Credit Suisse 19th Asian Investment Conference Hong Kong April 2016 Oil Search Limited ASX: OSH POMSoX: OSH US ADR: OISHY ARBN 055 079 868 www.oilsearch.com
Oil Search Profile Juha Established in Papua New Guinea Pnyang JuhaPPL260 North Oil Search licence interests, PNG PNG LNG Project (PNG) in 1929 Gas Fields Hides PNG LNG Project 29% interest in world-class PNG Facilities LNG…
2015 Highlights Total production of 29.25 mmboe 52% higher than 2014 and all-time record 2015 2014 Core profit of US359.9m, US39.4m loss after impairment of Taza, Kurdistan Total production (mmboe) 29.25 19.27 Final dividend for…
PNG LNG Project performing well above expectations Annualised production in 2015 of 7.4 MTPA, 7% above nameplate of 6.9 MTPA: Further upside expected in 2016 101 LNG cargoes sold in 2015: 78 sold under long term contract, ramp-up to…
Stable contribution from operated oil fields Juha North Hides GTE Papua New Guinea 2015 net operated production of 7.0 Juha Hides mmboe: Hides Kutubu Angore Port Moresby Similar to 2014 production of 7.1 mmboe Excellent…
Potential value upside from accelerating gas supply from OSH-operated AG fields to PNG LNG Significant value opportunity identified from accelerating gas blowdown of OSH-operated Associated Gas (AG) fields to PNG LNG Potential…
2016 Production Outlook 2016 production forecast of 27.5 29.5 mmboe, Net Production (mmboe)1,2 27.5 29.5 comprising: 30 29.25 PNG LNG (T1 + T2) OSH-operated production: 5.7 6.2 mmboe* Hides GTE PNG LNG: 22 23 mmboe 25 SE Mananda 3…
Gas growth driving value Gas commercialisation activities in Highlands and OSH Operated Gulf Province made significant progress in 2015: OSH Interest Oil Pipeline PNG LNG Project: production optimisation, debottlenecking Oil Field…
Potential PNG LNG expansion, underpinned by Pnyang and existing gas fields Potential PNG LNG Project expansion includes: PRL 3 (Pnyang) WI % High-value production optimisation/debottlenecking ExxonMobil affiliates (operator Esso PNG…
Muruk 1 (PPL 402): High potential exploration Muruk 1 taregted to spud in 2016: PPL 260 APPL 545 PPL 260 PPL PPL 402 Pad currently under preparation for drilling with OSH rig 269 Operated by OSH in co-venture with ExxonMobil Muruk…
Papua LNG potential next LNG development in PNG Significant progress made in 2015: Papua New Guinea CPF Kutubu Hides Elk/Antelope Total SA assumed operatorship of Elk-Antelope (PRL 15) in Port Moresby 3Q15, ramping up in-country…
Encouraging PRL15 appraisal results to date Positive appraisal results to date compared to OSHs current resource booking of 5.3 tcf, with potential for resource increase : Antelope 4 ST1 and 5 extended high quality carbonate reservoir…
Maximising value of next phase of LNG development in PNG Low oil price provides impetus to maximise value of PNG LNG Project expansion and proposed Papua LNG Project Sufficient land available Proposed Papua LNG plant through…
Time is right to drive greater cooperation and potential integration of PNGs LNG projects Examples of potential areas of cost savings Focus in 2016 is on resource confirmation and definition of development Existing Contractor Rel.…
LNG demand expected to exceed supply in early 2020s Global LNG market increasingly competitive Global LNG Demand vs Contracted Supply new projects in Australia, North America exports 600 ramping-up Market over-supplied near term and…
LNG projects from PNG competitive versus Australian and global alternatives (WoodMac) PNG LNG well placed compared to recently commissioned Australian projects. Production optimisation adding material value, debottlenecking can further…
Exploration strategy Exploration approach in light of low oil and gas prices is to reduce costs, focus on core areas and build long-term growth options. Generating opportunities: Renegotiation of drilling, seismic contract rates…
2016/17 PNG exploration/appraisal programme targeting 5-6 tcf gas (unrisked) close to existing infrastructure NW Highlands PPL 402 Gulf / Forelands Muruk 1 Activities targeting Exploration activities 3-4 tcf* mean targeting 1 tcf**…
Taza impairment Prudent approach to evaluation Taza 2 and 3 wells plus interpretation of 3D Seismic Attributes Jeribe 3D seismic completed in 2015 T2 Results indicate: Fractures largely absent in drilled locations Main Bounding…
Operating environment remains volatile Brent Oil Price Forecasts (Nominal) Short-term fundamentals remain weak: 120 110 Current production demand by 2 mmbopd 100 90 80 Inventories at highest level in years, with Iran to ramp-up…
PNG and OSH remain well positioned PNG: Production of oil, condensate and LNG highly competitive PNG LNG recognised as world-class and reliable project, performing well above nameplate Significant positive impact on perception of PNG,…
Helping preserve stable operating environment in PNG PNG LNG expansion and Papua LNG development have potential to significantly benefit national economy Operating and political stability essential for long-term sustainability…
Summary Strong production, with excellent performance from PNG LNG Project Robust cash flows with low breakeven: Implementation of 2015 Business Optimisation Programme initiatives has recalibrated cost base, improved organisational…
Appendix 2: Financial position Strong liquidity position at 31 December 2015 of US1.66 billion: Indicative Annual Repayment profile 600 US910m of cash (incl. US271m of PNG LNG escrowed cash) and US748m available corporate 500…
Appendix 3: 2016 Investment Outlook 2000 1,861 1,877 2016 Capital Cost Guidance (US315 400 million) 1750 1,672 Exploration & Evaluation: 1500 US210 250 million (largely discretionary) 1250 Development: US50 70 million USm…
Appendix 4: 2016 Guidance Summary Production 2016 Guidance1 Oil Search operated 5.7 6.2 mmboe2,3 PNG LNG Project LNG 95 100 bcf Liquids 3.3 3.5 mmbbl Total PNG LNG Project 22 23 mmboe2 Total Production 27.5 29.5 mmboe Operating…
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