Karoon Energy Ltd · ASX:KAR
Karoon Energy — Investor Presentation (March 2022)
27 slides from Karoon Energy's investor presentation, Mar 10, 2022
Slide 1: ASX cover letter - Investor Presentation
For personal use only 10 March 2022 Company Announcements Office ASX Limited Dear Sir / Madam Investor Presentation Enclosed is a presentation to be made by the CEO and Managing Director tomorrow. This announcement was authorised by the CEO and Managing Director. Yours faithfully Nick Kennedy Compan
Slide 2: Karoon Energy Ltd - ASX listed pure oil play
For personal use only Karoon Energy Ltd ASX listed pure oil play with high quality producing asset in Brazil March 2022
Slide 3: Disclaimer / Definitions
Disclaimer / Definitions For personal use only Disclaimer This presentation has been prepared by Karoon Energy Ltd. The information contained in this presentation is for information purposes only and does not constitute an offer to issue, or arrange to issue, securities or other financial products.
Slide 4: Overview of Karoon Energy
Overview of Karoon Energy Focus on oil in Santos Basin, Brazil For personal use only Oil producer with exposure to exciting Brazilian oil industry ▪ One of the few companies with pure oil exposure listed on the ASX ▪ Brazil focused, 100% owner/operator of a high-quality asset Building reputation as
Slide 5: Production rates targeted to double by early CY2023
Production rates targeted to double by early CY2023 Supported by robust balance sheet, liquidity For personal use only Cash at 31 Dec 2021 Liquidity at 31 Dec 2021 US$204 million US$334 million, plus potential US$50 million accordion facility * Production profile and cost outlook in FY2022 and FY202
Slide 6: Strong, independent Board
Strong, independent Board For personal use only Diversified skill-base, focus on governance and performance Independent, Non-executive Directors Bruce Phillips Peter Turnbull Clark Davey Luciana Rachid Peter Botten Chairman Managing Director Julian Fowles 5
Slide 7: Refreshed management team
Refreshed management team For personal use only Deep industry experience, capabilities and networks Julian Fowles Ray Church Antonio Guimarães Managing Director Executive Vice Executive Vice President and CEO President and CFO and President Brazil (appointed Nov 2020) (appointed Aug 2021) (appointed
Slide 8: 1H FY2022 – Key Highlights
1H FY2022 – Key Highlights Excellent performance from Baúna as Karoon completes its first year as an oil producer For personal use only Safe and Reliable Operating Strong Financials Growth Projects Advancing Sustainable Business Performance ▪ Underlying NPAT1,2: US$21.1m ▪ Completion of LP flare and
Slide 9: HSSE performance
HSSE performance Safe and reliable operations core priority for Karoon For personal use only ▪ One LTI in November 2021 (slip in FPSO galley). Slips and trips education program Six months to Dec 2021 Actual Target underway throughout Karoon ▪ No material environmental incidents TRIR 0.47 <2.0 ▪ Stri
Slide 10: Karoon's key strategic objectives
Karoon’s key strategic objectives Deliver safe and reliable operations and sanctioned projects to create foundation for growth For personal use only Delivering our Transformation Baúna FPSO, Cidade de Itajai Safely execute Baúna base business ▪ Deliver targeted production, safely and reliably ▪ Buil
Slide 11: Enablers to deliver strategy
Enablers to deliver strategy Deliver operations and sanctioned projects to create foundation for growth For personal use only Maersk Developer drill rig Delivering our Transformation Organisation and capabilities ▪ Management and Board revitalised ▪ New systems and processes ▪ Subsurface focus pivot
Slide 12: Strong production performance from Baúna field
Strong production performance from Baúna field High facilities availability and active well management For personal use only Delivering high operational uptime through focus on process safety, facility integrity and preventive maintenance ▪ Achieved outstanding operational uptime of 99% in 1HFY22, w
Slide 13: Baúna interventions and Patola development on track
Baúna interventions and Patola development on track Targeting increase in production to >30,000 bopd in early CY2023 For personal use only Baúna well intervention project Patola Development ▪ Targeting 5,000 – 10,000 bopd incremental production from four ▪ Drilling of two new development wells sched
Slide 14: Indicative production and cost profile
Indicative production and cost profile* Sanctioned projects targeting material production increase and opex/bbl reduction For personal use only Indicative production profile (MMbbl)* Indicative unit operating cost outlook (US$/bbl)* 8 - 10 28 - 30 25 12 - 18 4.4 – 4.6 3.14 FY21A FY22 FY23 FY21A FY22
Slide 15: Optimising Neon development concept
Optimising Neon development concept Alternative development concepts being explored, to maximise value For personal use only • Neon and Goiá light oil discoveries located 50 - 60km NE of Baúna in ~300m water depth • Work ongoing to update preliminary field development planning and re-evaluate commer
Slide 16: Assessing inorganic growth options
Assessing inorganic growth options Disciplined process underway to identify and pursue value-accretive growth opportunities For personal use only ▪ Karoon continuing to actively screen inorganic growth opportunities ▪ Well placed to take advantage of ongoing M&A in Brazil ▪ Competing against relativ
Slide 17: 1HFY22 underlying financial results
1HFY22 underlying financial results For personal use only US$ million 1H22 1H21 1H22 1H21 Revenue 186.5 23.8 Production (MMbbl) 2.5 0.82 Production Costs (incl FPSO depn & fin) (58.8) (18.1) Sales Volume (MMbbl) 2.57 0.5 Royalties (19.1) (3.9) Realised Oil Price (US$/bbl) 72.43 47.31 O&G Assets DD&A
Slide 18: Reconciliation of Underlying NPAT to Statutory Result
Reconciliation of Underlying NPAT1 to Statutory Result For personal use only Six months to December 2021 2020 Material increase recognised in fair value of contingent consideration payable to Petrobras for Baúna asset US$ million US$ million (US$183.8m pre-tax, US$121.3m after tax) due to higher f
Slide 19: Balance sheet profile and available liquidity
Balance sheet profile and available liquidity For personal use only Balance Sheet Highlights Facility Amount (US$ million) Cash and cash equivalents US$204m (30 June 2021: US$133m) 250 Non-cash working capital broadly stable. US$3.7m movement from (US$79.7m) 30 June to (US$76m) 31 Dec, predomina
Slide 20: Priority uses of capital
Priority uses of capital For personal use only Deliver safe and reliable operations ▪ Deliver production from on-going operations ▪ Investment in long term maintenance to maximise life of facilities Build and maintain strong, flexible ▪ Meet debt obligations and covenants Order of Priority balance s
Slide 21: FY2022 guidance
FY2022 guidance1 Production guidance narrowed towards upper end of range, unit opex reduced For personal use only Low High Strong 1HFY22 production due to high facilities uptime has narrowed production guidance towards Production (MMbbl) 4.4 4.6 high end of prior range Costs Baúna production exp
Slide 22: Karoon's five pillars of sustainability
Karoon’s five pillars of sustainability Underpinned by oversight from Board Sustainability and Operational Risk Committee For personal use only ▪ Safety is our first priority HSE ▪ Working closely with FPSO operator to improve already strong safety record ▪ Carbon management core focus of Karoon’s s
Slide 23: Carbon Management Action Plan to achieve emissions targets
Carbon Management Action Plan to achieve emissions targets Targeting carbon neutral for Baúna/Patola from FY2021, Net Zero by 20351 For personal use only Priority 1 Priority 2 Priority 3 Avoid and Reduce Assess direct Purchase additional offsets if needed First priority is to avoid or reduce and ind
Slide 24: Summary: Karoon well positioned to deliver shareholder value
Summary: Karoon well positioned to deliver shareholder value Safe, reliable oil producer with clear sustainable growth path For personal use only • Pure oil producer, benefiting from current strength in oil prices • Building reputation as safe and reliable operator • Successfully mitigated decline c
Slide 25: Appendix 1: Brazil's oil and gas industry
Appendix 1: Brazil’s oil and gas industry Prospectivity and favourable fiscal terms make Brazil attractive place to invest For personal use only ▪ Oil and gas industry well established with stable regulator and long tradition of respecting contracts already in place ▪ Favourable tax-royalty contract
Slide 26: Appendix: Impact of AASB 'Leases'
Appendix 2 For personal use only Impact of AASB 16 ‘Leases’ The Baúna FPSO charter contract lease has been accounted for in accordance with AASB 16 ‘Leases’. The following amounts have been reflected in the 1H FY2022 results: Six months to 31 December 2021 US$ million Profit and Loss Cost of sales –
Slide 27: For personal use only
For personal use only