Slide 1: Strategy on Track: 2005 Full Year Results
Strategy on Track 2005 Full Year Results 23 February 2006 1 Disclaimer & Important Notice This presentation contains forward looking statements that are subjectsubject to risk factors associated with the oil and gas industry. It is believed believed that the expectations reflected in these statement
Slide 2: Agenda; Record Financial Result
Agenda Overview Financial performance Strategy on Track Enhance existing core areas Mature emerging core areas Identify new core areas Q&A 3 Record Financial Result John Ellice- Ellice-Flint CEO & Managing Director 2005 Full Year Result Production 56.0 mmboe up 19% Sales Revenue $2,463 million up 64
Slide 3: Strong Reserve Replacement; Safety Performance Improves
Strong Reserve Replacement 2005 Year End Reserves 1P Reserves 414 mmboe up 19% 2P Reserves 774 mmboe up 20% Contingent Resources 1,971 mmboe up 37% 2005 1P RRR 218% 3yr Ave RRR 165% 1P Reserves (mmboe) 500 53 414 400 348 (56) 32 37 300 Acquisitions/ Exploration/ Divestments Production Revisions Appr
Slide 4: 2005 Highlights
2005 Highlights Hurricane, Hiu Aman, Henry, Caldita, Exploration success Firebird, Greenmount, Yamala Mutineer-Exeter, John Brookes on line Development projects Bayu-Undan LNG, Casino, Oyong, Maleo progressed Appraisal progress Jeruk, John Brookes, Mutineer, Cooper oil Moomba control system upgrade,
Slide 5: 2005 Delivers On Strategic Targets; Production Grows Strongly
2005 Delivers On Strategic Targets Production Growth 6-8% 8%* target 2005 actual EBITDAX growth p.s. Reserve Replacement Ratio *** >10% 59% Netback target actual 140% 165% $22 $32** target actual ROCE target actual >10% 20% target actual Reserve Replacement Costs *** US$5.50 US$8.71 target actual *
Slide 6: Margin Grows; Reserve Replacement Cost is Down
Margin Grows Netback $/boe (cash margin per barrel) Controllable Items 36 34 1.77 (0.51) 31.99 32 2.90 8.01 (1.96) 30 Costs 27.83 Gas 28 Prices FX Product 26 Mix 24 0.51 21.78 22 21.27 20 Moomba Liquids Incident Prices 18 16 2004 2005 11. Reserve Replacement Cost is Down Annual RRC per barrel 20 15
Slide 7: Reserves Grow; Three Year Reserve Performance Strong
Reserves Grow mmboe Proven Reserves Proven & Probable Reserves 450 800 1yr RRR 218% 1yr RRR 334% 3yr ave RRR 165% 3yr ave RRR 141% 400 700 350 600 300 500 2004 2005 2004 2005 Contingent Resources 2000 1 yr growth 37% 1750 3 yr CAGR 17% 1500 1250 1000 2004 2005 13. Three Year Reserve Performance Stro
Slide 8: Shareholders Benefit; Record Profit up 115%
…and Shareholders Benefit 350 40 ROCE EPS 35 ROE 300 EBITDAX per share 30 250 25 200 cents 20 % 150 15 100 10 50 5 0 0 2003 2004 2005 2003 2004 2005 15. Record Profit - up 115% $m 123 762 800 417 (87) 700 639 600 Exploration Significant Expensed Items 500 355 (46) 400 309 300 Significant Operating I
Slide 9: Behind the Headline: Significant Items; Operating Performance Strong
Behind the Headline: Significant Items 2005 2004 Impairment reversal (net of DD&A) 77 5 Gain on asset sales 39 55 Moomba incident 24 1 Restructuring (4) (15) Accelerated depreciation East Spar (13) - 123 46 17. Operating Performance Strong EBITDAX ($m) up 60% 2000 343 (39) (28) 1805 34 1839 1750 Cos
Slide 10: DD&A Rate Unchanged; Capital Expenditure
DD&A Rate Unchanged $m 600 (55) 50 (18) (16) 561 (25) (22) 497 475 500 Other Volume Impairment Moomba Reversal 400 Reserves East Spar Incident Revisions shut-in 300 & FDC 200 100 0 2004 2005 $10.08/boe $10.02/boe 19. Capital Expenditure $m 25 wells Exploration 22 wells, 7 discoveries Cooper Basin, M
Slide 11: 2005: A Good Year
2005: A Good Year NPAT $m Operating cash flow 800 762 1600 700 639 1400 600 1200 Tax change 500 1000 400 355 309 12% CAGR 300 800 200 600 Moomba 100 incident 400 0 200 As reported After significant 94 95 96 97 98 99 00 01 02 03 04 05 items Production Growth 19% Reserve Replacement Netback Ratio $32/
Slide 12: Strategy Built on Core Areas; Enhance Existing Core Areas
Strategy Built on Core Areas Identify Identify New New Core Core Areas Areas • Disciplined strategy Seeking new • Multiple tests options to extend • Time to deliver the growth profile Mature Mature Emerging Emerging Core Core Areas Areas • Two new core areas Captured growth • Multiple discoveries op
Slide 13: Fairview (CSG) Acquisition; Cooper Gas Exploitation
Enhance Existing Core Areas Fairview (CSG) - Acquisition • Santos 71.66% NRI, operated Phased Development Program TJ/d (net) • Net 2P reserves 143 mmboe 160 140 Phase I Phase II Phase III • 3 phase development plan 120 – 2006-2011 capex $440m 100 gross ($340m net) 80 60 – 200 new wells 40 – Increase
Slide 14: Cooper Oil - Exploitation and Results
Enhance Existing Core Areas Cooper Oil - Exploitation Cooper Basin Oil Reserves and Resources (STO) • Over 700 mmbbl resource 700 600 • New technology in mature 500 MMBbls basin 400 300 – 3D seismic 200 100 – Modern drill rigs 0 Discovered Produced 2P High Low – Progressive cavity pumps Resource Res
Slide 15: Cooper Oil 2006 Program; Casino Development
Enhance Existing Core Areas Cooper Oil – Exploitation 2006 Program • First rig operational Queensland South ATP299P • Second rig March 2006 Australia 89% • Drilling ~100 wells in Dullingari 66.6% 2006 Ballera Naccowlah – Capital of $160m (net) 55.5% Jackson – Targeting 2P reserves Jalbu Moomba of 6-
Slide 16: Mutineer Exeter; John Brookes Development
Enhance Existing Core Areas Mutineer Exeter - Development • 33.4%, operated • On-line ahead of schedule & below budget • Well performance better than expected in 2005 • Facility uptime in excess of 98% • Currently producing Production Rate 100 ~50,000 bbls/d (gross) Daily Production 80 (1,000 bbls/d
Slide 17: Exploration - Capture New Resources; Mature Emerging Core Areas
Enhance Existing Core Areas Exploration - Capture New Resources 2 wells Carnarvon 4 wells onshore Australia Hurricane Yamala Greenmount Legend 2 wells 2005 Discoveries Otway 2006 Wells Oil Pipeline Gas Pipeline Henry Ethane Pipeline 33 Mature Emerging Core Areas Papua New Guinea Gas & Oil West Natun
Slide 18: Darwin LNG Development; Timor/Bonaparte Exploration
Mature Emerging Core Areas Darwin LNG - Development • 10.6%, ConocoPhilips operated • 2P reserves 3.8 Tcf, 509 mmbbls liquids (gross) • Capex ~US$3.6 billion (gross) • Liquids recycle producing 100,000+ bpd • First LNG February 2006 • 3.5 Mt/yr LNG initial capacity 35 Mature Emerging Core Areas Timo
Slide 19: Indonesia Exploration; Jeruk Oil Appraisal
Mature Emerging Core Areas Indonesia - Exploration Kutei Basin Kakap 3 wildcat wells in 2005 Hiu Aman gas/condensate discovery 3 wells planned in 2006 Kalimantan East Java 3 wildcat wells in 2005 1,558 sq km 3D seismic survey Sulawesi West Papua 5 wells planned in 2006 West Papua Java 37 Mature Emer
Slide 20: Jeruk Appraisal Timeline; Oyong Development
Mature Emerging Core Areas Jeruk Oil – Appraisal Timeline 2003 2004 2005 2006 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Jeruk 1 Discovery Jeruk 2 Appraisal Jeruk 2 Re-entry 3D Seismic Acquisition 3D Seismic Processing 3D Seismic Interpretation Well Planning Jeruk 3 Jeruk 4 Jeruk 5 Development Studie
Slide 21: Maleo Gas Development; Kutei Basin Exploration
Mature Emerging Core Areas Maleo Gas - Development • 67.5%, operated • 2P reserves 240 bcf (gross) • Capex US$55 million (gross) • Start-up second half 2006 • Gas sales agreement signed • Gas reserves sold for electricity Helideck • Production up to 110 mmcfd Process Facilities Accommodation Wellhea
Slide 22: Hiu Aman/Selatan; Identify Potential New Core Areas
Mature Emerging Core Areas Hiu Aman/Selatan Donggala PSC • 50%, operated • Follow up to successful Hiu Aman wet gas discovery • Water depth 1,742 metres • Miocene sandstone primary objective Hiu Aman 1 Hiu Aman Selatan 1 Hiu Aman Selatan 1 Api 1 43 Identify Potential New Core Areas West Natuna USA K
Slide 23: Identify Potential New Core Areas; Summary
Identify Potential New Core Areas Kyrgyzstan 2005 new country entry 2006 regional studies and seismic acquisition South & SE Asia North Africa Ongoing regional studies, with likely new country entry in 2006 USA Targeting deep plays in shallow state waters 2006 planning 4 wells Egypt Farmin to Devon
Slide 24: Drilling Key to Strategy Delivery; Production Guidance
Drilling Key to Strategy Delivery 313 wells planned in 2006 Rigs contracted for extended terms Offshore Ocean Sovereign Sedco 601 Ocean Bounty Stena Clyde Onshore Ensign 18 , 30 & 32 PDI 721, 724 & 735 Mitchell 120, 150 & 151 47 2006 & 2007 Production Guidance Continued growth in production profile
Slide 25: Strategy on Track
Strategy on Track John Ellice- Ellice-Flint CEO & Managing Director Overview Financial performance Strategy on Track Enhance existing core areas Mature emerging core areas Identify new core areas Q&A 49 50 25
Slide 26: Reference slides: Upcoming Exploration
Reference slides 51 Upcoming Exploration Well Name Basin / Area Target Upside Resource Potential (mmboe) Santos Interest Timing 1 - 50 50 -100 100 - 250 >250 % Chinook Gulf of Suez Oil 9 50 Q1 06 Mosaic 1 Bowen Gas 9 51 Q1 06 Simbel Gulf of Suez Oil 9 50 Drilling Pawnee Gulf of Suez Oil 9 50 Q1 06 T
Slide 27: Prices & Exchange Rates; 2006 Capital Expenditure Outlook
Prices & Exchange Rates Change 2005 2004 % Realised Oil Price (US$/bbl) 54.76 36.11 52 Realised Oil Price (A$/bbl) 73.83 51.83 42 Average Gas Price A$/GJ 3.62 3.28 10 A$/US$ Exchange Rate 74.17 69.67 (6) (after hedging) 53 2006 Capital Expenditure Outlook $m 2006 2005 Exploration 225 186 Delineation
Slide 28: 2004 Profit Restatement; Production Costs
2004 Profit Restatement $m 2004 Full Year AGAAP Variance AIFRS Sales 1,501 - 1,501 Operating costs (527) - (527) Depletion & depreciation (512) 65 (447) Other revenue 194 9 203 Exploration & evaluation - (119) (119) Impairment (16) 24 8 Foreign currency - 6 6 Other expenses (69) 10 (59) Finance cost
Slide 29: Operating Cash Flow; 2006 Sensitivities
Operating Cash Flow $m 1500 69 1458 674 (1) (20) 1400 Interest & Other Working 1300 Tax Capital Items 1200 1100 1000 900 131 Moomba 800 Incident 736 700 605 EBITDAX 600 500 2004 2005 57 2006 Sensitivities Sensitivity Change NPAT impact (A$m) A$m) US dollar oil price US$1/bbl 19 A$/US$ exchange rate