Slide 1: Orbost gas plant
For personal use only Orbost gas plant 15 August 2016
Slide 2: Important information
The information in this presentation: For personal use only • Is not an offer or recommendation to purchase or subscribe for shares in Cooper Energy Limited or to retain or sell any shares that are currently held. • Does not take into account the individual investment objectives or the financial sit
Slide 3: Solid fundamentals, gas strategy, strong balance sheet
For personal use only 1 Solid fundamentals and management of core disciplines − Cooper Basin oil and cash generation − general administration and operating costs reduced − safety excellence 2 Cooper Energy is being transformed by the execution of the gas strategy − foundation gas supply agreements i
Slide 4: FY16 highlights
For personal use only • Revenue of $27.4 million, down 30% on lower oil prices • Significant non-operating items of $(32.0) million, mainly impairments announced at half year • Statutory net loss after tax $34.8 million compared with pcp net loss of $63.5 million • Underlying net loss after tax of $
Slide 5: Safety performance
For personal use only • Zero Recordable Cases, TRCFR = 0.0 (FY15 TRCFR = 4.2) Total Recordable Case Frequency Rate (TRCFR) • Zero Lost Time Injuries Events per million hours worked • 963,000 hours worked 6 – level with previous year • Continuous improvement initiatives implemented 4 4.18 – mindfulne
Slide 6: FY16 financial summary
For personal use only $ million unless otherwise indicated FY16 FY15 change Production MMbbl 0.47 0.48 -2% Sales volume MMbbl 0.45 0.46 -1% Sales revenue 27.4 39.1 -30% Oil price average A$/bbl 60.75 85.56 -29% Oil operating cash cost average A$/bbl 29.71 36.76 -19% Gross profit 9.9 14.1 -30% Gross
Slide 7: Underlying net profit after tax
For personal use only Underlying net profit after tax $ million Sales Sales revenue - revenue - Other Exploration FX Orbost care Fair val. Admin & FY15 price volume Cost of sales revenue w/o movements & maint. adjust. other Tax impacts FY16 -1.3 -2.8 -1.0 + 2.6 + 2.5 -1.0 -0.6 -1.2 +1.3 -11.3 + 7.6
Slide 8: Oil segment and underlying NPAT
For personal use only $ million FY 16 FY15 Oil Sales revenue 27.4 39.1 Gross profit 9.9 14.1 Gross profit / Sales revenue 36% 36% Exploration expense 0.2 2.3 General Admin1 2.6 3.0 Underlying EBITDA 11.3 17.0 Underlying PBT 6.6 8.1 Income tax expense (prima facie) 2.0 2.4 Oil Underlying NPAT 4.6 5.7
Slide 9: Cash and investments movement
For personal use only $ million Total cash & investments = 50.8 Total cash & investments = 41.3 13.6 (9.9) 1.0 Investments 1.3 (at fair value) 3.4 0.8 47.3 (32.4) 21.2 49.8 Investments 1.9 (at fair value) 39.4 12.4 Cash & deposits Cash & deposits Operating Investing, +7.9 Financing & Other +2.5 Jun-
Slide 10: Cooper Basin reserves, costs and netback
For personal use only Cooper Basin Proved & Probable (2P) reserves Cooper Basin costs & netback MMbbl1 A$/bbl 100 1.38 0.32 80 53 0.20 1.27 Netback 60 35 Royalty 40 Transport 7 4 20 16 16 Operating 11 11 0 30-Jun-15 Production Revisions 30-Jun-16 FY15 FY16 • Production in FY16 and FY17 impacted by s
Slide 11: Eastern Australia demand and contracted supply
For personal use only Eastern Australia demand and contracted supply Gladstone drawing gas from PJ eastern Australia 2,500 2,000 Supply under contract from: 1,500 NGP Cooper Basin 1,000 Otway Bass Gippsland 500 Surat-Bowen Demand 0 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Source: Energ
Slide 12: Orbost Gas Plant and Gippsland gas phases
For personal use only Orbost Gas Plant • Existing plant connected to Eastern Gas Pipeline • Capacity 90 TJ/day • Modifications to process Sole gas • COE: 50%, STO 50% (Operator) Illustrative graphic only – actual development plan may differ Phase 3 : Other Phase 2 :Manta Phase 1:Sole • Exploration p
Slide 13: Sole FEED and FID workplan
For personal use only September quarter December quarter FEED Mid FEED Review Regulatory Approvals Final Engineering Reports (end August) Final CAPEX (end August) Assurance Independent Expert Report (Subsurface & Reserves) Independent Expert Report (Review of Facilities Plan) Quality Assurance
Slide 14: Gippsland indicative gas production
For personal use only Indicative gross PJ 60 • Gippsland gas projects can produce approximately 320 PJ (gross) from current projects 50 • Peak production close to 50 PJ p.a and plateaus for 4-5 23 23 23 23 years from FY22 40 • Additional revenue from liquids production 13 10 • Near field exploration
Slide 15: Gas sales contracting strategy
For personal use only Indicative PJ COE sales 14 12 10 Available for 8 contract 6 AGL & O-I agreements 4 2 0 FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 FY29 • Foundation Heads of Agreement for 7.6 PJ pa with AGL and O-I Australia = 61% of Cooper Energy equity gas from Sole • Gas prices increa
Slide 16: Strategy and milestones
For personal use only Low cost Cooper Basin oil production & exploration Sole gas project construction complete & production commenced Sole gas project funding finalised and FID Portfolio of long and short term gas sales contracts Sole gas project construction commences Gippsland explora
Slide 17: Summary
• FY16 results reflect impact of lower prices and drilling suspension For personal use only • Cash generation from Cooper Basin operations is strong with low operating cash costs • Portfolio realignment near complete: Cooper Energy soon to be Australia only for first time in 12 years • Gas supply to
Slide 18: Appendices
For personal use only Appendices
Slide 19: Key figures
For personal use only Key figures Cooper Energy is an independent Australian exploration and Shares on issue2 435.2 mill production company Shareholders2 4,906 • Cash generating Cooper Basin oil production Market capitalisation2 $109 mill • Strong balance sheet, zero debt Cash & investments at 30 Ju
Slide 20: Underlying loss reconciliation
For personal use only $ million 12 months ending 30 June 2016 2015 Net loss after income tax 34.8 63.5 Adjusted for: Impairment of discontinued operations & loss on sale 13.0 47.6 Exit provision 3.7 0.0 Impairment of oil properties 0.0 7.5 Impairment of exploration and evaluation 21.7 7.2 Impairment
Slide 21: Hedge arrangements
For personal use only Hedge arrangements H1 H2 H1 Total (bbl remaining as at 30 June 2016): FY17 FY17 FY18 A$57.00 – A$69.70: zero cost collar options 60,000 30,000 - 90,000 A$54.45 floor + 50% above floor: 30,000 30,000 30,000 90,000 zero cost participating swap Total 90,000 60,000 30,000 180,000 2
Slide 22: Petroleum reserves and contingent resources
For personal use only Petroleum Reserves at 30 June 2016 (MMbbl) Category Proved (1P) Proved plus Probable (2P) Proved, Probable plus Possible (3P) Australia Indonesia Total Australia Indonesia Total Australia Indonesia Total Developed 0.62 0.50 1.12 0.98 0.93 1.91 1.70 1.39 3.08 Undeveloped 0.16 0.
Slide 23: FY17 guidance and expenditure
For personal use only Expenditure Wells # 0.59 0.52 0.49 0.48 Total Exp. Dev. Exp. Dev. 0.47 0.41 Australia • Cooper Basin 5 2 3 1-2 2-3 0.28 • Otway Basin 1 1 - - - – 0.24 • Gippsland Basin 8 8 - - - Total 14 10 3 1-2 2-3 FY11 FY12 FY13 FY14 FY15 FY16 FY17 • FY16 production guidance 0.24 MMbbl - 0.
Slide 24: South east Australia gas demand and supply
For personal use only Gas demand vs production/contract from existing suppliers for Forecast south east Australia gas demand and supply south east Australia balance PJ pa PJ pa 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 500 50 450 400 0 350 = supply/ 300 demand balance -50 250 200 -100 150
Slide 25: Gas flows and Victorian wholesale gas prices
For personal use only Gas flows from south east Australian sources 2015 vs 2016 Victorian wholesale gas price 2015 vs 2016 average Tj/day $/GJ 1,600 45 1,400 40 35 1,200 30 1,000 25 800 20 600 15 400 10 200 5 0 0 Apr- Apr- May- May- Jun- Jun- Jul-15Jul-16 January February March April May June July 1
Slide 26: Cooper Basin FY17 outlook
For personal use only • FY17 production forecast to be 0.24 MMbbl – 0.28 MMbbl • FY17 forecast direct operating cash cost ~A$31/bbl including transport and royalties • Ongoing investment in technical effort maintained with seismic inversion studies and prospect interpretation ongoing • 3- 5 wells pl
Slide 27: Manta gas development
For personal use only • COE business case identified economic opportunity for Manta development A A’ • Manta gas attracting enquiries from gas buyers • Untested Golden Beach reservoirs identified within the same structure below proven gas in the Manta field • Gas resource of 106 PJ 2C Contingent and
Slide 28: Otway Basin exploration
For personal use only • Analysis of Jolly-1 and Bungaloo-1 well data in PEL 494 and PRL 32 has confirmed: – a deep conventional gas play in Lower Sawpit Formation – Casterton Formation unconventional shale gas play • Victorian acreage subject of application to suspend and extend due to moratorium on
Slide 29: Reserves and resources notes
The approach for all reserve and resource calculations is consistent with the definitions and guidelines in the Society of Petroleum Engineers (SPE) 2007 Petroleum Resources Management System (PRMS). The resource estimate methodologies incorporate a range of uncertainty relating to each of the key r
Slide 30: Glossary and abbreviations
For personal use only $ Australian dollars unless specified otherwise Bbl barrels of oil boe barrel of oil equivalent bopd barrel of oil per day EBITDA earnings before interest, tax, depreciation and amortisation FEED Front end engineering and design kbbls thousand barrels LTIFR Lost Time Injury Fre
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