World Class Pareto Securities Oil & Offshore Conference September 12-13, 2012
World Class Overview
A Global Leader in Shallow Water Services Jackups Liftboats 42 Jackups 63 Liftboats Largest jackup provider in the U.S. Gulf of Mexico; 4th largest Largest liftboat provider provider worldwide worldwide Operations on three…
Global Footprint Global Summary Liftboats 63 Jackup Rigs 42 Inland Barges 16 U.S. Gulf of Mexico U.S. Gulf Coast Jackup Rigs 33 Liftboats 39 Inland Barges 16 (1) Far East Jackup Rig 2 West Africa Jackup Rigs 2…
World Class Business Outlook
Domestic Offshore Tight industry supply/demand for GOM Jackup Backlog and Dayrates (1) U.S. GOM jackups 8.0 150 Leading edge dayrates on the rise 7.0 135 GOM Backlog per Marketed Rig (Months) 120 GOM 200'MC Dayrate…
Leading Edge Dayrates Hercules Offshore Leading Edge Dayrates U.S. GOM 100 120 90 110 80 Dayrate (000 per day) 100 Dayrate (000 per day) 70 90 60 80 50 70 40 30 60 20 50 M 11 Oc 11 M 12 Se…
Domestic Offshore Backlog Hercules Offshore Average Backlog per Marketed Rig U.S.(1)GOM 180 150 120 90 60 30 0 Ju 0 Ju 1 Ju 8 Ju 9 Ju 2 M 08 M 09 M 10 M 11 M 12 Ja…
U.S. GOM Supply vs. Demand U.S. GOM Jackup Supply and Demand as of August 28, 2012 90 89% Industry Utilization Number of Rigs 65 of Marketed Rigs 60 39 38 34 30 (26) (1) 0 Current Less: Cold Marketed Planned Jackup…
Domestic Customer Base Exposure to Crude Oil Domestic customers have Customers U.S. GOM Liquids Mix significant exposure to crude oil, specifically Louisiana Light Sweet Apache 38% (LLS), which trades at a premium to WTI Chevron…
Large and Diverse Domestic Customer Base Diverse group of operators in the U.S. U.S. GOM Industry Customers Mix (1) GOM, ranging in size from mega-cap to private E&P CVX Arena Top three operators account for 12% 9% EXXI 6%…
Central GOM Lease Sales Gulf of Mexico lease sales are Central GOM Lease…
Reactivation Matrix (1) Capital Payback Analysis (m onths to payback) Dayrate Assumption 70,000 75,000 80,000 85,000 90,000 Reactivation Capital Cost 10 9.1 8.0 7.2 6.5 6.0 11 10.0 8.9 7.9 7.2 6.6 ( in millions) 12…
Domestic Offshore Potential Earnings Upside (1) Incremental EBITDA Analysis ( in m illions, except dayrate) Increase in Average Dayrate 5,000 10,000 15,000 20,000 25,000 18 28 56 84 112 140 Number of Rigs Working 19 43 72…
International Offshore Resilient oil prices are supportive of International Jackup Backlog and Dayrates strong growth in international capital spending 18.0 200 16.0 175 National Oil Companies have been Middle East 300'IC…
Accretive Rig Acquisition and Blue Chip Contract Key asset details Projected Return on Capital Employed Acquisition of the Ocean Columbia (renamed ( in millions) Hercules 266) Rig purchase price 40.0 Upgrade costs 35.0 Contract…
International Drilling Outlook FY 2012E FY 2013E Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Middle Hercules 261 83-85k 83-85k East Middle Hercules 262 79-81k 79-81k East Middle Hercules 266 124-126k East Hercules 260 W. Africa 69-71k 74-76k…
Discovery Offshore Fleet renewal and exposure to premium jackup market through 32.1% ownership of and management agreements with Discovery Offshore Discovery Offshores two newbuild jackup rigs will rank in the top 8% of global rig…
International Liftboats Largest liftboat provider in West Africa and established presence in Middle East Well-established liftboat market and long term demand growth drivers in West Africa, tempered by competition creep Robust…
Domestic Liftboats Seasonally-driven market demand, with activity levels most active during the summer and fall period Select industry capacity movement out of the Gulf of Mexico, including Companys Kingfish vessel to the Middle…
World Class Conclusion
Hercules Offshore Strategy Remains Consistent Maintain Leading Position Diversify Geographically in Core Businesses Opportunistic Growth Focus on And Fleet Optimization Shallow Water Assets Maintain Status as an Efficient,…
History of Growth August October January June August September November February 2004 2004 2005 2005 2005 2005 2005 2006 Acquired five Acquired 22 Acquired Rig 25 Acquired Rig Acquired Acquired Acquired Acquired jack up rigs…
Refinancing Summary Execution of comprehensive refinancing to facilitate rig acquisition, increase operational flexibility and extend maturity profile completed in April 2012 Refinancing consist of the following: 20 million new…
Investment Highlights Positive industry trends continue in the U.S. GOM led by tight jackup rig supply and oil/liquids-rich activity demand driver Strengthening international jackup market, exemplified by Companys recent Saudi…
APPENDIX 26 World Class
Domestic Offshore Marketed Rig Data Domestic Offshore Fleet Status as of 08/21/2012 Contract Est. Duration (1) Rig Name Rig Type Location Customer / Status Dayrate (000s) Days Date Hercules 120 120' - MC, TD GOM Chevron 39-41 132…
Domestic Offshore Marketed Rig Data (continued) Domestic Offshore Fleet Status as of 08/21/2012 (continued) Walter Oil & Gas 57-59 20 09/10/12 Walter Oil & Gas 60-62 44 10/24/12 Hercules 251 250' - MS, TD GOM Hall-Houston 74-76 23…
International Offshore Marketed Rig Data International Offshore Fleet Status as of 08/21/2012 Contract Est. Duration (1) Rig Name Rig Type Location Customer / Status Dayrate (000s) Days Date Hercules 170 170' - ILC, TD Bahrain…
GOM Shallow Water Operator Data Top 20 Shallow Water (0-350ft) GOM Lease Holders Apache Corp Current % of Total Operator Chevron Jackup Current Stone Energy McMoran O&G Apache Corp 6 16% Chevron 4 11% W&T Offshore Stone…
Summary of Discovery Offshore Structure Overview Structure Discovery Offshore is a newly established Luxembourgbased company Investors Hercules Offshore Constructing two ultra highspecification Keppel FELS Super A jackup rigs…
Adjusted EBITDA reconciliation The following table reconciles our Losses from Continuing Operations, the most directly comparable GAAP financial measure, to EBITDA and Adjusted EBITDA in thousands As of 12/31/2011 Loss from…
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