Harbour Energy Plc · LSE:HBR
Harbour Energy — Premier Oil — Merger or Acquisition (November 2020)
29 slides from Harbour Energy's merger presentation, November 2020
Slide 1: Investor Presentation
2020 Investor Presentation November 2020
Slide 2: Important notice
Contents Important notice IMPORTANT NOTICE: THIS PRESENTATION AND ITS CONTENTS ARE CONFIDENTIAL AND ARE BEING SUPPLIED TO YOU FOR YOUR INFORMATION ONLY AND ARE NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY TO ANY OTHER PERSON OR IN OR INTO OR FROM THE UNIT
Slide 3: Important notice
Contents Important notice Any securities referred to herein have not been, and will not be, registered under the Securities Act, and may not be offered or sold in the United States absent registration under the Securities Act except to qualified institutional buyers (“QIBS”) as defined in Rule 144A
Slide 4: Executive summary
Highlights Executive summary Proposed merger with Chrysaor, announced October 2020 Premier to acquire Chrysaor through reverse takeover Creates the largest UK listed independent oil and gas company with a strong balance sheet and significant international growth opportunities – Will join the ran
Slide 5: Transaction overview and key terms
Highlights Transaction overview and key terms Proposed merger of Premier and Chrysaor Pro forma ownership structure Premier to acquire Chrysaor through a reverse takeover PMO s/holders 5.5% Premier’s London listing retained Existing PMO Creditors Completion anticipated during Q1 2021 10.6% – C
Slide 6: Compelling strategic logic
Highlights Compelling strategic logic Creates the UK’s largest-listed independent E&P company – Combined production of 254 kboepd (>90% UK) in 2020 1H – Significant international, growth opportunities – Upper tier of FTSE250 Creates a diversified UK business of scale with significant operated po
Slide 7: Combined Group – key operational metrics
Highlights Combined Group – key operational metrics Diversified asset base with global footprint Opex/bbl - Peers Benchmarking1 2020 1H High degree of operating control enables Peer G opportunity to pursue efficiencies and drive Peer F Norwegian Peers investment decisions Peer E UK-Listed Indepe
Slide 8: Global portfolio with leading UK position
Highlights Global portfolio with leading UK position 2P Reserves as at YE2019 2C Resources as at YE2019 Vietnam Norway 3% Indonesia 2% Indonesia Vietnam UK 10% 4% 1% 93% Mexico 12% Falkland 717 927 Islands mmboe mmboe 43% UK 33% Norway UK Mexico Key Asset: Zama Vietnam Key Asset: Chim Sao Brazil Ind
Slide 9: Financing and combined capital structure
Highlights Financing and combined capital structure Simplified capital structure and strong balance sheet Leverage ratio as at 30 June 2020 Net debt/EBITDAX (ex. LCs) Significantly lower cost of debt Financial flexibility and capital allocation optionality to fund further growth 2.7 Position
Slide 10: Creating a new, independent O&G Company
Highlights Creating a new, independent O&G Company Post- UK-listed International Peers Norwegian Peers North American Peers Transaction 500 2020 1H Production 400 (kboepd) 300 200 100 0 Peer A Peer B Peer C Peer D Peer E Peer F Peer G Peer H Peer I Peer J Combined Company 1000 2P Reserves at YE’19 8
Slide 11: Premier: Production and operations overview
Production Premier: Production and operations overview UK North Sea Group production SE Asia UK 10 months to 30 October 2020 kboepd (net) 2020 1H: 62.5 kboepd Summer maintenance 50 programmes safely completed Successful well interventions and infill drilling campaigns 0 2019 2020 ytd 2020 exit
Slide 12: Catcher at oil plateau rates
Production Catcher at oil plateau rates Satellite 4D 4x infill Gas 2020 ytd fields seismic wells injection 26.5 kboepd, constrained in Q3 while build up of Calcium Naphthenate removed C. $2/bbl premium to Brent Low field opex Varadero well drilled Trial gas re-injection project; positive r
Slide 13: Solan P3: near-term production growth
Production Solan P3: near-term production growth Successful horizontal well on-stream on 15 September – 2,340 feet of net sand encountered vs 2,150 feet forecast – Positive signs of connectivity to water injector pressure support – Reservoir properties at higher end of expectations Free-flowed a
Slide 14: South East Asia
Production South East Asia Natuna Sea Block A: Premier operated, 28.67% interest 2020 ytd: 12.2 kboepd (net) Production kboepd (net) Continued field life to 2028 55.8% GSA1 market share 16 46% of 2020 2H production hedged at c.$8/mscf 12 Low operating costs of <$8/boe 8 Incremental investm
Slide 15: Growth projects with material upside potential
Development Growth projects with material upside potential Large, operated equity stakes in high quality projects, providing growth optionality Participation optimised via farm downs Ability to flex and control capex as operator Significant value in development portfolio Producing Tolmount T
Slide 16: Tolmount Main, UK: a robust project
Development Tolmount Main, UK: a robust project Partnership with Kellas Tariff structure Low Carbon by Design Dana and HGSL will pay kboepd (net) for the platform, pipeline Carbon Neutral by Commitment and terminal upgrades Tolmount gas will use the facilities in return for a Premier 50% opera
Slide 17: Zama, Mexico: a world-class asset
Development Zama, Mexico: a world-class asset A world-class development asset 810 mmboe (P50, gross), shallow water Light 28° API, large, high quality reservoir Planned plateau 150 kbopd (gross) Unit capex <$5/bbl Low GHG intensity: <8 kgCO2e/bbl (plateau) Robust PSC driven economics at
Slide 18: Significant value to be realised from exploration
Exploration Significant value to be realised from exploration Focused portfolio targeting emerging plays and discontinuities in proven hydrocarbon basins Significant position in the Andaman North Sumatran Basin; >12 TCF of amplitude supported gas identified High value, infrastructure-led explo
Slide 19: Combined group – investment highlights
Summary Combined group – investment highlights A UK-listed E&P joining the US & European peer group of super independents UK largest oil & gas producer with material operated position Diversified and low-cost asset base with an attractive global footprint Strong balance sheet with stable and low cos
Slide 20: Highly experienced executive team with deep sector knowledge
Appendix Highly experienced executive team with deep sector knowledge The new company will be led by Linda Cook (currently CEO of Harbour Energy) as CEO, and Phil Kirk (current CEO of Chrysaor) as President. Both Linda Cook and Phil Kirk will also serve on the Board as Executive Directors Ms. Cook
Slide 21: The evolution of Chrysaor
Appendix The evolution of Chrysaor The Shell & ConocoPhillips North Sea asset acquisitions are the foundation of Chrysaor’s current asset base July 2014 November 2017 September 2019 2020 Shell UK ConoccoPhillips UK North Sea North Sea Harbour Energy Founded Chrysaor’s Shell Acquisition ConocoPhillip
Slide 22: Summary of financial and operational KPIs
Appendix Summary of financial and operational KPIs H1 2020 Unaudited KPIs Premier Oil Chrysaor Combined Company1 Production (kboepd) 67 187 254 Operational 2P Reserves (mmboe) 175 542 717 Year End 2019 Revenue ($mm) 531 1,230 1,761 EBITDAX ($mm) 352 920 1,272 Financial Opex/boe ($/boe) 11.4 10.2 10.
Slide 23: Cost control, expenditure minimised
Appendix Cost control, expenditure minimised Ability to flex expenditure to ensure free cash flow positive through the cycle Maintained tight control of opex and 2020 Field opex $/boe continued cost discipline Budget Forecast 15 COP brought forward from loss making fields 10 Ability to flex an
Slide 24: Tuna, Indonesia: significant resource potential
Appendix Tuna, Indonesia: significant resource potential Premier 50 per cent1 interest, operator Premier discovered Tuna in 2014 104 mmboe gross 2C resource, as per RISC CPR IRR Farm down to Zarubezhneft subject to govt approval 28% 2021 two appraisal wells (Premier carried) WHP tied bac
Slide 25: Sea Lion Ph.1, Falkland Islands: a basin opening project
Appendix Sea Lion Ph.1, Falkland Islands: a basin opening project North Sea operating environment Conventional new build FPSO/subsea development FEED completed – Substantially de-risked – Best available technology Tier 1 supply chain secured via LOIs prior to downturn – Vendor funding agreed
Slide 26: Andaman, Indonesia: LNG scale gas resource
Appendix Andaman, Indonesia: LNG scale gas resource Andaman II (Premier 40%, op) 2014 Partners: Mubadala 30%, BP 30% Acquired operatorship of Andaman II JSA Prospective resource: >6 TCF + 200 mmbbls condensate 2018 Two main prospective areas: Awarded Andaman II Timpan and Sangar clusters (2017
Slide 27: Mexico: new 3D seismic data confirms prospectivity
Appendix Mexico: new 3D seismic data confirms prospectivity Block 30, Mexico: new 3D seismic data validates Wahoo potential Premier 30%, WDEA (op. ) Wahoo Prospect P50-P10 gross resource Water depth of 35-150m 77-116 mmbbls New 3D data confirms Wahoo as a low risk prospect with a flat-spot S
Slide 28: Block 717, Brazil: high impact, drill ready prospects
Appendix Block 717, Brazil: high impact, drill ready prospects Acreage secured via Brazil’s 11th Round Premier operated, 50 per cent Well deferred from July 2020 to Berimbau Q1 2022 600m water depth 2 intervals targeted testing Maraca stacked plays within the Upper and Lower Cretaceous B
Slide 29: November 2020
November 2020 www.premier-oil.com Premier Oil Plc 23 Lower Belgrave Street London SW1W 0NR T: +44 (0)20 7730 1111 E: premier@premier-oil.com