Skip to main content NY Bank Meetings – PEMEX Investor Presentation | Shale Experts
Loading...
Pm

NY Bank Meetings – PEMEX

PEMEX · Jun 6, 2019 · 59 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. NY Bank Meetings – PEMEX – slide 1
    PEMEX NY BANK MEETINGS June 6th, 2019 2019 D.R. Petrleos 2019 D.R.Mexicanos. Todos los Petrleos Mexicanos. derechos Todos reservados. reservados. los derechos
  2. NY Bank Meetings – PEMEX – slide 2
    Contents 1 PEMEX General Overview 2 Evaluation of Structural Challenges 3 Action Plan 4 Strategy backbone: Increasing crude oil production 5 Industrial Transformation 6 Financial Highlights 2 2019 D.R. Petrleos 2019…
  3. NY Bank Meetings – PEMEX – slide 3
    1. PEMEX General Overview 3 2019 D.R. Petrleos Mexicanos. Todos los derechos reservados.
  4. NY Bank Meetings – PEMEX – slide 4
    PEMEX: A vertically integrated company Exploration and Transformation Transportation Commercialization production and distribution 3rd largest exporter 10th largest crude 16th largest oil Strategic of crude to the producer1…
  5. NY Bank Meetings – PEMEX – slide 5
    Social impact of PEMEX in Mexico PEMEX is the most important company in Mexico in terms of size and revenue The largest contributor to the Federal Governments income (average of 11.0% in 2018) In 2018, PEMEX contributed MXN 2.1…
  6. NY Bank Meetings – PEMEX – slide 6
    Structural challenges for Petrleos Mexicanos 1 Excessive fuel theft 2 Public debt that doubled in the last five years and remains at elevated levels 3 Heavy tax burden 6 2019 D.R. Petrleos 2019 D.R.Mexicanos. Todos…
  7. NY Bank Meetings – PEMEX – slide 7
    Structural challenges: a vicious cycle Decline in oil production Objective of the new administration: Find solutions to Drop in Reduction of break the vicious investment Structural the company's cycle and challenges revenue…
  8. NY Bank Meetings – PEMEX – slide 8
    2. Evaluation of Structural Challenges 8 2019 D.R. Petrleos Mexicanos. Todos los derechos reservados.
  9. NY Bank Meetings – PEMEX – slide 9
    1. Fuel Theft Non-operational losses (Fuel theft) Cumulative loss due to fuel theft Figures in millions of constant pesos, 2018 = 100 in the period of 2014-2018: 36,163 MXN 101.1 bn 24,612 17,705 As a reference point, this…
  10. NY Bank Meetings – PEMEX – slide 10
    2. Accelerated Debt Growth Total Debt Balance 2013 2018* Figures in billions of current pesos 2,038 2,082 1,983 During the 2013-2018 period, PEMEX's debt grew at an 1,493 average annual rate of 1,143 20.9% 841 2013 2014…
  11. NY Bank Meetings – PEMEX – slide 11
    2. Accelerated Debt Growth (contd) Net financial cost 2013 2018 Figures in billions of current pesos 122 101 87 The interest cost for 2018 73 was equivalent to 43 64.7% 33 of PEMEX's investment for that year 2013…
  12. NY Bank Meetings – PEMEX – slide 12
    2. Accelerated Debt Growth (contd) Debt balance net changes 2013 2019* Figures in billions of current pesos 490 In this period PEMEX 350 drastically reduces 302 investment 55 44 2014 2015 2016 2017 2018 Source:…
  13. NY Bank Meetings – PEMEX – slide 13
    3. High Tax Burden Direct tax payments Figures in billions of current pesos, 2018=100 468 425 In 2018, direct taxes represented 379 401 2.1 times the amount of PEMEX's investment in that year The decrease in payment of…
  14. NY Bank Meetings – PEMEX – slide 14
    Impact of the structural challenges: PEMEX's decrease in investment PEMEX: Investment expenditure In 2018, PEMEX recorded the Figures in billions of current pesos, 2019=100 lowest investment in the last 20 years 446 455 During…
  15. NY Bank Meetings – PEMEX – slide 15
    Result: Decline in oil production Oil production, 2004-2018 Figures in millions of barrels per day From 2004, when the highest level of production was recorded, to the end of 3.4 3.3 3.3 3.1 2018, PEMEX accumulated 2.8 a 2.6…
  16. NY Bank Meetings – PEMEX – slide 16
    3. Action Plan 16 2019 D.R. Petrleos Mexicanos. Todos los derechos reservados.
  17. NY Bank Meetings – PEMEX – slide 17
    Action Plan Breaking the vicious cycle by proposing solutions to the Production three structural challenges (there is neither a unique nor immediate solution) Combined efforts are necessary to design comprehensive public…
  18. NY Bank Meetings – PEMEX – slide 18
    Strategy 1: Successful initiative against fuel theft Before (December 2018) 81 Illicit fuel market: 74 Losses in Thousands of Barrels/Day (November 2018 May 2019) 23 After 18 (May 2019) 9 8 4 5 7 4 5 4 4 5 5 3 4 4 4 3 6 5 4…
  19. NY Bank Meetings – PEMEX – slide 19
    Successful initiative against fuel theft Non-operating losses (fuel theft) Figures in millions of constant pesos, 2018 = 100 Equivalent to 36,163 22.2% of total debt Estimated 2019 maturities in 2020 savings of MXN 32.6 In…
  20. NY Bank Meetings – PEMEX – slide 20
    Strategy 2: Decreased reliance on debt financing The current administration will not use public debt to finance investments PEMEXs financial policy will be focused on optimizing its financing sources, executing refinancing…
  21. NY Bank Meetings – PEMEX – slide 21
    Net Indebtedness 2017 2019 Net Indebtedness* In the first quarter of Figures in billions of pesos 2019, PEMEX 55 recorded net 44 deleveraging of MXN 18 billion PEMEXs 2019 goal to not increase net indebtedness -18 is…
  22. NY Bank Meetings – PEMEX – slide 22
    Proactive liquidity management: renewal of credit lines This transaction represents the refinancing of the US2.0 billion term loan due in 2020 and US500 million of new money to PEMEX, which will be used for the repayment of other…
  23. NY Bank Meetings – PEMEX – slide 23
    Renewal of credit lines Figures in millions of dollars Before After (December 2018) (May 2019) 9,652 9,475 8,325 2,000 6,726 Refinancing 7,652 500 2,152 Total amount Maturities Maturities Total amount Maturities…
  24. NY Bank Meetings – PEMEX – slide 24
    Strategy 3: Reduction of the tax burden The Mexican government has taken the historic decision to reduce the fiscal burden to Petrleos Mexicanos. On May 24, a decree was published Estimated impact of tax benefits in the Official…
  25. NY Bank Meetings – PEMEX – slide 25
    Strategy 3: Reduction of the tax burden Reform to the Hydrocarbons Revenue Decrees Law (Ley de Ingresos Sobre Hidrocarburos) The decree grants a fiscal benefit The initiative will propose gradual consisting of an increase in the…
  26. NY Bank Meetings – PEMEX – slide 26
    Strategy 3: Reduction of the tax burden The aggregate tax Equivalent to: benefit for the period 45.8% of the total 2019-2021 amounts to accumulated debt maturities for the period US8.435 2019-2021 billion 61.8% of PEMEXs…
  27. NY Bank Meetings – PEMEX – slide 27
    Other support measures from the government in 2019 Amount Support measures from the Federal Government US Progress as of MXN billion billion June 1, 2019 1 Capital injection1 25 1.3 80% Payment of Pension Liability 2 35 1.8…
  28. NY Bank Meetings – PEMEX – slide 28
    Summary of Federal Government support The objective of the Concept 2019 2020 2021 Federal Government is to directly support To be To be PEMEX during the 1. Capital injection 25,000 defined defined first half of the six- 2.…
  29. NY Bank Meetings – PEMEX – slide 29
    4. Strategy backbone: Increasing crude oil production How are we getting there 29 2019 D.R. Petrleos Mexicanos. Todos los derechos reservados.
  30. NY Bank Meetings – PEMEX – slide 30
    Increase investments During 2019 PEMEX will increase Investment Expenditures investments by MXN BN, 2019=100 37.7% in real terms compared to the prior 446 455 412 year. 369 352 320 The capitalization from the Federal 273…
  31. NY Bank Meetings – PEMEX – slide 31
    Reversing the declining crude oil production trend 2019 exploration and production budget: Total: 210.7 billion pesos New developments: 43 billion pesos Increase investments in wells maintenance and reparation Stabilize current…
  32. NY Bank Meetings – PEMEX – slide 32
    Development of 20 new fields will boost production in 2019 In only one year, PEMEX will invest in 20 new developments, the same number previously achieved in one decade 20 20 Onshore Offshore 15 10 8 5 5 4 4 4 4 4 3 3 3 3 2 2…
  33. NY Bank Meetings – PEMEX – slide 33
    100% of the offshore infrastructure required for the development of new fields is already contracted The bidding process has started for the infrastructure development of 2 additional fields (Yaxch y Onel) Xikin Octli 7…
  34. NY Bank Meetings – PEMEX – slide 34
    One year after starting the contracts, we will have the first production of the 20 new fields First production First First Xikin-B, production production Cahua, Octli, in platform Suuk, Pokche, Teekit, Esah, We are here Xikin-A…
  35. NY Bank Meetings – PEMEX – slide 35
    Progress in the construction of offshore infrastructure is in line with expectations Progress of Global Platforms/ Pipelines Companies ESEASA-PERMADUCTO / BOSNOR-PERMADUCTO 100.0% 90.0% % Expected Progress: 20.80 % Actual Progress:…
  36. NY Bank Meetings – PEMEX – slide 36
    The required onshore infrastructure for the 20 new fields is also progressing in line with expectations Progress on the infrastructure of onshore fields 100% 90% % Expected Progress: 10.73 80% % Actual Progress: 11.20 70%…
  37. NY Bank Meetings – PEMEX – slide 37
    Bidding processes for drilling services Drilling services for the development of 18 fields have been contracted Additionally, wells for Onel and Yaxch were included in this process As a result, the Action Plan for 2019 increased the…
  38. NY Bank Meetings – PEMEX – slide 38
    Efficiency in the 2019 Action Plan: time and costs savings Drilling started in 3 new wells and its performance is exceeding expectations translating into time and cost savings Xikin-22 Xikin-45 Esah-21 Actual Actual Actual…
  39. NY Bank Meetings – PEMEX – slide 39
    Increase in exploration activities Increase in exploration activities will lead to new commercial discoveries that will be part of the 20 to 40 new fields per year Commercial Discoveries 40 40 32 32 24 20 6 8 1 2 3 2014…
  40. NY Bank Meetings – PEMEX – slide 40
    Ixachi: Largest Onshore Discovery in Mexico in the Last 25 Years Ixachi is the most relevant field out of the 20 new developments. At its peak production level, Ixachi will contribute approximately 25% of the incremental production…
  41. NY Bank Meetings – PEMEX – slide 41
    Ixachis production forecast Ixachi is already producing 3.9 Mbd Production is expected to reach 14 Mbd in December. 700 600 58 617 59 577 500 3 9 Gas 400 383 (MMpcd) 300 200 100 105 0 ene abr jul oct ene abr jul oct ene abr…
  42. NY Bank Meetings – PEMEX – slide 42
    Production forecast of the 22 new fields started in 2019 Production of new developments is expected to reach 70 Mbd in December 2019. Oil 320 303 267 255 203 Mbd 70 2019 2020 2021 2022 2023 2024 Gas 908 861 743 612…
  43. NY Bank Meetings – PEMEX – slide 43
    Production forecast considering future development of explorations 1,400 1,200 2019 2020 2021 2022 2023 2024 1,000 800 752 1,151 Oil 751 600 (Mbd) 417 400 2020-24 (148 new fields) 200 340 Other 0 72 operators 2019 (20…
  44. NY Bank Meetings – PEMEX – slide 44
    Committed production 2019-2024 Crude oilde Produccin production (thousand crudo (miles de barrels barriles diarios) per day) 3,500 Dec-2024 Dic-2018 3,000 2,560 2,654 2,500 Dec-2018 Dic-2018 2,000 1,713 1,500 1,000…
  45. NY Bank Meetings – PEMEX – slide 45
    Economic boost of the industry This administrations development of new fields in the upcoming years will have a significant impact reactivating the industry 2019 2020 2021 2022 2023 2024 Total 4,377 km Wells 50 80 90 87 95 89…
  46. NY Bank Meetings – PEMEX – slide 46
    Estimated increase in reserves Exploration activities and the development of new fields are expected to revert the declining trend in reserves Observed Projected 25,000 20,000 6,139 7,020 8,590 8,989 9,335 6,865 7,699 8,119…
  47. NY Bank Meetings – PEMEX – slide 47
    Stabilize and revert the declining trend in production to 1,725 M bd during 2019 January 1 May 31, 2019 MM Mbd 2,000 1,900 1,800 1,703 1,711 1,698 1,666 Production 1,688 20-May-19 1,700 1,677 1,687 1,600 1,500 Time…
  48. NY Bank Meetings – PEMEX – slide 48
    Significant cost reductions in new exploration and production service contracts Procurement strategy innovation + Transparency and honesty Cost reductions Vertical and horizontal integration of consortiums An estimated based…
  49. NY Bank Meetings – PEMEX – slide 49
    Efficiencies in procurement processes have translated in to savings Savings in new assigned contracts1 MXN million USD million Infrastructure 2,379 119 Onshore wells 6,066 303 Offshore wells 7,162 358 Total 15,607 780…
  50. NY Bank Meetings – PEMEX – slide 50
    New business model: Integrated Exploration and Extraction Service Contracts (CSIEEs) Main characteristics PEMEX maintains ownership of the assignment and continues as operator The maximum term of the contract can be between 15…
  51. NY Bank Meetings – PEMEX – slide 51
    In order to incentivize production, CSIEEs1 use staggered rates based on the probability of reserves Greater incremental production, higher fee paid USD per barrel F4 F3 F1 F2 Base Reference profile Additional Exploration /…
  52. NY Bank Meetings – PEMEX – slide 52
    5. Industrial Transformation 52 2019 D.R. Petrleos Mexicanos. Todos los derechos reservados.
  53. NY Bank Meetings – PEMEX – slide 53
    Transformation: National Refining System PEMEX National Refining System (NRS) consists of 6 refineries with atmospheric distillation capacity of 1,640 Mbd. Due to operative problems in 2018, the NRS operated below 40% of its…
  54. NY Bank Meetings – PEMEX – slide 54
    NRS Maintenance Plan In 2019, PEMEX will carry out a comprehensive maintenance program at the National Refining System, after which, petroleum products output is expected at 402 Mbd 1Q Maintenance 2Q Maintenance (in 3Q-4Q Maintenance…
  55. NY Bank Meetings – PEMEX – slide 55
    6. Financial Highlights 55 2019 D.R. Petrleos Mexicanos. Todos los derechos reservados.
  56. NY Bank Meetings – PEMEX – slide 56
    EBITDA: Stable Cash Flow PEMEX has generated a solid and stable cash flow, resulting in an EBITDA growth EBITDA USD Billion MXN MM 545.0 522.0 28% 32% 30.0 461.7 80.0 377.9 27.7 26.9 33% 33% Mexican Crude Oil Mix Price…
  57. NY Bank Meetings – PEMEX – slide 57
    2019 Financial Balance Figures in millions of pesos Compared to the 13,769 previous report, 4,239 Aprils financial balance improved by +501 million -622 pesos -14,386 Mays preliminary figures reflect a positive financial…
  58. NY Bank Meetings – PEMEX – slide 58
    Financial Debt Maturity Profile As of March 31, 2019, PEMEXs consolidated debt under IFRS amounted to US106.5 billion Debt Profile as of March 31, 2019* 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033…
  59. NY Bank Meetings – PEMEX – slide 59
    Thank you 2019 D.R. Petrleos Mexicanos. Todos los derechos reservados.

From the store

Browse maps, data & reports in the Shale Experts store