0 June, 2015 INVESTOR PRESENTATION An integrated energy player focused on exploration and production INVESTOR PRESENTATION JUNE 2015
AN INTEGRATED OIL & GAS COMPANY 2 Galp Energia Group Market capitalisation c.9 bn1 Exploration & Production Refining & Marketing Gas & Power Key Financials 2014 Ebitda: 1.3 bn 2014 Ebitda: 444 m 2014 Ebitda: 412 m 2014 Ebitda:…
FOCUSED ON E&P PROJECT EXECUTION AND OPTIMISING DOWNSTREAM AND GAS 3 Upstream business Downstream and gas businesses Execute sanctioned and Reinforce active partner Improve R&M Sustain LNG trading in de-risk pre-sanctioned role and…
GALP ENERGIA HOLDS A SET OF WORLD-CLASS UPSTREAM PROJECTS 4 DoC submitted and development plan expected to be defined during 2015 GREATER IARA Carbonate reservoir with excellent porosity LULA/IRACEMA ROVUMA AREA 4 and…
DOWNSTREAM AND GAS ACTIVITIES AS STABLE CASH FLOW PROVIDERS 5 Refining & Marketing Gas & Power Complex refining system set to deliver improved 2nd player in the Iberian NG market and leveraging returns international LNG demand…
GALP ENERGIA KEY TAKEAWAYS 6 Unique profile in the industry, aiming to deliver outstanding growth and committed to long term value creation bn boe 2.4 resources in place 2P reserves + 2C resources based Production free cash flow…
LIST OF CONTENTS 7 DELIVERING GROWTH IN THE UPSTREAM STEADY CONTRIBUTION FROM DOWNSTREAM AND GAS ACTIVITIES STRONG FINANCIAL POSITION SUSTAINABLE AND RESPONSIBLE GROWTH CONCLUDING REMARKS APPENDIX INVESTOR PRESENTATION…
STRONG E&P PORTFOLIO ON A PROMISING SET OF ASSETS 8 Portugal 7 1 Morocco East Timor of projects 1 4 27 Core area Angola 1 Brazil Potential area 3 Mozambique 1 Namibia Uruguay INVESTOR PRESENTATION JUNE 2015
STRONG PORTFOLIO PIPELINE 9 Exploration Appraisal Pre-development Development Production Namibia Guanxuma Jpiter Tango Iara 1 to 3 Block 32 Kaombo Lula/ Iara Lula/ Block New Iracema 2 Amazonas Iracema 4 14/14K ventures…
LARGE RESOURCE BASE IN PLACE 10 2014 2P reserves1 2014 2C resources1 (mmboe) (mmboe) Mozambique Angola Angola 638 1,672 Brazil Brazil 100% sanctioned projects 22% from sanctioned projects 1Working interest…
LULA/IRACEMA: SOLID TRACK-RECORD ABOVE INITIAL EXPECTATIONS 11 Production ramp-up (kboepd) 40 FPSO Cid. de Paraty Lula NE (120 kbopd) Full capacity since Sep-14 Average availability of c.95% 20 FPSO Cid. de Mangaratiba…
LULA/IRACEMA: EXECUTION OF A WORLD-CLASS PROJECT 12 Chartered units Replicant units1 FPSO Cid. de Itagua P-66 150 kbopd 150 kbopd Iracema North Lula South First oil: 2H15 First oil: 2017 P-67 150 kbopd FPSO Cid. de Maric Lula…
LULA/IRACEMA: COST OPTIMISATION OPPORTUNITIES 13 Drilling and completion ( days) 239 -21% YoY 170 135 125 92 2010 2013 2014 Target Best performance Benefitting from learning curve and optimised Negotiating new rig…
LULA/IRACEMA: SIGNIFICANT OIL RECOVERY UPSIDE 14 Recovery factor (oil) % 40% Water/Gas injection 4D seismic 28% Infill drilling WAG Subsea separation Technology development Current recovery factor Ambition Each 1 p.p.…
GREATER IARA: MULTISTAGE DEVELOPMENT FOR THREE SEPARATE ACCUMULATIONS 15 Significant resource base in a challenging heterogeneous reservoir EWT in Iara West-2 ended with an average flow rate of c.29 kbopd Three FPSO expected…
DE-RISKING OTHER RELEVANT PRE-SALT PROJECTS 16 CARCAR BM-S-8 JPITER BM-S-24 Current appraisal to test productivity and resource Appraisal activity expected to de-risk reservoir and potential development concept DoC submission…
MOZAMBIQUE: PROGRESSING WITH AREA 4 PROJECT DEVELOPMENT 17 Over 85 tcf GIIP identified Project well located to benefit from LNG market dynamics in Asia and Europe Potential for economies of scale in onshore LNG project Focus…
MOZAMBIQUE: INITIAL DEVELOPMENT PHASE BEING EXECUTED 18 CORAL FLNG PROJECT MAMBA ONSHORE LNG PROJECT 1 FLNG (2.5-3 mtpa) 2x5 mtpa LNG trains (1st phase) Competitive FEED and EPCIC proposals received in Ongoing competitive FEED and…
ANGOLA: MATURE FIELDS BEING COMPLEMENTED BY NEW DEVELOPMENTS 19 BLOCK 14/14K BLOCK 32 Current producing fields (Kuito, BBLT, Tmbua- Kaombo project being developed with 2 FPSO (2x125 Lndana) already reached full capacity kbopd)…
PROTECT VALUE BY FOCUSING ON SANCTIONED PROJECTS 20 Net installed capacity (operating & sanctioned) Execution risk (kboepd) 250 Operating ++ 200 4 replicant FPSO for Lula/Iracema Sanctioned 150 2 FPSO for Kaombo 100 3 leased…
YIELDING SIGNIFICANT PRODUCTION GROWTH 21 Working interest production (kboepd) Developing existing portfolio IOR/EOR CAGR 2014-20 25%-30% Exploration +24% +30%-35% 2013 2014 2015E 2020E Upside 2020+ Angola Brazil…
TECHNICAL COSTS DRIVEN BY HIGH MARGIN PROJECTS 22 Technical costs (/boe) Large scale of projects drives lower unit costs High quality assets reduce capex requirements 27 22 Lifting costs in 2019 expected to be below 6/bbl…
LIST OF CONTENTS 23 DELIVERING GROWTH IN THE UPSTREAM STEADY CONTRIBUTION FROM DOWNSTREAM AND GAS ACTIVITIES STRONG FINANCIAL POSITION SUSTAINABLE AND RESPONSIBLE GROWTH CONCLUDING REMARKS APPENDIX INVESTOR…
RESILIENT CASH FLOW FROM MODERN AND COMPETITIVE DOWNSTREAM ASSETS 24 REFINING OIL MARKETING Flexible refining system with 330 kbopd refining 1,449 service stations of which 148 in Africa capacity and combined Nelson complexity of…
STEADY CONTRIBUTION FROM GAS & POWER ACTIVITIES 25 SUPPLY & TRADING NG INFRASTRUCTURE POWER 2nd natural gas player in Iberia, Extensive infrastructure in Iberia 205 MW of total capacity installed with total annual sales of 7.5…
LIST OF CONTENTS 26 DELIVERING GROWTH IN THE UPSTREAM STEADY CONTRIBUTION FROM DOWNSTREAM AND GAS ACTIVITIES STRONG FINANCIAL POSITION SUSTAINABLE AND RESPONSIBLE GROWTH CONCLUDING REMARKS APPENDIX INVESTOR…
1Q15 EBITDA UP 50% YOY AND HEALTHY BALANCE SHEET MAINTAINED 27 Profit & Loss Balance Sheet (m) (m) 1Q14 4Q14 FY2014 1Q15 Mar.2015 Dec.2014 Turnover 4,125 4,470 17,904 3,923 Ebitda 265 399 1,314 398 Fixed and LT assets 7,830 7,599…
2014-19 EBITDA CAGR OF C.20% 28 Group Ebitda (m) CAGR c.20% 1,314 2014 2015E 2016E 2017E 2018E 2019E 2015 Ebitda guidance of 1.1 bn - 1.3 bn, with integration providing a cushion to current low oil prices 1Based on…
EBITDA DRIVEN BY UPSTREAM AND A STEADY CONTRIBUTION FROM R&M AND G&P 29 Upstream Ebitda R&M Ebitda G&P Ebitda (m) (m) (m) Power Infrastructure Natural Gas CAGR 2014-2019 35% 750 750 500 500 250 250 444 0 0 2014 2015E…
CAPEX FLEXIBILITY AND FOCUS ON HIGHER MARGIN PROJECTS 30 Capex profile Committed vs. uncommitted capex Total capex Committed Lula/Iracema Angola E&A 2015 Lula/Iracema Other development Uncommitted projects Other projects E&A…
RESILIENT CASH FLOW FROM INTEGRATED BUSINESS MODEL 31 Free Cash Flow (m) Integrated model stabilising free cash flow in a lower oil 500 price environment Group expected to turn free cash flow positive during 0 2018 and Brazil in…
CURRENT LIQUIDITY SUFFICIENT FOR THE NEXT THREE YEARS 32 Sources and uses 2015-2017 Liquidity of 3.1 bn1: Cash and equivalents of 1.1 bn; loan to Sinopec of 0.9 bn; available credit lines of 1.1 bn Available Net debt to Ebitda2…
DIVERSIFIED SOURCES OF FUNDING 33 Debt breakdown Debt reimbursement profile Part of proceeds from Brazil (m) capital increase lent back to Sinopec. Being gradually 1,000 3.5 bn 1.1 bn reimbursed according to Capex needs in Brazil…
COMMITTED TO A ROBUST FINANCIAL POSITION 34 Current liquidity sufficient until free cash flow turns positive Pursue an active portfolio management policy Extending reimbursement profile to match expected cash flow generation…
LIST OF CONTENTS 35 DELIVERING GROWTH IN THE UPSTREAM STEADY CONTRIBUTION FROM DOWNSTREAM AND GAS ACTIVITIES STRONG FINANCIAL POSITION SUSTAINABLE AND RESPONSIBLE GROWTH CONCLUDING REMARKS APPENDIX INVESTOR…
COMMITMENT TO BEST SUSTAINABLE AND GOVERNANCE PRACTICES 36 Sustainability Act responsibly and ethically, ensuring best practices in governance and transparency Involve the community and other stakeholders by encouraging the…
GALP ENERGIA CORPORATE SUSTAINABILITY RECOGNISED INTERNATIONALLY 37 Galp Energias acknowledgements Galp Energia achieved first place in the energy sector, in the Iberia 125 CDLI1 by the Carbon Disclosure Project in 2014 Presence in…
LIST OF CONTENTS 38 DELIVERING GROWTH IN THE UPSTREAM STEADY CONTRIBUTION FROM DOWNSTREAM AND GAS ACTIVITIES STRONG FINANCIAL POSITION SUSTAINABLE AND RESPONSIBLE GROWTH CONCLUDING REMARKS APPENDIX INVESTOR…
GALP ENERGIA WELL POSITIONED TO MANAGE VOLATILITY AND DELIVER GROWTH 39 Developing world class profitable upstream projects with significant upside opportunities Production CAGR1 of c.25% from already operating and sanctioned…
LIST OF CONTENTS 40 DELIVERING GROWTH IN THE UPSTREAM STEADY CONTRIBUTION FROM DOWNSTREAM AND GAS ACTIVITIES STRONG FINANCIAL POSITION SUSTAINABLE AND RESPONSIBLE GROWTH CONCLUDING REMARKS APPENDIX INVESTOR…
FREE FLOAT EXPECTED TO INCREASE IN THE NEAR FUTURE 41 Galp Energia shareholding structure Free float evolution Free float Of which, institutional investors in: 4.90% North America c.40% 2.45% UK c.20% 7.00% 2.03% France c.10% 7%…
KEY OPERATING INDICATORS 42 Exploration & Production 2014 YoY 1Q14 1Q15 YoY Average working interest production 1 (kboepd) 30.5 24% 28.1 41.5 +48% Oil production (kbopd) 28.8 26% 26.9 38.4 +43% Average net entitlement production 1…
2015-19 EBITDA SENSITIVITIES 44 Approximate annual Change Approximate impact in 2015 medium/long term impact Brent price 10/bbl 100 m 350 m Refining margin benchmark1 1/bbl 90 m 80 m EUR:USD 0.10 (70 m) (200 m) 1Benchmark…
KEY INDICATORS ON GALP ENERGIA DEBT 45 YE2013 YE2014 1Q2015 Gross debt 3.7 bn 3.7 bn 3.5 bn Cash and equivalents 1.5 bn 1.1 bn 1.1 bn Net debt 2.2 bn 2.5 bn 2.4 bn Net debt considering loan to Sinopec 1.3 bn 1.6 bn 1.4 bn…
2015 SCHEDULED EXPLORATION AND APPRAISAL ACTIVITIES 47 2 Spud Duration Well Area Target Interest E/A date ( days) status 1 Brazil BM-S-11 Ia ra RDA 4 10% A Feb-15 120 In progres s BM-S-8 Ca rca r Extens i on-2 14% A Jan-15 120 In…
KEY EXPLORATION AND APPRAISAL CAMPAIGN UNDERWAY 48 Apollonia well confirmed the Pit DST on oil accumulation extension of Jpiter discovery confirmed good permeability DST performed in Bracuhy and and porosity Elida to be spud in…
UNDEREXPLORED AREAS IN THE E&P PORTFOLIO STILL TO BE EVALUATED 49 Acquisition of a 10% stake in four First exploration well drilled in blocks in 2013 2Q14 with no hydrocarbons found Three blocks in deep waters and Analysing results…
UPGRADED REFINING SYSTEM COMPETITIVE AMONGST EUROPEAN PLAYERS 50 2020 mid-cycle refining net cash margin (/bbl) Only refiner in Portugal with a distillation capacity of 330 kbopd (c.20% of Iberia) Flexible refining system with…
ANNUALISED RETURN SINCE IPO OF 11%1 51 Share price evolution 350% 300% 250% 200% 150% 100% 50% 0% Galp Energia SXEP Peers average 1 From October 2006 to the end of May 2015 INVESTOR PRESENTATION JUNE…
A FOCUSED AND EXPERIENCED MANAGEMENT TEAM 52 Over 25 years of experience in different industries, including oil & gas, energy Chief Executive Officer and beverages. Member of the Board of Directors of Carlos Gomes da Silva Galp…
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