Amplitude Energy Limited · ASX:AEL
Amplitude Energy — Cooper Energy — Merger or Acquisition (October 2016)
47 slides from Amplitude Energy's merger presentation, Oct 24, 2016
Slide 1: For personal use only
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only 24 October 2016
Slide 2: Important notice
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES This investor presentation (“Presentation”) is issued by Cooper Energy Limited ABN 93 096 170 295 (“Cooper Energy” or “COE”). This Presentation has been issued by Cooper Energy in relation to: • Cooper Energy’s acquisition of the Victorian Gas Ass
Slide 3: Underwriters disclaimer
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Underwriters and Joint Lead Managers, and their advisers: None of Euroz Securities Limited (“Euroz”) or Canaccord Genuity (Australia) Limited (“Canaccord Genuity”) (together, the “Underwriters”) nor their or Cooper Energy’s respective advisers nor
Slide 4: Agenda
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only Transaction Overview Summary of Acquired Assets Post Transaction Cooper Energy Transaction Financing Appendices • Key risks • Offer jurisdictions • Notes on calculation of reserves and resources • Abbreviations 4
Slide 5: Transaction Overview
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only
Slide 6: Advancing execution of established gas strategy
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Cooper Energy is advancing execution of its established gas strategy with the For personal use only acquisition of gas production and development assets which will: • transform the company, with an immediate and substantial uplift in production an
Slide 7: Transaction details and strategic rationale
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only • Cooper Energy (“COE”) to acquire the Victorian Gas Assets of Santos Limited (“Santos”) (see slide 8) for cash consideration of up to $82 million¹ – $62 million cash payment to Santos upon completion of the Transaction; plus
Slide 8: Summary of acquired Victorian Gas Assets
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only 50% & Operator (subject to the approval of the joint venture partners (AWE Ltd & Mitsui E&P Casino-Henry¹ Australia Pty Ltd), of the producing Casino-Henry gas fields in offshore Otway Basin Sole 50% & Operator of VIC/RL3 in
Slide 9: Transaction highlights
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only Logical, value-adding step up in Cooper Energy’s established and soundly based gas strategy Transformational increase in production and reserves, with near term exposure to south-east Australia gas contracting opportuniti
Slide 10: What Cooper Energy acquires
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only Gas production: + 7 PJ pa • 7.3 PJ pa from Casino-Henry • Sales to 2018 contracted to EnergyAustralia 2P Gas reserves²: + 54 PJ • 54 PJ 2P gas reserves – including 45 PJ uncontracted Exploration acreage: VIC/P44 • Numerous ex
Slide 11: Multi-basin gas strategy and market
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only Market • Market-driven approach • Building portfolio of customers & contracts • Utilities and industrials • Includes AGL, O-I and Alinta Cooper Basin • Cash-generating oil production Onshore Otway Basin • Gas exploration acre
Slide 12: Accelerating market-focused gas business
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only • Accelerates building a market-focused, cost-competitive south-east Australia multi-basin gas business • Substantial uncontracted gas, development options and additional gas plant infrastructure - increases uncontracted gas
Slide 13: Production and 2P reserves uplift
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only FY16 production (MMboe)¹ 2P reserves² as at 30 June 2016 (MMboe) 11.6 2.3 0.2 0.3 Minerva Minerva (10%) (10%) Casino-Henry 10.1 Casino-Henry 1.7 (50%) (50%) COE COE Australia Australia 0.3 0.3 1.3 1.3 COE standalone COE pro f
Slide 14: FY17 production forecast
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only FY17 production forecast (MMboe)¹ 1.7 0.2 Minerva 1.0 0.1 1.3 Casino-Henry 0.6 COE Australia 0.3 0.3 0.3 COE Australia standalone COE post Transaction COE annualised post Transaction • 3.9x uplift in FY17 standalone forecast
Slide 15: Australian production versus peers
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only Australian production FY16 (MMboe) 10 8 COE elevated as mid range Australian oil and gas producer Production profile weighted towards gas 6 Gas Liquids Oil 4 2 0 COE CTP SXY COE pro forma AWE BPT Source: Company Filings, COE
Slide 16: FY17 production and capex guidance
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only COE standalone Victorian Gas Assets¹ COE post Transaction Production FY17 0.3 MMboe 0.7 MMboe 1.0 MMboe Capital expenditure FY17 (a) $20 million $3 million $23 million - Exploration & evaluation (b,c) $17 million $1 million $
Slide 17: South-east Australia gas demand and supply
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only Gas demand vs production/contract from existing suppliers for Cooper Energy gas production profile: post south-east Australia Transaction PJ pa PJ pa 100 500 SE Australia demand¹ 90 450 80 400 Manta (100%) 70 350 60 Sole (100
Slide 18: Summary of Acquired Assets
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only
Slide 19: Casino-Henry
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only Ownership post Transaction completion - COE: 50%, Operator1 (previously Santos) - AWE: 25% - Mitsui: 25% Description - Otway Basin, offshore Victoria (field water depths: 63-65 m) - Licences VIC/RL11, VIC/RL12, VIC/L24, VIC/L
Slide 20: Casino-Henry development and abandonment
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only Offshore subsea development - Online 2006 - 2 Casino wells and 34.2 km pipeline to Iona Gas Plant/gas storage system - 1 well each in Henry and Netherby online in 2010 via 21.7 km tie- back to Casino - 1 additional well requi
Slide 21: Minerva
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only Ownership post Transaction completion - COE: 10% (previously Santos) - BHP Billiton: 90% (Operator) Description - Otway Basin, offshore Victoria (water depth 59 m) - Minerva Gas Plant (10%) - Licence VIC/L22 Production (10% e
Slide 22: Minerva development and abandonment
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only Offshore subsea development - 2 production wells - 10 km subsea pipeline to Minerva Gas Plant - Gas plant connected to the SEAGas pipeline Assets for abandonment at end of life - 4 x subsea wells - 10 km subsea pipeline and c
Slide 23: Patricia Baleen
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only Ownership post Transaction completion - COE: 100% (previously Santos) Description - Gippsland Basin, offshore Victoria (water depth 51m) - Licence VIC/L21 Production acquired - Cumulative gas production to 2008 = ~43 Bcf Futu
Slide 24: Sole and Orbost Gas Plant
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only Ownership post Transaction completion • VIC RL/3 (Sole): COE: 100%, Operator (previously 50% Santos & Operator, 50% COE) • Orbost Gas Plant: COE: 100%, Operator (previously 50% Santos & Operator, 50% COE) Description - VIC/RL
Slide 25: Post Transaction Cooper Energy
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only
Slide 26: Post transaction portfolio
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only • Mixture of contracted and uncontracted gas balances risk mitigation with upside contracting opportunities • Blue chip gas customers for Casino-Henry (EnergyAustralia) and Sole Gas Project 2C (AGL, O-I and Alinta) • Uncontra
Slide 27: Production outlook: uplift now and higher for longer
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only Current Portfolio: Post Transaction: uplift now and higher for longer 12 12 10 10 8 8 6 6 4 4 2 2 0 0 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 Cooper Basin Minerva (10%) Casino
Slide 28: Sole Gas Project commercialisation pathway
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only Commercialisation pathway: an attractive project that has strong support from gas buyers • Sole Gas Project will continue to proceed through previously announced process to commercialisation (see detail on following slide) •
Slide 29: Sole Gas Project path to FID
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only FEED Mid FEED review Regulatory approvals Final engineering reports Assurance CAPEX estimate ¹ Independent Expert Report (Subsurface & reserves) Independent Expert Report (Review of Facilities Plan) Quality Assuran
Slide 30: Transaction Financing
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only
Slide 31: Transaction terms
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only Transaction terms Transaction • Up to $82 million cash, consisting of: consideration • $62 million cash payment to Santos upon completion of the Transaction; and • a contingent payment of $20 million, on the earlier of Sole G
Slide 32: Pro forma cash and facilities
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only Pro forma cash and facilities as at 30 June 2016 COE standalone Transaction impact¹ COE post Transaction ($ million) Cash 49.82 0.0 49.8 Debt drawn 0.0 8.13 8.1 Net cash/(debt) 49.8 (8.1) 41.7 Debt facilities available 13.6 2
Slide 33: Entitlement offer structure and size
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES • 1 for 2 pro-rata, accelerated, non-renounceable entitlement offer to raise approximately $62.6 million • Approximately 220 million New Shares to be issued (equivalent to approximately 50% of existing shares on For personal use only issue) Offer
Slide 34: Indicative timetable
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Trading Halt and announcement of the Transaction and Entitlement Offer Monday, 24 October 2016 For personal use only Institutional Entitlement Offer opens Monday, 24 October 2016 Institutional Entitlement Offer closes Tuesday, 25 October 2016 Trad
Slide 35: Appendices
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES For personal use only
Slide 36: Key risks
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Risk Description For personal use only Analysis of the acquisition COE has undertaken financial, operational, business and other analysis in respect of the Victorian Gas Assets in order to determine its attractiveness to COE and whether to pursue
Slide 37: Key risks: contracts and completion
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Risk Description For personal use only Contracts Associated with the Victorian Gas Assets’ are a range of contracts for sale of product (primarily gas) and goods and services. COE will work with Santos for transfer of these contracts and services
Slide 38: Key risks: oil and gas prices
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Risk Description For personal use only Volatility of oil and gas prices COE’s future value, growth and financial condition are dependent upon the prevailing prices for oil and gas. Prices for oil and gas are subject to fluctuations and are affecte
Slide 39: Key risks: counterparty and land access
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Risk Description For personal use only Counterparty risk The ability of COE to achieve its stated objectives will depend on the performance of the counterparties under the various agreements it has entered into. If any counterparties do not meet t
Slide 40: Key risks: government actions
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Risk Description For personal use only Government actions COE requires government regulatory approvals for its operations. The impact of actions, including delays and inactions, by governments in Australia or internationally may affect COE’s activ
Slide 41: Key risks: market and share price
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Risk Description For personal use only General market and share price risks There are general risks associated with investments in equity capital such as COE shares. The trading price of COE shares may fluctuate with movements in equity capital ma
Slide 42: Key risks: underwriting
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Risk Description For personal use only Underwriting risk COE has entered into an Underwriting Agreement with Euroz and Canaccord Genuity (together, the "Underwriters") under which the Underwriters have agreed to fully underwrite the Entitlement Of
Slide 43: International offer restrictions
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES International Offer Restrictions This document does not constitute an offer of New Shares of COE in any jurisdiction in which it would be unlawful. In particular, this document may not be distributed to any person, and the New Shares may not be of
Slide 44: International offer restrictions: Hong Kong
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Hong Kong WARNING: This document has not been, and will not be, registered as a prospectus under the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32) of Hong Kong, nor has it been authorised by the Securities and Futures Com
Slide 45: International offer restrictions: Switzerland
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Switzerland The New Shares may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange ("SIX") or on any other stock exchange or regulated trading facility in Switzerland. This document has been prepared without reg
Slide 46: Notes on calculation of reserves and resources
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES Estimates of reserves and contingent resources are based on COE assessment using information provided by Santos. COE expects to announce its assessment of reserves and contingent resources in accordance with ASX Listing Rules attributable to the V
Slide 47: Abbreviations
NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES $ Australian dollars unless specified otherwise For personal use only Bbl barrels of oil boe barrel of oil equivalent bopd barrel of oil per day capex capital expenditure FEED front end engineering and design FID final investment decision kbbls th