Genel Energy PLC · LSE:GENL
Genel Energy — Investor Presentation (May 2014)
41 slides from Genel Energy's investor presentation, May 2014
Slide 1: Investor Presentation May 2014
Investor Presentation May 2014
Slide 2: Disclaimer
DISCLAIMER These materials are being supplied to you by Genel Energy plc (the “Company”) solely for your information and for use at this presentation. All numbers and charts included in this presentation are from Company data unless specified otherwise. These materials may not be reproduced in any f
Slide 3: Unique Portfolio Positioned for Growth
UNIQUE PORTFOLIO POSITIONED FOR GROWTH The leading portfolio of assets in the Kurdistan Region of Iraq Four world class assets – Taq Taq, Tawke, Miran and Bina Bawi. Largest KRI producer with current net production capacity of 80kbopd, growth to 145kboepd targeted by end-2014 Largest holder
Slide 4: Strategy
STRATEGY Maintain the highest level of corporate governance Create value with the drill bit Manage our KRI business on a broadly cash flow neutral basis Maximise shareholder returns by monetising at all points in the exploration, development and production cycle and return excess cash to sha
Slide 5: Production and Sales
PRODUCTION AND SALES Net Genel Production (kbopd) Net Genel Revenues ($m) $500 – $600m(1) c.145 kboepd Year-End Capacity c.80 kbopd Capacity 348 70 kboepd 333 60 kboepd 44 44 42 142 150 17 12 29 2009 2010 2011 2012 2013 2014E 2009 2010 2011 2012 2013 2014E (1) 2014 guidance assuming revenue recognit
Slide 6: Cashflow and Capex
CASHFLOW AND CAPEX 800 KRI Cash Flow Neutrality since Merger Completion 600 Including: 2nd CPF and 4 additional $m 400 production wells at Taq Taq 200 Taq Taq Deep exploration well 0 KRI Operating Cash Flow KRI Capex 2nd CPF, additional production wells and 300kbopd export $550-600m pipeline f
Slide 7: Capital Strategy
CAPITAL STRATEGY Balance sheet will evolve to be consistent with Genel's future business needs and will reflect: Confidence in oil export revenue Capex needs of current portfolio Portfolio management Access to debt markets New business opportunities Commodity price environment Rigoro
Slide 8: 2014 Catalysts & Key Events – A Transformational Year
2014 CATALYSTS & KEY EVENTS – A TRANSFORMATIONAL YEAR Politics – pipeline exports to ramp up Agreement with Baghdad or independently via Turkey Ramp up of production at both Taq Taq and Tawke with international price realisations KRI Oil – processing capacity to grow Processing capacity at
Slide 9: Regional Pipeline Infrastructure
REGIONAL PIPELINE INFRASTRUCTURE New KRI export pipeline Iraq – Turkey pipeline – Iraq section Iraq – Turkey pipeline – Turkish section 40” Pipeline Tawke field 46” Pipeline Khurmala Dome Taq Taq field 40” Pipeline 46” Pipeline PIPELINE SYSTEM FULLY OPERATIONAL BY H2 2014 9
Slide 10: Genel Energy KRI Licenses
GENEL ENERGY KRI LICENSES Tawke Processing Capacity 708 200 mmbbls kbopd2 355 100 23 mmbbls 1,2 kbopd mmbbls 2P CR PR End-13 End-14 Ber Bahr 50 Dohuk mmbbls CR Bina Bawi 52 29 849 mmbbls mmboe mmbbls 2P CR CR Taq Taq Processing Capacity 579 200 mmbbls 120 kbopd 248 mmboe kbopd 2P PR End-13 End-14 Mi
Slide 11: Taq Taq – Ramping Up to 200,000 bopd Capacity
TAQ TAQ – RAMPING UP TO 200,000 BOPD CAPACITY 2013 Key Developments 77,000 bopd gross production in 2013 Strong domestic demand and pricing (c.$71/bbl) Trucked exports averaged c.20,000 bopd ($75-80/bbl) YE 2013 processing capacity of 120,000 bopd YE 2013 well production capacity >150,000
Slide 12: Tawke – Continuing Successful Development Drilling Program
TAWKE – CONTINUING SUCCESFUL DEVELOPMENT DRILLING PROGRAM 2013 Key Developments 39,000 bopd gross production in 2013 with domestic prices of c.$60/bbl YE 2013 processing capacity of 100,000 bopd YE 2013 well production capacity of c.155,000 bopd Horizontal production wells (TW-20 and TW-23)
Slide 13: KRI Gas Market
KRI GAS MARKET Export markets: GSA signed between Turkey and KRG in November 2013 GSA for 4 bcma of gas exports starting 2017 rising to 10 bcma by 2020 Option of increasing to 20 bcma Miran and Bina Bawi to deliver gas to underpin the GSA Gas Sales Offtake Agreements with KRG for Miran and
Slide 14: Dohuk Gas Project
DOHUK GAS PROJECT GSA for domestic gas supply signed with KRG in September 2013 Initial deliveries of 30-50 mmscfd commencing Q2 2014 and ramping up to 100-120 mmscfd Development – first phase near completion Summail-3 well completed March 2014 Summail-2 spudded April 2014 2 train CPF to
Slide 15: Miran
MIRAN Resources (RPS mean contingent) 10.5tcf gas in place 3.5tcf recoverable sales gas with 35mmbbls condensate Image TBC 60mmbbls oil Phased Gas Development Studies KRG exercises back-in right for 25% in Miran PSC (23 Feb 2014) Gas Sales Offtake Agreement H2 2014 FID H2 2014 Part
Slide 16: Bina Bawi
BINA BAWI Resources (RPS mean contingent) 8.1tcf gas in place 4.9tcf recoverable sales gas Gas Development Studies 6 bcma export development Gas Sales Offtake Agreement H2 2014 FID 2015, first gas 2018 Capex: facilities c.$500m/bcma, c.30 development wells for both phases at c.$35m p
Slide 17: KRI Gas – Significant Progress & Momentum
KRI GAS – SIGNIFICANT PROGRESS & MOMENTUM 2013 March KRG/Turkey agree Heads of Terms for bilateral Energy Agreement August Genel issued Declaration of Commerciality on the Miran discovery KRG approves Declaration of Commerciality on the Miran discovery September Gas Sales Agreement for Summa
Slide 18: Exploration Strategy
EXPLORATION STRATEGY High Impact Exploration 4-5 wells targeted per annum Focus on material prospects: >250mmbbls with PoS >20% Further high-impact activity in 2014: Taq Taq Deep well testing, Hagar Qim (Malta Area 4), Dilolo (Angola Block 39), Nour (Sidi Moussa), Angola Block 38, Mir Left
Slide 19: Exploration Inventory
EXPLORATION INVENTORY (PoS) Lower risk KRI portfolio drill-out potential, 50% proven basin, prospect specific risk Kurdistan Offshore Africa 45% Onshore Africa 40% Higher risk, high-impact Africa exploration – both basin and Probability of Success 35% prospect specific risk 30% 25% 20% 15% 10% 5% Mi
Slide 20: KRI Exploration – Taq Taq Deep
KRI EXPLORATION – TAQ TAQ DEEP Top Jurassic Depth Map Seismic Line S N W E TT-22 CRETACEOUS D E PTH (MSL) JURASSIC TRIASSIC Results to date Key prospect / drilling info Drilling operations completed in March 2014 at a depth of 4,600m Testing programme on Triassic and Jurassic currently in progre
Slide 21: Africa Exploration – High Impact Wells Targeted in 2014
AFRICA EXPLORATION – HIGH IMPACT WELLS TARGETED IN 2014 NORTH ATLANTIC OCEAN Mir Left Sidi Moussa Juby Maritime Area 4 MOROCCO Morocco Malta 3 licences, 13,890km2 combined 1 licence, 5,715km2 Juby Maritime (37.5% W.I.) 550mmboe Area 4 (75% W.I.) 700 mmboe Sidi Moussa (60% W.I.) 700mmboe Mir
Slide 22: Angola Pre-Salt Play and Genel Energy Licences
ANGOLA PRE-SALT PLAY AND GENEL ENERGY LICENCES Whales Park (Pre-Salt) (Post-Salt) Discoveries South Atlantic plate reconstruction White Rose/Genel JV holds 15% WI in Blocks 38 & 39 Kwanza Basin analogue of prolific Brazilian pre-salt plays $150m firm commitment includes entry and drilling co
Slide 23: Kwanza Basin Pre-Salt Plays
KWANZA BASIN PRE-SALT PLAYS Key Reservoir Intervals: 1 Platform Carbonates 2 Microbial Build-ups 3 Skeletal Limestone SW NE 2 1 3 23
Slide 24: Field Size Comparison
FIELD SIZE COMPARISON 10 Santos & Campos Basins: Lula, Large Pre-Salt Field Sizes 9 Santos Basin, Brazil 8 Recoverable Reserves (bn bbl) 7 6 5 6.5 bn bbls 4 rec. reserves 3 2 1 0 Angola Blocks 38 & 39 Kwanza Basin Modified after White Rose 2013 Source: ANP 24
Slide 25: Morocco – Juby Maritime (Cap Juby)
MOROCCO – JUBY MARITIME (CAP JUBY) Key play info Cap Juby: 110m water depth Upper Jurassic carbonate shelf & reef play (proven) Top Upper Jurassic reservoir: 2,110m TVDSS at JM-1 Middle Jurassic oolitic shoal play OWC, oil and gas shows down to 2,330m TVDSS Forward activity - evaluate Uppe
Slide 26: Morocco – Sidi Moussa (Nour Prospect)
MOROCCO – SIDI MOUSSA (NOUR PROSPECT) NOUR-1 Upper Jurassic Mid Jurassic Top Salt Key play info Nour-1: 980m water depth Upper Jurassic carbonate reef play; analogue to Cap Juby discovery Top Upper Jurassic reservoir: 1,936m TVDSS Middle Jurassic oolitic shoals play Top Mid Jurassic reservoi
Slide 27: Morocco – Mir Left
MOROCCO – MIR LEFT Salt Flank Leads BTU L.CRET UPPER JUR MID JUR SALT New 3D Seismic (PSTM, 2013) Upper Jurassic 1 Salt 2 Sub-Salt Structure Key play info 1,000 km2 3D seismic acquired in 1H2013 Salt flank trap – Upper & Middle Jurassic carbonate platform with reefs Continued targeting of Jura
Slide 28: Malta – Geological Context
MALTA – GEOLOGICAL CONTEXT Cretaceous Libyan Sirte Basin rift extension into Maltese waters Hagar Qim will test a Tertiary carbonate build up The Lower Eocene & Upper Cretaceous carbonate plays host billion barrel fields on the North African Margin 28
Slide 29: Malta – Area 4 (Hagar Qim Prospect)
MALTA – AREA 4 (HAGAR QIM PROSPECT) SW Hagar Qim 1 NE Lower Eocene Tertiary Cretaceous Cretaceous upside Hagar Qim-1: 460m water depth Cretaceous leads will be matured in 2014 with new PSDM Top reservoir (Lower Eocene) crest: ~2,200m TVDSS Prospective resources in Cretaceous: 450mmboe 4 way
Slide 30: Exploration Activity Programme
EXPLORATION ACTIVITY PROGRAMME Block Gross Block Net Gross Net Unrisked Unrisked Unrisked Unrisked Assets W.I. Country Prospective Prospective H1 2014 H2 2014 H1 2015 H2 2015 Resource Resource PoS Resources Resources Prospect Prospect (mmboe) (mmboe) (mmboe) (mmboe) Taq Taq 44% KRI 248 109 248 109 4
Slide 31: 2014 – An Exciting Year Ahead
2014 – AN EXCITING YEAR AHEAD Q1 Q2 Q3 Q4 Politics & Commissioning of KRI- Ramp-up of export volumes via KRI-Turkey pipeline infrastructure Infrastructure Turkey export pipeline infrastructure Tawke-21 and 22 (horizontal Taq Taq first deviated well Taq Taq first horizontal well Taq Taq C
Slide 32: Summary & 2014 Outlook
SUMMARY & 2014 OUTLOOK Oil Significant production growth of > 50% in 2014 Genel’s first gas sales at Dohuk Q2 2014 Gas Derisking of major gas resource (Miran and Bina Bawi GSA & FID) High impact exploration wells including the very material Dilolo Exploration prospect offshore Angola Financi
Slide 33: Genel Energy Reserves and Resources (End-2013)
GENEL ENERGY RESERVES AND RESOURCES (END-2013) Gross Resource Net Resource Unrisked Working Unrisked Risked 2P 3P Contingent Prospective Interest 2P 3P Contingent Prospective PoS Prospective mmboe mmboe mmboe mmboe % mmboe mmboe mmboe mmboe % mmboe Producing assets Taq Taq 579 974 - - 44% 255 428 -
Slide 34: Appendix
Appendix 34
Slide 35: Executive Management Team Across London and Ankara
EXECUTIVE MANAGEMENT TEAM ACROSS LONDON AND ANKARA Tony Hayward Group CEO of BP from 2007 to 2010 John Hurst Founder of Barrus Petroleum Chief Executive Previous roles at BP include Group Treasurer Head of Previously held senior positions with BP and Total Officer and Chief Executive for Ups
Slide 36: Genel Energy – Non-Executive Directors
GENEL ENERGY – NON-EXECUTIVE DIRECTORS Rodney Former positions include Chairman of Petrofac, U.S. Ambassador to Turkey from 1997 to 2000 Mark Chase Deputy Chairman of Tesco, Deputy Chairman of and Special Assistant to the President for Near Parris Chairman TNK-BP, Senior Independent Director at
Slide 37: Kurdistan Region of Iraq – PSC Terms
KURDISTAN REGION OF IRAQ – PSC TERMS Taq Taq Tawke Miran Dohuk Ber Bahr Chia Surkh Bina Bawi Genel Paying Interest 55% 25% 75%1 40% 60% 75% 55% Genel Working Interest 44% 25% 75%1 40% 40% 60% 44% KRG carried interest 20% 20% 25% (not carried) 1 20% 20% 20% 20% State royalty 10% 10% 10% 10% 10% 10% 1
Slide 38: Kurdistan PSC – Production Sharing
KURDISTAN PSC – PRODUCTION SHARING Contractor Interest (80%) Production & Revenue Production Government Interest (20%) Gross Production 100 bbls 100bbls Royalty Contractor Working Interest Production 80 bbls Cost Oil 10bbls Contractor Entitlement Production 15 bbls 40-55% of Net Production is Net Pr
Slide 39: Cost Oil
COST OIL 40-55% of Net Production (Gross Production minus Royalty) is available for Contractors to recover costs Unrecovered costs may be carried forward and recovered in future periods Equipment and facilities become the property of the Government once the Contractor recovers the cost What
Slide 40: Profit Oil
PROFIT OIL Contractor’s share of Profit Oil is determined by an R-factor formula Re-set every 6 months 𝐶𝑢𝑚𝑢𝑙𝑎𝑡𝑖𝑣𝑒 𝑅𝑒𝑣𝑒𝑛𝑢𝑒𝑠 𝑅 − 𝑓𝑎𝑐𝑡𝑜𝑟 = 𝐶𝑢𝑚𝑢𝑙𝑎𝑡𝑖𝑣𝑒 𝐶𝑜𝑠𝑡𝑠 R-factor < 1 30% 1< R-factor < 2.5 Between 15-30% R-factor > 2.5 15% Early in the field life…
Slide 41: Contacts and Website
CONTACTS AND WEBSITE Phil Corbett Head of Investor Relations +44 20 7657 5119 phil.corbett@genelenergy.com Website www.genelenergy.com 41