Newmed Energy Limited Partnership · TASE:NWMD
Newmed Energy Limited Partnership — Delek Drilling – Limited Partnership — Delek Group Investors Conference 2017
27 slides from Newmed Energy Limited Partnership's conference presentation, Oct 30, 2017
Slide 1: Investor Presentation
Investor Presentation October 2017 Delek Drilling – Energizing The Eastern Med
Slide 2: Disclaimer
Disclaimer This presentation was prepared by Delek Drilling – Limited Partnership (the “Partnership”), and is given to you only for the provision of concise information for the sake of convenience, and may not be copied or distributed to any other person. This presentation does not purport to be com
Slide 3: Leviathan Development Status Update
Leviathan Development Status Update 3
Slide 4: Leviathan – A Regional Energy Game Changer
Leviathan – A Regional Energy Game Changer Ownership Delek Drilling 45.3%, Ratio 15%, Noble Energy (operator) 39.7% 2P+2C Resources* 21.4 tcf, 38.4 mmbbl condensate Estimated First Gas 4Q 2019 Production Capacity (to be built in 2 stages) 1.2 bcf/d (~12 bcm/y) – for Domestic, Jordan and PA 0.9 bcf/d
Slide 5: Project Development on Time on Budget
Project Development on Time on Budget Phase I development progressing, 23% complete Fabrication has started on the platform topsides, jacket, and the subsea equipment All building permits received or submitted More than 500 people currently working on the Project. 1500 people by the end of 2
Slide 6: Leviathan Drilling Campaign
Leviathan Drilling Campaign Leviathan – 5 and Leviathan – 7 open hole were drilled in 2017 by the Atwood Advantage drill-ship. The Leviathan partners decided to complete the drilling and completion campaign with the Ensco DS- 7 Scope of work Drill Leviathan – 7 to TD Drill Leviathan – 3 to TD
Slide 7: Domestic Gas Market Outlook
Domestic Gas Market Outlook 7
Slide 8: Domestic Market Gas Consumption
Domestic Market Gas Consumption Israel Actual Gas Consumption (2004-2017) bcm/y Since the beginning of flow from Tamar in 2013, 10.7 the annual growth rate has been about 10% 9.7 8.4 7.6 6.9 5.3 5.0 4.2 3.8 2.7 2.6 2.3 1.6 1.2 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017E De
Slide 9: Domestic Market Limited Supply
Domestic Market Limited Supply Gas demand is constrained by Tamar capacity With Leviathan on stream a leap in demand for natural gas is expected from 2020, with the removal of this limitation and the entry of additional sources of gas Gas Demand in 2016 9.7 Increase demand for electricity and In
Slide 10: Domestic Demand Forecast Growth
Domestic Demand Forecast Growth Gas Demand Forecast (BCM) 40.0 Demand in 2025 – BDO VS NGA 35.0 30.0 25.0 20.0 15.0 10.0 5.0 0.0 2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 2037 2039 Source : BDO Delek Drilling – Energizing The Eastern Med
Slide 11: Gas Market Revolution
Gas Market Revolution Electricity generated by gas is expected to triple by 2040 and will represent 85% of total electricity generated according to Ministry of energy and water publications The consumption of coal (as of 2016) is equivalent to about 5 bcm per year Assuming complete production
Slide 12: Growing domestic gas market
Growing domestic gas market Electricity production capacity, historical development and expected capacity by type of fuel: 2010 2015 2020 Renewable Renewable Fuel Oil 5% Coal 8% 22% 17% Coal 28% Coal 37% Renewable 1% Natural Gas Natural Gas 40% 67% Natural Gas 75% Source : IEC, BDO estimates Delek
Slide 13: Coal Reduction Economic
Coal Reduction Economic Over supply of natural gas is not consistent with continued coal electricity production GAS COAL 4.7 3.2 Fuel Price ($/mmbtu) $/mmbtu $/mmbtu (77 $/ton) Energy Efficiency 58% 39% 3.2 3.3 Cost of energy in the production of electricity Cent/kWh Cent/kWh Government Take 60% 10%
Slide 14: Growing domestic gas market
Growing domestic gas market Domestic gas market growth engines Driven mainly by population growth, increase in disposable income and real wage and growth in the use Increased electricity of electrical appliances demand Increased connectivity of industrial clients to the natural gas network Change in
Slide 15: Additional Demand Factors in Process
Additional Demand Factors in Process 15
Slide 16: Additional Possible Demand Factors- Aluminum
Additional Possible Demand Factors- Aluminum Aluminum advantage ▪ Light ▪ Hard ▪ Don’t rust Aluminum usage ▪ Transportation - Engines, car parts, aircraft parts ▪ Construction - profiles, lintels, windows, fences ▪ Consumer Products - Disposable Products, Packaging ▪ Heat exchangers - computers
Slide 17: Additional Possible Demand Factors- Aluminum
Additional Possible Demand Factors- Aluminum Alumina Aluminum Potline Bauxite Aluminum Aluminum Smelter (smelting cells) oxide The production of aluminum is characterized by high energy consumption, alongside a relatively large number of workers Delek Drilling - Energizing The Eastern Mediterranean
Slide 18: Additional Possible Demand Factors- Aluminum
Additional Possible Demand Factors- Aluminum Delek Drilling is exploring to promote an aluminum plant in Israel World annual consumption of Aluminum is 59mm tons in 2016, Market average growth rate of 6.5% per annum Israel currently consumes about 50,000 tons of aluminum Most of the primary al
Slide 19: Additional Possible Demand Factors- Transportation
Additional Possible Demand Factors- Transportation Delek Drilling and Gazprom signed a non-binding MOU for jointly examination of possibilities of using natural gas as a fuel for transportation Delek Drilling LP– Energizing The Eastern Med 19
Slide 20: Unlocking Regional Markets
Unlocking Regional Markets 20
Slide 21: Jordan Gas Demand
Jordan Gas Demand 97% of Jordan energy is imported Natural gas is responsible for 80% of power generation Gas demand in 2017 is expected to reach 3.5-4.0 bcm, all of which imported LNG Fuel to power consumption represent demand of ~5 bcm INGL enlarged the originally designed pipeline Delek
Slide 22: Regional Infrastructure Solution
Regional Infrastructure Solution Regional market access via multiple infrastructure entry options solutions *Resources: 2C, based on NSAI report 2014 Delek Drilling– Energizing The Eastern Med 23
Slide 23: Egypt – Supply Demand Imbalance
Egypt – Supply Demand Imbalance ▪ Significant consumption of over 50 bcm/y, and Egyptian Domestic Supply-Demand Balance increasing by Approx. 8% year on year 90 80 ▪ Additional gas is required for two existing LNG 70 facilities, consuming approx. 17 to 20 bcm/y 60 ▪ Egypt is fast tracking new develo
Slide 24: Sea of Demand
Sea of Demand Israel – Domestic market Jordan - NEPCO Palestinian Authority Egypt – Domestic market Egypt – LNG Facilities Turkey Israel EEZ LNG Sites Platform Existing Pipelines Future possible Pipelines Delek Drilling – Energizing The Eastern Med 25
Slide 25: Delek Drilling Financial Strength
Delek Drilling Financial Strength Delek Drilling LP– Energizing The Eastern Med
Slide 26: Robust Dividend Distribution
Robust Dividend Distribution Cash dividend of c. $1.5B in last years 680 ~ 20% Dividend Yield LTM 200 150 100 2014 2015 2016 2017 • Dividend payment of Delek Drilling and Avner combined • Not include tax advances in the amount $300 mm between the years 2015-2017 Delek Drilling LP– Energizing The Eas
Slide 27: Thank You
Thank You
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