Beach Energy Limited · ASX:BPT
Beach Energy — Non-Deal Roadshow (April 2015)
58 slides from Beach Energy's roadshow presentation, Apr 8, 2015
Slide 1: Non-deal Roadshow April 2015
For personal use only Non-deal Roadshow April 2015 1
Slide 2: Compliance statements
Compliance statements For personal use only Disclaimer This presentation contains forward looking statements that are subject to risk factors associated with oil, gas, geothermal and related businesses. It is believed that the expectations reflected in these statements are reasonable but they may be
Slide 3: Table of contents
Table of contents For personal use only 1. Company overview 2. Strategic outlook 3. Cooper Basin: Western Flank 4. Eastern Australian gas market 5. Cooper Basin: Delhi (SACB and SWQ JVs) 6. Nappamerri Trough Natural Gas 7. Other interests 3
Slide 4: Company Overview
For personal use only Company Overview 4
Slide 5: Company overview
Company overview For personal use only Cooper and Eromanga Basins A re-aligned focus closer to home Oil Gas Gas Liquids Tight Gas • ASX 100 company with a market Operated capitalisation of ~$1.4 billion1 Non-operated • New Managing Director, Rob Cole, commenced March 2015 • Diversifi
Slide 6: Multi-play Cooper Basin acreage
Multi-play Cooper Basin acreage For personal use only Australia’s most prolific onshore hydrocarbon basin, with gross acreage of over 56,000 km2 6
Slide 7: FY15 and beyond
FY15 and beyond For personal use only • Production guidance of 8.9 – 9.4 MMboe MMboe Actual and Forecast Production – Production mix approximately half oil, 10.0 9.6 8.9 – 9.4 half gas and gas liquids Gas* • FY15 capital expenditure guidance reduced 8.0 8.0 2.1-2.3 7.5 (12-13 PJe) to $430 – $470 mil
Slide 8: FY15 revised capital expenditure guidance
FY15 revised capital expenditure guidance For personal use only FY15 Revised Capital Expenditure Guidance Original Revised Wells ($ million) DEVELOPMENT Cooper Basin (non-SACB and SWQ JVs) 55 – 60 50 – 55 13 Cooper Basin (SACB and SWQ JVs) 270 – 300 260 – 275 75 International 10 10 – 15 4 (Egypt) To
Slide 9: Reserves and contingent resources
Reserves and contingent resources1 For personal use only 2P: 86 MMboe 2P and 2C: 770 MMboe Gas and gas liquids 67 MMboe Unconventional 2P reserves Gas and gas liquids 86 MMboe 580 MMboe Oil 19 MMbbl Conventional Gas / gas liquids 92 MMboe Oil 12 MMbbl Large reserves and resources base supporting fut
Slide 10: Strategic Outlook
For personal use only Strategic Outlook 10
Slide 11: Superior Total Shareholder Return
Superior Total Shareholder Return For personal use only Demonstrated outperformance relative to peers 10 Year TSR 5 Year TSR 101% 100% 100% 80% 80% 60% 60% 57% Max: 44% 40% Max: 33% 40% 20% 20% Ave: 9% 0% 0% Ave: -15% -20% -20% Min: -18% -40% -40% -60% -60% Min: -61% Beach Peer Group Beach Peer Grou
Slide 12: Key value drivers
Key value drivers For personal use only Absolute focus on delivering superior Total Shareholder Return via key value drivers 1. Drive performance of existing base business 2. Leverage core oil expertise in Cooper Basin 3. Increase gas returns via east coast market 4. Realise value from strategic inf
Slide 13: 1. Drive performance of base business
1. Drive performance of base business For personal use only • Broad review of operating costs and return on assets commenced – Encompassing operated and non- operated assets • Active dialogue with joint venture partners underway to align efficiency targets • Western Flank intellectual property to be
Slide 14: 2. Leverage core oil expertise in Cooper Basin
2. Leverage core oil expertise in Cooper Basin For personal use only • Low cost, high net back operator – Quick drill times and high flow rates • ~4,000 km2 of 3D seismic adding to prospect seriatim – Re-processing, interpretation and inversion underway • New focus on untapped potential beyond origi
Slide 15: 3. Increase gas returns via east coast market
3. Increase gas returns via east coast market For personal use only • Three Queensland LNG plants at various East coast gas demand 2014 – 2020 (PJ)1 stages of completion – QCLNG first cargo in January 2015 – GLNG and APLNG first cargo expected in H2 CY151 • Potential coal seam gas feedstock shortfal
Slide 16: 4. Realise value from strategic infrastructure
4. Realise value from strategic infrastructure For personal use only • Significant interest in strategically located infrastructure, interlinking key markets • Working with joint venture partners to drive asset operating efficiencies • Moomba (Beach 20.21%) processing facility daily capacity – 380 T
Slide 17: 5. Maintain financial strength
5. Maintain financial strength For personal use only • Demonstrated ability to preserve financial flexibility • Focus on Balance Sheet strength to continue, with potential for reasonable levels of gearing for suitable growth opportunities $ million Beach Liquidity Reserves 800 600 300 300 300 300 30
Slide 18: 6. Value accretive growth close to home
6. Value accretive growth close to home For personal use only • Numerous new play types within Focusing on core strategic basins existing Cooper Basin acreage – New targets in Western Flank from seismic re-processing – Deep coal potential in south of basin – Seeking to replicate oil success in Easte
Slide 19: Cooper Basin: Western Flank
For personal use only Cooper Basin: Western Flank 19
Slide 20: Western Flank oil migration path
Western Flank oil migration path For personal use only 20
Slide 21: Western Flank: Bauer development and new fields
Ex PEL 91 For personal use only • Beach 40% and operator, Drillsearch 60% Retention licences 151 to 172 granted • H1 FY15 gross production of 2.1 MMbbl • Second Bauer four-well pad campaign complete • Bauer facility expansion to 75,000 bfpd complete (+25,000 bfpd) – Planning of next expansion underw
Slide 22: Bauer Field pad development
Bauer Field pad development For personal use only • Two four-well pad drilling campaigns completed in the Bauer Field • Development of flank area surrounding Bauer-12 • Three to six metre Namur Sandstone oil columns targeted • Wells drilled ~10 metres apart at surface; directional drilling from ~700
Slide 23: Pad well results
Pad well results For personal use only • Results exceeded pre-drill estimates High / Namur McKinlay Well (Low) to Sandstone Member • Six of eight wells high to prognosis Prognosis1 Net Pay1 Interval2 Pad 1 – Field size continues to increase Bauer-16 (1.1) 3.5 4.5 • Strong flow rates from short-term
Slide 24: Pad drilling logs
Pad 2 drilling logs For personal use only Bauer-20 Bauer-21 Bauer-22 Bauer-23 McKinlay Member Namur Sandstone OWC OOWC 2.0 metres low 0.3 metres high 0.9 metres high 3.1 metres high 2.8 metre Namur column 5.5 metre Namur column 5.3 metre Namur column 6.8 metre Namur column 1.0 metre sweep 0.4 metre
Slide 25: Infrastructure upgrades
Infrastructure upgrades For personal use only • New pipelines from Stunsail and Pennington facilities feeding into new hub • Hub to be gateway for transportation of oil through single pipeline to Bauer facility • CKS brought online in October 2014 • Balgowan Field to tie-in to Stunsail facility – Ex
Slide 26: Western Flank: seismic reprocessing and exploration
Ex PEL 92 For personal use only • Beach 75% and operator, Cooper Energy Retention licences 85 to 104 granted 25% • H1 FY15 gross production of 0.8 MMbbl • Reprocessing and inversion of existing 3D seismic underway – Callawonga and Butlers / Parsons trends targeted – Indications of oil volumes not or
Slide 27: Recent Namur Sandstone discoveries
Ex PEL 104 / 111 For personal use only • Beach 40%, Senex 60% and operator Retention licences 136 to 150 granted • H1 FY15 gross production of 0.9 MMbbl – Spitfire Field producing above expectations • Historical focus on Birkhead Formation • Recent Martlet-1 and Martlet North-1 oil discoveries in th
Slide 28: Gas sales and appraisal wells
Ex PEL 106 For personal use only • Beach 50% and operator, Drillsearch 50% Retention licences 129 and 130 granted • H1 FY15 gross production of 0.4 MMboe • Gas sales agreement with SACB JV to March 2016 • Canunda-2 appraisal well cased and suspended – Expected online in FY16, subject to joint ventur
Slide 29: Eastern Flank – ATP
Eastern Flank – ATP 924 For personal use only • Farming-in 45% with Drillsearch Enviable address between existing fields • Permit area ~2,300 km2 and located between the Inland and Cook oil fields • Targeting Jurassic oil and Permian gas reservoirs on large structural ridges • Agreement to drill up
Slide 30: Eastern Flank – ATP
Eastern Flank – ATP 732 For personal use only • Farming-in 50% with Bengal Energy Proximal to long-producing oil fields • Enviable address proximal to long- producing oil fields • Nassarius 3D covering 306 km2 acquired in 2014 in north of permit • Seismic processing complete and interpretation under
Slide 31: Deep Coals – PEL
Deep Coals – PEL 94 / 95 For personal use only • PEL 94: Beach 50% and operator, Strike New play type in south of Cooper Basin Energy 35%, Senex Energy 15% • PEL 95: Beach 50% and operator, Strike Energy 50% • Targeting deep coals at 1,500 metres – 2,000 metres depth in PEL 94 • Well costs of ~$3 mi
Slide 32: Eastern Australian Gas Market
For personal use only Eastern Australian Gas Market 32
Slide 33: East coast gas market dynamics
East coast gas market dynamics For personal use only • Falling quantity of contracted gas in key East coast domestic gas contracts, by basin, 2012 to 2031 Eastern Australian market – Contractual arrangements covering around 260 PJ of gas due to expire in next four to five years • Large domestic gas
Slide 34: Prolific gas acreage strategically located
Prolific gas acreage strategically located For personal use only • Cooper and Eromanga basins the engine room for Beach – Generating all Australian production – Conventional oil, gas and deep gas activity • Otway Basin – Offshore 3D seismic underway – Proximal to infrastructure supplying Victoria an
Slide 35: Key Beach gas transactions
Key Beach gas transactions For personal use only • Origin gas sales agreement High value - Signed April 2013 opportunities - 139 PJ over eight years; potential to extend to 173 PJ over ten years - Supply to start by 1 July 2015 Exposure to oil linked • Transitional GSA for up to 2.3 PJ to 30 June 20
Slide 36: Cooper Basin: Delhi (SACB and SWQ JVs)
For personal use only Cooper Basin: Delhi (SACB and SWQ JVs) 36
Slide 37: SACB and SWQ JVs
SACB and SWQ JVs For personal use only • Significant acreage with strategic infrastructure • Gross joint venture area of ~26,800 km2 (~6.6 million acres) • ~6,000 kilometres of flowlines • Primary processing and transportation facilities • Upside from shale, coal and basin centred gas plays • Beach
Slide 38: SACB JV gas – 2013/14
SACB JV gas – 2013/14 For personal use only • Development in 2013 and 2014 primarily focused on close spaced infill drilling • Cowralli, Moomba North and Big Lake fields key focus; mixed program results 38
Slide 39: SACB JV gas – 2015
SACB JV gas – 2015 For personal use only • 2015 program more geographically widespread • Mudera and Marabooka to focus on shallower Coorikiana sands, with lower drilling costs • Potential drilling programs in Moomba North and Tirrawarra 39
Slide 40: SWQ JVs – 2015
SWQ JVs – 2015 For personal use only • 2015 program to focus on northern fields, with appraisal and exploration drilling • Significant development and appraisal / exploration at Whanto • Pipeline infrastructure upgrades underway to deliver gas to market 40
Slide 41: Nappamerri Trough Natural Gas
For personal use only Nappamerri Trough Natural Gas 41
Slide 42: Nappamerri Trough Natural Gas
Nappamerri Trough Natural Gas For personal use only An aerially extensive resource, with permits covering more than 800,000 acres Ex PEL 218 (PRLs 33 to 49) – Beach 100%; ATP 855 – Beach 64.9% and operator, Icon Energy 35.1% 42
Slide 43: Permian cross-section
Permian cross-section For personal use only In excess of 1,000 metres of gas saturated section across entire permit areas 43
Slide 44: Stage 1 exploration phase
Stage 1 exploration phase For personal use only Stage 1 exploration phase complete – all technical objectives met Key Objectives Key Highlights Geographically and vertically delineate 1. 18 wells drilled across permits target zones Test fracture stimulation techniques and 2. 16 wells fracture st
Slide 45: Stage 1 foundation
Stage 2 foundation For personal use only Stage 1 learnings and investment provide significant optionality for future activities • Significant third party investment to date Significant Stage 2 • Permits in good standing with minimal spend required learnings and Foundation • Large gas volumes confirm
Slide 46: Next steps
Next steps For personal use only A measured approach to capital spend and timing of future activities • Complete technical review of Stage 1 results with joint venture partner • Confirm play concepts for further appraisal, such as Daralingie sands, areas Next Steps1 of strong gas shows/pressure (Kep
Slide 47: Potential new play: Daralingie Formation
Potential new play: Daralingie Formation For personal use only Unique Stratigraphy • Intersected stratigraphic sections in the Nappamerri Trough not seen elsewhere in the Cooper Basin • Daralingie sand packages productive when tested to date • Thick sand packages in Daralingie likely to be further a
Slide 48: Identified high grade targets
Identified high grade targets For personal use only Ex PEL 218 • Observed enhanced porosity • Structural highs ATP 855 • Daralingie (Etty-1) and Patchawarra (Geoffrey-1) flows • Gas kick in Keppel-1 • High reservoir pressure • Elevated permeability • Evidence of natural fractures and enhanced porosi
Slide 49: Other Interests
For personal use only Other Interests 49
Slide 50: Other Australian interests
Other Australian interests For personal use only Otway Basin Gippsland Basin Various Beach interests, from 30.0% to 75.0% Beach 65%, Cooper Energy 35% and operator 50
Slide 51: Other Australian interests
Other Australian interests For personal use only Bonaparte Basin Browse and Carnarvon Basins Browse Basin: Beach 7.34%, Santos 47.83% and operator, Chevron 24.83%, Inpex 20.0% Beach farming-in 85% with TOAG (currently Beach 55% and operator, TOAG 45%) Carnarvon Basin: Beach 10.0%, Santos 37.33% and
Slide 52: Egypt – Sale process underway
Egypt – Sale process underway For personal use only Egypt Permit Interests Abu Sennan Concession Beach 22%, KEE 50% and operator, Dover 28% 52
Slide 53: Tanzania – Farming-down to Woodside
Tanzania – Farming-down to Woodside For personal use only Lake Tanganyika South Block Seismic Surveys Beach farming-down 70% to Woodside 53
Slide 54: New Zealand
New Zealand For personal use only South Island – Canterbury Basin North Island – Taranaki Basin PEP 57080: Beach 50%, Tod Exploration 50% and operator Beach 50%, NZOG Devon 50% and operator PEP 52181: Beach 25%, NZOG Energy 35% and operator, TAG 40% 54
Slide 55: Appendix
For personal use only Appendix 55
Slide 56: Summary financial results
Summary financial results For personal use only H1 FY15 H1 FY14 Change Sales volumes (MMboe) 5.7 5.6 2% Sales revenue ($ million) 426.8 557.2 (23%) Operating cash flow ($ million) 135.6 274.5 (51%) NPAT ($ million) (79.1) 160.5 (149%) Underlying NPAT ($ million) 72.4 158.1 (54%) Cash balance ($ mill
Slide 57: Production by area
Production by area For personal use only Area H1 FY15 H1 FY14 Change Cooper / Eromanga basins 2,370.2 2,603.9 (9.0%) Oil (kbbl) Egypt 49.5 32.7 51.4% Total oil 2,419.7 2,636.6 (8.2%) Sales gas and ethane (PJ) Cooper Basin 11.5 11.0 4.4% LPG (kt) Cooper Basin 24.2 25.9 (6.7%) Condensate (kbbl) Cooper
Slide 58: Contact information
Contact information For personal use only Beach Energy Limited 25 Conyngham Street Glenside SA 5065 Tel: +61 8 8338 2833 Fax: +61 8 8338 2336 Website: www.beachenergy.com.au External Affairs Chris Jamieson Group Executive External Affairs Email: chris.jamieson@beachenergy.com.au Derek Piper Investor