STRE01 PRO Proposed amendments Bondholder presentation 23 April 2015
Table of contents Background and proposed amendments Company update Appendix April 2015 Bondholder Presentation Page 2
Background for proposal Since the bond issue in April 2013, Sterling has experienced several challenges related to the Breagh field, now believed to be overcome: Oneoff operational challenges have been addressed and have not…
Sale of Romanian business and future strategy The Romanian Assets Sale will provide much needed liquidity and significantly reduce future commitments: Complete exit from Romania structured as a sale of subsidiary company with all 3…
Financial outlook Group cash balances endMarch 2015: 18 million Free cash deficit at 30 April 2015 expected to be approx. 27m This is the deficit after a) making amortization instalment and interest payment of 32.7m, b) transferring…
Operating Cash Flow and Expenditures Sharp increase in operating cash flow in 2017 arises from final two wells (A11 and A12) and a sidetracked existing well coming online, together with startup of onshore compression mid year…
April 2015 amendment proposal Bond amendments: A deferral of the 30 April 2015 amortization instalment until the closing of the Romanian Assets Sale or 30 October 2015, whichever is earlier For the avoidance of doubt, interest…
Table of contents Background and proposed amendments Company update Appendix April 2015 Bondholder Presentation Page 8
Overview of Sterling Resources E&P independent listed on TSXV (Toronto, ticker SLG) Market cap of US49m (21 April 2015, at C0.16/share) Net debt of 185m(1) at 31 March 2015 Post planned Romanian sale and exit from France, pure…
Breagh: field summary Participants Sterling (30%), RWE Dea (70%, op.) Material, early productionstage asset Field 2P Reserves(1) 444 Bcf sales gas, 1.6 MMb condensate Scale 1.1 Tcf full field gasinplace (P50)(1) Net 2P Reserves(1)…
Breagh: production outlook and cash flow generation Breagh production estimates (20152024, net to Sterling) Breagh cash flow projections (20152024, net to Sterling) Significant increase in 2017 is a result of 2 new wells and…
Breagh: production performance 2014 year to date 2015 opened up A07 & A08 A08 Online 160 further Plan to open up further A08 A04 Offline 150 A07 Online Daily Raw Gas Produc on 140 Cumula ve Raw gas produc…
Breagh: future plans Remaining Phase 1 development Drilling program due to recommence in Q4 2015 A09, A10 and hydraulic stimulation of one existing well are firm, onstream mid 2016 A11, A12 and hydraulic stimulation of another…
Cladhan: development summary Participants Sterling 213.8%, TAQA (52.7%, op.), MOL (33.5%) 2P Reserves(1) 10.2 MMbbls field, 0.44 MMbbls net (post carry) First Production Q3 2015 Subsea development via Tern platform (operated by…
Asset value backing Bond LTV for duration of the bond Beforetax RPS reserves valuations as at end 2014(1): Before Tax 1P m 2P m 3P m Breagh Phase 1 377 496 675 Cladhan 4 13 30 Total 381 509 705 Aftertax RPS reserves…
Significant value in tax losses Issuer has very significant UK tax losses: Sterling Resources UK tax position As of 31 December 2014: 433m (673m) (RFCT) loss(1) and 397m (616m) (SCT) loss(1) Ring Fence Exploration Supplement…
Table of contents Background and proposed amendments Company update Appendix April 2015 Bondholder Presentation Page 17
Group and Issuer balance sheets GROUP BALANCE SHEET m ISSUER BALANCE SHEET m 31 Dec 2014 31 Dec 2013 30 Jun 2014 31 Dec 2013 Assets Assets Cash & Cash Equivalents (1) 18 35 Cash & Cash Equivalents 6 15 Restricted cash 0 8…
Breagh: comparison of original and Sterlingrevised profiles Breagh: RPS vs updated Sterling estimates Since RPS prepared its reserves report, well timings have slipped by several months and it Capital expenditures (m) Net…
UK North Sea: additional assets Southern North Sea Crosgan discovery close to Breagh Net 2C Contingent Resources of 41 Bcf(1), before reflecting disappointing well results from the appraisal of the Crosgan discovery announced on 5…
Netherlands: probable oil development Sterling is operator of Jurassic and Early Cretaceous horizons in licences F17a, F18 (Sterling 35%) Net 2C Contingent Resources in F17a/18 of 12 MMbbls(1), in four oil discoveries Other…
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