EURASIA DRILLING COMPANY LTD Credit Suisse Energy Summit Vail, Colorado February 6-10, 2012
Agenda EDC Overview Overview Outlook Outlook Strategic Focus Strategic Focus Investment case Performance and positioning Investment Case Q&A Positioning Q&A 3
EDC at a glance EDC Overview THE LARGEST DRILLING COMPANY IN RUSSIA AND THE CIS 2011 Growth Revenue US 2.7 billion* +50% vs. 2010 Outlook Operating statistics: 4,777,433 meters drilled +16% vs. 2010 879,090 horizontal meters…
Geographic presence EDC Overview Head Office Regional/Branch Office Support Base Operational Areas Outlook TIMAN-PECHORA Usinsk EASTERN SIBERIA Kogalym Strategic Focus Moscow WESTERN SIBERIA VOLGA-URALS…
2012 Outlook- Onshore operations EDC Overview Drilling volume forecast is approx. 5.5 million Horizontal drilling volumes are expected to meters for 2012, implying growth of about 15% increase further in line with total meters…
2012 Outlook- Offshore operations EDC Overview In February 2011, the Company acquired the Trident 20 jack up rig from Transocean which is currently contracted to Petronas Carigali Sdn Bhd in the Turkmen waters of the Caspian Sea.…
Key strategic focus EDC Overview Acquire in-house and/or independent drilling SLB drilling assets add 3-4% market share on Increase market contractors a full-year basis share Invest in fleet expansion and upgrades By 2012, roughly…
Caspian Sea jack-up market EDC Overview Demand for jack-ups growing in all STATOIL Exploration Caspian sectors served by EDC: NCOC (Exxon) In the Russian sector, Lukoil has Exploration made a number of discoveries and CMOC…
Russian market EDC Overview Russias onshore market by meters drilled (mln) 2013F Drilling volumes in Russia grew at 2012F more than 8% between 2006-2010 2011F As per REnergyCo, demand for Outlook 2010 drilling is expected to grow…
Russian oil industry EDC Overview Russias crude oil production (bpd) 12 60 Crude oil production from 10 50 Brownfields accounts for 85-90% Production from Greenfields of Russias total output, but has 8 40 Outlook Production from…
Drilling complexity is increasing EDC Overview Customers demanding hi-spec rigs Fleets must be modern Depths/complexity increasing Fleets must be heavier Assets are becoming scarce Fleets must be more efficient Outlook Logistics…
Horizontal drilling EDC Overview Horizontal drilling volumes in Russia (th. meters) Migration toward exploitation of 2010 more challenging geologies and isolated oil reserves requires 2009 more sophisticated drilling Outlook…
Operating performance EDC Overview EDC drilling volume performance (th. meters) LUKoil-Bureniye 5,500 EDC Actual 19% CAGR in drilling EDC Forecasts 4,777 volumes during EDCs history as an 4,041 4,103 3,753 independent driller…
Rig fleet and CAPEX EDC Overview EDC capital expenditures (US mln) EDC rig fleet 400 Actual 100-125 T 160-175 T 200-225 T 250-270 T 320-400 T 450 T about 350m 0 350 327 2011E 320 1,000 300 284 Outlook 2,000 * Max. Depth…
Market share (by meters drilled) EDC Overview 2007 (at IPO) 2010 2011 EDC 22% EDC 24% EDC 25% Outlook All others 40% All others 30% All others 32% * SurgutNG 23% SurgutNG 26% SurgutNG 25% Strategic Focus At the time…
Customer diversification (by meters drilled) EDC Overview 2007 (at IPO) 2010 2011 Other 1% 2% Other 1% 3% Other 6% 8% 11% 21% Outlook 15% 29% 15% Strategic Focus 76% 57% 55% In 2007 the share of non-Lukoil In 2010 we…
Debt profile EDC Overview Debt structure 1,000 899 800 To finance acquisitions the Company raised the following debt late in 2010 600 and during 1H-11: 404 US (million) Outlook 400 284 263 3-years ruble denominated loan…
Q&A EDC Overview Outlook Strategic Focus Investment Case Positioning Q&A 20
Appendices EDC Overview Outlook Strategic Focus Investment Case Positioning Q&A 21
Appendix: IR contacts EDC Overview Investor Relations key contacts Richard Anderson Kim Kruschwitz Chief Financial Officer Vice President, Marketing and Investor Relations Outlook Tel: +1-281-778-0621 Tel: +44 (0) 207 717 9707…
Appendix: Worlds largest drillers EDC Overview --550-- Nabors Industries LTD M --6.5-- Helmrich & Payne, Inc R Outlook A I --364-- Precision Drilling Corp --5.2-- Nabors Industries LTD R G --350-- Patterson UTI Energy, Inc…
Appendix: Market dynamics EDC Overview The Russian oil industry entering a new phase mbd Phase 1 Phase 2 Phase 3 Phase 4 12,000 Collapse of Soviet Well re-activation and Growth stalls Tax reform Union leads to huge fall…
Appendix: Income Statement EDC Overview 2007 2008 2009 2010 1H 2010 1H 2011 in US thousands Audited Audited Audited Audited Unaudited Unaudited Av. Exchange Rate RUB/USD 25.6 24.9 31.7 30.4 30.1 28.6 Total Revenue 1,492,189…
Appendix: Balance Sheet EDC Overview 2007 2008 2009 2010 30-Jun-11 in US thousands Audited Audited Audited Audited Unaudited ASSETS Current Assets Cash 343,089 279,430 433,724 629,466 533,607 Trade Accounts Receivable, net 230,888…
Appendix: Cash Flow Statement EDC Overview 2007 2008 2009 2010 1H 2010 1H 2011 in US thousands Audited Audited Audited Audited Unaudited Unaudited Net Income 168,544 220,933 165,490 207,353 104,810 150,601 Non-cash Adjustments…
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