Pharos Energy Plc · LSE:PHAR
Pharos Energy — SOCO International — FY2014 Earnings Presentation
19 slides from Pharos Energy's earnings presentation, Mar 12, 2015
Slide 1: 2014 Full Year Results
2014 Full Year Results 12 March 2015 March 2015 │ 1
Slide 2: Preface
Preface This presentation, which is confidential and is being supplied only to persons with professional experience in matters relating to investments for the purposes of the Financial Services and Markets Act 2000, does not constitute or form part of any offer or invitation to sell or issue, any of
Slide 3: 2014: A Year of Delivery for SOCO
2014: A Year of Delivery for SOCO • TGT development programme continues with eight wells drilled in 2014 • H5 development ahead of September/October 2015 first oil schedule • Production performance of 13.6 KBOEPD (slightly below guidance) • ERC Equipoise study significantly enhances our understandin
Slide 4: Challenging Environment
Challenging Environment $140/bbl $130/bbl $120/bbl $110/bbl $100/bbl $90/bbl $80/bbl $70/bbl $60/bbl $50/bbl $40/bbl 2009 2011 2013 2015 2017 2019 Historical Brent Current Forward Curve Forward Curve 6 Months Ago March 2015 │ 4
Slide 5: Partner Reaction to Oil Price and Uncertainty
Partner Reaction to Oil Price and Uncertainty Dramatic oil price drop and increased uncertainty has caused SOCO’s partners to take a significantly more conservative approach to future spend and activity • 2015 production target below 2014 • 2015 firm drilling programme limited to current FDP approve
Slide 6: Reserves in the New Oil Price Environment
Reserves in the New Oil Price Environment (4) MMboe TGT CNV Congo Group SOCO WI Oil and Gas 2P Commercial Reserves (1)(2)(3) 1 January 2014 87.5 29.8 12.8 130.1 Production (4.2) (0.8) - (5.0) 2P Reserves, 31/12/2014 (pre revision and re-classification) 83.3 29.0 12.8 125.1 2P Commercial Reserves, 31
Slide 7: TGT Reserves and Resources Reclassification
TGT Reserves and Resources Reclassification Figures in MMbbl / MMboe P90 P50 P10 Stock Tank Oil Initially In Place 498 759 1,052 • SOCO 2014 year end reserves and resources TGT Field Gross assessment grounded in ERCE Model and 1P 2P 3P supported by engineering studies Commercial Reserves + 126.3 169
Slide 8: TGT Production Profiles Underpinning Reserves and Contingent Resources
TGT Production Profiles Underpinning Reserves and Contingent Resources 100 kbopd 90 kbopd • ERC Equipoise has been engaged building a TGT field wide model 80 kbopd incorporating all data 70 kbopd • Extensive process (over the last two 60 kbopd years) leading to new field simulation 50 kbopd model 40
Slide 9: TGT Future Development Options
TGT Future Development Options Option: Install WWP and modify FPSO Option: Install CPP and replace FPSO with FSO • SOCO considering a range of options to accelerate production ramp-up currently constrained by facilities limitations • Detailed engineering work underway on short and long term options,
Slide 10: Africa: Focusing on High Impact Options
Africa: Focusing on High Impact Options Licence Status LXM-101 discovery with unitisation progressing Marine XI Reprocessing seismic across the block Evaluating Lideka East appraisal options Well moved to H1 2016 Mer Profonde Sud Farm-out discussions ongoing with multiple parties Cabinda N
Slide 11: Africa: Congo Republic – Marine XI
Africa: Congo Republic – Marine XI LXM-101 Well (Lidongo LXM-101 Discovery) Well (Lidongo Discovery) • Potential extension of pre-salt Litchendjili field (Eni) – announced to have c.1.2bn boe in place • Well spudded in August and encountered oil in the targeted Djeno formation, tight pre-salt reserv
Slide 12: Africa: Congo Republic – Mer Profonde Sud ("MPS")
Africa: Congo Republic – Mer Profonde Sud (“MPS”) • SOCO operator of MPS • Various leads and prospects identified ranging 50-300 mmbo • Offsets fields of >200 mmbo recoverable • Engaged in drillsite determination G&G effort Moho- Bilond • Seismic data & rock physics o • Petrophysics • Best estimate
Slide 13: 2014 Financial Summary – Income Statement Items
2014 Financial Summary – Income Statement Items US$ millions, unless otherwise stated 2014 2013 Commentary 2014 production of 13,605 BOEPD vs. 2013 production of Sales revenue 448.2 608.1 16,694 BOEPD Oil price realised ($/bbl) 102.91 112.62 Gross profit 304.4 439.0 Opex c.$9/bbl in 2014 vs. $8.
Slide 14: 2014 Financial Summary – Cash Flow Items
2014 Financial Summary – Cash Flow Items US$ millions, unless otherwise stated 2014 2013 Commentary Operating cash flow before working 344.4 472.0 capital, interest and tax Change in working capital 37.6 3.3 2014 includes positive impact from receivables of $32m I Net cash from operating activitie
Slide 15: SOCO Robust in Challenging Environment
SOCO Robust in Challenging Environment • Strong balance sheet • $166 million cash at year end 2014 • Debt free • Substantial cash generative production and attractive economics • Vietnam assets with operating cash flow break even in low $20s/bbl; cash flow break even in mid-$50s/bbl with 2015 capex
Slide 16: 2015 Outlook
2015 Outlook • Production outlook for 2015 at 10.5-12.0 KBOEPD reflects only firm wells and conservative initial flow rates on H5 • Focus on delivering TGT H5 on time • Ongoing work on revised TGT RAR, FDP and ERCE reservoir modelling • Analysis of Marine XI discovery and progress toward unitisation
Slide 17: Appendix
Appendix March 2015 │ 17
Slide 18: 2014 Production Detail
2014 Production Detail 20142014 20132013 GROSS BASIS TGT production 38,462 48,876 Oil (BOPD) 34,875 44,406 Gas (BOEPD) 3,587 4,470 NET BASIS TGT production 11,538 14,635 Oil (BOPD) 10,464 13,301 Gas (BOEPD) 1,074 1,334 CNV production 2,067 2,059 Oil (BOPD) 1,423 1,494 Gas (BOEPD) 644 565 Total Produ
Slide 19: SOCO International plc
SOCO International plc 48 Dover Street London W1S 4FF United Kingdom Tel: 020 7747 2000 Fax: 020 7747 2001 Registered No: 3300821 www.socointernational.com March 2015 │ 19