Rockhopper Exploration Plc · LSE:RKH
Rockhopper Exploration — Investor Presentation (July 2012)
22 slides from Rockhopper Exploration's investor presentation, July 2012
Slide 1: Rockhopper Exploration Plc Investor Update July / August 2012
ROCKHOPPER EXPLORATION PLC INVESTOR UPDATE JULY / AUGUST 2012
Slide 2: Important Notice
IMPORTANT NOTICE This Presentation does not constitute an offer or invitation or a solicitation of any offer or invitation for the sale or purchase of any securities in the Company. In addition, it is not intended to form the basis of or act as an inducement to enter into any contract or investment
Slide 3: Opening a New Oil Province
ROCKHOPPER EXPLORATION OPENING A NEW OIL PROVINCE • Rockhopper holds licences in the North Falkland Basin • Ten well drilling campaign 2010‐2012 • 70% success rate • Significant upside remains • Gross best unrisked prospective resources of approx. 3.3 bnbbls (1) Contingent Resources (mmbbls) Net to
Slide 4: Detailed Acreage Position Post Farm Out
DETAILED ACREAGE POSITION POST FARM OUT – SUBJECT TO REGULATORY AND PARTNER APPROVALS Licence RKH Interest PL032 40% PL033 40% PL023 40% PL024 40% PL003 3% PL004a 3% PL004b 24% PL004c 10% 4
Slide 5: A Transformational Deal for Rockhopper
A TRANSFORMATIONAL DEAL FOR ROCKHOPPER Rockhopper, Bank of America Merrill Lynch and Rothschild approached global audience A Global including independents, IOCs and NOCs Competitive Auction Completed Disciplined process with international parties from three continents conducting detailed due dil
Slide 6: Terms of the Farm Out – A Quick Reprise
TERMS OF THE FARM OUT – A QUICK REPRISE Upfront cash payable on completion: US$231mm The Financial Net development funding / carry from 1 April 2012: US$722mm Terms of Net exploration carry: US$48mm the Farm-out Optional standby funding arrangement: US$ ‘full field’ funding Conditions Preced
Slide 7: Farm-out Closes the Value Gap and Derisks the Project
FARM‐OUT CLOSES THE VALUE GAP AND DERISKS THE PROJECT • GCA prepared economic evaluation to derive Post-deal: Highly Value Accretive Farm-out Net Present Values (“NPVs”) for Sea Lion and Rockhopper GCA Risked GCA Unrisked Further Pre-deal Econ. Evaluation Econ. Evaluation adjacent discoveries of US$
Slide 8: Sea Lion: Well Appraised and Ready for Development
SEA LION: WELL APPRAISED AND READY FOR DEVELOPMENT Indicative Sea Lion Extensive Work Completed Schedule To First Oil Development Costs Multiple 2D, 3D seismic programmes FEED US$mm 10 operated wells $ 5,000 Pre-First Oil 2 drill stem tests (“DST”) and 15 mini DSTs Development $ 4,000 Post-Fir
Slide 9: Significant Upside Remains in North Falkland Basin
SIGNIFICANT UPSIDE REMAINS IN NORTH FALKLAND BASIN • Rockhopper to take sub‐surface lead in exploration • Rockhopper has strong understanding of the North Falkland Basin following its highly successful drilling campaign with 70% success rate • Appraisal of existing discoveries (Casper, Casper South,
Slide 10: Transformational Exploration Potential Through AMI and New Venture Activity
TRANSFORMATIONAL EXPLORATION POTENTIAL THROUGH AMI AND NEW VENTURE ACTIVITY • Southern Africa • AMI targets geological province that is continuation of Cretaceous rifted eastern margin play of the opening Southern Atlantic • Knowledge transfer of critical exploration techniques to evaluate opportuni
Slide 11: Appendix
APPENDIX 11
Slide 12: Information on Premier Oil
INFORMATION ON PREMIER OIL Key Facts on Premier Oil Sea Lion is Important to Premier Oil Net Production • Premier Oil plc was founded in 1934, is (boepd) 160,000 headquartered in London and listed on LSE since Huntington, Rochelle Pelikan Solan Catcher 140,000 1936 120,000 100,000 – Interests in eig
Slide 13: GCA Assumptions and Summary Output
GCA ASSUMPTIONS AND SUMMARY OUTPUT • Competent Person’s Report (“CPR”) issued by Gaffney Cline & Associates (“GCA”) in April 2012 (1) Sea Lion Adj. Discoveries Total Net Unrisked Oil Contingent 1C Resources (mmbbl) 194.7 30.7 225.4 Resources for Sea Lion and Adjacent Discoveries 2C Resources (mmbbl)
Slide 14: Details on Optional Standby Financing Arrangements
DETAILS ON OPTIONAL STANDBY FINANCING ARRANGEMENTS Assuming US$2,000mm costs to first oil (leased FPSO), this implies US$800mm for Rockhopper’s share less development funding/carry of US$722mm, resulting in a funding need of US$78mm Assuming US$3,000mm costs to first oil (purchased FPSO), this i
Slide 15: Details on Optional Standby Financing Arrangements (Cont'd)
DETAILS ON OPTIONAL STANDBY FINANCING ARRANGEMENTS (CONT’D) WORKED EXAMPLES ILLUSTRAING THE ENTITLEMENT CALCULATION IF STANDBY FUNDING IS TAKEN UP (1) Capex to First Oil US$mm 3,000.0 Rockhopper’s 40% Equity Share US$mm 1,200.0 US$3bn Capex to First Oil Less: Development Funding / Carry Net To Rockh
Slide 16: Expected Tax Treatment of the Farm Out
EXPECTED TAX TREATMENT OF THE FARM OUT Branch elections effective from 1 April 2012 mean that this is outside the scope of UK tax Deemed as a disposal within the Falkland Island ring fence and therefore subject to Capital Gains Tax (“CGT”) Upfront cash is taxable, exploration carry (undertaken
Slide 17: Accounting & Class Test Treatment of the Farm Out
ACCOUNTING & CLASS TEST TREATMENT OF THE FARM OUT Treated in line with prevalent industry practice Accounting Treatment Only the cash element is recognised at the time of completion and set against related intangible expenditure Therefore, no gain or loss will be generated in the group income
Slide 18: Operations: Drilling Efficiency (AGR Data)
OPERATIONS DRILLING EFFICIENCY (AGR DATA) WOW Vs. North Sea NPT Vs. North Sea A ll wells average (46 A ll wells average (46 9.5% 18.5% wells) wells) No rth Sea average (35 No rth Sea average (35 10.6% 20.8% wells) wells) Ocean Guardian NFB Ocean Guardian NFB semi-sub; Ro ckho pper 4.0% semi-sub; Ro
Slide 19: Operations: Metocean Conditions and Drilling Performance
OPERATIONS 0.0 Rockhopper 'Sea Lion' All Wells From Spud Time Depth Curve 14/10-2 METOCEAN CONDITIONS AND 14/10-3 14/10-4 14/10-5 DRILLING PERFORMANCE 14/10-6 500.0 14/10-7 14/10-8 14/10- 9, 9z 14/15-4,4A,4z 1000.0 • Metocean conditions not extreme Depth (m) 1500.0 • 15 months wave rider buoy data 2
Slide 20: Oil Quality / Assay
OIL QUALITY / ASSAY GOOD QUALITY OIL AND GLOBALLY TRADABLE • Sea Lion – Medium light sweet crude – Circa. 20% wax – Low sulphur – Low TAN • Trading study based on 2x assays – Globally marketable • Gulf Coast 20 days • NW Europe 25 days • Far East 35 days • Likely to trade at tight discount to Brent
Slide 21: Exploration Prospect Inventory – Fan Play Type
EXPLORATION PROSPECT INVENTORY – FAN PLAY TYPE Fan Name Block WI % Gross Unrisked Prospective Resources MMBBLS GCoS % Low Best High SL30 PL032 40 8.5 13.0 18.6 22 Casper South PL032 40 3.8 6.2 9.1 16 Casper South PL004c 10 5.3 8.1 11.3 16 Beverley West PL004b 24 7.7 12.8 19.6 34 Beverley PL004c 10 3
Slide 22: Exploration Leads Inventory
EXPLORATION LEADS INVENTORY Lead Block WI % Gross Unrisked Prospective Resources MMBBLS GCoS % Best (1) Jason PL032 40 254.4 5 (1) Tyssen PL032 40 65.4 5 (1) Sedge PL004c 40 65.7 5 Fox (1) PL004b 40 172.7 GCA 5 Stephens (1) PL004c 40 67.5 2012 CPR 5 (1) Walker PL032 40 27.0 5 (1) Meredith PL032 40 9
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