Overview presentation Tullow Oil plc November / December 2015
Overview presentation OVERVIEW PRESENTATION
Overview presentation A leading global independent exploration & production company 22 329mmboe 861mmboe 74,600 boepd 2C Contingent Countries 2P Reserves Resources production Figures at 1H 2015 Established record of delivering…
Overview presentation The Tullow strategy Additional cash flow from new production Monetisation High Margin Exploration Selective Options & Production and Development Portfolio Cash flow Appraisal Management Costs &…
Overview presentation Future project pipeline making significant progress Future Development Projects Countries with ongoing operations Key oil producing countries TEN Development East Africa Development 75% project completed…
Overview presentation New venture campaigns focused on long term value Commercial Screening Off-limits Exploration Tested at 50/bbl Low cost of supply Ultra-deepwater Value accretive Deepwater gas High Margin Oil Shale oil…
Overview presentation Re-setting the business for lower oil price COMPLETED ONGOING Reduce costs Cut near term annual exploration budget to c.200m Target opex and capex reductions across group Restructured and simplified the…
Overview presentation Good progress in 1H 2015 Delivery of high margin production / capital allocation Bbl West African Strong performance 120 Production 67 kbopd 1H15 vs. 63 kbopd in 1H14 109/bbl Oil hedging Delivered 146m revenue…
Overview presentation Net income 1H 2015 v 1H 2014 100 116 65 133 m 0 18* 41 68 95 -100 315 -200 -300 573 90 -400 70 48 103 -500 171 -600 -700 Net income Price Hedging Oil Volume/ Gas Volume/ Operating…
Overview presentation Sources and uses of funds Cash inflow 1,191m 1H 2015 Net cash inflow 167m m Operating cash flow 450m* (1H 2014:726m*) Sources Uses 1,200 Disposals 57m (1H 2014:nil) 57m 389m Net loan draw down 684m (1H…
Overview presentation Capex reductions expected over coming years 1.9 billion capex for full year 2015 Ghana: Jubilee & TEN developments - 1,210m 2016 (F) 1,200m Other West Africa: Non-op production - 190m Europe: Maintaining mature…
Overview presentation Strong liquidity position through TEN first oil Debt maturity profile Key metrics m Commitment size Maturity m 30 Sep 2015 31 Dec 2014 RBL 3,700 Oct 2019 Cash and cash equivalents 282 319 Corporate Facility 1,000…
Overview presentation Oil hedging Hedge strategy Hedge strategy is approved by the Board and reviewed quarterly Hedges are executed rateably on a three year forward rolling basis Hedge by purchasing a mix of Dated Brent options…
Overview presentation Financing strategy Proactive measures already taken to manage business in a low oil price environment Quality assets and hedging programmes have allowed us financial flexibility and headroom; Financial…
Overview presentation OVERVIEW PRESENTATION
Overview presentation Strong production and development business Strong production and development business robust to low oil prices Production: significant near-term production growth of high margin oil Operating costs: low opex cost…
Overview presentation Strong delivery across West Africa production portfolio Strong 1H 2015 West Africa oil production: 66,500 bopd FY 2015 West Africa oil production guidance: 66-67,000 bopd 2017 West Africa oil production…
Overview presentation Stable low-cost portfolio of non-operated oil production Portfolio of 24 non operated fields across 5 countries Low operating cost c.15/bbl and cash break-even c.30-40/bbl Increased focus on efficient…
Overview presentation Jubilee development options present growth opportunities Strong Jubilee performance year-to-date 1H15 average gross production: 105 kbopd FY15 guidance: 100 kbopd Gas export rates of up to 120 mmscfd Reduced…
Overview presentation TEN development to deliver significant cash flow in 2016 Base case development 300 mmboe reserves being developed - 80% oil 24 well development - 10 wells on-stream at start up Gross development capex of 4.9…
Overview presentation TEN project on schedule and on budget for first oil mid-2016 Project c.75% complete FPSO Conversion (94%) - All major installation work complete - On track for arrival offshore Ghana in Q1 2016 - Mooring…
Overview presentation Ghana: focus on high margin oil Big fields get bigger Material resource base : long-term value growth Industry experience: Big oil fields get Bigger Development geoscience & engineering targeting the…
Overview presentation East Africa regional integration & capex deflation Integrated regional pipeline Conceptual studies completed on Northern and Southern Route Governments announced joint decision on northern route in August…
Overview presentation OVERVIEW PRESENTATION
Overview presentation Adapting our E&A strategy to current environment Adapted to mitigate risks & expense Reduce cost exposure: Farm-out early to spread risk & earn carries Revised risk screening: High-grade exploration programmes to…
Overview presentation Finding oil onshore East Africa Location Activity Uganda Lake Albert 17+ oil fields discovered (90% success) Basin 1.7 billion barrels of oil discovered Kenya South 9/11 wildcat oil discoveries Lokichar + 2…
Overview presentation Kenya appraisal progressing well in 2015 Extensive appraisal program nearing completion 10 wells successfully drilled year to date All wells have met or exceeded expectations Appraisal wells remaining for 2015;…
Overview presentation Upside in Kenya: Basin testing wildcats & new play testers Northern Area Central Core Area Southernmost Area Multiple opportunities to build upon South Lokichar Basin success Slide 31
Overview presentation Caribbean-Guyanas Atlantic Margin: shift to shelf Three major basins with proven oil systems Shelf edge plays lower cost to develop Seismic evaluation ongoing to high-grade prospects for future selective…
Overview presentation Africa Atlantic Margin: shift to simple lower-cost plays Shelf edge plays: lower-cost to develop Vast acreage positions - Mauritania to Namibia Oil plays proven - diversity in prospect inventory Experience,…
Overview presentation High margin production and competitive cost base Realized oil price per bbl ()1 Operating costs per boe ()2 Brent avg. 79.5 111.3 111.7 108.7 98.9 57.8 18.6 16.5 16.2 108.0 108.0 105.7 97.5 14.6 13.5 78.0…
Overview presentation 2015 Exploration and Appraisal Programme EAST AFRICA mmboe Country Block Prospect/Well Interest Gross Mean Net Mean Spud Date 13T Emesek (ex-Tausi) 50% (op) Potential basin opener In progress South Lokichar…
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