEARCH LIMITED 52

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