Tullow Oil Plc · LSE:TLW
Tullow Oil — FY2010 Earnings Presentation
36 slides from Tullow Oil's earnings presentation, Mar 9, 2011
Slide 1: Tullow Oil plc – 2010 full year results
2010 full year results 9 March 2011 Tullow Oil plc – 2010 full year results
Slide 2: Disclaimer
2010 full year results Disclaimer This presentation contains certain forward-looking statements that are subject to the usual risk factors and uncertainties associated with the oil and gas exploration and production business. Whilst Tullow believes the expectations reflected herein to be reasonable
Slide 3: Contents
2010 full year results Contents Section Page Introduction 4 Finance 6 Production and Development 13 Exploration 22 Conclusions 34 Slide 3
Slide 4: Introduction – Aidan Heavey
2010 full year results Tullow Oil plc – 2010 full year results Introduction – Aidan Heavey
Slide 5: A transformational year for Tullow
2010 full year results A transformational year for Tullow • First Oil from Jubilee establishes Tullow as a successful deepwater operator • Portfolio of major new oil fields to be developed • Frontier exploration to open new basins in 2011 • Business well balanced and well funded to implement explora
Slide 6: Finance – Ian Springett
2010 full year results Tullow Oil plc – 2010 full year results Finance – Ian Springett
Slide 7: Creating shareholder value
2010 full year results Creating shareholder value Consistent and repeatable strategy • High-impact exploration portfolio • Sustainable long term value growth • Ghana: Jubilee discovery & fast track development • Balance exploration, major projects & funding • Uganda: commercialisation, • Safety, env
Slide 8: 2010 results summary
2010 full year results 2010 results summary 2010 2009 Change Sales revenue $1,090m $916m + 19% Operating profit $235m $151m + 56% Net profit $73m $31m + 137% Basic earnings per share 6.1c 3.2c + 90% Dividend per share 6.0p 6.0p No change Capital investment1 $1,235m $1,085m + 14% Cash generated from
Slide 9: Net income 2010 v 2009
2010 full year results Net income 2010 v 2009 $m 275 250 225 $7m $18m 200 175 $72m $191m 150 125 100 $78m $20m 75 $32m 50 $73m 25 $31m 0 2009 Price Volume Costs / Expl Tax IAS 39 Portfolio 2010 Net Fin fees Write-offs Management 2010 Net income improved primarily due to higher prices offset by lower
Slide 10: Sources and uses of funds
2010 full year results Sources and uses of funds 2010 Net cash inflow $90m Cash inflow $3,164m (2009: $228m outflow) $m • Operating cash flow $818m* (2009:$464m*) Sources Uses • Disposal of oil & gas assets $7m (2009:$17m) $86m $886m • Equity placing $1,453m (2009:$622m) $184m • Net loan drawdown $8
Slide 11: Significant 2011 capital expenditure
2010 full year results Significant 2011 capital expenditure Forecast • $1,500m forecast for 2011 2011 $850m $650m $1,500m – Ghana: Jubilee phase 1a development & Owo/Tweneboa appraisal & development P&D – Uganda: Exploration drillout and Lake Albert development 2010 $715m $520m $1,235m – High-impact
Slide 12: Implementation of financial strategy
2010 full year results Implementation of financial strategy Selective development Well funded balance sheet; Active portfolio investment to maximise value increasing operational cash flow management Invest for exploration-led value growth • Mauri-Tano trend • South America • East Africa Slide 12
Slide 13: Production & Development – Paul McDade
2010 full year results Tullow Oil plc – 2010 full year results Production & Development – Paul McDade
Slide 14: Jubilee Phase 1 – World-class project now on production
2010 full year results Jubilee Phase 1 – World-class project now on production Exceptional delivery • Jubilee field discovered June 2007 • FPSO arrived in Ghana on schedule June 2010 • Production commenced 28 Nov 2010 • Presidential First Oil Ceremony 15 Dec 2010 New image • First cargo lifting 5 Ja
Slide 15: Jubilee and WCTP development opportunities
2010 full year results Jubilee and WCTP development opportunities Jubilee Phase 1a Jubilee Unit Area Reserves and Resources (mmbo) • Infill programme of 5 to 8 wells Phase 1 Phase 1a Phase 1b • Designed to maintain FPSO plateau 17 wells 5-8 wells 10-20 wells • Sanction in 2011; to commence in 2012 L
Slide 16: Enyenra & Tweneboa – Ghana's next major development
2010 full year results Enyenra & Tweneboa – Ghana’s next major development Extensive appraisal and testing Resources • Successful Enyenra-2A and Tweneboa-3 P90 P50 P10 • Further appraisal in 2011 ~ 2-4 wells Enyenra oil (mmbo) 100 200 550 • Well Testing planned to establish reservoir Tweneboa hydroc
Slide 17: Uganda – Preparing for an active 2011
2010 full year results Uganda – Preparing for an active 2011 Memorandum of Understanding (MOU) • Delay in recent weeks due to Ugandan elections • MOU terms agreed and documentation being finalised Operational Restart • Drilling operations restarted in Block 2 – Kigigole 6, Ngege-2 • Ogec rig on stan
Slide 18: Good development progress across global portfolio
2010 full year results Good development progress across global portfolio Africa • Côte d’Ivoire - FPSO upgrade completed in 2010 in preparation for infill drilling in 2012-2013 • Equatorial Guinea - 4-D time lapse seismic acquired in preparation for further infill drilling and tie backs • Gabon - Pr
Slide 19: Strong production growth in 2011
2010 full year results Strong production growth in 2011 Current production Group working interest production U.K. Oil production Future production 100 boepd (x000) 16 Other licence areas Gas production 12 80 8 Pakistan Bangladesh 4 boepd (x000) boepd (x000) 16 16 0 60 2010 2011 mboepd 12 12 8 8 4 4
Slide 20: Reserves and Resources summary
2010 full year results Reserves and Resources summary 1600 Reserves and Resources 1,387 mmboe 1400 Reserves Resources • Commercial reserves 294 mmboe 1200 • Contingent resources 1,093 mmboe mmboe 1000 800 • Ghana & Uganda Resources to migrate to 600 Commercial Reserves in short term 400 200 0 Total
Slide 21: Conclusion
2010 full year results Conclusion • Strong safety and environmental performance • Tullow established as a competent deepwater operator • Enyenra/Tweneboa – next Operated deepwater mega-project • Five rig programme planned for Uganda E&A drillout • Global development portfolio fuels significant produ
Slide 22: Exploration and Appraisal – Angus McCoss
2010 full year results Tullow Oil plc – 2010 full year results Exploration and Appraisal – Angus McCoss
Slide 23: Exploration-led value growth continues to "move the needle"
2010 full year results Exploration-led value growth continues to “move the needle” “Mauri-Tano Trend” Mauritania-Senegal deepwater basin Liberian deepwater East African basin Ivorian-Tano rift basins deepwater basin Uganda-analogues Jubilee-analogues East African Transform margin Mesozoic/Karoo oil
Slide 24: 83% global exploration and appraisal success rate in 2010
2010 full year results 83% global exploration and appraisal success rate in 2010 FRENCH GUIANA GUYANA NETHERLANDS GABON – 10 wells 94 of 2,494 1,889 sqkm 1,660 sqkm 3D OMOC-N-1 OMOC-N302 S/T sqkm 3D 3D PSDM OMOC-N301 OMOC-103 171 km 2D 4,084 sqkm OMOC-N201 OMOC-501 PAKISTAN – 1 well 3D P
Slide 25: Ghana E&A programme delivering excellent results
2010 full year results Ghana E&A programme delivering excellent results Six fields discovered since 2007 • Jubilee – world-class producing oil field • Mahogany East appraised – tie back to Jubilee • Odum – potential satellite development • Tweneboa – significant oil and gas-condensate field • Enyenr
Slide 26: Two new fields in Ghana – Enyenra & Teak
2010 full year results Two new fields in Ghana – Enyenra & Teak Enyenra-Tweneboa Area Teak • Turbidite channels & fans in vast 200 sqkm system • 73m net hydrocarbons in Campanian & Turonian • Excellent quality reservoirs − 50-100-200 mmboe (~70% liquids) • Tweneboa – significant oil and gas-condensa
Slide 27: Jubilee play pursued throughout Equatorial Atlantic region
2010 full year results Jubilee play pursued throughout Equatorial Atlantic region • Industry-leading acreage on Late Cretaceous turbidite sweet spots throughout Equatorial Atlantic region • Geological model being successfully tested − Turbidite channels & fans deposited during Late Cretaceous contin
Slide 28: Following up on Liberian basin discoveries
2010 full year results Following up on Liberian basin discoveries Mercury & Venus follow up in Liberian Basin • Critical Jubilee-play risks overcome through immediate success at Venus B-1 & Mercury-1 • Operator has confirmed Discoverer Spirit drill-ship to start follow-up 2011 campaign − Sierra Leon
Slide 29: Testing the Jubilee-play in South America
2010 full year results Testing the Jubilee-play in South America Drilling Zaedyus in French Guiana • Giant turbidite fan system confirmed by 3D seismic − Bigger than the Ghana fan system − Numerous prospects mapped − High risk with high reward potential − Extensive regional follow-up • Zaedyus curre
Slide 30: Uganda: Lake Albert Rift Basin E&A success continues
2010 full year results Uganda : Lake Albert Rift Basin E&A success continues High success ratio through technical excellence • 38 out of 39 wells found hydrocarbons • High quality seismic & FTG unlock basin potential • Main play fairways mapped in detail • Ramping up to 5 rigs, including slant rig P
Slide 31: Exploring in Kenya & Ethiopia to replicate Ugandan success
2010 full year results Exploring in Kenya & Ethiopia to replicate Ugandan success Three Major Rift Trends • Western Tertiary Rift Trend − Lake Albert Rift Basin – 2.5 Bbo − Prolific Victoria Nile Delta Play • Eastern Tertiary Rift Trend − More volcanic – less prospective? − Loperot-1 (1992) - 13m oi
Slide 32: 2011 Exploration and Appraisal programme
2010 full year results 2011 Exploration and Appraisal programme Country Block Prospect Interest Gross upside* Spud Date Tweneboa-4 Q2 2011 49.95% (op) 650 mmboe** Tweneboa-DST Q2 2011 Deepwater Tano Enyenra-3A Q3 2011 Enyenra-DST 49.95% (op) 550 mmbo** Q3 2011 Ghana Enyenra-4A Q4 2011 Teak Downdip 4
Slide 33: 2011 Exploration and Appraisal programme (cont.)
2010 full year results 2011 Exploration and Appraisal programme (cont.) Country Block Prospect Interest Gross upside* Spud Date Uganda Block 1&2 Butiaba E&A Various 1,000 mmboe In progress 10BB North Kerio 50% 75 mmboe 2H 2011 Kenya 10A Paipai 50% 230 mmboe 2H 2011 Tanzania Mtwara Sudi 50% 200 mmboe
Slide 34: Conclusions – Aidan Heavey
2010 full year results Tullow Oil plc – 2010 full year results Conclusions– Aidan Heavey
Slide 35: A transformational year for Tullow
2010 full year results A transformational year for Tullow • First Oil from Jubilee establishes Tullow as a successful deepwater operator • Portfolio of major new oil fields to be developed • Frontier exploration to open new basins in 2011 • Business well balanced and well funded to implement explora
Slide 36: Investor Relations Contact
2010 full year results Tullow Oil plc 9 Chiswick Park 566 Chiswick High Road London, W4 5XT Tel: +44 203 249 9000 Fax: +44 203 249 8801 Investor Relations Contact Chris Perry: chris.perry@tullowoil.com 2010 Half-yearly Results