EnQuest A clear purpose and strategy with a focused business model Purpose With hydrocarbons expected to remain a key element of the global energy mix for many years, EnQuest is focused on enhancing hydrocarbon recovery and extending…
EnQuest priorities Deliver, de-lever, grow Production Deliver Cost control Capital discipline Scheduled bank amortisation De-lever Targeting net debt:EBITDA ratio of 1-2x Develop asset base Grow Consider selective,…
EnQuest H1 2019 performance On track to meet operational and financial targets Net production1 (Boepd) Unit opex (/Boe) Cash capex (m) 80,000 24 140 68,548 22.6 70,000 22 130 126 60,000 53,990 125 20.1 50,000 20 120 40,000…
EnQuest H1 2019 performance Debt reduction continuing; net debt:EBITDA at 1.8x1 Net debt:EBITDA ratio 8 7 6.6 6 5 4 3 3.8 3.3 2 2.5 1.8 1 1.7 De-lever 0 1 2014 2015 2016 2017 2018 1H 2019 Group net debt is 1,638…
EnQuest H1 2019 performance Magnus acquisition driving growth Material increase in production to 68,548 Boepd Grow Full year guidance of 63,000 to 70,000 Boepd unchanged Annual net production1 (Boepd) 80,000 Developing reserves…
Responsibly extending the useful lives of assets Focused on Safe Results Environmental Social Governance Board Senior Management Policies Procedures Minimising emissions Active management of Flaring c.45% below…
Operations overview Bob Davenport Managing Director - North Sea
Production performance Growth of c.27%; within the guidance range H1 2019: 68,548 Boepd1 Production growth: H1 2018: 53,990 Boepd1 30,215 Delivered Strong production efficiency Additional equity interest, well 21,655 23,107…
H1 2019 operational delivery Strong Magnus performance; pipeline projects completed early Magnus performance in line with expectations Net production (Boepd) Northern 68% High production efficiency; reservoir North Sea management;…
H1 2019 operational delivery cont. Kraken performance improved; successful IWR in Malaysia Improving production efficiency Net production (Boepd) 7% Power engine performance; plant stability; spares management DC4 wells producing…
Enhancing performance at Magnus Improving efficiency, lowering costs and enhancing production Improved efficiency with PE at c.80% Improved power system reliability Increased water handling capacity Focused maintenance…
Kraken field development Subsurface & wells performing; Western Flank project planned Continued strong reservoir and well Water cut trend performance 100% Water cut has remained stable 90% 80% Coning Channelling Efficient sweep…
Financial review Jonathan Swinney Chief Financial Officer
Results summary Strong H1 2019 performance Unless otherwise stated all figures are on a Business performance basis and are in US Dollars Comparative figures for the income statement relate to the period ended 30 June 2018 and the…
Operational expertise Growing production while maintaining cost discipline 2016 2017 2018 H1 2019 2019 Outlook Production (Boepd) 39,751 37,405 55,447 68,548 63,000 to 70,000 Operating expense ( million) 357 349 466 248 c.550…
Capital discipline Focused development spend to drive returns m 80 H1 2019 vs H1 2018 cash capex H1 2019 cash capex of 74 H1 2019: 125m 125 million: 70 H1 2018: 126m 63 Delivered 60 Kraken DC4 wells and prior 50 period…
Magnus enters profit share in H2 2019 EnQuest 100m cash consideration repaid during H2 2019 Illustrative Magnus cash waterfall Strong performance at Magnus driving: Accelerated repayment of BP Vendor loans 25% vendor loan fully…
Net debt and cash flow Strong cash generation and cost control driving debt reduction m Movement in net debt 2,000 Debt reduction: 1,900 Delivered 1,800 Net debt down by 11% 1,774 H2 2019 outlook 1,700 2 c.4.6 MMbbls hedged…
Repaying ahead of amortisation schedule Facilitated by strong cash generation RCF repayments1 m De-levering ahead of 300 schedule Early repayment saves 250 incremental interest costs Demonstrates capital discipline 200 Debt…
2019 Outlook On track to meet targets; debt reduction remains the priority GroupProduction production (net) KrakenCash production capex(gross) Net debt:EBITDA 63,000-70,000 Boepd 30,000-35,000 Bopd Below 2x Operating…
Amjad Bseisu Chief Executive
EnQuest performance summary Strong first half performance; de-levering prioritised Production growth: H1 2019 up 27% at 68,548 Boepd Cost control: H1 2019 unit opex down 11% at 20/boe Deliver Capital discipline: Completed Kraken DC4…
Future resource maturation opportunities Part of a balanced capital allocation process 2C resources 50 MMboe Future upside Annual drilling programme with strong economics Further drilling upside with target maturation in c.270 MMbbls…
EnQuest A clear strategy with a focused business model Questions & Answers 25
Appendices
Group tax position No material UK cash CT/SCT on operational activities expected UK Tax Allowances m Tax losses at 31 December 2018 3,125.3 2018 utilisation (217.8) 2018 RFES 80.3 Prior year adjustment 11.3 Tax losses at 30 June…
Group tax position Effective tax rate reconciliation ETR % ms Profit Before Tax 38.7 UK CT Rate (40.0) (15.5) RFES 32.1 UK and overseas tax rate differences (13.0) Permanent items (7.4) Other, including IFRS interim…
Post-tax remeasurements and exceptional items As at 30 June 2019 78.3 million post-tax loss was primarily made up of: Increased contingent consideration associated with the acquisition of 75% interest in Magnus of 33.0 million,…
Debt structure Long-dated, manageable repayment structure m Debt structure m Debt structure m Future repayment profile 2,500 (end Dec 2018)1 2,500 (end June 2019)2 (end July 2019)3 17 1,000 72 72 2,000 2,000 49 179 49 179 165…
IFRS 16 impact summary for H1 2019 Minimal overall impact New lease assets EBITDA PBT Financing cash flow and liabilities 2.2 million 2.2 million 87.7 million 3.2 million Immaterial increase in EBITDA / decrease in PBT…
EnQuest: 8 Hubs A strong platform for growth Heather/Broom Kraken Thistle/Deveron The Dons Magnus Alma/Galia Greater Kittiwake Area PM8/Seligi 32
Well set for substantial growth Strong CAGR (c.17.2% to 2019 mid-point) Average net production (Boepd) 80,000 70,000 70,000 63,000 60,000 50,000 40,000 30,000 20,000 10,000 0 2009 2010 2011 2012…
Strong reserves growth since creation Reserve life c. 13 years MMboe Net 2P Reserves 400 350 263 300 250 245 (99) 200 150 100 81 50 0 Net 2P reserves Reserve additions Production Net 2P reserves start 2010…
Operational growth beyond 2019 Selected portfolio opportunities Deliver 2P Reserves Late-life asset / Platform Well Plant Sub-sea Infill drilling life extension drilling intervention improvements tie-back Magnus Kraken…
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