Beach Energy Limited · ASX:BPT
Beach Energy — Non-Deal Roadshow (July 2011)
54 slides from Beach Energy's roadshow presentation, Jul 4, 2011
Slide 1: Evolution and Revolution
Beach Energy Limited For personal use only ‘Evolution and Revolution’ Hong Kong – 4&5 July 2011 Reg Nelson Singapore – 6&7 July 2011 Beach Energy Limited, Asian Roadshow – 4-7 July 2011 Managing Director Slide 1
Slide 2: Overview
For personal use only Overview Beach Energy Limited, Asian Roadshow – 4-7 July 2011 Slide 2
Slide 3: Compliance statements – Disclaimer
Compliance statements For personal use only Disclaimer • This presentation contains forward looking statements that are subject to risk factors associated with oil, gas, geothermal and related businesses. It is believed that the expectations reflected in these statements are reasonable but they may
Slide 4: Beach Energy Limited - A unique value proposition
Beach Energy Limited - A unique value proposition For personal use only Beach Energy Limited, Asian Roadshow – 4-7 July 2011 Slide 4
Slide 5: Key catalysts for 2011
Key catalysts for 2011 For personal use only Multiple near-term catalysts with material re-rating potential Beach Energy Limited, Asian Roadshow – 4-7 July 2011 Slide 5
Slide 6: Large Resource base to build Reserves
Large Resource base to build Reserves For personal use only 2P Reserves 2P Reserves & Contingent Resources 66 MMboe* 363 MMboe* 2P Reserves are a fraction of the total resource base Cooper / Eromanga Other Cooper / Eromanga 2P Other Material resource additions likely for Cooper Basin gas activity *
Slide 7: Solid production platform
Solid production platform For personal use only Beach Operated Western Flank Oil Gross Expected Ultimate Recovery (MMbbl) • FY11 guidance of ~ 6.5 MMboe* 12 • Consistent Cooper Basin production 10 performance 8 • Short-term opportunities for production growth given: 6 – Better land access for activi
Slide 8: Positioned for growth in Eastern Australian gas markets
For personal use only Positioned for growth in Eastern Australian gas markets Beach Energy Limited, Asian Roadshow – 4-7 July 2011 Slide 8
Slide 9: Prolific acreage position
Prolific acreage position For personal use only Beach owns a strategic suite of assets and infrastructure, positioning it to supply gas for generations to come Beach Energy Limited, Asian Roadshow – 4-7 July 2011 Slide 9
Slide 10: Eastern Australian gas markets are growing
Eastern Australian gas markets are growing For personal use only • Current domestic gas demand ~ 715 PJ per annum: – ~ 100 PJ from Cooper Basin • Domestic gas demand expected to grow to ~ 1350 PJ by 2025*: – Driven by power generation – Higher demand scenarios possible • Gladstone based LNG projects
Slide 11: Excellent prospects to increase Cooper Basin supply
Excellent prospects to increase Cooper Basin supply For personal use only • Strong predicted growth in Eastern Australian gas demand • Strong predicted growth in Asian LNG demand • Excellent channels to markets • 2015+ opens up various domestic and export linked opportunities • Cooper Basin gas does
Slide 12: The impact of eastern Australian LNG projects
The impact of eastern Australian LNG projects For personal use only Australian East Coast 2P Reserves* • Two projects have achieved FID committing > 16 mtpa capacity 7.0% BG Group 2.3% 18.7% Santos / PETRONAS 4.2% / TOTAL / Kogas • BG Group has recently Origin Energy announced it is marketing for 9.
Slide 13: SACB/SWQ JV – Significant long-term resource potential
For personal use only SACB/SWQ JV – Significant long-term resource potential Beach Energy Limited, Asian Roadshow – 4-7 July 2011 Slide 13
Slide 14: SACB/SWQ JV – Its importance to Beach
SACB/SWQ JV – Its importance to Beach For personal use only • Equity interests of approximately 20% for the SACB JV and 23% for the SWQ JV • A significant land holding for these interests of approximately 22,000 km2 • Situated in a proven and prolific basin • Cooper Basin cumulative gross production
Slide 15: SACB/SWQ JV – Ultimate potential is significant
SACB/SWQ JV – Ultimate potential is significant For personal use only Source: Santos Remaining gross unrisked resource potential of over 4 billion barrels of oil equivalent Beach Energy Limited, Asian Roadshow – 4-7 July 2011 Slide 15
Slide 16: SACB/SWQ JV - GLNG Project supply opportunity
SACB/SWQ JV - GLNG Project supply opportunity For personal use only • Discussions ongoing between SACB JV and Santos for the supply of 750 PJ to Santos’ GLNG Project*: – Beach’s share of supply would be ~ 152 PJ – 15 year contract - proposed to commence in 2014 – Oil-linked gas pricing • Highlights
Slide 17: The Cooper Basin shale gas potential
For personal use only The Cooper Basin shale gas potential Beach Energy Limited, Asian Roadshow – 4-7 July 2011 Slide 17
Slide 18: A commanding Cooper Basin shale gas acreage position
A commanding Cooper Basin shale gas acreage position For personal use only • PEL-218 (Permian JV) potential shale gas in place 40-80 Tcf • Similar properties to successful US shale plays • Encounter-1 and Holdfast-1 both successful due to: – Target zones either in line or thicker than anticipated (3
Slide 19: Advantages of PEL shale acreage
Advantages of PEL 218 shale acreage For personal use only • Semi desert country • Strong relationship with one pastoral owner • Thick target zone to yield more gas in place • Fracture containment not an operational constraint • Deep shale target zone at 3,400 metres • Eromanga aquifers well above sh
Slide 20: Fracture stimulation successfully completed
Fracture stimulation successfully completed For personal use only • Holdfast-1 fracture stimulation completed in seven stages • Stages completed: – Roseneath shale (3) – Epsilon formation (2) – Murteree shale (1) – Patchawarra formation (1) Goals • Design fracture stimulation program • Understand ga
Slide 21: Comparison to US plays
Comparison to US plays For personal use only Haynesville Parameter PEL 218 Permian REM Barnett (Texas) (Louisiana) Depth (metres) 2,900 – 3,500 1,650 – 3,000 3,050 – 3,950 Shale thickness 120 – 260 75 – 150 60 – 90 (metres) Total Organic Carbon 3–5 5 4 Av% Pressure Gradient 0.72 0.55 0.85 (psi/ft) G
Slide 22: Beach has 'core' and flank Nappamerri acreage
Beach has ‘core’ and flank Nappamerri acreage For personal use only • Shale gas plays cover thousands of square kilometres * • ‘Sweet spots’ (e.g., the ‘core’ Haynesville) may exist particularly where the shale target zone is: – In the deepest parts of the acreage – Over-pressured – Thick – Gas satu
Slide 23: BG Group - Haynesville 'core' economics
BG Group - Haynesville ‘core’ economics* For personal use only • Average well recovery: 9 bcf Typical well (bcfpa) 3 • BG net wells: 275 (2011-15) • Average well cost: US$9 million 2.5 (~US$1.0/mmbtu) • Operating cost: US$1.4/mmbtu 2 • Unit technical cost: US$2.4/mmbtu • Economic breakeven: US$3.2/m
Slide 24: Goodrich - Haynesville type curve
Goodrich - Haynesville type curve* For personal use only Low (6.5 Bcfe) Base (7.5 Bcfe) High (8.5 Bcfe) IP rate (MMcf/d) 14.0 15.5 19.5 IP rate (30 day avg. MMcf/d) 10.0 11.0 15.5 Gross EUR (Bcf) 6.5 7.5 8.5 Pretax IRR 20% 30% 49% F&D ($/Mcfe) $1.87 $1.62 $1.43 Robust economics PV10 ($MM) $2.0 $3.6
Slide 25: Shale gas - Cost reduction driven by…
Shale gas - Cost reduction driven by….. Rate MMCFD: Conventional (24-28/64 “ choke) vs For personal use only ‘optimised’ (14/64” choke) Technology • Multi-stage fracture stimulation techniques • Pad drilling Techniques • Restrictive choke techniques being adopted • Choke settings reduced along with
Slide 26: Next steps and indicative timeline
Next steps and indicative timeline With successful proof of concept: For personal use only • Design pilot horizontal wells targeting highest yield zones in REM • Drill further vertical delineation wells across acreage • Expand production pilot to multiple wells • Seek to monetise early production vi
Slide 27: Dominant Western Flank oil acreage position
For personal use only Dominant Western Flank oil acreage position Beach Energy Limited, Asian Roadshow – 4-7 July 2011 Slide 27
Slide 28: Cooper Basin – Western Flank Oil
Cooper Basin – Western Flank Oil For personal use only Western Flank oil is a core contributor due to: • High net back per barrel (total opex including transport and royalty of approx. $25/barrel) • Strong equity positions • Quick drill and tie-in periods • Established infrastructure • High flow rat
Slide 29: Western Flank drilling program
Western Flank drilling program For personal use only Beach operated • Five exploration wells in PEL 91 (Beach 40%) • Eleven wells in PEL 92 (Beach 75%), five exploration and six development/appraisal wells • Success rate to date is 64% from eleven wells drilled Senex operated • Proposed ten well pro
Slide 30: Birkhead Formation Channel Sand
Birkhead Formation Channel Sand For personal use only Source – Senex, 2011 Birkhead channels can be imaged on seismic, significantly reducing risk Beach Energy Limited, Asian Roadshow – 4-7 July 2011 Slide 30
Slide 31: 'Big oil' potential, Tanzania
For personal use only ‘Big oil’ potential, Tanzania Beach Energy Limited, Asian Roadshow – 4-7 July 2011 Slide 31
Slide 32: Lake Tanganyika, Tanzania – East African Rift
Lake Tanganyika, Tanzania – East African Rift For personal use only • Beach 100% • Underexplored area with high potential • Lake Tanganyika South acreage is approximately 7,000 km2 • Potential for large (> 200 MMbbl) discoveries: – Natural oil seeps on Lake Tanganyika indicate a working petroleum sy
Slide 33: Lake Albert, Uganda – major success to date
Lake Albert, Uganda – major success to date For personal use only • Tullow identified this East African rift basin opportunity in 2001 • Lake Albert area approximately 5,300km2 • The Lake Albert rift basin is part of a string of Pliocene-Miocene age rift basins that cut through East Africa • Lake Al
Slide 34: Lake Tanganyika natural oil seeps
Lake Tanganyika natural oil seeps For personal use only Beach Energy Limited, Asian Roadshow – 4-7 July 2011 Slide 34
Slide 35: Lake Tanganyika South vs Lake Albert - Analogy
Lake Tanganyika South vs Lake Albert - Analogy Lake Tanganyika South Seismic Line – 2D Lake Albert Seismic Line – 3D For personal use only 1.5 sec - 2.0 sec - 2.5 sec - Deeper water in Lake Tanganyika Source: Beach Energy Ltd – Project Probe data Source: Tullow Oil plc – EAPCE, 2011 Beach Energy Lim
Slide 36: Lake Tanganyika North – Gazettal tender
Lake Tanganyika North – Gazettal tender For personal use only • Tanzanian government recently gazetted the Lake Tanganyika North block • Similar potential to South block based on available seismic • A competitive gazettal process with nine companies submitting tenders • Government evaluation of tend
Slide 37: Egypt – Established and growing portfolio
For personal use only Egypt – Established and growing portfolio Beach Energy Limited, Asian Roadshow – 4-7 July 2011 Slide 37
Slide 38: Egypt overview
Egypt overview For personal use only • Beach interests range 15 – 22% • An established and growing portfolio • Exposure to prolific and emerging hydrocarbon basins: – Portfolio of near-term development & exploration opportunities • North Shadwan expected to produce first oil in 2011 • Abu Sennan six
Slide 39: Abu Sennan concession
Abu Sennan concession For personal use only • Beach 22% • 3D seismic coverage over whole concession which has been the key to success for Apache in the surrounding tenements • Apache recently acquired tenements from BP adjacent to Abu Sennan • Initial six well program underway, with the potential fo
Slide 40: Gulf of Suez
Gulf of Suez For personal use only • Beach 20% interest • High potential Gulf of Suez acreage • Three existing oil discoveries: – NS 377 and 385 (‘near shore fields’) – NS 394 ‘Burtocal’ • First oil expected in 2011 • North Shadwan delays due to pipeline operator sign off on oil mix in pipeline • Pr
Slide 41: Mesaha concession
Mesaha concession For personal use only • Beach interest 15%* • One of the largest concession areas in Egypt at 57,000km2 • Wildcat basin with the right ingredients • Possible rift basin similar to Gulf of Suez/Lake Albert/Lake Tanganyika • Potential for very large oil fields (~ 100 MMbbl+) • 2D sei
Slide 42: Appendices
For personal use only Appendices Beach Energy Limited, Asian Roadshow – 4-7 July 2011 Slide 42
Slide 43: Australian pipeline growth
Australian pipeline growth Pre - 1995 Post - 1995 For personal use only • Approx 10,500 km • Approx 20,000 km • Point-to-point pipelines • Interconnected pipelines • Majority government owned • Privatisation Source: APA investor presentation, April 2010 Beach Energy Limited, Asian Roadshow – 4-7 Jul
Slide 44: The importance of REM section for shale & tight gas
The importance of REM section for shale & tight gas For personal use only • Thick target section • Gas charged • Over-pressured • Favourable mineralogy • Lacustrine play, with similar litho/geochem properties to North American marine shale plays Key attributes confirmed to date provide significant e
Slide 45: Nappamerri Trough – thick Early Permian shale sequence
Nappamerri Trough – thick Early Permian shale sequence For personal use only Shale play thickness: • Roseneath 80-200 metres • Epsilon ~100 metres • Murteree ~80 metres Over-pressured tight gas play: • Epsilon – mid and basal zones sandier • Patchawarra – multiple sands Other tight gas in section: •
Slide 46: PEL Shale - Favourable mineralogy
PEL 218 Shale - Favourable mineralogy For personal use only 100 0 Barnet Haynesville 40-60% Clay: Eagle Ford Utica Nappamerri • Similar to Barnett and Haynesville 80 20 Barnet Eagle Ford Haynesville 10-20% Carbonate: Utica Sil 60 40 • Carbonate in the form of siderite % Nappamerri ica ys +o Cla the
Slide 47: PEL Shale - Over-pressured at REM level
PEL 218 Shale - Over-pressured at REM level For personal use only Pressure (psi) Formations outside Trough 0 0 2000 4000 6000 8000 10000 • Normally pressured - hydrostatic gradient • All 0.43 psi/ft 1000 Exploration wells – in Trough Regional pressure data – over-pressures confined to • Over-pressur
Slide 48: Western Flank oil - Namur Sandstone
Western Flank oil - Namur Sandstone PARSONS-1 Namur Sandstones plays: For personal use only • Widespread high net to gross braided channel environment • Subtle structures delineated on 3D seismic data • Very high permeability • Parsons-3 clean up flow 5,200 bopd Parsons-1 Namur Beach Energy Limited,
Slide 49: Western Flank oil - Birkhead Formation Channel Sand
Western Flank oil - Birkhead Formation Channel Sand For personal use only Growler 3 Birkhead Sandstones plays: • Deposited in meandering channels • Do not necessarily rely on structural traps – can be extensive accumulations • Can be imaged on seismic data Beach Energy Limited, Asian Roadshow – 4-7
Slide 50: Tanzania – Attracting the majors
Tanzania – Attracting the majors For personal use only • Various phases of exploration undertaken since 1952 with very few exploration wells drilled • Early wells drilled with poor quality or inadequate seismic control • Tanzania has now attracted attention of the large players, eg: – Shell – Statoi
Slide 51: Rift systems - Gulf of Suez vs Lake Tanganyika
Rift systems - Gulf of Suez vs Lake Tanganyika For personal use only Gulf of Suez: Gulf of Suez Lake Tanganyika • Rift valley system • Area approximately 9,000km2 • 800+ exploration wells drilled • 9.5 billion barrels of oil discovered Lake Tanganyika • Rift valley system • Area approximately 32,900
Slide 52: Lake Tanganyika South – play types
Lake Tanganyika South – play types For personal use only • Typical rift graben/half graben geometries • Seismic indicates large structures with bounding faults • Play types are: – Stratigraphic traps – Fault traps – Three way structured traps against basement – Anticlinal traps • These are similar t
Slide 53: Lake Tanganyika South – Beach exploration program
Lake Tanganyika South – Beach exploration program For personal use only • Eleven year PSA structured into phases of 4 + 4 + 3 years • Phase 1 minimum commitment expenditure of ~ US$7 million • One exploration well required in Phase 2 & Phase 3 Phase 1 planned exploration • Seismic reprocessing of pr
Slide 54: Contact information
Contact information Beach Energy Limited – Head office For personal use only 25 Conyngham Street Glenside SA 5065 Tel: +61 8 8338 2833 Fax: +61 8 8338 2336 Website: www.beachenergy.com.au Chris Jamieson Investor Relations Manager Tel: +61 8 8338 2833 Mob: +61 8 (0)487 173 244 Email: chris.jamieson@b