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December 2009 Investor Presentation – Ion Geophysical Corp

Ion Geophysical Corp · Dec 15, 2009 · 54 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. December 2009 Investor Presentation – Ion Geophysical Corp – slide 1
    ION in Transformation While Weathering the Storm Bob Peebler CEO Brian Hanson CFO December 15 -17, 2009
  2. December 2009 Investor Presentation – Ion Geophysical Corp – slide 2
    Forward-looking Statement Todays presentation may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements as to expectations,…
  3. December 2009 Investor Presentation – Ion Geophysical Corp – slide 3
    An Overview of ION Business: Advanced geophysical hardware, software, imaging services, and data libraries across the seismic workflow for both Land and Marine. Mission: To solve the most challenging geophysical imaging problems…
  4. December 2009 Investor Presentation – Ion Geophysical Corp – slide 4
    ION Served Market Approximately 3.8 Billion 2008 Land Systems Marine Systems ION Competition Data Processing 2D Regional Multi-client Programs 0 500 1000 1500 Marine systems does not include permanent OBC [4]
  5. December 2009 Investor Presentation – Ion Geophysical Corp – slide 5
    ION is a Global Technology-Driven Seismic Solutions Provider Mix Mix of of Business Business by by Location Location Mix Mix of of Business Business by by Segment Segment (Percentage (Percentageof of2008 2008Revenues)…
  6. December 2009 Investor Presentation – Ion Geophysical Corp – slide 6
    Business Increasingly International Location of Discoveries 100 MMBOE 2001 2001 2005 2005 Discoveries Discoveries 100 249 mmboe 250 499 mmboe 500 999 mmboe 1000 UP mmboe Source: CERA. [6]
  7. December 2009 Investor Presentation – Ion Geophysical Corp – slide 7
    Majority of Global Resource Base is Onshore Hydrocarbon Distribution in the Top 25 Basins Known Reserves + Mean Undiscovered Resources Billions of Barrels of Oil Equivalent 40 538 126 85 34* 94 72 33 61 76 41 80 702 129…
  8. December 2009 Investor Presentation – Ion Geophysical Corp – slide 8
    2009 Both a Year of Challenges and Opportunity The financial crisis combined with oil and gas price collapse put tremendous pressure on ION. All business units, with the exception of GXT data processing and Concept, saw significant…
  9. December 2009 Investor Presentation – Ion Geophysical Corp – slide 9
    Who is BGP BGP is the worlds largest land seismic contractor with over 110 crews with approximately serving international markets. BGP is wholly owned by CNPC, the largest Chinese integrated oil and gas company. CNPC operates in…
  10. December 2009 Investor Presentation – Ion Geophysical Corp – slide 10
    The Strategy of the Joint Venture Leverage the R&D of ION and Operational Expertise of BGP. R&D centers will remain primarily in the U.S. and Canada with much of the manufacturing moving to China to reduce costs. Field test new…
  11. December 2009 Investor Presentation – Ion Geophysical Corp – slide 11
    The BGP/ION Joint Venture Terms BGP and ION contribute all land equipment technology and businesses, less geophones, to the JV. Total JV equity value estimated at 275 million. BGP purchases 51% of the JV for the value of their…
  12. December 2009 Investor Presentation – Ion Geophysical Corp – slide 12
    Financial Impact on IONs Balance Sheet After closing the ARAM transaction ION was planning to issue a 175M bond offering to pay-off a short term sellers note of 35M, a 40M bridge note from Jefferies, and nearly 100M that was drawn…
  13. December 2009 Investor Presentation – Ion Geophysical Corp – slide 13
    Steps to Close the JV and Governance Expect to close in March of 2010. Finalize definitive agreement Finalize refinancing with Chinese banks. Complete the mutually agreed upon 5 year plan. Finalize operational details related to…
  14. December 2009 Investor Presentation – Ion Geophysical Corp – slide 14
    NewCo JVthe first year New combined management team to establish Corporate headquarters in Beijing and a secondary headquarters and R&D center in Houston Integration and alignment of the combined BGP and ION legacy workforce…
  15. December 2009 Investor Presentation – Ion Geophysical Corp – slide 15
    IONs Long Term Strategy Solving the most complex reservoir imaging problems A leader in geophysical imaging technology and services that aims at solving the toughest problems. Balanced portfolio from early adopter technology for…
  16. December 2009 Investor Presentation – Ion Geophysical Corp – slide 16
    Diversified Technology Portfolio with Products in Various Stages of the Product Lifecycle A Portfolio Approach ARAM products complement our product portfolio 2009 2004 Vibrators with robust Land System Four Geophones margin…
  17. December 2009 Investor Presentation – Ion Geophysical Corp – slide 17
    Land Imaging Systems Segment Land Acquisition Vibrators and Geophone Systems Energy Sources FireFly Worlds First digital X-VIB / ADV-IV SM-24 Geophone Full-wave Cable-less Vibrator Vehicles Analog Sensor Recording System…
  18. December 2009 Investor Presentation – Ion Geophysical Corp – slide 18
    2008 Estimated Global Seismic Crew Count Estimates for 2008(1) EAME & Russia & North Latin Total(2) ISC CIS China/AP America America WGN working EY 2008 280 104 43 39 78 24 of Crews 872 176 240 305 118 33 Dynamite/Vibe…
  19. December 2009 Investor Presentation – Ion Geophysical Corp – slide 19
    Land technology trends High Density Shooting for higher resolution Shallow plays such as Heavy Oil are 10X trace density of more conventional basins Benefits seen above leading to a move towards denser sampling in mature basins to…
  20. December 2009 Investor Presentation – Ion Geophysical Corp – slide 20
    Demand for Increasing Channel Count Need for better reservoir description driving demand [ 20 ]
  21. December 2009 Investor Presentation – Ion Geophysical Corp – slide 21
    Land Survey Schematic Cableless Recording System (FireFly) [ 21 ]
  22. December 2009 Investor Presentation – Ion Geophysical Corp – slide 22
    The FireFly Ecosystem A Comprehensive Approach Navigation and positioning Survey design for optimum image Node-based, full-wave recording system GIS planning and Comprehensive data management operations support [ 22 ]
  23. December 2009 Investor Presentation – Ion Geophysical Corp – slide 23
    FireFly Commercialization Update A combination of sales and rental/purchase agreements China Qaidam Basin 3D First commercial sale of FireFly Receiver stations: 10,808 Source points: 13,632 In progress Chopo Sur 3D Comesa and…
  24. December 2009 Investor Presentation – Ion Geophysical Corp – slide 24
    Qaidam Base Camp [ 24 ]
  25. December 2009 Investor Presentation – Ion Geophysical Corp – slide 25
    East Texas Blocker Projects Survey size: 170 sq. Kms ION Haynesville Line 3000 Project started August 1 Source will be mostly Vibroseis 68 sq mi. - Blocker 3D with some dynamite and Power Plant gunboat 7 sq mi. - Baby…
  26. December 2009 Investor Presentation – Ion Geophysical Corp – slide 26
    Blocker - Varying Access and HES Challenges Dense Forest and Water Hazards [ 26 ]
  27. December 2009 Investor Presentation – Ion Geophysical Corp – slide 27
    Difficult Navigation Vibroseis and Personnel Challenged by the Terrain [ 27 ]
  28. December 2009 Investor Presentation – Ion Geophysical Corp – slide 28
    Pemex and FireFly 3 Projects Using Comesa as Contractor Area 2 Coyula IN PROGRESS Area 3 Tesechoacan Area 1 Chopo Sur - COMPLETED [ 28 ]
  29. December 2009 Investor Presentation – Ion Geophysical Corp – slide 29
    FireFly Operations Comesa Chopo Sur, Mexico Start: May 2009 8000 FireFly stations 297 sq km 3849 sources 11767 receivers Completed [ 29 ]
  30. December 2009 Investor Presentation – Ion Geophysical Corp – slide 30
    Coyula - Urban Acquisition [ 30 ]
  31. December 2009 Investor Presentation – Ion Geophysical Corp – slide 31
    Sequence of FireFly Deployments Cumulative Recording Since 2005 FireFly Recording Points 29,438 46,425 76,606 91,098 58,192 41,395 18,841 8,286 450 400 350 FireFly Trace Count (Millions) 300 250 200 150 100 50 0…
  32. December 2009 Investor Presentation – Ion Geophysical Corp – slide 32
    Marine Imaging Systems Segment Towed Streamer Marine Positioning Ocean Bottom Acquisition Systems Systems Acquisition Systems DigiBird and DigiFIN Marine VectorSeis Ocean DigiSTREAMER Positioning Redeployable Marine Streamer…
  33. December 2009 Investor Presentation – Ion Geophysical Corp – slide 33
    Total Vessel Count Including combined Streamer KM Towed Streamer Fleet 180 9000 160 8000 Capacity Range: 11 140 7000 120 6000 Vessel count Streamer km Hi 3D 100 5000 Hi 2D/Low 3D 2D 80 4000 Streamer Km Low…
  34. December 2009 Investor Presentation – Ion Geophysical Corp – slide 34
    A Matter of Perspective 16 x 12km Spread Configuration Overlaid on Manhattan 16 x 12 towed streamer spread configuration [ 34 ]
  35. December 2009 Investor Presentation – Ion Geophysical Corp – slide 35
    Analogy: Commercial Air Travel vs. Towed Streamer Operational Planning Commercial Air Travel Towed Streamer [IA] Flight Plan Survey Plan [ 35 ]
  36. December 2009 Investor Presentation – Ion Geophysical Corp – slide 36
    Analogy: Commercial Air Travel vs. Towed Streamer Operational Command & Control Intelligence Commercial Air Travel Towed Streamer [IA] Auto Pilot Orca [ 36 ]
  37. December 2009 Investor Presentation – Ion Geophysical Corp – slide 37
    Analogy: Commercial Air Travel vs. Towed Streamer Dynamic Operational Execution Commercial Air Travel Towed Streamer [IA] Dynamic Horizontal Control Tail rudder DigiFIN Dynamic Vertical Control Wing flaps…
  38. December 2009 Investor Presentation – Ion Geophysical Corp – slide 38
    [IA] in Action Orca Software Controlling the Streamer Spread via DigiFIN [ 38 ]
  39. December 2009 Investor Presentation – Ion Geophysical Corp – slide 39
    Seismic Imaging Solutions Segment Seismic Data Integrated Seismic Seismic Data Processing Services Solutions (ISS) Libraries GXT Imaging Solutions Leading Depth Imaging Deal origination for oil Technology. company underwritten…
  40. December 2009 Investor Presentation – Ion Geophysical Corp – slide 40
    IONs Global Footprint in Data Processing January 2004 Geophysical Service Centers (GSCs) [ 40 ]
  41. December 2009 Investor Presentation – Ion Geophysical Corp – slide 41
    ION 2009 Global Processing Scale GSC Project Experience [ 41 ]
  42. December 2009 Investor Presentation – Ion Geophysical Corp – slide 42
    Overview of a BasinSPAN Program Comprehensive view of the petroleum system Integrates geology and geophysics Ultra-deep view Source rock deposition Migration pathways Sediment fairways Customized program design Acquisition…
  43. December 2009 Investor Presentation – Ion Geophysical Corp – slide 43
    BasinSpan Example: ArcticSpan High Potential in the Region Estimates place 25% of all remaining undiscovered reserves in the Arctic. Source: USGS, World Petroleum Assessment [ 43 ]
  44. December 2009 Investor Presentation – Ion Geophysical Corp – slide 44
    Integrated Approach to ArcticSpan Hardware, Software and Solutions Expertise Integrated Seismic Solutions (ISS) Marine Imaging Systems DigiSTREAMERTM Arctic Operational Experience Ice management Continuous recording Project…
  45. December 2009 Investor Presentation – Ion Geophysical Corp – slide 45
    2009 NE GreenlandSPAN Accomplishments Successfully Acquired Towed Streamer Data in 10/10ths Ice 9/10ths Ice 10/10ths Ice [ 45 ]
  46. December 2009 Investor Presentation – Ion Geophysical Corp – slide 46
    Summary The continuing economic recovery will likely sustain or drive oil prices higher than 60-80 bbl. Supply will once again become the main driver. IONs short term goal has been to weather the storm by focusing on cash…
  47. December 2009 Investor Presentation – Ion Geophysical Corp – slide 47
    Appendix Selected Financial Highlights [ 47 ]
  48. December 2009 Investor Presentation – Ion Geophysical Corp – slide 48
    Net Revenues 2002-2009 Q3 YTD ( Millions) 800 713 700 680 600 504 500 400 363 299 300 241 200 150 119 100 0 2002 2003 2004 2005 2006 2007 2008 YTD 2009 [ 48 ]
  49. December 2009 Investor Presentation – Ion Geophysical Corp – slide 49
    Revenues and Gross Margin Percent 2005-2009 Q3 YTD Revenues ( Millions) Gross Margin % 750 713 40 680 700 650 600 35 32.9 550 504 500 30.6 30.6 450 30 28.5 400 363 27.0 350 299 300 25 250 200 150 20 100 50 2005 2006 2007 2008…
  50. December 2009 Investor Presentation – Ion Geophysical Corp – slide 50
    Segment Revenues 2005-2009 Q3 YTD ( Millions) Land Imaging Systems Marine Imaging Systems 350 325 200 178 183 300 250 150 128 206 200 200 157 100 150 69 72 100 69 50 50 0 0 2005 2006 2007 2008 YTD 2005 2006 2007 2008 YTD…
  51. December 2009 Investor Presentation – Ion Geophysical Corp – slide 51
    EBITDA 2005-2009 Q3 YTD ( Millions) 190 156 140 122 90 83 51 43 40 21 -9 (10) -49 (60) 2002 2003 2004* 2005 2006 2007 2008 YTD 2009 EBITDA (earnings before net interest expense, taxes, depreciation, and amortization) *…
  52. December 2009 Investor Presentation – Ion Geophysical Corp – slide 52
    Source and Use ( in millions) Sources JV Stake Sale 108.5 Equity Offering (PF for Bridge) 67.1 100M Revolver (No drawdown) - Term Loan Refinancing 106.2 Total Sources 281.8 Uses Repayment of Revolver 138.0 Repayment of…
  53. December 2009 Investor Presentation – Ion Geophysical Corp – slide 53
    Additional Detail Balance Sheet: Pre and Post Close (000) Q3 2009 Revolver Post Close Comments Fully Drawn Cash 19,556 34,200 Debt Detail: Revolver 98,000 138,000 0 Seller's Note 35,000 0 Term A 106,250 106,250 Icon 19,774 -…
  54. December 2009 Investor Presentation – Ion Geophysical Corp – slide 54
    [ 54 ]

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