Chairmans Address Annual General Meeting of Shareholders 13 May 2016
The FAR corporate evolution Transitioning from a junior explorer 2013 share register (2) to a leading energy company Retail Investors entry in to ASX Top 300 - March 2015 67% Institutional ASX top 5 oil & gas company, behind…
The FAR share price evolution Attracting Partners Portfolio Flow/FAR merger in Senegal Mgment Exploration Evaluation & Appraisal Feb-12 Jun-14 Oct-14 Oct-15 Apr-16 Capital raisings 15m, 4.3cps 8m, 4cps 46.7m, 11cps 40m, 8cps 60m,…
FARs market capitalization increased by 300% in 3 yrs 140 450 400 120 Current market capitalisation 350 of A350m 100 300 80 A145m in value 250 through A265m of capital market 60 raisings capitalisation growth over 200…
FAR have outperformed since last AGM Last twelve months (% change)(1) Last three years (% change)(2) Cairn Energy 12% 12% FAR 157% FAR -6% Carnarvon Petroleum 67% ASX200 -8% ASX200 3% Carnarvon Petroleum -18% Cairn Energy -29% -8%…
Funding FAR
What it takes to get Institutional Funding To present ourselves as highly professional To deal with expectations on Governance and Remuneration practices - a one size fits all mentality is often not ideal for FAR To recognise the…
We have upgraded our Governance Framework Corporate Governance Statement Policies - Anti-Bribery and Corruption Committees & Charters - Diversity - Board Charter - Environment & Sustainability - Audit Committee - Human Rights &…
Remuneration frameworks
Global Listed Company Remuneration Frameworks Post GFC listed companies globally have moved to to satisfy political and institutional demand that managements interest are more clearly and transparently aligned with shareholders…
Frameworks Institutions rely on Proxy advisors to determine their voting - engaging and meeting the requirements of the proxy advisors is essential - but various advisors have different views making even this part difficult retail…
What are Performance Rights They are not a share or an option The requirements are measured in 3 years time (the vesting date) until then the employee gets nothing thats why they call them long term incentives If the grant…
Cath and Ben 13
FARs overheads are very low 2015 0.24M In-house technical Admin expenses 0.55M Corporate salaries Corporate consulting 1.99M Other 4.51M 0.64M 14
Travel stats 2015 Cath Norman Ben Clube Percentage of 2015 Percentage of 2015 Europe 40 days Europe 59 days Africa 31 days spent travelling* Africa 33 days spent travelling* 42% 48% US 7 days US 0 days Domestic 11 days…
The FAR Remuneration Framework Total Possible Remuneration = base Salary (50%) + theoretical max at risk component (50%) base salary = cash 558,000 FAR MD example - subject to annual performance review On our MDs recommendation at…
MD compensation benchmarking LTM Australian peer group comparison of Total Fixed Remuneration (TFR) and At Risk compensation FAR TFR is the 350% lowest of the peer group 300% FAR at risk is 250% also one of the At risk…
MD compensation benchmarking LTM International and Australian peer group comparison of Total Fixed Remuneration (TFR) and At Risk compensation 600% FAR TFR is the lowest of the 500% peer group 3,575m 1,018m FAR at risk is also At…
Calculating the final number of performance rights In 3 years time the 2016 LTI grant will be determined Absolute Share Price Measure FAR MD example - If the share price has grown at less than 15% compound for the 3 years 0 shares…
Summary In 2016 our Managing Director will be paid (subject to the resolutions being passed today) - Cash A558,000 - She will not be paid a cash bonus - She will not receive any free options or shares - She will receive 3,578,000…
Evaluating the worlds largest oil discovery FAR Limited Annual General Meeting 13 May 2016
Senior management Gordon Ramsay Business Development Ben Clube Peter Thiessen COO, Director CFO, Company Secretary Peter Nicholls Exploration Manager 2
FAR snapshot Two major basin opening oil discoveries in Senegal in 2014 SNE Field largest global oil find since discovery in 2014 SNE Appraisal drilling commenced 2015 5/5 successful wells offshore Senegal to date Quality partners in…
SNE Oil field footprint approximately 350 km2 4
Senegal Strong in-country relationships OFFSHORE SENEGAL PSC FAR 16.7% paying interest, 15% beneficial interest Peaceful democracy Operator: Cairn Energy PLC Solid growth: 4.7% GDP in 2014 S&P sovereign credit rating 'B+/B…
Geological setting W FAN-1 SNE-2 SNE-1 SNE-3 BEL-1 E Buried Hills play Shelf Edge play Fan play 0 10 km 6
FAN-1 Discovery W FAN-1 SNE-2 SNE-1 SNE-3 BEL-1 E FAN-1 well drilled first Results announced Oct 2014 Oil gravity 28-41 degrees API Gross oil bearing interval 500m Operator gross oil (STOIIP) in place P90: 250 mmbbls P50: 950…
SNE-1 Discovery W FAN-1 SNE-2 SNE-1 SNE-3 BEL-1 E SNE Field Result announced Nov 2014 Largest oil discovery for 2014 Has not been surpassed to date Approximately 350 km2 footprint 0 10 km 8
SNE-1 oil discovery Results announced Nov 2014 Excellent reservoir 25% average porosity Oil gravity 32 degrees API Gross oil column of 96m (36m net) Contingent recoverable resource* P90 (1C): 150 mmbbls P50 (2C): 330 mmbbls P10…
SNE appraisal well locations Objective of wells: Size of oil pool Test reservoir properties and deliverability from logging, coring and testing Measure field connectivity BEL-1 SNE-2 SNE-1 SNE-3 N S Drilling Oil Traps Flow…
SNE-2 Appraisal well Excellent flow from two independent drill stem tests (DST) Gross 12m zone: 8,000 bopd stabilised and constrained, interpreted flow 10,000 bopd Gross 15m zone: 1,000 bopd unstabilised Flow considerably…
SNE-3 Appraisal well Excellent flow from two drill stem tests (DST) 3 Gross 15m zone: 5,400 bopd max and 4,000 bopd stabilised Increased to gross 20.5m zone: 4,500 bopd stabilised Flow greater than prognosis Confirmed…
Growth of the SNE oil field 600 561 (84) 468 500 (70) 2C Contingent 400 330 resource (50) mmbbls, 300 unrisked, 100%basis oil only 154 (net to FAR) 200 (23) 100 0 Pre-drill prospective Post SNE-1 RISC, Pre Appraisal,…
BEL-1 Well results Dual objective for well Bellatrix exploration prospect Gas discovery in stacked sands 8m net gas pay No water contact detected potential for down dip oil leg SNE field northern appraisal 100m gross oil column…
Appraisal progress to date Objective of wells are to establish: Size of oil pool Reservoir properties and deliverability from logging, coring and testing Flow test SNE-2 Reservoir connectivity Drilling program…
Interference testing Pulsing well Observation well Observation well 17
Interference testing Pulsing well Observation well Observation well 18
Interference testing Pulsing well Observation well Observation well 19
Interference testing Pulsing well Observation well Observation well 20
Interference testing Pulsing well Observation well Observation well 21
SNE-4 Appraisal well Spudded 16 April Aims of the well intersect key reservoirs in the oil acquire reservoir information from all units increase the contingent resources W E 22
Senegal prospects and leads JV PSC area 7,490 km2 3D seismic coverage 5,000 km2 23
Capturing more shelf edge exposure New FAR Djiffere 3D seismic bought FAR option to earn a 75% W.I. New Senegal joint venture 2015 3D seismic shot along trend from existing mapped prospects and assists SNE delineation…
Senegal economics Excellent PSC terms Minimum Economic Field Size (MEFS) approx 200mmbbls* NPV/bbl of US10 at US50/bbl oil price and reduced CAPEX* Estimated first oil 2021 Costs coming down 25 *Reference Cairn Energy Capital…
Industry woes, costs coming down 75% drop in oil price since peaks of 2014 Dividends being widely reduced or cancelled general negative investor sentiment Exploration companies to weather the low oil prices well into 2017 Estimated…
Global rig count Africa Worldwide 160 4500 Discovery wells Appraisal 150 4000 program 140 3500 130 US330/day1 3000 120 < 5% NPT2 2500 110 US650/day1 2000 100 50% NPT2 90 1500 80 1000 Aug Aug Apr Apr Apr Dec…
Whats happening next Results of SNE-4 well by end May Decision on future appraisal by end May Upgrade to contingent resources mid year (inc BEL-1, SNE-4 and core data) Receipt of Djiffere seismic data mid Q3 FAR statement on SNE…
Budget going forward (A) Cash 31 March = 31.7M Capital raise = 57.6M Outgoings current quarter : 30M Expected Q3/Q4 : 30-40M Includes 2 wells (plus interference test) Licence retention Geotechnical work Administration…
Guinea-Bissau Three blocks, operator Svenska FAR 15% WI, 21.43% PI SINAPA (BLOCK 2) AND ESPERANA (BLOCKS 4A & 5A) 21.43% paying interest, 15% beneficial interest New 3D seismic evaluating SNE look-a- Operator: Svenska Petroleum…
Kenya Interest in two exploration blocks in BLOCK L6 BLOCK L9 the Lamu Basin 60% interest offshore 24% interest onshore 30% interest Operator: Ophir Energy PLC Operator: FAR Limited Lamu Basin has proven oil at both ends of…
Australia WA-458-P exploration permit offshore WA-458-P OFFSHORE DAMPIER BASIN Western Australia is surrounded by 100% paying and beneficial interest Operator: FAR Ltd discoveries Structural and combined structural- stratigraphic…
Social responsibility FAR and its partners are committed to supporting activities that deliver positive, lasting social and economic benefits to Senegal through the following programs: Great Entrepreneur competition in Senegal English…
2016 revealing the prize 2013: Year of farmout 2014: Year of discovery 2015/2016: Evaluating the SNE Field 100% success rate offshore Senegal Undrilled exploration prospects with 1bn bbls potential Expanding footprint through…
Contact us Level 17, 530 Collins Street Melbourne VIC 3000 Australia T: +61 3 9618 2550 far.com.au infofar.com.au FAR is going social Follow us on Twitter, LinkedIn and on our U-tube channel
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