Slide 1: Half-Year Results
2016 Half-Year Results 18 August 2016
Slide 2: Forward-looking statements
Forward-looking statements This presentation may contain forward-looking statements and information that both represents management's current expectations or beliefs concerning future events and are subject to known and unknown risks and uncertainties. A number of factors could cause actual results,
Slide 3: Agenda
Agenda 2016 1H highlights Tony Durrant Operations update Robin Allan Finance Richard Rose Outlook Tony Durrant August 2016 | P2
Slide 4: 2016 1H highlights
2016 1H highlights Tony Durrant
Slide 5: 2016 1H highlights
2016 1H highlights 93% 1 84% High production efficiency 2014 2016 1H 80 kboepd 2 58 kboepd 61 kboepd Solan Step change in production E.ON 2015A 2016 1H 2016 2H 18 kboepd 3 15 kboepd Continued portfolio upgrading E.ON acquisition case 2016 2H $35/boe 4 $25/boe Cost reductions delivered 2014 cash cost
Slide 6: Operations update
Operations update Robin Allan
Slide 7: Asia – providing cash flow for the business
Asia – providing cash flow for the business Indonesia • 97% production efficiency • Strong demand (44% of GSA 1, record GSA 2 delivery) • $9/boe opex • Increase demand post 2020 – Quick payback, high return projects – Bison, Iguana, Gajah Puteri • Longer term growth opportunities Low cost, – Tuna, 3
Slide 8: UK North Sea – growth story
UK North Sea – growth story UK overview Solan (100% op) Huntington (100% op) • 88% production efficiency • Plateau production of 20-25 kboepd • Increased equity • UK drives production growth: • Opex <$10/bbl • Production exceeding budget E.ON Catcher Solan Base Catcher (50% op) • On track for first
Slide 9: Solan on-stream
Solan on-stream • First oil achieved 12 April • First tanker offload completed end July • P2 tied in; both water injector wells online • Plateau rates of 20-25 kboepd • Generating significant cash flows for the group opex of <$10/bbl (plateau rates) August 2016 | P8 Photograph courtesy of J Belver
Slide 10: Catcher – ahead of plan
Catcher – ahead of plan Drilling Subsea Burgman BP3 producer well Tay reservoir • 6 wells drilled with excellent operational • Templates, flowline bundles, midwater performance arches and gas export pipeline installed • Pre-drill predictions for reservoir • Buoy and moorings system installed quality
Slide 11: Catcher hull in Keppel's yard, Singapore
Catcher hull in Keppel’s yard, Singapore Singapore Production mboepd 20 • Hull join and infill blocks completed 15 • Blast and coat of tanks completed 10 • Welding completed 5 • First topsides module lift on track 0 for September 2024 2020 2022 2025 2016 2023 2017 2019 2021 2018 Vietnam Production m
Slide 12: Catcher topsides on track for September lifting; >90% mechanically complete
Catcher topsides on track for September lifting; >90% mechanically complete Crude Gas Gas Gas Flare Utility Stabilisation Compressor Treatment Compressor 99% 97% 95% 97% 96% 96% Power Gen 99% E-House 99% Oil Separation 95% E-House, AOS yard, Singapore August 2014 | P11
Slide 13: Catcher schedule
Catcher schedule Capex - 20% reduction in costs secured * • Plateau rates of 50 kboepd (gross) 350 Sanctioned budget 300 Actual/current forecast • $1.8bn total project cost 250 $mm 200 • Potential savings from reduced well count, 150 contingency release and FX 100 50 • On track for FPSO sail-away su
Slide 14: Tolmount – significant UK development opportunity
Tolmount – significant UK development opportunity Overview Tolmount East • Premier operated, 50% • Discovered in October 2011 – 61 metre gas column – Flowed on test at 51 mmscfd Tolmount • 2 appraisal wells in 2013 – No further appraisal required • 450 bcf of resource – Largest UK gas discovery sinc
Slide 15: Tolmount – illustrative development solution
Tolmount – illustrative development solution Timetable to sanction Indicative metrics (gross) • Concept select by year-end • 450 Bcf • Capex <$600m – Standalone, normally • Opex: c.$7/boe unmanned or subsea • Peak production : 200 mcfd tie-back to nearby • First gas 2020 facilities • Project optimis
Slide 16: Southern Gas Basin: portfolio of opportunities
Southern Gas Basin: portfolio of opportunities Ravenspurn Deep (5% carried interest) • BP/Perenco long-reach well planned for late 2016 Babbage (47% op) • Infill opportunities Artemis (100% op) • 150 Bcf discovery Minerva • 3 wells drilled • Potential tie back to Newton (50% op) Tolmount or Minerva
Slide 17: Sea Lion Phase 1 – reducing breakeven price
Sea Lion Phase 1 – reducing breakeven price • Licence extended to 2020 • FEED progressing well – Facilities capex and opex cost estimate reductions from FEED contractors’ collaboration – Logistics and drilling cost estimate reductions following extensive market engagement – $45/bbl current estimated
Slide 18: Mexico – potential for material value creation
Mexico – potential for material value creation • Sureste Basin is a prolific 4-way dip closure beneath salt stock hydrocarbon province (62 bn bbls and adjacent of proven oil) salt flank prospectivity • Awarded 2 high quality blocks in 2015 licensing round • Current carried 10% interests; option to i
Slide 19: Finance
Finance Richard Rose
Slide 20: Financial highlights 1H
Financial highlights 1H • Profitable and positive operating cash flow • Continued cost reductions • Benefit of lower $/£ exchange rate • Reduced capex commitments • Free cash flow generation from Q4 2016 • Progress with banks on debt restructuring US$16.5/boe Group operating costs in 2016 1H August
Slide 21: Cash flow in 2016 1H
Cash flow in 2016 1H 6 months 6 months to 30 June to 30 June 2016 2015 Working Interest production (kboepd) 61.0 60.4 Capital expenditure ($m) Entitlement production (kboepd) 57.0 55.7 2016 1H FY 2016E Realised oil price (US$/bbl) - post hedge 48.6 83.7 Exploration $69m $100m Realised gas price (US$
Slide 22: Profitable first half
Profitable first half 6 months to 30 June 6 months to 30 June 2016 $m 2015 $m Sales and other operating revenues 394 577 Cost of sales (355) (684) Gross profit/(loss) 39 (107) Exploration/New Business (15) (52) Reduction in decommissioning estimate 101 - General and administration costs (13) (8) Gai
Slide 23: Continued cost reduction
Continued cost reduction Falling cash cost break even Significantly lower forward committed capex ($/boe) ($mm) 40 1400 Exploration & pre-dev projects 35 Sanctioned developments 1200 Production maintenance & abex 30 1000 25 800 20 600 15 400 10 5 200 0 0 2014 2016F 2014 2015 2016 2017 2018 Operating
Slide 24: Net debt and refinancing update
Net debt and refinancing update • Net debt of $2.6 bn, flat on end Q1 position Net debt • Net debt expected to peak in Q3 2016 at $2.9 bn • Net debt/EBITDAX ratio of 5.2x at 30 June 2016 • Revised maturity profile Progress • Amended financial covenants with lending • Security group • Enhanced econom
Slide 25: Outlook
Outlook Tony Durrant
Slide 26: Outlook
Outlook +10 kboepd per annum 1 Continuing production growth 2016 2017 2018 $2.25bn 2 $1.8bn Catcher delivery Sanctioned budget Forecast >50% IRR 3 Select highest return projects 30% 20% for sanction Infills Tolmount Sea Lion $20/boe 4 $15-17/boe $10/boe Maintain competitive cost base 2016 Solan Catc
Slide 27: Premier Oil Plc contact details
August 2016 www.premier-oil.com Premier Oil Plc 23 Lower Belgrave Street London SW1W 0NR Tel: +44 (0)20 7730 1111 Fax: +44 (0)20 7730 4696 Email: premier@premier-oil.com