OIL SEARCH LIMITED Investor Field Trip 11 13 November 2009 1 PNG Field Trip 11 - 13 November 2009 WELCOME TO PNG OSH PARTICIPANTS Peter Botten Managing Director Gerea Aopi Exec Gen Mgr PNG Phil Bainbridge Exec Gen…
Field Trip Route DAY 1 HIDES Ambua Lodge DAY 2 6S DAY 3 MORO APF 8S PORT MORESBY 100km LNG Plant 144E 147E 3 OIL SEARCH LIMITED PNG LNG Project 4
PNG LNG Plant Site Visit 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 Material…
LNG Facility and Loading Terminal 7 Project Overview Integrated development of Hides, Angore and Juha gas fields plus associated gas from the Kutubu, Agogo, Moran and Gobe oil fields Hides Gas Conditioning Plant (HGCP)…
PNG LNG Project Fields Angore Juha Main Hides Moran Agogo Kutubu Gobe Main 9 PNG LNG Update On track for a Final Investment Decision on 8 December 2009 Targeting first LNG sales late 2013/2014 Project issues:…
PNG LNG Update EM Project Execution Performance Historically, ExxonMobil 2004 2008 start-ups Actual vs. Funded (%) has delivered projects on 120 time and on budget, even during the recent period 100 of high inflation 80 PNG LNG…
LNG Contract Pricing Analysis of Contracts to Japan, Korea and China (DES) 18 Crude Oil Parity RasGas to KOGAS (from 2007) 16 Dec 06 Shell (QG) to PetroChina 14 Apr 08 Bontang (Renewals) Mar 08 12 Average Australia to…
Financing OSH share of capex (2008 -2015) including financing fees, capitalised interest through construction etc is US5.3 billion. Will be funded 70/30 debt:equity OSH participating in joint project finance facility for 70% debt…
PNG LNG Onshore Pipeline Route aims to avoid: Inhabited areas Sacred areas Archaeological sites Critical wildlife habitat 17 PNG LNG Offshore Pipeline 200,000 tonnes of steel Less than 100 metres deep Route…
PNG LNG LNG Plant 6.6 mtpa LNG plant 2 Storage Tanks 4 Loading Arms 19 PNG LNG Logistics NORTHERN ROUTE Early Works Hides Gas Conditioning Plant Drilling SOUTHERN ROUTE Onshore Pipeline AIR ROUTE Heavy…
PNG LNG Shipping 21 Countdown to FID Finalise Licence-Based Benefits Sharing Agreements ongoing in the licence areas during the field trips State offers Development Licences Finalise initial equity interests Receive…
LNG Expansion: The Next Growth Phase 23 The Next Growth Phase PNG LNG T1 and T2 is transformational for both Oil Search and PNG 580mmboe of 2P reserves will be commercialised (OSH share, pre-Government back-in) PNG LNG…
Asian LNG Markets Outlook LNG Uncontracted Demand (mmtpa) 120 100 Other New Markets India 80 China Taiwan 60 Korea 40 Japan 20 2007 2008 2009 2010 2012 2015 2020 Source: Source: F FACTS ACTS GLOBAL GLOBAL ENERGY,…
PNG Gas Exploration PPL260 2010 PPL260 Korka gas test PRL03 PPL260 2011 Huria Fold Belt gas test CSG PRL02 PDL1 PRL11 7 Licences 6S PPL239 PRL12 PDL6 PDL5 2010/11 Mananda PPL233 Attic / FW oil/gas test 2011/12…
Huria Prospect PPL260 PRL 11 WI % Oil Search 52.50 Exxon 47.50 PRL02 Huria Prospect Near field opportunity located PDL1 adjacent to Angore and Hides gas fields PRL11 PRL12 Large, broad surface anticline needs…
Barikewa Deep Prospect PDL4 PPL219 PPL190 PRL 09 WI % PPL190 Oil Search 42.55 Santos 42.55 PDL3 PDL4 PPL190 Cue 14.90 Barikewa Deep Prospect PRL09 APDL14 Barikewa-1 drilled Magobu sand in 1958 Logs show high resistivity…
OIL SEARCH LIMITED PNG LNG Project Benefits Sharing Agreement 33 Community Benefit Streams Under law and precedent, PNG community benefits from new oil and gas developments in a number of different ways: Compensation…
PNG LNG Benefits Sharing Due to scale of PNG LNG, it was agreed that development forum process would be split into: Umbrella Benefits Sharing Agreement (UBSA) to define benefit distribution to licence level, held in Kokopo, East New…
UBSA Environment Sing Sing prior to meetings 37 UBSA Diversity Range of LLGs and landowners attending the UBSA Forum 38
UBSA Presentations Community representatives hearing the State outlining their benefits proposal 39 UBSA Benefits Summary Equity based on Joint Operating Agreement interest Oil fields equity as current for Kutubu, Gobe and…
Governance Parties agreed that benefits are to be applied for the good of present and future generations and used to create a development base for the future Parties agreed to co-ordinate the various agencies (NG, Donors, LNG…
UBSA Signing Petroleum & Energy Minister Duma signing UBSA 43 Community Affairs and the Environment 44
Our Communities Operations cover 1,800 km in the Southern Highlands and Gulf Provinces Population in oil region 25,000 people, 60,000 involved in PNG LNG Huli, Fasu, Foe, Sau and Gulf ethnic groups, 110 villages, 13 language…
Relationships Maintenance of relationships is the key to success Achieved through: Regular day & overnight visits by CA staff Recruitment of local people as village liaison officers to assist in a two-way flow of information…
Education Enhancement Education sponsorship programme (A450,000 pa) tertiary studies, positive selection bias for female applicants and those studying health, education & trade subjects. More than 100 students sponsored each year…
Tax Credit Scheme Legislation allows resource developers to expend 0.75% of taxable income on construction or maintenance of eligible infrastructure Tax credit projects do not have to be in project area Expenditure to end 2008…
Health Services Major commitment to Health Care. OSH provides medical services to staff, contractors & the community Employs over 70 health professionals 6 educators 8 medical clinics Treats 40,000 patients each year, about the…
Oil Search HIV Programme Targeting HIV Prevention and Control in Rural Development Enclave Partnership with Government and Churches Funded by: Asian Development Bank, AusAID & NZ AID Focus Areas Improve access to counselling,…
Health and Wellbeing Programme Oil Search recognises the importance of its workforce Seeking to optimise the physical and psychological wellbeing of workforce via holistic lifestyle programme Dedicated health staff & VBC Lifestyle…
Environmental Management Company achieved ISO 14001 accreditation in Jan 2009. Focus on ongoing improvement Major programmes include Fauna/flora research partnership with WWF and establishment of protected areas Greenhouse gas…
Production 61 Oil Operations in PNG PRL03 Hides 5 producing oil fields PRL02 PDL1 PRL11 Kutubu Gobe Main PDL6 SE Gobe PPL239 PRL12 PDL5 Moran PPL233 SE Mananda Moran Kutubu Agogo SE Mananda PDL2 PPL219 Gobe…
Kutubu 63 Kutubu Processing Facility Processing Production Gas Compression Separation 180 MMSCFD Oil - 18,000 BOPD Associated Gas - 180 MMCFD Gas Injection - 180 MMSCFD Water - 18,000 BPD Water Injection 18,000 BPD…
Moran and Agogo Processing Facility Processing Production Gas Compression Moran Separation Current Production 110 MMSCFD Oil 20,000 BOPD Fuel & Flare Associated Gas - 115 MMCFD Gas Injection - 110 MMSCFD Water Prod - 5300 BPD…
Gobe 67 Gobe Processing Facility Processing Production Gas Compression Separation 85 MMSCFD Oil - 6,500 BOPD Associated Gas - 105 MMCFD Gas Injection - 105 MMSCFD Water - 7500 BPD Water Injection 9,500 BWPD Storage…
Kumul Marine Terminal Located 260 kilometres from Kutubu and 50km offshore in the Gulf of Papua 69 Hides Gas Field - Nogoli Hides Gasfield located 25km SW of Tari and 600km NW of Port Moresby Two completed production…
Core Expertise Developing country specialist Ability to work co-operatively with host governments and local communities Culturally sensitive Experienced in operating in challenging environments Low cost, innovative, regionally…
Usano: a rejuvenated field 12,000 10,000 UDT 10,12 8,000 Oil Rate (bopd) 6,000 UDT 8,9 UDT 11 4,000 UDT 7 2,000 Usano Main Block Usano East Block 0 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003…
Field Development Drilling Activity Moran: 2009 : 1 well 2010 : 2 wells Agogo: Kutubu: 2009 : 1 well 2009 : 2 wells 2010 : 1 well Usano: 2009 : 2 wells SE Gobe: 2010 : 1 well 75 Drilling Strategy Rig…
PNG Production Outlook Have had significant success in improving field production through development drilling and well/facility optimisations, at low cost per barrel Production forecast reflects: Base production from existing…
Safety Goal Incident Free Operations OSH implements of wide range of initiatives specifically targeting improvements in HSE performance Management continuously monitor broad range of leading and lagging HSE performance…
Exploration 81 3 year forward exploration programme* Placeholders Proven HW Anticline Play Proven FW Play Unproven Deep Jurassic Play Unproven Intra Pliocene Clastics Play New Concepts Near continuous exploration,…
PNG Oil Exploration Fold Belt PRL03 PPL260 2010 Mananda Attic/ PRL02 PDL1 PRL11 Distal Foldbelt Oil Play FW oil & gas test PPL239 PDL6 6S PDL5 PRL12 PPL233 Follow-up Sub thrust 2009/10 Wasuma oil test leads adjacent to…
Wasuma Prospect PDL4 PPL219 PPL190 PPL 219 WI % PPL190 Wasuma Prospect Oil Search 71.25 NOEX 28.75 PDL3 PDL4 PPL190 Near field exploration opportunity adjacent to SE Gobe oil field and existing infrastructure APDL14…
Papuan Basin Unproven Identified Plays Intra Pliocene Reservoir & Seal Clastic Play Potentially turbidites eg Flinders Deeper Jurassic Sands Agogo Deep Seal Barikewa Deep Reservoirs & intraformational Seals 87…
MENA Exploration Le Kef Tajerouine K42 Shakal Area 18 Dubai Office Sanaa Office Block 7 Block 3 89 Shakal Kurdistan, Iraq Shakal compartment Shakal PSC WI% Oil Search 15 Shakal Prod. Ltd (op) 36 Petoil 9…
K42 Kurdistan, Iraq Bina Bawi Surface Anticline: K42 Option WI% Oil Search 75 K42 Shamaran 25 Highly prospective area, on trend with Jambur (1 billion bbl) Seismic Option awarded in July 2009 18 month period to acquire 200km…
Tubba-1 Block 3, Yemen Block 7 Block 3 WI% Oil Search 60.00 PetOil 34.00 Yemen Oil Company 6.00 Block 3 Tubba structure on trend with Habban oil field (100 mmbbls reserves) Tubba-1 well spudded 14 August Drilled 650m of…
Tunisia Tajerouine WI % Oil Search 100 Le Kef WI % Oil Search 25 Primoil (op) 25 ETAP (Govt) 50 Frontier exploration in foothills to Atlas Mountains Several proven play types from elsewhere in Tunisia Tajerouine 2010…
Equity Raising Uncertainty on closure timing of IPIC transaction became unworkable in context of PNG LNG financing and ASX requirement for shareholder approval IPIC remains strongly supportive of OSH and PNG LNG Healthy share price…
Revenue Update at 30 September 2009 Total Revenue YTD 9 mths 9 mths 3Q09 realised oil price to Sept to Sept of US72.44/bbl, 08 09 compared to Oil & Gas US55.57/bbl in 2Q09 production 6,443 5,899 (mmboe) Crude inventory available…
Active Cost Management Global industry cost 1H09 1H08 pressures easing USm USm Continuing active cost Field Costs reduction programmes - Oil: PNG 32.1 32.9 - Oil: MENA 0.0 4.3 US/boe Total cash costs per boe - Hides 2.7 4.2 16…
Capex Outlook Update USm 1Q-3Q 4Q FY09 Actual F/C F/C Investing : Exploration 75 65 140 PNG LNG 177 213 390* Other gas commercialisation 1 2 3 Development/Production 123 17 140 Corporate (inc rigs) 11 1 12 Financing:…
The Next Growth Phase Oil Search 2002/03 Strategic Review provided framework for delivery of consistent top quartile returns Programme to take operatorship of major fields Investment for reserve and production growth Cost…
PNG LNG Transforms Oil Searchs Production Outlook 2009 2010-2013 2014+ 1. Deliver 2. Project PNG Build, LNG Positioning 3. Project Completion, Delivering Growth Project for Growth 60,000 Net Production (boepd) 50,000 LNG…
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