Citi Australian and New Zealand Investor Conference 19 October 2016
Table of contents 1. Company Overview 4 2. FY16 Financial Performance 14 3. Operations Update 20 4. FY17 Outlook 25 Appendix 36 3
Company Overview
A compelling value proposition Profitable and net debt free: US26/bbl cash flow breakeven; 0.6bn available liquidity Leveraged to oil price recovery: +US10/bbl = +50m NPAT and +A65m cash flow Cost savings progressing: Material…
Beach Energy Diversified oil and gas explorer and Cooper and Eromanga Basins producer Oil Gas Gas Liquids Tight Gas Operated Australias largest onshore oil Non-operated producer, with a major gas business Core operations in the…
Cooper Basin acreage Western Flank Gas and Gas Liquids Ex PEL 106 (100%*) - Middleton facility Ex PEL 513 (40%) Ex PEL 101 (80%*) Greater Kenmore- Bodalla area oil assets2 Western Flank Oil Unconventional acreage1 Ex PEL…
Western Flank core production Primary source of Beach oil production FY16 net production of 4.0 MMbbl Material contributor to Beach gas and gas liquids production FY16 net production of 370 kboe Compression project underway…
Delhi SACB and SWQ joint ventures Diverse Cooper Basin acreage position of 26,800 km2 (6.6 million acres) Substantial gas processing infrastructure, connected to key energy markets Primary source of Beach gas production, and a…
Strategic Cooper Basin infrastructure Infrastructure ideally located to service southern, eastern and LNG markets 6,000 kilometres of flowlines into Moomba Moomba daily gas processing capacity of 375 TJ (80% utilised) Moomba /…
Reserves and contingent resources1 2P: 70 MMboe 2P and 2C: 275 MMboe Unconventional Gas and gas liquids 2C gas and gas liquids 47 MMboe 92 MMboe Conventional 2C gas/gas liquids 2P reserves 89 MMboe Oil 70 MMboe 23 MMbbl 2C…
Clear strategy for value accretive growth Optimise Maintain Grow east coast Expand beyond Cooper Basin core financial strength gas business Cooper Basin Growth Enablers Growth Drivers Core operations underpin existence…
Strong progress across all pillars in FY16 Optimise our core in the Cooper Basin Maintain financial strength Drillsearch merger and integration Net debt free 26% operated field cost reduction 40% corporate cost savings 90%…
FY16 Financial Performance
Cash flow breakeven reduced by 60% A / bbl US / bbl FY16 90 60% 65% Cash flow 89 Reduced cash flow breakeven from lower costs and breakeven1 74 35 26 greater control over SACB JV capital expenditure 0 FY15 FY16 FY15 FY16 Broad…
40 million p.a. Drillsearch merger synergies Combined Beach and Drillsearch million Corporate Overheads 57% reduction in combined Beach / 60 Drillsearch corporate overheads 57% reduction since FY15 Duplicated corporate overheads…
Underlying NPAT despite oil price Underlying NPAT down 61% to 36 million Underlying NPAT A/bbl million Brent oil Decline mainly due to impact on revenue 270 140 from lower realised oil prices 33% reduction in average realised oil…
Robust financial position Further strengthening of financial position Operating Cash Flows A/bbl million due to: Brent oil 600 140 Capital expenditure reduction to 184 million (FY15: 416 million) Cost savings achieved across the…
Leveraged to oil price recovery A leading Australian oil producer, with a Australian Oil Production Last 12 Months major gas business 5.2 MMbbl Oil-linked gas sales with other beneficial pricing parameters Active Western Flank…
Operations Update
Record production delivered in FY16 Record production of 9.7 MMboe Production (MMboe) 53% oil; 47% gas and gas liquids 9.6 9.7 9.1 Record operated oil production of 3.6 MMbbl 8.0 7.5 Gas* Gas* 4.4 4.5 Higher portion of operated…
Increased operated oil exposure Area FY15 FY16 Change Cooper / Eromanga basins 4,490 5,028 12% Oil (kbbl) Egypt 132 141 7% Total oil 4,622 5,169 12% Cooper Basin 22.1 21.8 (1%) Sales gas and ethane (PJ) Egypt 0.1 0.3 365% LPG…
90% drilling success rate in FY16 90% drilling success rate from 51 wells High drilling success rates in FY16 Five new field discoveries in Windorah Wells Successful Wells Trough (SWQ JV) Area Category Drilled / Rate Field…
100% drilling success rate in Q1 FY17 Two gas appraisal and three development Kangaroo-1 has de-risked Birkhead leads wells in the SACB and SWQ JVs Three operated oil development wells Hanson-4, Stunsail-3 (ex PEL 91); Callawonga-12…
FY17 Outlook
Significant east coast gas opportunity Structural change underway in the east East coast gas supply and demand 2015 2025 (PJ/a)1 coast gas market Supply Demand 2,000 Increasing signs of gas supply / demand imbalances 1,500 New…
Record production expected in FY17 Peak oil field decline in FY17 to be offset by merger benefits 100% ownership of core and field development activities producing permits (ex PEL 91 and 106) Field Natural Bauer facility expansion…
Facility expansions to optimise production Bauer Oil Facility Expansion Bauer facility expansion to 120,000 barrels of fluid Daily capacity per day (+60%) (kbfpd) 120 Completion expected in Q3 FY17 120 60% increase in Expansion to…
Capital directed for greatest returns Rigorous capital allocation framework underpins all discretionary expenditure decisions 180 200 million 184 million Discretionary Expenditure: High-graded projects; NPV positive; near-term line…
Diverse play types will drive organic growth High graded prospects to expand existing footprints Up to 13 operated wells planned Low risk development wells Near-field exploration / extensions New focus on Birkhead / Patchawarra…
Growth via drilling of 13 operated wells Permit Well Timing Target Rationale Result1 Hanson-4 Q1 Namur Development well to support facility expansion Success: C&S Stunsail-3 Q1 Namur Development well; part of low cost, full field…
Greater influence over SACB JV outcomes Recent Joint Venture Changes Benefits to Beach Not tied to joint venture partner Separate lifting and marketing of commitments Gas lifting / marketing own equity molecules Ability to seek best…
Non-core asset divestments to continue Cooper Basin activity Sale agreement for Kenmore-Bodalla operated oil interests Mature fields and remote operations; operating costs were double those of Western Flank Mitigated end of life…
Disciplined approach to inorganic growth Clearly defined growth strategy underpinned by robust core base business Strategy Demonstrated progress in FY16 via Drillsearch merger Focussed on opportunities with similar risk profile to…
A compelling value proposition Profitable and net debt free: US26/bbl cash flow breakeven; 0.6bn available liquidity Leveraged to oil price recovery: +US10/bbl = +50m NPAT and +A65m cash flow Cost savings progressing: Material…
Comparison of NPAT with underlying NPAT FY15 FY16 million million NPAT (514.1) (588.8) Adjusted for: Mark-to-market of convertible notes derivative (13.3) Merger costs 7.7 Unrealised hedging losses 15.4 Provision for non…
Broad suite of activity in FY17 FY17 Capital Expenditure million Wells Key Projects Exp. App/Dev Western Flank Operated Oil Solidus 3D inversion Ex PEL 91 25 30 5 2 Bauer and Hanson facility expansions Callawonga facility expansion…
Contact information Beach Energy Beach Energy Limited Limited 25 Conyngham 25 Conyngham Street Street Glenside SA Glenside SA 5065 5065 Tel: +61 Tel: +61 8 8 8338 8338 2833 2833 Fax: +61 Fax: +61 8 8 8338 8338 2336 2336 Website:…
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