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The Integrated Gas Major Presentation – BG Group

BG Group · Feb 7, 2008 · 70 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. The Integrated Gas Major Presentation – BG Group – slide 1
    BG Group The Integrated Gas Major London 7th February 2008
  2. The Integrated Gas Major Presentation – BG Group – slide 2
    BG Group Welcome Sir Robert Wilson Chairman
  3. The Integrated Gas Major Presentation – BG Group – slide 3
    BG Group Introduction Frank Chapman Chief Executive
  4. The Integrated Gas Major Presentation – BG Group – slide 4
    Legal Notice Certain statements included in this presentation contain forward-looking information concerning BG Groups strategy, operations, financial performance or condition, outlook, growth opportunities or circumstances in the…
  5. The Integrated Gas Major Presentation – BG Group – slide 5
    The Integrated Gas Major Key messages Good 2007 results LNG flexibility delivering value Earnings outlook to 2009 confirmed Total E&P resources now 10 bn boe, up 2 bn boe E&P production potential 6-8% CAGR 2005 to 2020…
  6. The Integrated Gas Major Presentation – BG Group – slide 6
    The Integrated Gas Major Total operating profit m CAGR 35% 1997-2007 3500 3,248 3,103 3000 2500 2,389 2000 1,520 1500 1,287 1000 833 888 688 500 330 160 229 0 1997 2000 2003 2006 2007 E&P T&D, LNG, Power & Other…
  7. The Integrated Gas Major Presentation – BG Group – slide 7
    The Integrated Gas Major Key messages Good 2007 results LNG flexibility delivering value Earnings outlook to 2009 confirmed Total E&P resources now 10 bn boe, up 2 bn boe E&P production potential 6-8% CAGR 2005 to 2020…
  8. The Integrated Gas Major Presentation – BG Group – slide 8
    The Integrated Gas Major Overview Strategy 2007 results Portfolio for growth Conclusions 8
  9. The Integrated Gas Major Presentation – BG Group – slide 9
    BG Group Strategy Frank Chapman Chief Executive
  10. The Integrated Gas Major Presentation – BG Group – slide 10
    Strategy Integrated Gas Major Integrated Gas Major Connect gas to Secure competitively high value markets priced resources Build & access markets Equity reserves Serve customers Contracted resources Skills to succeed across…
  11. The Integrated Gas Major Presentation – BG Group – slide 11
    Strategy Business environment Trend BG response High commodity prices Strong cash conversion Cost inflation Long-life, low cost base Increased demand for LNG Flexible LNG supply portfolio Governments priorities . . . Integrated…
  12. The Integrated Gas Major Presentation – BG Group – slide 12
    BG Group 2007 results Ashley Almanza Chief Financial Officer
  13. The Integrated Gas Major Presentation – BG Group – slide 13
    2007 results Group highlights Good operating performance EPS +11% (+17% underlying*) Cash flow from operations +10% Strong financial position Robust outlook Dividend +30% * At constant upstream prices and US/UK exchange rate…
  14. The Integrated Gas Major Presentation – BG Group – slide 14
    2007 results E&P volumes (mmboe) 10.1 220.3 219.2 (3.5) (5.5) 2006 Disposals CATS Underlying 2007 growth Underlying growth of 5% 14
  15. The Integrated Gas Major Presentation – BG Group – slide 15
    2007 results E&P benchmarking Annual unit opex cost trend (/boe) 12 10 8 6 4 2 0 2002 2003 2004 2005 2006 2007 BG Top quartile Combined Companies Bottom quartile Source: Evaluate Energy 2007, BG Group Peer Group…
  16. The Integrated Gas Major Presentation – BG Group – slide 16
    2007 results E&P 2007 total operating profit (m) 241 (64) 2634 (127) (120) 2457 2387 2006 Pre E&A & E&A Underlying Price/ CATS As reported CATS expense FX Continuing operations excluding disposals, certain re-measurements…
  17. The Integrated Gas Major Presentation – BG Group – slide 17
    2007 results 2007 proved reserve additions (mmboe) Underlying performance Organic reserves replacement = 107% (8) 2007 63 (117) Production 172 110 Revisions Developments Acquisitions Price Net & sales & disposals…
  18. The Integrated Gas Major Presentation – BG Group – slide 18
    2007 results E&P benchmarking 3 year F&D cost trend (/boe) 25 20 15 10 5 0 2001-03 2002-04 2003-05 2004-06 2005-07 BG Top quartile Combined Companies Bottom quartile Source: Evaluate Energy 2007, BG Group Peer Group…
  19. The Integrated Gas Major Presentation – BG Group – slide 19
    2007 results LNG total operating profit Q4 Full Year Full Year 2007 2007 YOY Shipping & Marketing 145m 463m +39% Liquefaction 38m 127m +22% Business Development (20m) (69m) -18% Total 163m 521m +48% Continuing operations…
  20. The Integrated Gas Major Presentation – BG Group – slide 20
    2007 results T&D total operating profit (m) 12 2 270 (23) 25 247 231 2006 Comgas India Other Underlying Interconnector As disposal reported Continuing operations excluding disposals, certain re-measurements and impairments…
  21. The Integrated Gas Major Presentation – BG Group – slide 21
    2007 results Power total operating profit (m) 22 2 130 106 2006 Acquisitions Other 2007 (part year) Continuing operations excluding disposals, certain re-measurements and impairments Total operating profit includes BG Groups…
  22. The Integrated Gas Major Presentation – BG Group – slide 22
    2007 results E&P: Production BG net production (000s boepd) 2005-12 1000 CAGR 6-8% 2009 800 680-710,000 boepd 600 Medium term 2007-09 Long term 2010-12 400 Key projects: Key opportunities: Buzzard Karachaganak Jasmine…
  23. The Integrated Gas Major Presentation – BG Group – slide 23
    2007 results Production and price effects Norway Canada UK Kazakhstan Tunisia Algeria India T&T offshore Egypt Thailand T&T onshore Oman Bolivia Brazil Tax royalties PSC /Tax royalties with minor price impact PSC with…
  24. The Integrated Gas Major Presentation – BG Group – slide 24
    2007 results LNG: Outlook Capital invested Return * Liquefaction 2008 15% 2009 0.8bn 2009 16% (was 13%) Shipping Volumes EBITDA margin ** and 2008 13.5 mtpa 2008 30% Marketing 2009 13.5 mtpa 2009 30% (was 18%) * Pre-tax…
  25. The Integrated Gas Major Presentation – BG Group – slide 25
    2007 results Framework for growth EPS Based on firm projects In BG plans** Energy growth* Zero growth Key growth projects Karachaganak Buzzard US LNG Trinidad E&P/ LNG Hasdrubal 2006 2009 Schematic representation only…
  26. The Integrated Gas Major Presentation – BG Group – slide 26
    2007 results Capital investment 2007-2009 ( billion) 0.7 (0.6) 0.9 8.8 0.3 7.5 Prior year Exploration Acquisitions Inflation FX Current Maintaining capital discipline 26
  27. The Integrated Gas Major Presentation – BG Group – slide 27
    2007 results Capital structure and dividend Capital investment for 2008 2009 6.3 bn Substantial growth in investment opportunities Dividend re-based: +30% Long-term growth, good returns 27
  28. The Integrated Gas Major Presentation – BG Group – slide 28
    2007 results Summary EPS +11% (+17% underlying*) E&P production growth 2005 to 2012: CAGR 6-8% LNG margin raised from 18% to 30% Growing opportunity set Positive outlook for EPS Strong financial position, dividend re-based +30% *…
  29. The Integrated Gas Major Presentation – BG Group – slide 29
    BG Group Portfolio for growth
  30. The Integrated Gas Major Presentation – BG Group – slide 30
    Portfolio for growth Key country portfolio Norway UK Kazakhstan USA Tunisia India Trinidad & Tobago Egypt Oman Nigeria Brazil Core countries Potential core countries Focusing on developing material countries 30
  31. The Integrated Gas Major Presentation – BG Group – slide 31
    Portfolio for growth E&P asset base BG net production (000s boepd) of assets on stream at end 2006 only 700 600 500 400 Assets in production in 2006 only 300 200 100 0 2006A 2009 2012 2015 At 2008 reference conditions…
  32. The Integrated Gas Major Presentation – BG Group – slide 32
    Portfolio for growth LNG contracted volumes BG contracted volumes mtpa 15 10 Contracted volumes only 5 0 2006A 2009 2012 2015 2018 2021 2024 LNG business underpinned by contracted volumes 32
  33. The Integrated Gas Major Presentation – BG Group – slide 33
    Portfolio for growth Global LNG & US: Industry context Demand continuing to grow Supply projects delayed Cost escalation Construction industry capacity Government priorities BG portfolio : Longevity, cost leadership and global…
  34. The Integrated Gas Major Presentation – BG Group – slide 34
    Portfolio for growth Global LNG & US: Costs World-wide liquefaction capex (/tpa) US regasification capex (/mscfd) 1000 1000 Greenfield projects Greenfield projects Expansion projects Expansion projects 800 800 BG liquefaction…
  35. The Integrated Gas Major Presentation – BG Group – slide 35
    Portfolio for growth Global LNG & US: Supply mtpa Egypt & T&T 25 OKLNG & Brass 20 Australia NLNG Train 7 15 10 Other term supply Nigerian LNG T4/5 Contracted Equatorial Guinea to 2023 Egyptian LNG T2 5 Atlantic LNG T4…
  36. The Integrated Gas Major Presentation – BG Group – slide 36
    Portfolio for growth Global LNG & US: Markets UK Belgium USA S. Korea Spain Italy Japan India Taiwan Mexico Egypt Trinidad Nigeria EG Australia Chile In 2007, BG supplied 3.5 mtpa, or approximately 50%* of all Atlantic…
  37. The Integrated Gas Major Presentation – BG Group – slide 37
    Portfolio for growth Global LNG & US: US portfolio Lake Road Masspower Boston Dighton New York Atlanta Elba Island Lake Charles LNG Houston Cypress Regasification Power LNG Transport Markets Miami Storage Strong…
  38. The Integrated Gas Major Presentation – BG Group – slide 38
    Portfolio for growth Global LNG & US: Conclusions Strong competitive position Large, long-life supply base Low cost structure Flexible portfolio, serving global markets Integrated US portfolio Market-led strategy Capturing value…
  39. The Integrated Gas Major Presentation – BG Group – slide 39
    Portfolio for growth UK: Jasmine 30/6-7 Discovery well BG 30.5% 30/6-7 2008 sidetracks Jasmine Jasmine area appraisal ongoing Northern 30/6-6 Jasmine Terrace Jasmine West discovery well Gross reserves 100-176-275 mmboe…
  40. The Integrated Gas Major Presentation – BG Group – slide 40
    Portfolio for growth UK: Jackdaw Northern UK Norway 30/2a Lower appraisal well 30/3a Lower BG operator 30/2c and 30/2a 30/2a-6 Courageous Jackdaw BG increased equity in Jackdaw 30/2a BG 43.1% (from 34.4%) Jade 30/2c 30/2c BG…
  41. The Integrated Gas Major Presentation – BG Group – slide 41
    Portfolio for growth UK: Buzzard Producers Injectors Northern panel BG 21.73% Major oil field, on stream 2007 Central panel Field limit Dec 2007 Southern panel Peak production 220,000 boepd Field limit in 2003 Southern…
  42. The Integrated Gas Major Presentation – BG Group – slide 42
    Portfolio for growth UK: Production BG net production (000s boepd) 200 Delivering projects Jasmine on stream 2011 Further 150 potential Jackdaw on stream 2013 50 mmboe Other incrementals 2009+ 100 Delivering Plateau of 50 mmboe…
  43. The Integrated Gas Major Presentation – BG Group – slide 43
    Portfolio for growth Kazakhstan: Karachaganak Tenth anniversary of FPSA Record production performance Operations improvement projects Fourth stabilisation train Tie in during 2008 shutdown On schedule for 2009 Western export…
  44. The Integrated Gas Major Presentation – BG Group – slide 44
    Overall profile inline but splits will change Portfolio for growth Kazakhstan: Karachaganak Phase III & beyond BG BGnet netproduction production(000s 000s boepd) boepd 250 Phase III being progressed 200 Development concept…
  45. The Integrated Gas Major Presentation – BG Group – slide 45
    Portfolio for growth Egypt: E&P and LNG Egypt gas production in 2007 BG fields produce over 40% of total Split ca 50/50 domestic/LNG WDDM Phase IV on stream Rosetta Phase III on stream, Q1 08 El Manzala Seismic image El Burg BG…
  46. The Integrated Gas Major Presentation – BG Group – slide 46
    Portfolio for growth Trinidad & Tobago Operational improvements ECMA Dolphin New domestic sales, 1.2 tcf Start July 2009, 220 mmscfd De-bottlenecking Also, ca 1 tcf of uncontracted gas NCMA 3c/d Poinsettia project Plateau…
  47. The Integrated Gas Major Presentation – BG Group – slide 47
    Portfolio for growth India BG in0 India Gujarat Gas Mahanagar Gas E&P volumes 2006-7 grew 33% Secured KGOSN2004/1 3D seismic in 2008 Delivered 5 LNG cargoes Set up gas marketing business T&D volumes 2006-7 grew 9% Panna Mukta…
  48. The Integrated Gas Major Presentation – BG Group – slide 48
    Portfolio for growth India BGnet BG netproduction production(000s 000s boepd boepd) Panna/Mukta Potential Panna (BG 30%) 60 Gross HIIP 1.7 bn boe Mukta Existing 50 Added 2 WHPs and 15 wells Mukta Plan Started 2 WHPs, 9…
  49. The Integrated Gas Major Presentation – BG Group – slide 49
    Portfolio for growth Tunisia BG net production (000s boepd) Miskar (BG 100%) 60 3 infill wells drilled in 2007 50 3 infill wells in 2008/09 Hasdrubal 40 Miskar North 5% de-bottlenecking by 2009 Exploration Miskar Infill/…
  50. The Integrated Gas Major Presentation – BG Group – slide 50
    Portfolio for growth Thailand: Bongkot Bongkot North (BG 22.22%) Record production in 2007 Continuing to extend plateau Licence extended to 2023 Three E&A wells in 2008 BG net production (000s boepd) Bongkot South (BG 22.22%) BN…
  51. The Integrated Gas Major Presentation – BG Group – slide 51
    Portfolio for growth Nigeria OKLNG 50km OPL 332 Two further OKLNG (BG 14.25%) farm-ins* Four trains, ca 5.5 mtpa each Upstream focus area Shareholders Agreement signed OPL 286-DO Technical and cost reviews OPL 332 (BG 45% &…
  52. The Integrated Gas Major Presentation – BG Group – slide 52
    Portfolio for growth Oman: Abu Butabul BG 100%, 30 year EPSA Gross GIIP 2-11-17 tcf Field 3D seismic acquired Two rigs secured for appraisal Appraisal drilling commenced 6-8 wells in 2007/8 Vertical wells, proppant fracs…
  53. The Integrated Gas Major Presentation – BG Group – slide 53
    Portfolio for growth Norway Exploration drilling Barents Sea Appraisal drilling Ververis BG 22 licences, 14 operated Nucula Drilling 4 prospects in 2008 discovery 3 BG operated Norwegian Tromso Sea Mandarin & Jordbaer high…
  54. The Integrated Gas Major Presentation – BG Group – slide 54
    Portfolio for growth Australia: Queensland Gas Co (QGC) alliance Proposed BG/QGC alliance Australia LNG plant QGC assets in 20% of assets / 9.9% shares Walloon Fairway Consideration 299m Surat Basin Brisbane Option for further…
  55. The Integrated Gas Major Presentation – BG Group – slide 55
    Portfolio for growth Brazil: Comgas Brazils largest gas distributor 2007 gas sales 13.8 mmcmd Over 570,000 customers connected Customer growth 8.7% pa 2002-07 Legend Good economic outlook Gs Natural da Bolivia Potential to grow…
  56. The Integrated Gas Major Presentation – BG Group – slide 56
    Portfolio for growth Brazil: Santos Basin overview Rio de Janeiro Santos Basin Pre-Salt 300 km offshore BM-S- 50 BM-S- 10 Water depth 2,000m+ BM-S- 52 Salt layers up to 2,000m thick BM-S- 13 Carbonate reservoirs Parati BG…
  57. The Integrated Gas Major Presentation – BG Group – slide 57
    Portfolio for growth Brazil: Tupi BG equity 25%; area 1,200 sq kms Iracema Gross HIIP now 12-30+ billion boe Tupi & Iracema likely one structure Multiple stacked reservoirs Well rates 10-20,000+ boepd Tupi-1 Oil 28o API Tupi Sul…
  58. The Integrated Gas Major Presentation – BG Group – slide 58
    Portfolio for growth Brazil: Tupi schematic section 3 km Tupi-1 Tupi Sul Sag Upper Rift Upper Rift Lower Rift Basement NW SE Tupi Sul established three reservoirs 58
  59. The Integrated Gas Major Presentation – BG Group – slide 59
    Portfolio for growth Brazil: Tupi notional development sequence EWT to assess long term deliverability & producibility e.g. 1 or 2 wells initially, then further use for appraisal Gross production up to 20,000 bopd; Date 2009+…
  60. The Integrated Gas Major Presentation – BG Group – slide 60
    Portfolio for growth Brazil: 2008 drilling and key prospects BM-S- 52 BG 40% Corcovado (1), (2) BM-S- 13 BG 60% BM-S- 10 BG 25% BM-S- 11 BM-S- 50 BG 25% BG 20% Iara (1) Parati Tupi Carioca BM-S- 47 BG 50% Saleta…
  61. The Integrated Gas Major Presentation – BG Group – slide 61
    Portfolio for growth E&P: E&A progress Drilling 2007 Seismic 2007 Completed 20 wells, 12 successes UK Key successes Canada Norway Tupi Sul and Carioca (Brazil) Jasmine Northern Terrace (UK) Libya Bongkot South (Thailand) Algeria…
  62. The Integrated Gas Major Presentation – BG Group – slide 62
    Portfolio for growth E&P: 2008 E&A preview Summary of wells Alaska Canada UK Norway 4-6 New plays 1 well 3 wells 4 wells 3 wells 1 well 1 well 1 well Play extenders 17-19 Appraisal/Near term production 20-23 Tunisia 1 well 1…
  63. The Integrated Gas Major Presentation – BG Group – slide 63
    Portfolio for growth E&P: Prospect inventory Total risked exploration resources: 3,356 mmboe Onshore Norway Deepwater Other Brazil Egypt China Nigeria UK Offshore Conventional Well balanced inventory, around 75% of…
  64. The Integrated Gas Major Presentation – BG Group – slide 64
    Portfolio for growth E&P: Reserves and resources CAGR 19% Reserves/ mmboe Production* 10,046 10000 8,017 8000 7,071 3,356 46 Years 2,713 6000 2,440 3,122 30 Years 1,772 4000 1,211 1,236 1,383 1,529 16 Years 2000 2,184 2,149…
  65. The Integrated Gas Major Presentation – BG Group – slide 65
    Portfolio for growth E&P: Reserves and Sustainable resourcesgrowth production 10,046 mmboe 2000 2000 1.6 million boepd 3,356 CAGR 8% 1500 1500 1.2 million boepd 1000 1000 CAGR 6% 3,122 3,122 1,529 1,529 500 500 2,039…
  66. The Integrated Gas Major Presentation – BG Group – slide 66
    BG Group Conclusions
  67. The Integrated Gas Major Presentation – BG Group – slide 67
    The Integrated Gas Major Key messages Good 2007 results LNG flexibility delivering value Earnings outlook to 2009 confirmed Total E&P resources now 10 bn boe, up 2 bn boe E&P production potential 6-8% CAGR 2005 to 2020…
  68. The Integrated Gas Major Presentation – BG Group – slide 68
    BG Group Appendix
  69. The Integrated Gas Major Presentation – BG Group – slide 69
    Appendix Key assumptions REFERENCE CONDITIONS Brent Oil price US 55/bbl US Henry Hub 7.25/mmBtu US/UK exchange rates of 2:1 Prepared under International Financial Reporting Standards All production includes fuel gas PRINCIPAL…
  70. The Integrated Gas Major Presentation – BG Group – slide 70
    Appendix Glossary Increase or (decrease) GOR Gas Oil Ratio United States dollar GSA Gas Sales Agreement UK pounds sterling HIIP Hydrocarbons initially in place m Million UK pounds sterling HPHT High pressure high temperature 000…

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