JUNE 2015 ANNUAL GENERAL MEETING – Transatlantic Petroleum Ltd.

Transatlantic Petroleum Ltd. · Jun 10, 2015 · 104 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

2015 ANNUAL MEETING JUNE 10, 2015
TRANSATLANTIC PETROLEUM: DALLAS, TX APPLYING PROVEN, NORTH AMERICAN TECHNOLOGY TO KNOWN INTERNATIONAL HYDROCARBON BASINS Good fiscal terms and respect for rule of law Deep inventory of low risk projects High quality 3D seismic,…
TRANSATLANTIC BOARD OF DIRECTORS Name Select Experience Former President & CEO of Sprott Resource Lending (formerly Quest Capital Corp.), President and Brian Bayley Director of Ionic Management Corp. Chief Operating Officer, President…
MANAGEMENT TEAM Name Position Select Experience Riata Energy (renamed SandRidge, NYSE: SD), Longfellow Energy; N. Malone Mitchell 3rd Chairman & CEO owns 36% of TransAtlantic Longfellow Energy; Texas Pacific Oil Company; Coquina Oil…
A YEAR IN REVIEW OPERATIONAL SUCCESS SINCE LAST ANNUAL MEETING February 2015 November 2014 Record reserves and production growth Acquisition of Stream Announce target of 10mm in Waterflood response seen in run rate annual cost…
TRANSATLANTIC RELATIVE SHARE PERFORMANCE CORRELATED TO PEERS One Year Year To Date 160 140 140 120 120 100 100 80 80 60 60 40 40 TAT 20 TAT 20 BNK BNK TGL TGL 0 0 Source: Bloomberg; 1 year data as of…
COMPANY GROWTH Annual Net Reserves - Turkey Quarterly Net Production(1) 35 6000 30 5000 25 15.4 4000 20 MMBOE BOEPD 12.0 15 3000 6,122 5,969 8.7 5,033 5,000 4,622 10 2000 4,391 5.6 4,076 4,022 5 1000…
RESERVE ACCURACY IS IMPROVING (DOWNEY CURVE) COMBINATION OF MANAGEMENT DECISIONS AND ASSET UNDERSTANDING 2013 Pre and Post Drill Reserve Estimates* Pre-Drill Cumulative EUR Post-Drill 0 5 10 15 20 25 Wells Drilled 2014…
THE GOOD NEWS PRODUCTION POTENTIAL (NET) NET BOE/D Total Production Forecast* 25,000 Requires More CapEx What our licenses have 20,000 the potential to produce 15,000 10,000 5,000 - Jun-15 Dec-15 Jun-16 Dec-16…
THE BAD NEWS - CUMULATIVE DRILLING INVESTMENT USD Cumulative Drilling Investment 1,000,000,000 Total Cost to Drill - 972 mm 900,000,000 800,000,000 What we have to spend 700,000,000 600,000,000 500,000,000…
PRODUCTION VS. CASH FLOW TO ACHIEVE THAT GROWTH NET BOE/D Production Vs. Cash Flow USD 30,000 300,000,000 25,000 20,000 200,000,000 15,000 10,000 100,000,000 5,000 Break Even - Aug. 2020 - 0 Jun-15 Jun-16 Jun-17 Jun-18 Jun-19…
WITH CURRENT CASH FLOW AND DEBT SERVICE THIS IS MORE LIKE WHAT WE CAN DO Assuming: No additional liquidity Pay debt to zero Drill only with incremental cash flow NET BOE/D 10,000 Production Forecast 9,000 8,000 7,000…
PROJECTS ACROSS ALL STAGES OF DEVELOPMENT Reserves Internal Unbooked Prospective Reserves Size of circle is relevant size of reserves Cash Flow Positive Thrace (Shallow) Selmo (still 50+ locations) Constant Production + Selmo…
SO HERE IS OUR PLAN NET BOE/D Total Production Forecast USD Cumulative Drilling Investment 25,000 NEW PARTNER PRODUCTION 25,000 1,000,000,000 TAT PRODUCTION JV Partner Capex Total Cost to Drill 900,000,000 Carry Value Sell This TAT…
WE WILL SELL JOINT VENTURES (JVS) AND IMPROVE: PRODUCTION INCOME BALANCE SHEET VALUE PER SHARE 6 Transactions Nearly every area Sale- VPP: 40 - 80 million cash proceeds Estimated required loan paydown: 20 - 30 million Carry-Loan:…
CORE CORPORATE STRATEGIES Area Strategy SELMO Expedite Selmo development to maximize returns prior to 2025 MOLLA Grow Molla assets through drilling to validate 3D then expedite development blocks to establish primary revenue source…
GEOLOGICAL DISCUSSION LEE MUNCY VP GEOSCIENCES 18
150 YEARS OF G&G EXPERIENCE ADDED IN LAST 12 MONTHS These geologists and geophysicists have a variety of experience working many diverse basins and plays throughout the world They are all seasoned veterans working in the oil and…
GEOLOGICAL DISCUSSION 82 EXPLORATORY PROSPECTS & 210 YE 2014 2P DEVELOPMENT LOCATIONS IDENTIFIED This marks a significant increase in the number or exploratory prospects from a year ago and these numbers are expected to grow as the…
EXPLORATION PROJECTS SE Turkey Molla 3D conventional prospects (200 MMBO*) Dada Sand Play (107 MMBO*) Dada Shale Play (Potential reserves undefined at this time) NW Turkey Various Danismen, Osmancik, Sogucak, and Hamitabat Prospects…
MOLLA 3D AREA SE TURKEY 22
SE TURKEY MOLLA 3D AREA 71 CONVENTIONAL PROSPECTS HAVE BEEN IDENTIFIED IN THE MOLLA 3D AREA 22 Bedinan, Hazro or Mardin structural prospects 49 Dada Sand stratigraphic prospects Bedinan, Hazro & Mardin Prospects & Leads Dada Sand…
SE TURKEY MOLLA 3D AREA 22 BEDINAN, HAZRO AND MARDIN PROSPECTS IDENTIFIED, SO FAR Bahar Field is the analog for many of the Bedinan prospects Bahar Field - Bedinan Structure Cavasulu Prospect - Bedinan Structure 17 MMBO*…
SE TURKEY MOLLA 3D AREA Molla SE / Karagoz Prospect Area Bedinan Structure 44 MMBO* Recoverable Reserve Potential * Internal estimate. Refer to Note on Internally Generated Reserve Estimates 25 TAT NYSE TNP TSX
SE TURKEY MOLLA 3D AREA Bahar Field Cavasulu Molla SE 1 3 6 Prospect Prospect Karababa A Hazro F4 Bedinan 26 TAT NYSE TNP TSX
SE TURKEY DADA SAND & SHALE PLAYS THERE ARE TWO TYPES OF PLAYS WITHIN THE DADA SHALE Dada Sand Play Conventional stratigraphic prospects Characterized as sand channels and fans encased within the Dada Shale Identified from 3D seismic…
SE TURKEY DADA SAND PLAY: THE CONCEPT SANDSTONE BODIES ENCASED WITHIN THE SHALE SOURCE ROCK Top of Dada Shale Target package of sandstone reservoirs Base of Dada Shale 28 TAT NYSE TNP TSX
SE TURKEY DADA SAND PLAY atak 1 Petrophysical Evaluation Log of Dada Shale Section Oil bearing zones Major source rock for Diyarbakir Basin 29 TAT NYSE TNP TSX
SE TURKEY DADA SAND PLAY IDENTIFIED FROM 3D SEISMIC DATA AS AMPLITUDE BRIGHT SPOTS AVO analyses of these bright spot anomalies indicate they are associated with Type II and Type III AVO anomalies comparable to AVO anomalies found…
SE TURKEY DADA SAND PLAY BAHAR FIELD AREA EXAMPLE OF SEISMIC AMPLITUDE & LOCATION OF GATHERS Gather 1 Gather 2 Gather 3 Gather 4 Gather 5 1 2 4 5 3 Points 3 & 4 show good AVO response and should be productive while…
SE TURKEY DADA SAND PLAY 49 reflector packages, interpreted to be sand bodies within the Dada Shale, have been mapped from the Molla 3D seismic dataso far Based on 160 acre spacing, there are approximately 175 drilling locations if…
THRACE BASIN PROSPECTS NW TURKEY 33
NW TURKEY THRACE BASIN Structure map on top of Mezardere Formation showing license blocks and TransAtlantics prospect areas within the Thrace Basin . Not shown are leads & prospects in the Edirne Area and on recently nominated…
NW TURKEY THRACE BASIN 70 BCF* RECOVERABLE RESERVES FROM NEW PROSPECTS 8 exploratory prospects are currently identified on TAT acreage within the Thrace Basin The prospects target the Danismen, Osmancik, Sogucak, and Hamitibat…
NW TURKEY THRACE BASIN GUNEY REISDERE PROSPECT 2,900 meter drill depth with 38 BCF* of recoverable gas reserves Sogucak LS, Ceylan Tuff, and Hamitibat SS targets Structure Map Sogucak Limestone * Internal estimate. Refer to Note…
NW TURKEY THRACE BASIN Target Level Osmancik Fm. M.Dere Fm. The prospect is a down thrown 3-way structure trapped against a Teslimkoy Fm. major fault. The reservoirs are adjacent to the kitchen Ceylan Fm. area…
DELVINA PROSPECT ALBANIA 38
ALBANIA DELVINA PROSPECT Discovered in 1987 Four wells have been drilled on the structure with two of the four productive The Delvina 12 and Delvina 4 wells will require relatively simple workovers to restore production A fifth…
ALBANIA DELVINA PROSPECT THERE APPEAR TO BE MULTIPLE STRUCTURES PRESENT BENEATH THE DELVINA BLOCK Current plans: Complete the drilling of the D-34 well Drill a new well on one of the adjoining structures Evaluate full field…
ALBANIA DELVINA PROSPECT Geological Profile Across Delvina Field Showing Delvina 34 Location Illustrated on the previous map as the green cross-section 41 TAT NYSE TNP TSX
BALLSH, GORISHT & CAKRAN ALBANIA 42
ALBANIA BALLSH, GORISHT, & CAKRAN These oil fields were discovered in the 1960-70s Vast majority of wells only drilled into producing zone until first good flow of oil For example, only 4 wells drill the entire 750m column in the…
ALBANIA BALLSH, GORISHT, & CAKRAN In the Gorisht Field, 269 wells penetrated the Eocene Limestone section, however, only 4 of those wells penetrated the entire thickness of prospective reservoir. It is anticipated that the Ballsh,…
ALBANIA BALLSH, GORISHT, & CAKRAN Gorisht 240 Kocul 44 Most of the wells only penetrated the top 50 M of limestone reservoir and were completed only in the shallowest portion of the reservoir Frac Barrier Deeper wells show oil…
ALBANIA BALLSH, GORISHT, & CAKRAN Ballsh Gorisht Cakran Initial deepening candidates New drill locations Structure maps on the top of the Eocene Limestone. Plan to deepen wells Ballsh and Gorisht are relatively shallow…
NORTH KOYNARE PROSPECT BULGARIA 47
BULGARIA NORTH KOYNARE PROSPECT NORTH KOYNARE PROSPECT North Koynare Prospect is seismically tied and analogous to the Dolni Dabnik and Gorni Dabnik fields located 23 KM to the northeast The potential exists for numerous prospects…
BULGARIA NORTH KOYNARE PROSPECT Dolni Dabnik Structure Map A 1400 Acres (570 Hectares) Proposed B Location B R1 R2 A 3D seismic defined structure (62 km2 3D seismic survey) Prospect is located on a different structure…
BULGARIA NORTH KOYNARE PROSPECT DOLNI DABNIK IS PRIMARY OBJECTIVE PROPOSED PROPOSED A LOCATION A B LOCATION B R1 Triassic Unconformity Triassic Unconformity Dolni Dabnik Dolni Dabnik 200M CLOSURE HEIGHT It is a Lower…
DEVELOPMENT PROJECTS SELMO FIELD 51
SE TURKEY SELMO FIELD WHAT HAS CHANGED SINCE LAST YEAR Drilling locations have been high-graded using 3D seismic data Production performance has been tied to the seismic data for all of the wells in the field There is a correlation…
SE TURKEY SELMO FIELD 53 DEVELOPMENT LOCATIONS HAVE BEEN IDENTIFIED IN THE SELMO FIELD MSD Top Depth Structure map (BSL-ft) MSD Horizontal (43) LSD Horizontal (2) MSD/LSD Vertical (8) 53 TAT NYSE TNP TSX
SE TURKEY SELMO FIELD S 35 H-2 MSD Reflector High amplitude peak responses shown here as continuous reflectors suggest porosity typically associated with dolomitic facies Model validated in the Selmo 35 H-2 well with EUR of…
DEVELOPMENT PROJECTS BAHAR FIELD 55
SE TURKEY BAHAR FIELD 11 BEDINAN DEVELOPMENT LOCATIONS IDENTIFIED IN BAHAR FIELD Bahar Field Structure Map Top Bedinan Existing Well Proposed Well 56 TAT NYSE TNP TSX
SE TURKEY BAHAR FIELD FURTHER POTENTIAL IN THE HAZRO Plan to drill a horizontal well in the Bahar Field to further test the Hazro F4 proven productive in the Bahar 1 and Bahar 2 ST wells Bahar Field Structure Map Top Hazro Bahar…
ENGINEERING DISCUSSION JAMES HULING CHIEF OPERATING OFFICER 58
PROVEN RESERVES GROWTH SELMO FIELD ACQUIRE AND EXPLOIT 2009: Acquired mature legacy field with many infrastructure problems Upgraded facilities and infrastructure and doubled production with infill drilling and exploitation Started…
PROVEN RESERVES GROWTH SELMO FIELD CASE HISTORY: ACQUIRE AND EXPLOIT BOPD Well Count MBOE Selmo Net P1 Yearly Reserves Selmo Field Gross Daily Production 5,000 200 10,000 4,500 180 9,000 4,000 160 8,000 3,500 140 7,000 3,000…
SELMO WATERFLOOD: EXPANSION IN PROGRESS WATERFLOOD YIELDING 105 BOPD & INCREMENTAL EUR OF 400 MBO* BPD Water Cut (%) Pilot Waterflood Incremental Response 10,000 100% 95% 1,000 90% 85% Started Waterflood Pilot 100…
SELMO FIELD AS A CASE MATURE LEGACY FIELDS PROVIDE YEARS OF PROJECT HARVESTING Using state of the art technology with proven exploitation techniques TransAtlantic continues to increase reserves from this fifty year old field CUM Oil…
ORGANIC RESERVES GROWTH BAHAR FIELD CASE HISTORY: EXPLORE & DEVELOP Organic growth from proprietary 3D seismic inventory Commenced production in 2013 Proved reserve growth from inception to 3.2 MMBOE at YE2014 3P Reserves growth to…
ORGANIC RESERVES GROWTH BAHAR FIELD CASE STUDY: EXPLORE & DEVELOP Bahar Field Daily Production Bahar Net P1 Reserves BOPD MBOE 2000 3,500 1800 3,000 1600 1400 2,500 1200 2,000 1000 800 1,500 600 1,000 400 500…
BAHAR FIELD Bahar 6 was completed in both the Dada and Bedinan formations Production is outperforming the average curve of Bedinan only production All wells are vertical Bahar Field Well Results BOPD 900 Bahar 6: Comingled Bahar…
ORGANIC RESERVES GROWTH BAHAR FIELD CASE STUDY: EXPLORE & DEVELOP Organic Growth from 3-D Seismic using modern completion techniques. Currently realizing growth through development. Future horizontal development, secondary potential,…
PROVEN EFFICIENT OPERATOR IMPROVING EFFICIENCIES AND LOWERING OPERATING COSTS (USD/BOE) Operating Expense Thousand USD/Month Turkey 18.00 2,400 16.00 2,000 14.00 12.00 1,600 10.00 1,200 8.00 6.00 800 4.00 LOE…
ALBANIA GROWTH POTENTIAL LEGACY FIELDS EXPLOITATION OPPORTUNITY EXHIBIT A: SELMO FIELD Gorisht Field Production Selmo Daily Production 80,000 5,000 70,000 4,500 CUM OIL (MBO) 60,000 4,000 Demonstrated Production Growth OIL…
69 BOPD 10000 100 1000 ALBANIA TRANSITION TAT NYSE TNP TSX Roll-out New Remove Prior Organization Management Strike Starts Power Turned Off Transformer Failure Transformer Repair Transformer Failure Replace…
ALBANIA OIL FIELDS PLAN GORISHT & BALLSH THEN CAKRAN Existing Wells Field Development Strategy Capacity: 75 150 bfpd (1) Lower high capacity pumps to formation level (5) Drill injector (3) Drill wells horizontally into…
ALBANIA TRANSITION FLOW METERS Installed flow meters for custody transfer of oil sales which provides check on volume & weight measurements Inlet Flowmeter Outlet Flowmeter 71 TAT NYSE TNP TSX
ALBANIA TRANSITION Started 14-well PCP Installation Campaign Replacing dilapidated artificial lift Utilizing existing PCP inventory with replacement tubing and rods Working with existing infrastructure Source: Kudu 72 TAT…
ALBANIA FINALIZING WORK PROGRAM 2015 Focus: Finalize Albania Amending Agreements Take over remaining Ballsh wells Return wells to production Upgrade production facilities Upgrade power infrastructure Upgrade SWD…
CURRENT ACTIVITY TODD DUTTON PRESIDENT 74
CURRENT ACTIVITY Albania Oil Fields Switching out and lowering pumps on 14 wells Delvina 34 Gas Well Drilling ahead at 6,117 Ft Pinar 1 Completion (Molla) Slim Hole Tools - in progress South Gosku Completion TD above pay zone…
BAHAR FIELD MAP WELL LOCATIONS (CURRENT DRILLING ORDER: 9, 7, 5, 2H-1) Bahar 11 Bahar 5 Bahar 9 Bahar 2ST Bahar 2 Bahar 8 Bahar 1ST Bahar 10 Bahar 3 Bahar 2H Bahar 4 Bahar 6 Bahar 12 Bahar 7 76 TAT NYSE TNP…
MOLLA PROJECT LIFECYCLE Vertical Horizontal 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Well Costs Horizontal Multi-Stage Acid Well Productivity Initial Fracs Frac evolution size Prospect Active Drilling Development…
BAHAR FIELD 3 STRING CASING DESIGN WELLBORE SCHEMATIC Setting Depth Mud Weight/ FIT TVD/MD (rkb) RKB Setting Depth TVD / MD (rkb) RKB Elev. 2276' Casing Elev. 2276 CASING Hole Size Hole Size Formation 100 MD/TVD 100' MD/TVD…
BAHAR FIELD 2 STRING CASING DESIGN TransAtlantic Turkey, LTD Bahar 9 District XI, Siirt, Turkey WELLBORE SCHEMATIC Setting Depth 2015 Mud Weight/ FIT VD/MD (rkb) RKB Setting Depth TVD / MD (rkb) Elev. 2126 RKB Elev. 2126'…
MICROSEISMIC SURVEYS What is Microseismic Utilizes 3D seismic technology Indicates where frac starts and where it goes (logs say NNE-SSW, but we really dont know) Allows measurement of stimulated and propped reservoir rock Why…
MICROSEISMIC SURVEY Surface Arrays Image Source: MicroSeismic 81 TAT NYSE TNP TSX
MICROSEISMIC SURVEY Fracture Orientation - Horizontal Wellbore Direction Image Source: MicroSeismic 82 TAT NYSE TNP TSX
MICROSEISMIC SURVEY Frac Width Frac Height N W E S UP DOWN Stage Coloring Legend Image Source: MicroSeismic 83 TAT NYSE TNP TSX
MICROSEISMIC SURVEY STIMULATED ROCK VOLUME RESULTS Stimulated Reservoir Propped Reservoir IP 1884 BOEPD 11 Stages IP 978 BOEPD 14 Stages 31,000/Stage 102,000/Stage Image Source: MicroSeismic 84 TAT NYSE TNP TSX
MICROSEISMIC SURVEY Frac Height Frac Width N W E UP Distance from Stage Center Y (feet) S Distance from Stage Center Z (feet) Propped Fracture Volume (ft3) DOWN Propped Fracture Volume (ft3) Distance from Stage…
MICROSEISMIC SURVEYS WHAT WILL HORIZONTAL WELLS DO FOR US IN BAHAR Average Average Average Average Average Horizontal Play 12 mo Prod Prod/Stage Prod/ Prop Stage Count Prop/Stage MBOE MBOE BOE Eagle Ford 25 224,400 558 22.3…
DRILLING INVESTMENT Year Wells Gross BOE/D Gross TAT BOE/D Partner Partner CapEx CapEx Net CapEx(2) BOE/D 2015E(1) 7 28.4 7,520 25.6 5,430 2.8 1,144 2016E 44 135.4 9,440 74.7 5,570 60.7 2,687 2017E 57 203.5 17,630 94.6 10,430…
DRILLING INVESTMENT (NET) THATS A LOT OF MONEY, BUT REINVESTING THE RESULTING CASH FLOW MAKES THIS THE NET: Year Wells Gross BOE/D Gross TAT BOE/D Partner Partner BOE/D CapEx CapEx Net CapEx Net of Sales Net of Sales Net of…
PRODUCTION WEDGE NET BOE/D PRODUCTION FORECAST 20,000 20,000 18,000 18,000 16,000 16,000 14,000 14,000 Selmo 12,000 12,000 Albania Gas 10,000 10,000 Albania Oil 8,000 8,000 6,000 6,000 Molla Exploration 4,000…
WIL SAQUETON FINANCIAL CHIEF FINANCIAL OFFICER 90
2015 COST SAVINGS & CASH MANAGEMENT ACCOMPLISHMENTS Have implemented actions that will generate 9mm annualized cash cost savings across G&A and LOE Turkey at 10mm annualized cash savings Dallas costs up slightly due to investment of…
FINANCIAL MODEL OVERVIEW The following slides portray a simplified Balance Sheet (Cash, Debt) under several scenarios Key assumptions modeled Brent at 65 through 2016 and at 75 from 2017 through 2020 2014 actual realized discounts…
BALANCE SHEET (SIMPLIFIED) -- CURRENT CASH FLOW & DEBT Cash/Debt BOE/D Cash vs Debt Principal balance - No JVs 200,000,000 Debt Principal balance 7,000 Cash Balance Production 6,000 150,000,000 5,000 100,000,000 4,000…
BALANCE SHEET (SIMPLIFIED) JOINT VENTURES Cash/Debt Cash vs Debt Principal balance - JVs BOE/D 400,000,000 18,000 350,000,000 16,000 Debt Principal balance 300,000,000 Cash Balance JV Exp 14,000 250,000,000 Cash Balance JV LP…
EBITDAX WITH JOINT VENTURES (EXPECTED CASE) EBITDAX EBITDAX with Joint Ventures Per Share 250,000,000 7.00 6.00 200,000,000 EBITDAX/Sh 5.50 5.00 150,000,000 4.00 3.00 100,000,000 2.00 50,000,000 55mm Convertible Notes…
BALANCE SHEET (SIMPLIFIED) CONVERT TO EQUITY Cash/Debt (USD) Cash vs Debt Principal balance - JVs and Convertible Notes convert to Equity 450,000,000 Debt Principal balance 400,000,000 Cash Balance JV Exp 350,000,000 Cash Balance…
BALANCE SHEET (SIMPLIFIED) JOINT VENTURES & BOND ISSUE Cash/Debt (USD) Leverage Ratio Cash vs Debt Principal balance - JVs and Bond issuance 500,000,000 2.00 Debt Principal balance 450,000,000 Cash Balance JV Exp 1.50 400,000,000…
JV MARKETING PROCESS So whats different now Much more Proof than 2 years ago More reasonable terms for partner Buyers market issues Some accept terms but desire operations Some dont want operations but less technical What can go…
TURKEY ELECTIONS DEMOCRACY WORKING, NO CONTESTED RESULTS AKP (Erdogan) highest vote but not absolute control Kurds win parliament representation likely greater peace in SE Turkey 4 parties over 10% Waiting on coalition or…
Q&A N. Malone Mitchell 3rd Chairman & CEO Todd Dutton President James Huling COO Wil Saqueton VP & CFO Lee Muncy VP Geosciences 100 TAT NYSE TNP TSX
CONTACT Lizzy Chesnut Investor Relations (214) 265-4716 lizzy.chesnuttapcor.com www.TransAtlanticPetroleum.com 101 TAT NYSE TNP TSX