Emerald Resources Nl · ASX:EMR
Emerald Resources Nl — Emerald Oil & Gas NL — Investor Presentation (March 2010)
37 slides from Emerald Resources Nl's investor presentation, Mar 26, 2010
Slide 1: Company Summary and Business Plans
For personal use only Emerald Oil & Gas NL Company Summary and Business Plans March 2010
Slide 2: Disclaimer
For personal use only Disclaimer This presentation contains forward looking statements that are subject to risk factors associated with the oil and gas industry. It is believed that the expectation reflected in the statements are reasonable but they may be affected by a variety of variables and chan
Slide 3: Company Overview
Company Overview For personal use only • Perth based oil & gas exploration and production company, • Listed on ASX in June 2006 • Oil & Gas production and low risk exploration in USA, high potential exploration in Browse Basin, Western Australia • 115 5 million shares on issue 115.5 • 7.7 million un
Slide 4: Purpose
Purpose For personal use only 1. To outline Emerald’s new strategy and business plans to shareholders and investors 2. To describe key opportunities and activities in 2010/2011 3 T 3. To indicate i di t the th potential t ti l value l ffrom successfully f ll implementing i l ti the Company’s busines
Slide 5: Key Messages
Key Messages For personal use only • Emerald is poised for rapid value growth in 2010 through directional change in business strategy • Balanced project portfolio: – material interests in all key projects (31.5% to 100%) – ability to control or drive activities in all key projects – weighted toward
Slide 6: Emerald's Business Strategy
For personal use only E Emerald’s ld’ BBusiness i St Strategy t
Slide 7: Emerald's Vision
For personal use only Emerald’s Vision Create a substantial oil and gas business from several US oil and gas projects focused on delivering g cash flow and incrementally y building g company value over next 2-3 years and selectively divesting assets as opportunities present, to re- position into lar
Slide 8: Emerald's Previous Strategy (2006-2008)
Emerald’s Previous Strategy gy ((2006-2008)) For personal use only US Business environment then: • High gas/oil price environment • High prices for reserves in ground • Resource plays emerging to meet high gas prices (e.g. shale gas) • Many US investors seeking to invest in drilling projects Busines
Slide 9: Strategic Direction Change – New (2009+)
Strategic g Direction Change g – New ((2009+)) For personal use only US Business environment now: • low gas prices, strong oil prices • Heavily discounted prices for reserves in ground • Resource plays dominating US oil and gas drilling • Drilling investment money tight and activity levels low Busin
Slide 10: Emerald Oil and Gas Growth Strategy & Options
Natural Extension Different Current Business Game — Emerald Oil and Gas Growth Strategy & Options - 2010 Establish Substantial Operating Cash Surplus t - KEP IMMEDIATE PRIORITY 9 - NOXXE (sustainability) re 0 2010-2012 Create Step growth e - NW Alice (SO%WI with OSO, 100% WI acreage) Fa - NOXXE (att
Slide 11: Emerald's Strategic Imperatives
Emerald’s Strategic g Imperatives p For personal use only 1. Establish surplus operating cash flow – top priority in 2010 Appalachian Gas - KEP gas projects and P&J 8 well program NOXXE – current oil production & existing well workover program 2. Deliver step change Company value growth – 2010/2011
Slide 12: Emerald's Business Plans
For personal use only E Emerald’s ld’ BBusiness i Pl Plans
Slide 13: Emerald Portfolio - Strategic Fit
Emerald Portfolio - Strategic g Fit For personal use only R1, EP104, West Kora PL (12.75% WI) P & J JV (80% WI) - 500 km² permits - 8 wells Ky - Stokes Bay well - West Kora oil Canning Appalachian - 50% Amine Plant Basin Gas Projects KEP LLC (75% equity) TP24, EP463 - 16 wells WA-419-P (100% WI) - 1
Slide 14: Short Term Business Plans 2010 & 2011
For personal use only Sh t Term Short T Business B i Plans Pl 2010 & 2011 1. Generate Operating Cash Surplus 1 2. Initiate step change company value growth
Slide 15: Emerald 'Indicative' Projects Schedule to June 2011
Emerald ‘Indicative’ Projects j Schedule to June 2011 For personal use only 2010 2011 Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Appalachian Gas Target 1 MMcfd by J June 2010 8 well recompl P + J (80% WI) New KEP Project C New KEP Project A 22 Mile KEP (75% equity) LL Arnett New
Slide 16: Indicative Emerald Cashflow Metrics
Indicative Emerald Cashflow Metrics For personal use only EMR Net Revenue from 1 year of production: Appalachian Gas @1MMcfd $A1,070,000 NW Alice Gas @1MMcfd * $A1,031,000 NOXXE @100bopd $A517,000 Price Assumptions: Note: These are not a production forecasts. Gas Price $US4.00 per 1000 BTU The above
Slide 17: Emerald Oil and Gas NL Business Plan Summary
Emerald Oil and Gas NL Business Plan Summary For personal use only 1. Build production and cashflow from US - existing wells & infrastructure,, low risk – Appalachian gas production – NOXXE oil production 2. Initiate step growth projects in Texas (NW Alice, NOXXE) – Acquire additional lease acres &
Slide 18: Onshore Gulf Coast - Texas
For personal use only Onshore Gulf Coast - Texas ( t change (step h company growth) th) 1. NW Alice – gas appraisal & production drilling 1 2. NOXXE NOXXE –- existing oil production & gas exploration oil production and drilling NW Alice – g gas/condensate drilling g
Slide 19: NOXXE
NOXXE For personal use only 31.5% EMR equity option in NOXXE LLC • MOU for option to acquire EMR 31.5% foundation equity interest in NOXXE LLC f $US1MM ($US750K cash for h&66.4 4 million illi ShShares @ 4 4.29 29 cents/share) t / h ) • Expect EMR participation to be finalised approx end March 2010 •
Slide 20: NOXXE Activity plans 2010/2011
NOXXE Activity plans 2010/2011 For personal use only Phase 1 – Re-work and recomplete existing wells (2010) • Program currently underway with wells identified for re-work in all fields: o Humble - 6 oil wells o Dickinson -1 oil well o North Dyersdale - 2 oil wells, 1 gas well • Remaining wells to be
Slide 21: NW Alice Project Location
NW ALICE PROJECT LOCATION
Slide 22: NW Alice Project
NW Alice ce Project oject For personal use only (Noble Energy (op) 60% OSO Exploration 26% EMR 14%) • RJ Hunter H t #1 discovery di wellll d drilled ill d M March h 2007 50+ feet of Gas/Condensate pay in Yegua Sands, • Casing collapse on perforation prevented flow testing. • 3-D seismic survey acqui
Slide 23: NW Alice – Concurrent Projects
NW Alice – 2 Concurrent Projects For personal use only 1. Increase EMR WI in AMI area interests & drill with OSO – OSO et al 50%, EMR 50% – Drill targets identified by Noble from 3D seismic – First well Q2 2010 2. Build 100% EMR lease position, farmout & drill – Continue to build contiguous acreage
Slide 24: Appalachian Gas Projects
For personal use only Appalachian ppa ac a Gas Projects ojects (Production & Cash flow) 1. P&J 8 Well Program 1 2. KEP gas and oil projects
Slide 25: Appalachian Basin, USA
For personal use only Appalachian Basin Basin, USA • Oldest producing basin in U.S. • Conventional and shale gas with multiple targets in every well • Gas price premium due to high BTU content and proximity to biggest US gas markets (low transport fees) • Large Devonian shale gas plays (Marcellus, O
Slide 26: Appalachian Gas Project Location
APPALACHIAN GAS PROJECT LOCATION WEST VIRGINIA
Slide 27: Appalachian Gas Business Summary
Appalachian Gas Business Summary For personal use only History • Original 2008 entry strategy based on high US gas prices ($US10+/Mcf) and reserves drilling (2 wells drilled in WV) • Gas prices declined sharply in 2009 (<$US3/Mcf at lowest point) • Slow progress due to extreme weather & P&J operator
Slide 28: Appalachian Gas Projects (75% to 80% EMR Interest)
Appalachian Gas Projects (75% to 80% EMR Interest) For personal use only Strategic objectives • Build production & deliver operating cash surplus C Currentt St Status t • P&J 8 well rework program progressing slowly (Operator issues) • Kentucky Energy Partners LLC – 1 gas projects producing producin
Slide 29: Typical KEP well set up
For personal use only Typical KEP well set up Gas sales line connection Extreme weather made operations difficult in 2009
Slide 30: Kentucky Energy Partners LLC
Kentucky Energy Partners LLC For personal use only Commercial Terms • LLC company formed with capable local field operator/engineering consultant lt t to t identify, id tif acquirei anddd develop l areas with ith hi high h productivity gas wells • Emerald provides 100% capital investment for 75% com
Slide 31: Canning Basin (WA)
For personal use only Canning Basin (WA) Potential Commercial Gas Discovery – Stokes Bay #1 High g Potential Exploration p (oil, gas, CO2 geosequestration for LNG)
Slide 32: Canning Basin Interests and Work Commitments
EMERALD OIL AND GAS CANNING BASIN INTERESTS AND WORK COMMITMENTS =u WA-415-P Reprocess 1500kms 2D 475kms new seismic 2D = $3.2million Secondary 400kms seismic 2D co aquisition is" T nwWen Lacapedei- 4 Lead WA-416-P WA-417-P Reprocess 700kms 2D Reprocess 700kms 2D 55kms new seismic 2D 175kms new seis
Slide 33: EMR Canning Basin Interests
For personal use only EMR Canning Basin Interests Exploration Permit / Retention Emerald Permit Size Licence / Applications Working (approx sq km) Interest EP104/R1 (Stokes Bay #1) 12.75% 290 L98-1 (West Kora) 12.75% 200 TP 24 100% 200 EP 463 100% 400 WA -419-P 100% 8,000 Total 9,090
Slide 34: Canning Basin - Stokes Bay #1 Gas Discovery
Canning Basin - Stokes Bay #1 Gas Discovery For personal use only • Location: Retention Lease R1, Canning Basin, WA • Operator: p Buru Energy gy • Well Objectives: Anderson sands, Nullara Carbonates • Emerald interest: 12.75% WI, 10% Government Royalties Stokes Bay 1 – Potential Gas Discovery – Dril
Slide 35: Glossary
Glossary For personal use only $A Australian dollars $AK thousand Australian dollars $AMM million Australian dollars $US US dollars $USK th thousand d US dollars d ll $USMM million US dollars 3D 3D seismic ac acres bbl barrels Bcf billion cubic feet boe barrels of oil equivalent (based on energy equ
Slide 36: Competent Person Statements
Competent Person Statements For personal use only 1. NOXXE reserves mentioned in this communication are summarised from Pearl Petroleum Engineering Consulting Services reports dated November and December 2008. These reports were prepared for DayStar Oil & Gas Corp by Nguyen B. Ngoc (B.S. and M.S. Pe
Slide 37: Contacts
For personal use only Contacts • Office Address: Suite 2, 12 Parliament Place West Perth WA 6005 • Phone: (+61 8) 9482 0510 • Fax: (+61 8) 9482 0505 • Web: www.emeraldoilandgas.com • Email: E il Mike Krzus – Managing Director mkrzus@emeraldoilandgas.com
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