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BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited

Eurasia Drilling Company Limited · Nov 18, 2010 · 31 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. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 1
    November 2010
  2. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 2
    EDC Overview Overview: EDC at a glance Investment Case EDCs Position Investment case Growth Potential Outlook Q&A Performance and positioning Growth opportunities Outlook Q&A 3
  3. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 3
    EDC Overview No.1 459 24% 3,065 Largest independent Rig fleet including Market share Thousand meters drilled Investment Case EDCs Position Growth Potential drilling company in Russia 208 onshore, onshore Russia as measured…
  4. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 4
    EDC at a glance EDC Head Office Overview Regional/Branch Office Investment Case Support Base EDCs Rig Fabrication Position Operational Areas Growth Potential TIMAN-PECHORA Outlook Q&A EASTERN Usinsk SIBERIA Kogalym WESTERN…
  5. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 5
    EDC Russias Onshore Market by Meters Drilled (mln) Total meters drilled onshore Overview Investment Russia during 1H10 were 14% 2012F Case EDCs above 1H09 levels. 2011F Position Growth As per REnergyCo, demand for 2010F…
  6. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 6
    US Oil production vs Wells drilled Russian Oil Production vs Wells drilled EDC 70 12,000 10 12,000 Overview Investment 60 Case 10,000 10,000 8 Number of New Wells ('000) Number of New wells ('000) US Production (Kbpd)…
  7. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 7
    EDC Russia Brownfield Oil Production, mln bpd Legacy output (Brownfield Overview Investment 9.30 9.22 production) in Russia has been Case EDCs 9.20 deteriorating since 3Q08; Position 9.10 Growth The industry has lost 320 kbpd in…
  8. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 8
    EDC Customers demanding hi-spec rigs Fleets must be modern Overview Investment Fleets must be heavier Case Depths/complexity increasing EDCs Position Assets are becoming scarce Fleets must be more efficient Growth Potential…
  9. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 9
    EDC Financial Highlights Operating Highlights Overview Investment Case Revenue was US 491mln in 3Q 2010 Drilling output of 3,065,111 meters for EDCs Position compared to US 334 mln in 3Q 2009 9M10 was 6% ahead y-o-y (9M09…
  10. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 10
    EDC Russia Onshore Meters Drilled (th. meters) Market Share Overview Investment Case 2010F 13,044 (9M10) 1H10 EDCs Position 2009 14,554 EDC Growth 24% Potential 2008 15,454 All others Outlook 33% 2007 14,627 Q&A 2006 12,305…
  11. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 11
    EDC CAGR of 19% in EDC Drilling Volume Performance (th. meters) Overview Investment drilling volumes 4,500 Case during EDCs EDC Forecasts 4,000 EDCs 4,000 Position 4,020 Drilled Meters (thousands) EDC Growth history as an…
  12. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 12
    EDC 9M 2010 Contracts Developments Overview Investment Case 2% In 2007 our major client accounted for 77% of 1% Other EDCs 11% total meters drilled Position Growth Potential Continuous efforts on diversifying our Outlook 57%…
  13. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 13
    EDC Expected CAPEX Expenditure EDCs Rig Fleet Overview Investment 350 1 Case 320 327 Actual EDCs 300 Position 2010F 75-125 T 160-175 T 200-225 T 250-270 T 320-400 T 450 T Growth 0 Potential 250 200m-250m 1,000 Outlook US…
  14. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 14
    EDC Primary differences between operations in Russia versus Overview Investment most operations in other parts of the world are: Case EDCs Extremely cold winter conditions combined with warm Position Growth summer temperatures […
  15. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 15
    EDC 2007 2008 2009 1H 2009 1H 2010 Overview (US'000) Audited Audited Audited Unaudited Unaudited Investment Case EDCs Revenue 1,492,189 2,101,779 1,382,203 673,188 862,013 Position Growth % growth 37.2% 40.9% -34.2% -25.8% 28.0%…
  16. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 16
    EDC Balance Sheet, as of 31-Dec-08 (US mm) Balance Sheet, as of 31-Dec-09 (US mm) Overview Investment Case EDCs P, P&E 609 P, P&E 684 Position 881 Equity Equity 1,002 Growth Potential Inventories, trade Inventories, trade…
  17. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 17
    EDC Overview Acquisition of Russian land drilling/workover businesses Investment Case Asset swap between EDC & Schlumberger announced in October EDCs Position EDC active participant in Slavneft and Gazpromneft divestiture of their…
  18. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 18
    EDC Transaction with Schlumberger announced 5th October: Overview Investment Case EDC transfers NTS assets (cementing, DD/telemetry and drilling fluids) EDCs Position and crews (24 cementing, 57 DD/telemetry & 50 drilling fluids)…
  19. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 19
    EDC STATOIL Demand for jack-ups growing in all Overview Exploration Investment Caspian sectors served by EDC: Case NCOC (Exxon) EDCs Exploration In the Russian sector, Lukoil has made Position CMOC (Shell) several discoveries and has…
  20. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 20
    EDC Iraq opportunities Overview Investment Case Iraq, holder of the worlds third-largest oil EDCs Position reserves, aims to increase crude Growth Potential production to 6 mln barrels a day by 2015 Outlook Q&A Licenses…
  21. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 21
    EDC Onshore drilling Overview Investment The Companys current forecast for full-year drilling output is approx. 4 million meters Case EDCs Drilling volumes for non-Lukoil customers are expected to increase in aggregate, Position…
  22. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 22
    EDC Overview Continue to invest in expanding our fleet, implementing state-of-the-art technology Investment and enhancing service quality; Case Increase market share Targeting acquisition of one or more in-house drilling companies;…
  23. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 23
    EDC Forward calendar Overview Investment Case BofA Merrill Lynch Russia & CIS Conference November 15-18, 2010 (London, New York) EDCs Position Goldman Sachs EEMEA Conference Nov. 29- Dec 1 (London) Growth Potential UBS…
  24. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 24
    EDC Overview Investment Case EDCs Position Growth Potential Outlook Q&A 25
  25. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 25
    26
  26. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 26
    R --550-- Nabors Industries LTD IM --6.3-- Nabors Industries LTD R G I --353-- Precision Drilling Corp A --4.7-- Helmrich & Payne, Inc G --350-- Patterson UTI Energy, Inc FR --4.1-- Eurasia Drilling Company Ltd LK --305-- Ensign…
  27. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 27
    West Siberia Eastern Siberia An incremental barrel brings in US 47.2/bbl to An incremental barrel brings in US 18.5/bbl the budget at US 70/bbl oil price at current to the budget at US 70/bbl oil price at tax levels current tax…
  28. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 28
    250 Est. Rigs Added 200 Projected Demand Numbr of Rigs Built 150 Russias onshore rig fleet has suffered from a long 100 period of underinvestment 50 0 1987 1991 1992 1996 1997 2000 2001 2005…
  29. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 29
    2007 2008 2009 1H 2009 1H 2010 Audited Audited Audited Unaudited Unaudited Av. Exchange Rate RUB/US 25.6 24.9 31.7 33.1 30.1 Total Revenue 1,492,189 2,101,779 1,382,203 673,188 862,013 Costs and Other Deductions Operating Expenses…
  30. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 30
    2006 2007 2008 2009 30-Jun-10 Audited Audited Audited Audited Unaudited Exchange Rate RUB/US 26.3 24.5 29.4 30.2 31.2 ASSETS Current Assets Cash 29,296 343,089 279,430 433,724 383,170 Trade Accounts Receivable, net 151,371 230,888…
  31. BAML RUSSIA AND CIS CONFERENCE – Eurasia Drilling Company Limited – slide 31
    2007 2008 2009 1H 2009 1H 2010 Audited Audited Audited Unaudited Unaudited Net Income 168,544 220,933 165,490 78,392 104,810 Non-cash Adjustments (Depreciation) 58,705 101,777 106,390 49,791 67,127 Changes in Working Capital excl.…

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