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Morgan Stanley UK Conference – Oil Search Limited

Oil Search Limited · Oct 6, 2015 · 27 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. Morgan Stanley UK Conference – Oil Search Limited – slide 1
    Morgan Stanley UK Conference September/October 2015 Oil Search Limited ASX: OSH POMSoX: OSH US ADR: OISHY ARBN 055 079 868 www.oilsearch.com
  2. Morgan Stanley UK Conference – Oil Search Limited – slide 2
    Oil Search Profile Established in Papua New Guinea (PNG) in 1929 29% interest in world class PNG LNG Project, operated by ExxonMobil, and 60% interest in all PNGs producing oil fields, operated by OSH Tunis Erbil TUNISIA IRAQ…
  3. Morgan Stanley UK Conference – Oil Search Limited – slide 3
    Overview Strong production from quality assets: PNG LNG Project performing above expectations Oil assets performing well Solid balance sheet with liquidity of US1.6bn LNG growth projects advancing: PNG LNG production…
  4. Morgan Stanley UK Conference – Oil Search Limited – slide 4
    Oil Search licence interests, PNG Juha Pnyang JuhaPPL260 North PNG LNG Project Gas Fields Papua New Guinea Hides Hides PNG LNG Project Kutubu Facilities Angore Port Moresby Moran Non PNG LNG Agogo Gas/Oil Fields Proposed…
  5. Morgan Stanley UK Conference – Oil Search Limited – slide 5
    PNG LNG Project producing consistently above nameplate capacity 52 LNG cargoes exported in 1H15, 125 cargoes loaded to date since Project start-up in 2014 Annualised production in 1H15 of 7.1 MTPA, Qingdao LNG compared to nameplate…
  6. Morgan Stanley UK Conference – Oil Search Limited – slide 6
    Solid demand for PNG LNG spot cargoes Full contractual volumes being taken, with contract ramp-up underway to plateau of 6.6 MTPA in 2Q16 Good demand for spot volumes, 85% of spot cargoes have been sold to contract customers PNG LNG…
  7. Morgan Stanley UK Conference – Oil Search Limited – slide 7
    2015 Production Outlook 2015 production guidance increased to Net Production (mmboe) 27 29 mmboe, comprising: 30 27 - 29 PNG LNG (T1 + T2) 6.3 6.9 mmboe from operated oil fields and Hides Hides GTE GTE* 25 SE Mananda 21 22 mmboe…
  8. Morgan Stanley UK Conference – Oil Search Limited – slide 8
    Next phase of LNG development in PNG OSH holds material positions in NW Hub OSH Operated OSH Interest (Pnyang field) and Gulf Hub (Elk-Antelope Oil Pipeline Oil Field field), likely sources of gas for next phase of Gas Pipeline…
  9. Morgan Stanley UK Conference – Oil Search Limited – slide 9
    NW Hub: PNG LNG expansion and domestic power MoU signed in January 2015 by ExxonMobil (as Pnyang operator of PNG LNG and PRL 3) and PNG Government sets schedule to develop Pnyang gas field, to underpin: PNG LNG Project expansion…
  10. Morgan Stanley UK Conference – Oil Search Limited – slide 10
    Pnyang South 2 appraisal well to further constrain 1C and 2C resource Pnyang 1X PPL 421 PPL 294/APPL 507 Pnyang 2X Pnyang South 2 PPL 269 PRL 3 Pnyang 1X Pnyang 2X Pnyang South 1 Pnyang South 2 PPL 464 PPL 395 0 4…
  11. Morgan Stanley UK Conference – Oil Search Limited – slide 11
    Gulf Hub: Papua LNG Project facilities site locations agreed, operator transition to Total SA completed Potential second world-scale LNG development in PNG Papua New Guinea CPF Kutubu Hides Elk/Antelope Significant progress…
  12. Morgan Stanley UK Conference – Oil Search Limited – slide 12
    Elk-Antelope appraisal programme to be completed 2H15, certification 2Q16 Results of appraisal programme to date have been at upper end of OSHs expectations: Antelope 4 extended good quality reservoir to south Antelope 5 testing…
  13. Morgan Stanley UK Conference – Oil Search Limited – slide 13
    Window for uncontracted LNG demand expected to re-emerge early next decade Global LNG contracted 120 Delta between forecast demand and supply and demand balance long-term contracts East of Suez 500 Mideast 100 Global Demand India…
  14. Morgan Stanley UK Conference – Oil Search Limited – slide 14
    LNG projects from PNG competitive versus Australian and global alternatives (WoodMac) 20 LNG project break-even comparison 15 US/mmBtu 10 5 0 FOB Shipping Source: Wood Mackenzie, full-life breakeven, 12% discount…
  15. Morgan Stanley UK Conference – Oil Search Limited – slide 15
    Oil Search exploration: Revitalising acreage and drilling programmes OSH estimates Yet-to-Find potential of 5 bnboe in PNG Potential PNG resource base* Focus on building PNG acreage to support: Producing LNG expansion and potential…
  16. Morgan Stanley UK Conference – Oil Search Limited – slide 16
    Active PNG exploration/appraisal programme proposed PPL 402 Muruk 1* PRL 3 Pnyang reserves evaluation Pnyang South 2* PPL 269 Strickland 1* Well 2* PRL 15 Antelope 4 ST1 Antelope 6 Antelope South* PPL 339 Kalangar…
  17. Morgan Stanley UK Conference – Oil Search Limited – slide 17
    Measured appraisal of Taza in Kurdistan Taza 3D Seismic Cube Taza 1, 2 & 3 Three wells and 680km2 3D seismic survey completed unfractured Currently evaluating field size and economics based on well region and seismic results Taza 2…
  18. Morgan Stanley UK Conference – Oil Search Limited – slide 18
    Exploration and appraisal programme 2015 2016 2017 Q3 Q4 Q1 Q2 Q3 Q4 Q1 PNG Highlands Activity PRL 3 (OSH - 38.5%) P'nyang South 2 & other possible appraisal activities* PPL 269 (OSH - 10%) Strickland 1 PPL 269 Well 2* PPL 402 (OSH -…
  19. Morgan Stanley UK Conference – Oil Search Limited – slide 19
    Business environment outlook Oil market appears oversupplied into 2016, inventories Brent Oil Price Forecasts to 2025 remain at record levels 120 Falling oil prices impacting LNG prices and markets Lower for longer pervasive in…
  20. Morgan Stanley UK Conference – Oil Search Limited – slide 20
    Business Optimisation Key focus areas Refocus organisation on core strategic priorities and value creation Ensure we have the right people in the right places and appropriate cost structure in lower oil and gas price environment Take…
  21. Morgan Stanley UK Conference – Oil Search Limited – slide 21
    Key milestones* 2015 2016 2017 PNG LNG Project/Expansion PNG LNG Project/Expansion PNG LNG Project/Expansion Continued operation above nameplate Drill Pnyang South 2 Resource certification of Pnyang and capacity of 6.9 MTPA Target…
  22. Morgan Stanley UK Conference – Oil Search Limited – slide 22
    OSH rejects Woodsides non-binding conditional indicative proposal On 8 September 2015, OSH announced receipt of non-binding, conditional indicative, scrip only proposal from Woodside: One WPL share for every four OSH shares Proposal…
  23. Morgan Stanley UK Conference – Oil Search Limited – slide 23
    Summary Strong production, with excellent performance from PNG LNG Project and steady output from operated PNG fields: PNG LNG performing above nameplate capacity with further upside potential to create material additional value High…
  24. Morgan Stanley UK Conference – Oil Search Limited – slide 24
    Appendix 1: Key metrics Production (mmboe) Net Profit After Tax (USm) 25 400 353.2 19.3 20 300 14.3 205.7 227.5 15 202.5 200 175.8 10 6.7 6.4 6.7 5 100 0 0 2011 2012 2013 2014 1H2015 2011 2012 2013 2014 1H2015 Oil Price…
  25. Morgan Stanley UK Conference – Oil Search Limited – slide 25
    Appendix 2: Treasury Update (as at 30 June 2015) Strong liquidity position of US1.59 bn: Cash (USm) US843m of cash (incl. US182m of PNG LNG 1,200 1,047 960 escrowed cash) 843 900 US750m of undrawn revolving facilities 600 488…
  26. Morgan Stanley UK Conference – Oil Search Limited – slide 26
    Appendix 3: 2015 Investment Outlook 2000 1,877 2015 Capital Cost 1,861 Guidance (US610 690m) 1750 1,672 1,568 Exploration & Evaluation: US310 340m 1500 1250 Development: US170 200m USm 1000 US918m PRL 15 Production:…
  27. Morgan Stanley UK Conference – Oil Search Limited – slide 27
    Appendix 4: 2015 Guidance Summary Production 2015 Guidance Oil Search operated (PNG Oil and Gas) 6.3 6.9 mmboe PNG LNG Project LNG 92 97 bcf Liquids 3.0 3.2 mmbbl Total PNG LNG Project1 21 22 mmboe Total Production1 27 29 mmboe…

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