Bhp Group Ltd · ASX:BHP
Bhp — RIO Tinto — Merger or Acquisition (May 2008)
86 slides from Bhp's merger presentation, May 7, 2008
Slide 1: Petroleum CSG Briefing
Petroleum CSG Briefing Marius Kloppers, Chief Executive Officer J Michael Yeager, Chief Executive Petroleum 7 May 2008
Slide 2: Disclaimer
Disclaimer This document has been prepared by BHP Billiton Limited and BHP Billiton Plc (“BHP Billiton”) and comprises the written materials/slides for a presentation concerning BHP Billiton’s offers for Rio Tinto Limited and Rio Tinto plc (“Rio Tinto”). By reviewing/attending this presentation you
Slide 3: Disclaimer (continued)
Disclaimer (continued) Cautionary Note to US Investors – The SEC permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing
Slide 4: Today's agenda
Today’s agenda Strong Fit in BHP Billiton’s Asset Portfolio How we run BHP Billiton Petroleum Driving Base Performance Executing Growth Projects Capturing Additional Opportunities Delivering Results Concluding Remarks
Slide 5: Today's agenda
Today’s agenda Strong Fit in BHP Billiton’s Asset Portfolio How we run BHP Billiton Petroleum Driving Base Performance Executing Growth Projects Capturing Additional Opportunities Delivering Results Concluding Remarks
Slide 6: Strong fit in BHP Billiton's asset portfolio
Strong fit in BHP Billiton’s asset portfolio BHP Billiton knows this business as well as any of its minerals businesses Oil is a natural resource commodity with real attractions Petroleum in BHP Billiton – a symbiotic relationship Petroleum is a high quality upstream business, ideally positioned to
Slide 7: Petroleum has been a key business for a long time
Petroleum has been a key business for a long time Petroleum EBIT contribution to BHP Billiton (US$ ‘000) 3,500 3,000 2,500 2,000 1,500 1,000 500 0 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Source: BHP Billiton 2008. Notes: Resu
Slide 8: In many aspects, upstream Petroleum is little different to mining
In many aspects, upstream Petroleum is little different to mining Strategic focus Upstream, long-life, low-cost, expandable, export-oriented assets diversified by commodity, geography and market High quality assets where investment returns are commensurate with risk Core activities Safety, environme
Slide 9: Board and executive skills complementary and strong
Board and executive skills complementary and strong BHP Billiton Board Paul Anderson Over 20 years experience in US based natural gas and gas infrastructure companies John Buchanan A long career with BP, culminating with 6 years as an Executive Director and Group CFO David Jenkins A long career with
Slide 10: Long-life core assets, consistent with BHP Billiton strategy
Long-life core assets, consistent with BHP Billiton strategy BHP Billiton attributable production Annual production (mmboe) 120 100 80 60 40 20 0 1969 1971 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 History Projected NWS Ba
Slide 11: Strong fit in BHP Billiton's asset portfolio
Strong fit in BHP Billiton’s asset portfolio BHP Billiton knows this business as well as any of its minerals businesses Oil is a natural resource commodity with real attractions Petroleum in BHP Billiton – a symbiotic relationship Petroleum is a high quality upstream business, ideally positioned to
Slide 12: Strong long-term global growth in energy demand
Strong long-term global growth in energy demand Energy demand growth (CAGR) (mmtoe) 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 Renewables Hydro Nuclear Coal Gas Oil +1.4% +2.4% +1.6% 2000 2010 2020 2030 Source : IEA World Energy Outlook
Slide 13: But energy consumption growth is substantially a China story
But energy consumption growth is substantially a China story Global primary energy consumption 2000 - 2007 (mmtoe) 3,500 3,000 2,500 2,000 1,500 1,000 500 0 2000 2001 2002 2003 2004 2005 2006 Growth in consumption 2000 - 2007 (mmtoe) Rest of Asia Pacific India China Africa Middle East Europe & Eures
Slide 14: As is oil consumption growth
As is oil consumption growth Global oil consumption 2000 - 2007 (kbpd) 30,000 25,000 20,000 15,000 10,000 5,000 0 2000 2001 2002 2003 2004 2005 2006 Growth in consumption 2000 - 2007 (kbpd) Rest of Asia Pacific India China Africa Middle East Europe & Euresia S & Central America North America 5.4% 36
Slide 15: By 2006, spare oil production capacity virtually eliminated
By 2006, spare oil production capacity virtually eliminated Global oil production and capacity (mmbpd) 90 80 70 60 50 40 30 20 10 0 Global capacity Global production 1966 1971 1976 1981 1986 1991 1996 2001 2006 Source: International Energy Agency (IEA), DOE, Goldman Sachs Commodities Research.
Slide 16: Rapid escalation in investment, but driving costs rather than capacity
Rapid escalation in investment, but driving costs rather than capacity IOC Capital Investment Upstream Worldwide US$bn 450 400 350 300 250 200 150 100 50 0 $160 $170 $217 $276 $401 2002 2003 2004 2005 2006 Source: JS Herold Upstream Cost Inflation Cost Index (year 1999 = 100) 180 160 140 120 100 80
Slide 17: Oil price fundamentals strong – fuelled by higher costs
Oil price fundamentals strong – fuelled by higher costs Marginal costs and long dated oil prices (US$/bbl) 100 90 80 70 60 50 40 30 20 10 0 Oil price Marginal cost 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Source: Nymex and Goldman Sachs Equity Researc
Slide 18: What price oil?
What price oil? EIA Long term price forecasts (US$/b) 120 100 80 60 40 20 0 2008 High Reference Low 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 Source: Bloomberg, Global Insight.
Slide 19: Capital strength and technical capability combine to deliver value growth
Capital strength and technical capability combine to deliver value growth through discovery Finding and development costs (three year average) (US$/boe) Capital strength Strong cash flow Strong balance sheet Risk management Global portfolio view Long-term view 45 40 35 30 25 20 15 10 5 0 FY05 FY06 F
Slide 20: Size and investment performance have a strong link in the oil and gas sector
Size and investment performance have a strong link in the oil and gas sector Oil and gas sector weighted average return on capital employed 2005 - 2007 (% Weighted average ROCE) 25 20 15 10 5 0 Super majors Large O&G Independents Small independents Source: JS Herold
Slide 21: Strong fit in BHP Billiton's asset portfolio
Strong fit in BHP Billiton’s asset portfolio BHP Billiton knows this business as well as any of its minerals businesses Oil is a natural resource commodity with real attractions Petroleum in BHP Billiton – a symbiotic relationship Petroleum is a high quality upstream business, ideally positioned to
Slide 22: An E&P player with the power and reach of a super-major
An E&P player with the power and reach of a super-major Market capitalisation (US$ bn April 2007) Exxon Mobil Royal Dutch BHP Billiton BP Total Chevron ENI Conocophillips Statoilhydro BG Group Occidental Encana Imperial Oil Devon Energy Suncor Energy Repsol YPF Apache Canada Natural Woodside Husky E
Slide 23: Petroleum stands alone for consistent returns
Petroleum stands alone for consistent returns EBIT Margin(a) (%) 70 60 50 40 30 20 10 0 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 FY 2002 FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 Notes: a) FY2005, FY2006 and FY2007 are shown on the basis of Underlying EBIT. Prior periods are calculated under UKGAAP. All pe
Slide 24: Strong fit in BHP Billiton's asset portfolio
Strong fit in BHP Billiton’s asset portfolio BHP Billiton knows this business as well as any of its minerals businesses Oil is a natural resource commodity with real attractions Petroleum in BHP Billiton – a symbiotic relationship Petroleum is a high quality upstream business, ideally positioned to
Slide 25: Today's agenda
Today’s agenda Strong Fit in BHP Billiton’s Asset Portfolio How we run BHP Billiton Petroleum Driving Base Performance Executing Growth Projects Capturing Additional Opportunities Delivering Results Concluding Remarks
Slide 26: Overview of BHP Billiton Petroleum
Overview of BHP Billiton Petroleum A significant oil and gas exploration and production business Large and diverse portfolio of operating assets, development opportunities and exploration permits Operations in six countries Currently exploring in an additional four countries Eight development projec
Slide 27: BHP Billiton Petroleum financial profile
BHP Billiton Petroleum financial profile Production(a) (mmboe) Revenue ex 3rd party products (US$m) Underlying EBIT (US$m) EBIT margin(b) (%) Exploration (US$m) Capital Expenditure (US$m) Reserve Replacement Ratio (%) EBIT ROCE (%) 1H08 60.5 3,112 1,972 63.2 295 1,153 NR 52 FY07 116.0 4,964 3,014 60
Slide 28: Global operational focus
Global operational focus E Canada Petroleum HQ Gulf of Mexico Colombia Trinidad The Falklands Exploration UK Algeria Pakistan Malaysia North West Shelf W Australia Bass Strait Producing and development
Slide 29: Production diversified by asset and product type
Production diversified by asset and product type Production for the quarter ending 31-Mar-2008(a) Production by asset (mmboe, total = 32.73) Other 28% Algeria 6% UK 9% Atlantis 11% North West Shelf 20% Bass Strait 25% Shenzi & Genghis Khan 1% Production by product (mmboe, total = 32.73) NGL 7% LNG 1
Slide 30: Our core strategy and competitive advantages
Our core strategy and competitive advantages The core strategy Large, long-life upstream assets with multiple options – that we operate Target organic growth opportunities through exploration which are material to BHP Billiton Balanced portfolio of proven hydrocarbon basins and significant frontier
Slide 31: The functional organization
The functional organization Very simple organizational model – worldwide functional accountability Management focus on the parts of the business which are critical to success Exploration Safety Opportunity inventory Resource adds Seismic and data quality Finding costs CRT Development Safety Concept
Slide 32: Management team in place to execute
Management team in place to execute J. Michael Yeager Chief Executive Petroleum Stephen O’Rourke President Exploration Nigel Smith President Development Timothy Cutt President Production Renee Klimczak President Gas Marketing Alex Green Marketing Director Crude Marketing Zlatko Todorcevski Chief Fin
Slide 33: Benefits of the worldwide functional organization
Benefits of the worldwide functional organization Clear accountability and organizational alignment – clear focus of management Promotes functional excellence in all disciplines Worldwide ranking ensures quality and materiality Highly leveragable model targeting lowest costs Career development witho
Slide 34: The strategy has already delivered early results
The strategy has already delivered early results Significant improvements in safety performance – 3 LTIs YTD (9 mos) vs 20 in FY06 Average daily production for Apr-08 was 378 kboed vs. 318 kboed FY06 Strong base performance – cost focus and reliability Currently ramping up recent developments –prima
Slide 35: Key messages
Key messages BHP Billiton Petroleum is a significant oil and gas exploration and production business and a key component of BHP Billiton The core strategy is clear and simple Significant organization change has occurred over the last 12-18 months An experienced management team is implementing the st
Slide 36: Today's agenda
Today’s agenda Strong Fit in BHP Billiton’s Asset Portfolio How we run BHP Billiton Petroleum Driving Base Performance Executing Growth Projects Capturing Additional Opportunities Delivering Results Concluding Remarks
Slide 37: Driving Base performance
Driving Base performance “Base” is production and operations that are on-stream today Driving the Base performance of our existing operations is a key operational goal In-Country management responsibility, supported by the global functional organization Goal is to mitigate natural production decline
Slide 38: Base producing areas
Base producing areas Bass Strait After almost 40 years, achieved record winter gas sales Algeria BHP Billiton operations stable and highly profitable United Kingdom Long-life assets – training ground for deepwater operations worldwide Trinidad Significant improvement in uptime performance
Slide 39: Production growth areas
Production growth areas Gulf of Mexico 100 kbpd (net) new production expected by end FY09 North West Shelf 5th LNG train to start-up in late CY08 Western Australia Stybarrow new project volumes of 40 kbpd (net) Pakistan Recently expanded production by ~50%
Slide 40: Key strategic objectives that drive Base performance
Key strategic objectives that drive Base performance Safety: Focus on continuously improving 1st quartile industry safety performance Reliability: Maximize daily volume through world class reliability management Cost: Strengthen current 1st quartile unit cost performance Volumes: Start-up new operat
Slide 41: Safety – substantially improved our safety performance
Safety – substantially improved our safety performance, and now solidly top quartile in the industry Achieved ~72% reduction in Total Recordable Incident Frequency Rate (TRIFR) between 2HCY05 and 1QCY08 Delivered improvements despite significant ramp-up in drilling and construction activities Key di
Slide 42: Reliability – significantly improving our uptime performance
Reliability – significantly improving our uptime performance Uptime measured against 100, 100, 100 Track and monitor both scheduled and unscheduled downtime Significant improvement in performance 3QFY08: 93.5% vs 1QFY07: 89.0% 1% improved uptime = ~1.5 mmboe (~4 kboed) Key initiatives All downtime i
Slide 43: Cost – unit cost structure is highly competitive among peers
Cost – unit cost structure is highly competitive among peers Cost focus is on unit cost per barrel oil equivalent Unit operating costs holding steady ~US$5.00/boe Rising to ~US$6.00/boe over next 4 years Unit DD&A at ~US$6.00/boe worldwide Forecast to rise as major projects come on-line Both unit op
Slide 44: Volumes – start up four new projects in FY08
Volumes – start up four new projects in FY08 Incremental capacity – BHP Billiton’s attributable share (boed) 88,550 158,147 Total capacity 89,500 8,422 Current net production 21,175 40,000 Stybarrow Genghis Khan Zamzama Atlantis South Total % Working Interest 50.0% 44.0% 38.5% 44.0% Gross capacity 8
Slide 45: Stybarrow (50% WI, BHP Billiton operated)
Stybarrow (50% WI, BHP Billiton operated) Performance highlights FPSO and subsea wells Brought on-stream in November approximately two months ahead of schedule Achieved sustained production at design capacity of 80 kbpd (gross) Record-setting single well flow rates of approximately 32 kbpd
Slide 46: Genghis Khan (44% WI, BHP Billiton operated)
Genghis Khan (44% WI, BHP Billiton operated) Performance highlights Subsea wells tied back to Marco Polo platform Design capacity of 55 kbpd (gross) Brought on-stream in October, bringing Shenzi production forward by ~ 2 years Two wells completed
Slide 47: Zamzama Phase II (38.5% WI, BHP Billiton operated)
Zamzama Phase II (38.5 % WI, BHP Billiton operated) Performance highlights Plant expansion started up Feb 2008 Gas plant expansion design capacity 150 mmcfd (gross) Currently optimizing production systems
Slide 48: Atlantis (44% WI, non-operated)
Atlantis (44% WI, non-operated) Performance highlights Semi-submersible platform with deepwater subsea wells Brought on-stream in October (crude) through December (natural gas) Design capacity for 200 kbpd; 180 mmcfd (gross) 6 wells currently producing at 100 kbpd (gross), 2 additional wells planned
Slide 49: Prices – obtain market pricing
Prices – obtain market pricing Global Crude and Gas Marketing organizations Measure product sales vs. available production for sale daily Goal is to capture maximum daily price, or as close as we can Full price exposure is our corporate position
Slide 50: Pricing environment is strong
Pricing environment is strong Crude prices 100 kbpd (net) GoM new production in progress 40 kbpd (net) Western Australia new production on-stream Excellent fiscal regimes – captures full upside Gas sold regionally, supported by clean fuel initiatives and growing economies Shorter duration contracts
Slide 51: By 2012, ~60% of gas and LNG production will have price reopener mechanisms
By 2012, ~60% of gas and LNG production will have price reopener mechanisms available Gas and LNG contracts pricing structure 100% 80% 60% 40% 20% 0% FY2008 FY2009 FY2010 FY2011 FY2012 Contracts with NO Reopener Contracts with reopener (a) Contracts to expire within 4yrs Short term sales (0-4yrs) No
Slide 52: Key messages
Key messages Driving the Base performance of our existing operations – to extract maximum value from all production – is a key operational goal Safety improvements have been realized – continue improvements to maintain top quartile safety performance Excellent uptime performance and year-on-year imp
Slide 53: bhpbilliton resourcing the future
1 Pf | bhpbilliton resourcing the future
Slide 54: Today's agenda
Today’s agenda Strong Fit in BHP Billiton’s Asset Portfolio How we run BHP Billiton Petroleum Driving Base Performance Executing Growth Projects Capturing Additional Opportunities Delivering Results Concluding Remarks
Slide 55: Petroleum projects are a key element of the BHP Billiton growth pipeline
Petroleum projects are a key element of the BHP Billiton growth pipeline WA Iron Ore Quantum 2 DRC Smelter CMSA Heap Leach 2 Olympic Dam Expansion 1 Angola & DRC Macedon CMSA Leach 1 Perseverance Deeps NWS Nth Rankin B WA Iron Ore RGP 4 RBM Thebe Cannington Life Ext Nimba Mad Dog West Boffa/Santou R
Slide 56: Projects in execution beyond Stybarrow, Genghis Khan, Zamzama and Atlantis
Beyond Stybarrow, Genghis Khan, Zamzama, and Atlantis – 8 projects in execution OIL GAS LNG UK Petroleum HQ Algeria Pakistan Trinidad Gulf of Mexico Neptune (35%) 50 kbpd / 50mmcfd deepwater development HU&C completed; 6 wells drilled & completed Hull remediation in progress Start-up anticipated 2Q
Slide 57: Neptune (35% WI, BHP Billiton operated)
Neptune (35% WI, BHP Billiton operated) Project overview Tension leg platform and subsea wells 4,250ft water depth 50 kbpd and 50mmcfd capacity (gross) HU&C completed; 6 wells drilled & completed Hull remediation in progress Start-up 2Q CY08
Slide 58: Projects such as Neptune are large scale
Projects such as Neptune are large scale Neptune development relative to Empire State Building Neptune TLP and seafloor piping layout 4th deepest TLP in the world Neptune development relative to Manhattan
Slide 59: Shenzi (44% WI, BHP Billiton operated)
Shenzi (44% WI, BHP Billiton operated) Project overview TLP and subsea wells 4,300ft water depth – 2nd deepest TLP in the world 100 kbpd and 50mmcfd capacity (gross) Fabrication in progress; 2 wells drilled & completed Start-up mid CY09
Slide 60: Pyrenees (71.43% WI, BHP Billiton operated)
Pyrenees (71.43% WI, BHP Billiton operated) Project overview FPSO and subsea wells 96 kbpd capacity (gross) FPSO conversion underway Start-up 1H CY10
Slide 61: Progression of BHP Billiton's project experience
Progression of BHP Billiton’s project experience 2006 Mustang Fixed Platform 1996 Liverpool Bay Fixed Platform 2004 Angostura Fixed Platform 1995 Cossack Pioneer FPSO 1999 Buffalo FPSO 1989 Challis* FPSO 1986 Jabiru* Venture FPSO 2000 Keith Subsea Tieback 1993 Bruce Fixed Platform 1994 Griffin FPSO
Slide 62: Leading edge tension leg platform experience
Leading edge tension leg platform experience TLPs – Sanctioned, Installed, Operating or Decommissioned 3,000-foot water depth 4,000-foot water depth Source: Offshore Magazine / Mustang Engineering – 2007 Deepwater Solutions & Records for Concept Selection
Slide 63: Industry leading deepwater drilling performance
Industry leading deepwater drilling performance GoM deepwater exploration and appraisal wells (Days per 1000 ft drilled, Jan-2000 to Dec-2007) 8 7 6 5 4 3 2 1 0 23 wells 68 wells 17 wells 26 wells 44 wells 39 wells 26 wells 8 wells 8 wells 13 wells BHP Billiton Kerr McGee Unocal Anadarko Shell BP Ch
Slide 64: Ahead – Inventory of future projects under design and evaluation
Ahead – Inventory of future projects under design and evaluation OIL GAS LNG UK Petroleum HQ Algeria Pakistan Gulf of Mexico Mad Dog West (23.9%) Subsea tie-back Puma (29.8%) Subsea tie-back Shenzi N (44%) Subsea tie-back Neptune N (35%) Subsea tie-back Knotty Head (25%) Deepwater development Trinid
Slide 65: Significant resource position to support long term growth
Significant resource position to support long term growth Attributable Reserves and Resources (mmboe, as at 30-Jun-2007) 3,500 3,000 2,500 2,000 1,500 1,000 500 0 Probable Reserves plus 2C Contingent Resources 2,241 mmboe Proved Reserves 1,353 mmboe Onshore Offshore Deepwater LNG Africa Europe Ameri
Slide 66: Key messages
Key messages Petroleum makes a significant contribution to BHP Billiton’s overall growth prospects BHP Billiton Petroleum is executing leading-edge deepwater projects The 8 projects currently in execution underpin our forecast volume growth of 10% CAGR to FY11 Deep inventory of future development op
Slide 67: Today's agenda
Today’s agenda Strong Fit in BHP Billiton’s Asset Portfolio How we run BHP Billiton Petroleum Driving Base Performance Executing Growth Projects Capturing Additional Opportunities Delivering Results Concluding Remarks
Slide 68: Exploration strategy – capturing additional opportunities
Exploration strategy – capturing additional opportunities Target opportunities that are material to BHP Billiton Balance proven hydrocarbon plays with frontier exploration Focus on opportunities that have the potential for multiple successes Seeking Control and Operatorship
Slide 69: Significant gains over the past months
Significant gains over the past 18 months Rejuvenated growth opportunities Acquired a number of key acreage positions 75% increase in exploration spending in FY08 to ~US$700m from US$395m in FY07 (net) Forward exploration spend anticipated to be at or above FY08 level Increased equity ownership from
Slide 70: Recent exploration successes
Recent exploration successes Thebe Major gas discovery in Western Australia 100% BHP Billiton working interest Mad Dog West W2 Well Path Original LKO Post drill LKO Major field extension in deepwater GoM 23.9% BHP Billiton working interest
Slide 71: Key exploration and appraisal wells planned
Key exploration and appraisal wells planned Canadian Laurentian 1 well planned Gulf of Mexico 8 wells planned Colombia 2 wells planned Malaysia 4 wells planned NW Australia 6 wells planned Falklands 2 wells planned Exploration and appraisal wells Material in size to BHP Billiton Balance proven plays
Slide 72: Proven play: W Australia
Proven play: W Australia (41 permits, 8.3-100% WI, 10 permits operated) Exmouth Thebe Scarborough Macedon Browse Approximately 9.2 million acres (gross), WD 170 to 2,500m Two major discoveries – Thebe (100% WI), Scarborough (50% WI) Running 3D seismic on all other operated acreage Source: WSI Earth
Slide 73: Proven play: GoM
Proven play: GoM (318 Blocks, 62% Avg WI, 222 blocks operated) Miocene Play Paleogene Play 1.72 million acres (gross) (excluding March 2008 lease sale), WD 10 to 7,600ft Major BHP Billiton discoveries in Atwater Foldbelt Miocene play, now in development or production Excellent acreage position in pl
Slide 74: Proven play: Malaysia (Sabah)
Proven play: Malaysia (Sabah) (2 Blocks, 60% WI, operated) Kikeh Development Major Murphy discovery Start-up 2007 120 kbpd capacity Ubah-2 – Oct 2005 Shell discovery Wildcat and stepout wells 2.1 million acres (gross) – WD 1,600 to 2,800m Extension of Deepwater Miocene fold belt play New 3-D seismic
Slide 75: Frontier exploration: Colombia
Frontier exploration: Colombia (2 blocks, 75% WI, operated) 2.3 million acres (gross) – WD 500 to 2,700m Large tracts of frontier acreage with significant upside New 3-D acquisition complete No commitment wells – expect to be ready to drill in 2009 Source: WSI Earth by ESRI, Includes data supplied b
Slide 76: Frontier exploration: The Falklands
Frontier exploration: The Falklands (14 licenses, 51% WI, operated) 11 million acres (gross) – WD 200 to 2,000m Frontier acreage covering prospective portion of two large sub-basins Multiple leads with significant potential Two commitment wells – expect to commence drilling in 2009 – 2010 Source: WS
Slide 77: Key messages
Key messages The exploration strategy is clear and simple We will target opportunities that are material to BHP Billiton Recently acquired multiple key blocks with Operatorship Exploration spend increased to approximately US$700m Made key discoveries in GoM and Western Australia Planning to drill 24
Slide 78: Today's agenda
Today’s agenda Strong Fit in BHP Billiton’s Asset Portfolio How we run BHP Billiton Petroleum Driving Base Performance Executing Growth Projects Capturing Additional Opportunities Delivering Results Concluding Remarks
Slide 79: Forecast volume growth of ~10% CAGR to FY11
Forecast volume growth of ~10% CAGR to FY11, underpinned by projects in execution BHP Billiton net production forecast (mmboe/yr) 200 150 100 50 0 ~10% CAGR Gas Liquids FY07 FY08E FY09E FY10E FY11E
Slide 80: BHP Billiton Petroleum – Delivering results
BHP Billiton Petroleum – Delivering results How we run BHP Billiton Petroleum Functional business model has been established An experienced management team is in place and executing The core strategy is clear and simple Driving base Top quartile industry safety performance performance Achieved 93.5%
Slide 81: Today's agenda
Today’s agenda Strong Fit in BHP Billiton’s Asset Portfolio How we run BHP Billiton Petroleum Driving Base Performance Executing Growth Projects Capturing Additional Opportunities Delivering Results Concluding Remarks
Slide 82: Concluding remarks on Petroleum
Concluding remarks on Petroleum Petroleum fits strategically and BHP Billiton is a natural owner Strong BHP Billiton technical and human capability The business is delivering results – operating performance and growth Attractive and visible growth profile Substantially low risk operating geographies
Slide 83: Our offer for Rio – Unlocking value
Our offer for Rio – Unlocking value Combined entity will have a unique portfolio of tier 1 assets Highly complementary large-scale, low-cost, long-life assets Strengthened asset portfolio and superior future growth options Unparalleled exposure to overlapping mineral basin positions and infrastructu
Slide 84: BHP Billiton's 45% premium is a substantial value uplift
BHP Billiton’s 45% premium is a substantial value uplift, prior to the pro rata share of synergies BHP Billiton / Rio Tinto Exchange Ratio(a) 3.8 for 1 3.6 for 1 3.4 for 1 3.2 for 1 3.0 for 1 2.8 for 1 2.6 for 1 2.4 for 1 2.2 for 1 12-Dec: BHP Billiton Investor Presentation 1-Feb: Chinalco purchase
Slide 85: Conclusion – Strength, stability and growth
Conclusion – Strength, stability and growth BHP Billiton’s core strategy remains unchanged BHP Billiton is focused on producing volumes from its low cost assets to take advantage of the strong market conditions A combination of BHP Billiton and Rio Tinto can generate substantial additional value for
Slide 86: bhpbilliton resourcing the future
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