Beach Energy Limited · ASX:BPT
Beach Energy — Investor Presentation (March 2012)
39 slides from Beach Energy's investor presentation, Mar 27, 2012
Slide 1: Entitlement Offer and Convertible Note Offer Presentation
Beach Energy Limited For personal use only Entitlement Offer and Convertible Note Offer Presentation 27 March 2012 NOT FOR DISTRIBUTION OR Entitlement OfferRELEASE INOffer and Convertible Note THE UNITED Presentation STATES – 27 March 2012 OR TO U.S. PERSONS Slide 1 NOT FOR DISTRIBUTION OR RELEASE I
Slide 2: Important notices
Important notices The information contained in this document is for information purposes only and does not constitute an offer to issue or sell, or arrange to sell, securities or other financial products. In particular, this document does not constitute an offer to sell, or a solicitation of an offe
Slide 3: Important notices (continued)
Important notices (continued) All references to dollars, cents or $ in this presentation are to Australian currency, unless otherwise stated. References to “Beach” may be references to Beach Energy For personal use only Limited or its applicable subsidiaries. Unless otherwise noted, all references t
Slide 4: Executive summary
Executive summary • Beach Energy Limited (“Beach”) is raising approximately $345 million through a: For personal use only – $195 million fully underwritten 1 for 8 accelerated pro rata non-renounceable entitlement offer (“Entitlement Offer”); and – $150 million convertible notes issue to sophisticat
Slide 5: Overview of Entitlement Offer
Overview of Entitlement Offer For personal use only • Fully-underwritten, 1 for 8 accelerated pro rata, non-renounceable Entitlement Offer entitlement offer to raise approximately $195 million Structure and Size • Approximately 140 million new Beach ordinary shares (“New Shares”) to be issued (12.5%
Slide 6: Overview of Convertible Note Offer
Overview of Convertible Note Offer Convertible Note • Senior Unsecured Convertible Notes due 2017 issued by Beach (“Convertible Notes”) • Expected issue size $150 million For personal use only Offer Structure and Size Maturity • Unless previously purchased and cancelled, redeemed or converted, the C
Slide 7: Strategic and operational overview
For personal use only Beach Energy Limited Strategic and operational overview Entitlement Offer and Convertible Note Offer Presentation – 27 March 2012 Slide 7 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES OR TO U.S. PERSONS
Slide 8: A unique value proposition
A unique value proposition For personal use only Entitlement Offer and Convertible Note Offer Presentation – 27 March 2012 Slide 8 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES OR TO U.S. PERSONS
Slide 9: Safety a priority
Safety a priority For personal use only • Low Supervision Classification for Exploration and Oil Production Operations (SA) by South Australian Government regulator • HSE Strategic Planning – three year plan • Continued support for APPEA Stand Together for Safety campaign • 2010 and 2011 without a r
Slide 10: Resource and reserve growth and production
Resource and reserve growth and production 2P Reserves for FY12 likely to increase For personal use only 95 MMboe • Reserve and resources growth since 2010 77 MMboe • Current 2P reserves, at 77 MMboe, are a 66 MMboe fraction of total 2P reserves plus 2C contingent resources of ~660 MMboe • Resource
Slide 11: Key financial metrics
Key financial metrics Underlying NPAT expected to For personal use only • Market capitalisation approximately improve in FY12 $1.8 billion • Admitted to S&P/ASX 100 index in March 2012 • Annual net operating cash flow before capital expenditure expected to average ~$200 million • Financial position:
Slide 12: Pro-forma impact of the Capital Raising
Pro-forma impact of the Capital Raising Pro-forma $000s Reviewed 31-Dec-11 Adjustments (1) Adjusted 31-Dec-11 Pro-forma 31-Dec-11 For personal use only transactions (2) Cash 58,565 (4,834) 53,731 335,161 388,892 Other current assets 154,733 - 154,733 - 154,733 Non-current assets 1,439,076 - 1,439,07
Slide 13: Capital expenditure to FY13
Capital expenditure to FY13 Beach has multiple development opportunities which it intends to fund through a combination of net For personal use only cash flow from operations, the current Capital Raising and other available resources Multiple opportunities to develop substantial resource base in FY1
Slide 14: High quality operations in the prolific Cooper Basin
High quality operations in the prolific Cooper Basin • Oil and gas production generating For personal use only operating cash flow to support business growth and development • Gas sales revenue underpinned by long-term contracts • High historical exploration success rate across well-defined plays •
Slide 15: SACB/SWQ JV
SACB/SWQ JV Gross unrisked resource potential of For personal use only • Equity interests of 20.21% in the SACB JV and 4 billion+ boe estimated within acreage1 23.2% in the SWQ JV (Santos operated) • Well established Australian onshore hydrocarbon basins with: – Over 40 years of production history –
Slide 16: Cooper Basin – Western Flank oil
Cooper Basin – Western Flank oil Western Flank oil is a core contributor to Beach For personal use only • Strong equity positions (75% in PEL 92; 40% in PEL 91; 40% in PEL 104, PEL 111 and PRL 15) • Production target of 10,000 bopd (net to Beach) by 2013 • Sales in Brent, currently stronger than WTI
Slide 17: Western Flank gas and gas liquids production
Western Flank gas and gas liquids production For personal use only • Beach commenced wet gas production The first operated gas and gas liquids on the Western Flank in January 2012 production for Beach in the Cooper Basin • Beach 50% (operator), Drillsearch 50% • Initial flow rates of 25 MMscfd, made
Slide 18: Cooper Basin unconventional operations
Cooper Basin unconventional operations • A shale and basin centred gas discovery For personal use only within the Nappamerri Trough • Estimated potential resource of 300+ Tcf gas in place in 100% held PEL 218 licence in South Australia with potential for more in adjacent areas • Exploration and appr
Slide 19: Beach's Cooper Basin unconventional gas potential
Beach’s Cooper Basin unconventional gas potential Beach has an acreage position with a very large 300+ Tcf of gas in place estimated for For personal use only resource potential PEL 218 PEL 218 • Beach 100% of Permian Gross area: • Results from initial drilling in Encounter-1 and ~1,600km2 Holdfast-
Slide 20: Advantages of Beach's unconventional acreage
Advantages of Beach’s unconventional acreage For personal use only • Good working relationship with pastoral owners and other stakeholders • Co-operative not competitive land use • Semi-desert country • Relatively flat topography • Well established oil and gas infrastructure • Raw and sales gas pipe
Slide 21: Strong outlook for East Coast demand
Strong outlook for East Coast demand Industry commentators suggesting gas For personal use only • 2015+ opens up domestic and export linked prices trending toward $6-9/GJ opportunities • Three LNG projects in Gladstone have achieved FID with > 20 mtpa capacity: Domestic and LNG project gas demand pr
Slide 22: Indicative timeline for Cooper Basin unconventional
Indicative timeline for Cooper Basin unconventional • Fracture stimulate Encounter-1 with sequential stimulation and testing For personal use only • Independent review of all reserves and resources currently underway • Drill at least five vertical delineation wells in 2012 to appraise shale and basi
Slide 23: Other unconventional opportunities
Other unconventional opportunities For personal use only Otway Basin • Conventional plays proven – gas, (Beach 35-67%) condensate and oil • Moderate to high TOC’s • Gas and liquids prone Gippsland • Wombat gas project Basin • Two wells planned to be fracture (Beach earning stimulated in 1H 2012 up t
Slide 24: Aiming to build a strong business in Egypt
Aiming to build a strong business in Egypt • Established position with a portfolio of Abu Sennan • Six well appraisal/exploration For personal use only production, development and (Beach 22%) program exploration opportunities • Oil, gas and condensate discoveries from first four wells drilled • Part
Slide 25: Rift systems - Lake Tanganyika South Block, Tanzania
Rift systems - Lake Tanganyika South Block, Tanzania • Beach 100% For personal use only • Underexplored area of 7,200 km2 (Lake Albert 5,300 km2) • Natural oil seeps identified on Lake Tanganyika, as with Lake Albert, indicating a working petroleum system • Lake Tanganyika has the potential for > 20
Slide 26: Summary investment highlights
Summary investment highlights For personal use only Profitable base business generating cash flow that has contributed to business growth and development History of exploration success with strong conversion of resources to reserves Unconventional gas upside from the Cooper Basin Portfolio o
Slide 27: Capital Raising timetable
For personal use only Capital Raising timetable Entitlement Offer and Convertible Note Offer Presentation – 27 March 2012 Slide 27 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES OR TO U.S. PERSONS
Slide 28: Indicative Capital Raising timetable
Indicative Capital Raising timetable Key dates For personal use only Transaction announced Institutional Entitlement Offer opens 27 March 2012 Convertible Note Bookbuild Offer opens Institutional Entitlement Offer closes 28 March 2012 Convertible Note Bookbuild Offer closes Results of Entitlement Of
Slide 29: Key risks and important notices regarding foreign jurisdictions
For personal use only Key risks and important notices regarding foreign jurisdictions Entitlement Offer and Convertible Note Offer Presentation – 27 March 2012 Slide 29 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES OR TO U.S. PERSONS
Slide 30: Key risks
Key risks RISKS RELATING TO THE INDUSTRY For personal use only Exploration and development: Oil and gas exploration and development involves a certain degree of risk. In the normal course of business, the Company depends on the following factors: successful exploration; establishment of commercial o
Slide 31: Key risks (continued)
Key risks (continued) Exposure to oil and gas prices: A severe decline in the price of oil and gas may have a material adverse effect on the Company’s financial performance. Historically, international crude oil prices have been very volatile. Although the Company has a management policy for hedging
Slide 32: Key risks (continued)
Key risks (continued) Material change to reserves and resources: Underground oil and gas reserve and resource estimates are expressions of judgement based on knowledge, experience and industry practice. Estimates which are valid at a certain point in time may alter significantly or become uncertain
Slide 33: Key risks (continued)
Key risks (continued) Health, safety and environmental impact constraints: The business of exploration, development, production and transportation of hydrocarbons involves a variety of risks which may impact the health and safety of personnel, the community and the environment. It is conceivable tha
Slide 34: Key risks (continued)
Key risks (continued) Changes in government policy and laws: Changes in government policy (such as in relation to taxation) or statutory changes may affect the Company’s business operations and its financial position. A change in government regime may result in changes to fiscal, monetary, property
Slide 35: Key risks (continued)
Key risks (continued) GENERAL INVESTMENT RISKS For personal use only Global economic developments and market conditions: The Company’s operational results may be adversely impacted by factors including significant changes in general economic conditions such as interest rates, inflation, deflation an
Slide 36: Important notices regarding foreign jurisdictions
Important notices regarding foreign jurisdictions HONG KONG For personal use only WARNING. The contents of this document have not been reviewed by any regulatory authority in Hong Kong. You are advised to exercise caution in relation to the offer. If you are in any doubt about any of the contents of
Slide 37: Important notices regarding foreign jurisdictions (cont.)
Important notices regarding foreign jurisdictions (cont.) JAPAN The New Securities have not been and will not be registered under the Financial Instruments and Exchange Law of Japan (Law No. 25 of 1948, as amended) (the “FIEL”). Pursuant to Article 2(3)(ii)(a) of the FIEL, a solicitation to acquire
Slide 38: Important notices regarding foreign jurisdictions (cont.)
Important notices regarding foreign jurisdictions (cont.) FRANCE For personal use only This Investor Presentation is not being distributed in the context of and does not constitute a public offering of securities (offre au public de titres financiers) in France within the meaning of Article L.411-1
Slide 39: Contact information
Contact information Beach Energy Limited - Head office: 25 Conyngham Street For personal use only Glenside SA 5065 Tel: +61 8 8338 2833 Fax: +61 8 8338 2336 Website: www.beachenergy.com.au Entitlement Offer and Convertible Note Offer Presentation – 27 March 2012 Slide 39 NOT FOR DISTRIBUTION OR RELE