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HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc

Tullow Oil Plc · Jul 30, 2014 · 62 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. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 1
    2014 HALF-YEARLY RESULTS Tullow Oil plc 30 July 2014
  2. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 2
    2014 HALF-YEARLY RESULTS Contents Section Page Introduction 4 Finance 6 Development and Operations 13 Exploration and Appraisal 19 Conclusion 28 Appendix 30 Slide 3
  3. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 3
    2014 HALF-YEARLY RESULTS TULLOW OIL PLC 2014 HALF-YEARLY RESULTS AIDAN HEAVEY
  4. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 4
    2014 HALF-YEARLY RESULTS Good progress made during 1H 2014 West Africa Stable Jubilee production 103,000 bopd TEN development on time and on budget Onshore discovery at Igongo in Gabon East Africa Kenya discoveries support…
  5. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 5
    2014 HALF-YEARLY RESULTS TULLOW OIL PLC 2014 HALF-YEARLY RESULTS IAN SPRINGETT
  6. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 6
    2014 HALF-YEARLY RESULTS Business and funding strategy Business Strategy Funding Strategy Financing Initiatives Additional cash flow from new production Commercial Bank Facilities Operating Cash High Monetisation Exploration…
  7. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 7
    2014 HALF-YEARLY RESULTS 2014 Half-yearly results summary 1H 2014 1H 2013 Comments Sales revenue 1,265m 1,347m Unchanged from 1H 2013 after adjusting for Bangladesh Gross profit 673m 764m asset sale and Gabon production deferral…
  8. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 8
    2014 HALF-YEARLY RESULTS Sources and uses of funds Cash inflow 1,672m m 1H 2014 Net cash inflow 59m 2,000 Operating cash flow 728m* (1H 2013:1,030m*) Net loan draw down 944m 944m (1H 2013:901m) 1,500 219m 161m Cash outflow…
  9. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 9
    2014 HALF-YEARLY RESULTS Debt capital structure has evolved in 1H14 Debt maturity profile Key metrics mm Commitment size Maturity mm 30 June 2014 RBL 3,500 Dec 2019 Cash and cash equivalents 411 Corporate Facility 750 Apr 2017 Debt…
  10. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 10
    2014 HALF-YEARLY RESULTS 2014 capital expenditure 2.1 billion capex for full year 2014 Ghana: Jubilee Phase 1A & TEN developments (760m) Kenya: Exploration and appraisal drilling (310m) 2014 720m 220m 1,160m 2,100m Uganda:…
  11. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 11
    2014 HALF-YEARLY RESULTS Highlights Financial performance Strong Revenue and Cash Flow generation from core West African production Strong balance sheet Second successful 650m bond issue, re-financing of 750m corporate RCF plus…
  12. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 12
    2014 HALF-YEARLY RESULTS TULLOW OIL PLC 2014 HALF-YEARLY RESULTS PAUL McDADE
  13. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 13
    2014 HALF-YEARLY RESULTS Core West African production on track to meet FY 2014 target West African production KENYA South Lokichar Basin 1H 2014 actual: 63,900 boepd Development studies underway; single basin has potential to…
  14. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 14
    2014 HALF-YEARLY RESULTS Ghana projects on track to enhance production and cash flow Ghana gross production profile 250 Jubilee production on track to meet 2014 FY TEN to be developed (80:20 oil:gas) TEN Upside (45:55 oil:gas)…
  15. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 15
    2014 HALF-YEARLY RESULTS West African production generating strong cash flows Significant incremental investment activity across non-operated assets Strong pre-tax operating cash flow generation across West African portfolio in 1H…
  16. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 16
    2014 HALF-YEARLY RESULTS Progressing oil resources towards development in East Africa Full life cycle regional scale E&P business Two basins discovered; over 300,000 bopd gross potential Large yet-to-find from basin opening…
  17. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 17
    2014 HALF-YEARLY RESULTS Highlights Core West African production Core West African production on track; generating 1H pre tax operating cashflow 916m TEN development TEN development mid-2016 first oil on track; building to a…
  18. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 18
    2014 HALF-YEARLY RESULTS TULLOW OIL PLC 2014 HALF-YEARLY RESULTS ANGUS McCOSS
  19. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 19
    2014 HALF-YEARLY RESULTS Finding oil in 2014 H1 E&A Commercial Technical Dry Hole We continue to find our own oil Outcomes Discovery Discovery EAST AFRICA Cost-effective feedstock for value creation Exploration Ewoi-1 Emong-1…
  20. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 20
    2014 HALF-YEARLY RESULTS Campaign approach to finding oil in Africa & the Atlantic We find oil in Africa & the Atlantic Value added through finding our own New Oil Drilling Out Successful Core Plays & Basins Exploration Business…
  21. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 21
    2014 HALF-YEARLY RESULTS Balancing investment across the portfolio We find oil in Africa & the Atlantic Frontier Core 5 1 South Atlantic Margins 4 East African Rift Basins Low cost options give exposure to upside 10 Bbo STOIIP…
  22. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 22
    2014 HALF-YEARLY RESULTS Shifts of emphasis within exploration portfolio for value Uruguay Ghana Liberia, Sierra Leone Guyana Suriname Gabon Namibia Netherlands Uganda Guinea Norway Ethiopia Mauritania Kenya Madagascar Higher…
  23. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 23
    2014 HALF-YEARLY RESULTS Kenya Ethiopia: World-class oil province potential E&A campaign delivery parallel approach 1. South Lokichar Basin drill-out, appraisal & testing Discovery of 600 mmbo Pmean gross resources Flow tests…
  24. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 24
    2014 HALF-YEARLY RESULTS Near infrastructure & Frontier opportunities in North Atlantic Barents Sea - Frontier Major oil finds continue at Wisting prospect cluster Hassel & Bjaaland target cluster potential up to 500 mmbo…
  25. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 25
    2014 HALF-YEARLY RESULTS West African near-field exploration in producing heartlands Oil field & production plateau extensions Numerous near-field & near-infrastructure exploration & appraisal prospects in Ghana, Gabon (e.g.…
  26. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 26
    2014 HALF-YEARLY RESULTS Highlights Good progress year to date Successful Exploration & Appraisal outcomes in first half of 2014, continuing to add value to portfolio Campaign approach Campaign approach hedges annual…
  27. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 27
    2014 HALF-YEARLY RESULTS TULLOW OIL PLC 2014 HALF-YEARLY RESULTS AIDAN HEAVEY
  28. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 28
    2014 HALF-YEARLY RESULTS Delivering on our strategy Additional cash flow from new production Monetisation High Margin Exploration Selective Options & Production and Development Portfolio Cash flow Appraisal Management…
  29. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 29
    2014 HALF-YEARLY RESULTS TULLOW OIL PLC 2014 HALF-YEARLY RESULTS
  30. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 30
    2014 HALF-YEARLY RESULTS Net income 1H 2014 v 1H 2013 m 400 300 2 84 43 27* 55 200 313 100 226 0 107 115 95 53 -100 1H 2013 Price Volume Operating Other costs Exploration Net Finance Tax Loss on 1H 2014 costs…
  31. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 31
    2014 HALF-YEARLY RESULTS TULLOW OIL PLC 2014 HALF-YEARLY RESULTS DEVELOPMENT & OPERATIONS
  32. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 32
    2014 HALF-YEARLY RESULTS Potential to increase Jubilee FPSO capacity FPSO capacity improvements Current oil capacity Work Work Work - Constrained by gas export infrastructure completed in progress outstanding - On track to deliver…
  33. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 33
    2014 HALF-YEARLY RESULTS Visible future growth TEN development overview Base development case 300 mmboe reserves being developed 24 well development Gross development capex of 4.9 billion Leased FPSO, capacity of 80,000 bopd…
  34. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 34
    2014 HALF-YEARLY RESULTS Visible future growth - TEN Project on track Execution schedule with strategic milestones 2013 2014 2015 2016 Over 2 million man-hours ACTIVITY Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 worked to date…
  35. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 35
    2014 HALF-YEARLY RESULTS Non-operated - strengths and opportunities Material portfolio of high margin resources High margin oil fields give broad technical base with potential to drive future value growth Influencing non-operated…
  36. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 36
    2014 HALF-YEARLY RESULTS Non-operated sustaining high margin production Good technical work has delivered investment opportunities High value incremental High return investments compete strongly for capital within investments can…
  37. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 37
    2014 HALF-YEARLY RESULTS Non-operated case study: Gabon Gabon net production profile 16,000 14,000 High value infill drilling has offset decline 12,000 10,000 Tullow technical influence impacting boepd 8,000 Operator…
  38. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 38
    2014 HALF-YEARLY RESULTS Non-operated case study: Equatorial Guinea Use of 4D seismic data to optimise infill drilling - First iteration in 2010 (learning ahead of use at Jubilee & TEN) - Next campaign planned for late 2014/15…
  39. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 39
    2014 HALF-YEARLY RESULTS East Africa Business highlights Full life cycle regional scale E&P business Two basins discovered with over 300,000 bopd potential Large yet-to-find upside from basin opening exploration campaign Governments…
  40. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 40
    2014 HALF-YEARLY RESULTS Uganda development status Project definition being finalised 250 Appraisal programme completed Development costs reduced by 30% 200 200 Kingfisher PL awarded, all EA2 Field Gross Production (kbopd)…
  41. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 41
    2014 HALF-YEARLY RESULTS Uganda development optimisation and Capex savings Development optimisation and Capex reduction 3bn Capex cost reduction 4% programme in 2013/14 Reduction in 9% Facilities Capex Reduction in Capex reduced…
  42. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 42
    2014 HALF-YEARLY RESULTS Shortening appraisal timelines in Kenya ASSET 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Kingfisher EA2 Buliisa EA1 Buliisa Kaiso Tonya Kaiso Tonya Kingfisher Buliisa FID…
  43. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 43
    2014 HALF-YEARLY RESULTS Focus on driving down Kenya well costs Kenya well costs Since 2004 50 104 exploration and appraisal wells & sidetracks - 77 as operator 40 wells tested both production & injection 40 Total well costs…
  44. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 44
    2014 HALF-YEARLY RESULTS Exploring Kenya & Ethiopias significant resource potential The following basins will be tested in 2014/2015 Date North Kerio Basin: Kodos 3Q 2014 Turkana Central Basin: Epir 3Q 2014 Turkana North Basin:…
  45. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 45
    2014 HALF-YEARLY RESULTS Kenya development plans rapidly advancing Explore, appraise and develop simultaneously Exploration and appraisal drill out by end 2015 - 600 mmbo Pmean gross resources discovered to date Appraisal Area of…
  46. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 46
    2014 HALF-YEARLY RESULTS East Africa regional crude oil export pipelines Regional pipeline agreed - Governments across region supportive 600 km Significant progress on technical design 860 km - Routing and environmental screening…
  47. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 47
    2014 HALF-YEARLY RESULTS TULLOW OIL PLC 2014 HALF-YEARLY RESULTS EXPLORATION & APPRAISAL
  48. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 48
    2014 HALF-YEARLY RESULTS 2014 Exploration and Appraisal activities NETHERLANDS - 1 well NORWAY - 6 wells Seismic Key Vincent (E11-1) Langlitinden (7222/11-2) Gotama (31/2-21) Acquisition Hanssen (7324/7-2) Butch SW (8/10-6) Butch…
  49. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 49
    2014 HALF-YEARLY RESULTS 18 month Exploration and Appraisal programme mmboe Country Block Prospect/Well Interest Gross Mean Net Mean Spud Date WEST & NORTH AFRICA Gabon Arouwe Sputnik-1 35% 206 72 Imminent In addition to our…
  50. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 50
    2014 HALF-YEARLY RESULTS 18 month Exploration and Appraisal programme mmboe Country Block Prospect/Well Interest Gross Mean Net Mean Spud Date SOUTH & EAST AFRICA Etom 21 8 In progress 13T Ekales appraisal 50% (op) 53 20 Q4…
  51. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 51
    2014 HALF-YEARLY RESULTS 18 month Exploration and Appraisal programme mmboe Country Block Prospect/Well Interest Gross Mean Net Mean Spud Date EUROPE, SOUTH AMERICA & ASIA PL 494 Heimdalsh 15% 140 21 In progress PL 591 Zumba 80%…
  52. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 52
    2014 HALF-YEARLY RESULTS Exploring for high value oil Higher profitability associated with higher oil reserve mix Oil finding principles 100% Focus on finding high value producible light oil 80% Oil is multiples more valuable than…
  53. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 53
    2014 HALF-YEARLY RESULTS How we explore: our process works 600M 1,000M Risked upside* Monte Carlo simulation of Prospect & Lead Inventory (P10 = 4.3 Bbo) within full potential of plays & basins (6.6 Bbo) Slide 54
  54. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 54
    2014 HALF-YEARLY RESULTS Cost efficient exploration 3.3/boe (2007-2013) 900 Potential Kick in East African Rift Basins 3 core campaigns < 3.3/boe 800 Creaming Curve East African Rift Basins 1.95/boe Net Contingent Resources…
  55. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 55
    2014 HALF-YEARLY RESULTS Net contingent resource additions from E&A 900 Ekales-1 & Agete-1 200mmboe / year, steady average performance 800 Strong run of success in Uganda & Ghana Twiga-1 & Etuko-1 New basins campaigns deliver…
  56. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 56
    2014 HALF-YEARLY RESULTS Kenya overview: volumes, maps & cross-sections Slide 57
  57. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 57
    2014 HALF-YEARLY RESULTS Kenya exploration in 2014 Three basin opening wells in 2H 2014 Slide 58
  58. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 58
    2014 HALF-YEARLY RESULTS Guinea phase of West African Margin Campaign Targeting the elusive upside of the Jubilee play Regional geology points to turbidite sands deposited by an ancient delta of the Niger River Potential scale of…
  59. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 59
    2014 HALF-YEARLY RESULTS Central Atlantic Margin Campaign Mauritania Outboard Plays Mauritania deepwater turbidites (1st phase) Fregate-1 discovers over 30m light oil & condensate Commercialisation options under review (high costs)…
  60. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 60
    2014 HALF-YEARLY RESULTS Next growth frontier exploration examples Namibia reachable turbidites Older turbidites beneath shelf (low cost) Oil system established by Wingat-1 (HRT) New 3D survey highlights 2015 prospect Albatross…
  61. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 61
    2014 HALF-YEARLY RESULTS Guyanas: extensive Jubilee play potential plus upside plays Non-operated E&A lacks success after Zaedyus-1, turns to de-risked oil plays and new attractive lower geo-pressured prospects on Eastern Slope…
  62. HALF YEAR 2014 EARNINGS CALL – Tullow Oil Plc – slide 62
    2014 HALF-YEARLY RESULTS Download the Tullow Investor Relations and Media App from the Apple and Android stores: Tullow Oil plc 9 Chiswick Park 566 Chiswick High Road London, W4 5XT United Kingdom Follow Tullow on: Tel: +44…

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