Acquisition of Magnus Oil Field & Sullom Voe Oil Terminal The Right Assets in the Right Hands 24 January 2017
Amjad Bseisu Chief Executive
Agenda Acquisition Introduction Amjad Bseisu, CEO Transaction summary Jonathan Swinney, CFO Transaction timetable Acquisition assets Neil McCulloch, COO Operations update Outlook and conclusion Amjad Bseisu, CEO 2
Magnus and SVT acquisition The Right Assets in the Right Hands 3
Strategic rationale EnQuest is a life extension expert, with the right integrated technical skills, operational scale and high level of operating efficiency Well placed to extend the lives of Magnus and SVT Will provide new…
Magnus opportunity Recognises EnQuest as an Operator of Choice for maturing North Sea assets PM8/Seligi gross production Greater Kittiwake Area gross production EnQuest assumed Shutdown for operatorship maintenance May October…
Highlights: Acquisition of 25% of Magnus oil field Cashless and financially riskless Operatorship and acquisition of an initial 25% interest in Magnus oil field and 3% of Sullom Voe terminal Base consideration 85 million, subject to…
Jonathan Swinney Chief Financial Officer
Transaction highlights Acquisition of 25% of Magnus and 3% of SVT Base consideration of 85m, subject to working capital and other adjustments Consideration deferred and reimbursed from positive cumulative cash flows BP to pay for…
Supplementary details Effective economic date is 1 January 2017 EnQuest to also acquire 29% of BPs existing interest in Northern Leg Gas Pipeline and the Ninian Pipeline System, when exercising its option for the remaining 75% of…
Indicative timeline for initial 25% transaction During 2017: Transition; regulatory approvals and safety cases Novation of contracts By end of 2017: EnQuest to become SVT Operator and Licence Operator EnQuest owns 25% of…
The Kraken FPSO Now in the North Sea, at the yard in Rotterdam Neil McCulloch Chief Operating Officer
Transaction assets overlaid on EnQuests existing nearby assets. EnQuests northern North Sea assets 12
Magnus overview Mature, single-owner asset with significant remaining potential Facilities The Magnus platform is located in Block 211/12A and is the most northerly installation in the UKCS Closest neighbours are Northern Producer…
Magnus operating cost and efficiency Focus and economies of scale 2015 EnQuest has developed a focused operating philosophy EnQuest has safely reduced costs from 42/bbl in 2014 to 23/bbls in the first half of 2016 Over the same…
Magnus subsurface opportunity Unlock the potential by getting the asset in the right hands Magnus Opportunity Underinvested production opportunities Quick optimisation gains likely Improvements identified for water alternating…
SVT overview A strategic infrastructure hub SVT was commissioned in 1978 and receives East of Shetland (EoS) oil via two pipelines: Brent Pipeline System (BPS) services Brent, Thistle, Northern Producer, Alwyn, TENCCA Ninian…
The SVT prize Reduction in costs for NNS assets SVT life extension = Thistle, Don, Heather, Magnus life extension Reduced cost per barrel for EnQuest Magnus, Thistle, Dons, Heather SVT cost reduction = increased EnQuest NAV…
Operations update 2016 Highlights Production averaged 39,751 Boepd in 2016, up 8.7% on 2015, with production in the UK North Sea up 11.3% Production at the end of the year was affected by the maintenance shutdown of the Brent…
Kraken Development Progress update Overall schedule The Kraken FPSO is on schedule and under budget, on track for delivery of first oil in Q2 2017 FPSO is in Rotterdam for inspection and certification, prior to sailing offshore to…
Amjad Bseisu Chief Executive
2017 Outlook EnQuests production in 2017 will is expected to average in the range of 45,000 Boepd to 51,000 Boepd for the full year and will be dependent on the timing of Kraken first oil EnQuest is on course to further reduce…
Conclusion EnQuest is the natural owner of Magnus and SVT Cashless and riskless transaction Operatorship of SVT takes control of a very important asset The EnQuest operating model is well suited to Magnus and SVT EnQuest will…
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