Talos Energy, Inc. · NYSE:TALO
Talos Energy — Barclays CEO Energy-Power Conference 2021
34 slides from Talos Energy's conference presentation, Sep 8, 2021
Slide 1: Barclays CEO Energy-Power Conference
September 8-9, 2021 Barclays CEO Energy-Power Conference
Slide 2: Cautionary Statements
Cautionary Statements Cautionary Statement Regarding Forward-Looking Statements This presentation contains “forward-looking statements” for purposes of the federal securities laws. All statements, other than statements of historical fact included in this presentation, regarding our strategy, future
Slide 3: Talos Energy Mission & Vision
Talos Energy Mission & Vision Talos is committed to leveraging its technical, operational and commercial expertise to help supply society’s growing Talos Corporate need for secure, affordable energy while being responsible global citizens and building value for all stakeholders Evolution Talos h
Slide 4: Building A Leading Independent Energy Company
Building A Leading Independent Energy Company Louisiana Texas CCS Texas GLO Carbon Opportunities Capture Site RAM POWELL POMPANO AMBERJACK Talos Acreage Talos Seismic Emerging CCS Project Opportunities GC-18 HP-1 CCS VENTURES Solid Foundation Attractive Operating Profile Strong Credit Catalysts for
Slide 5: Compelling Equity Upside Story
Compelling Equity Upside Story Talos trades at a significant discount to fundamental value despite solid execution and a strong credit profile NAV excludes any value from: 1P Probables: Primarily performance- based (no additional capital required); PV-10 of ~$1.5 Bn at $65/$3 (net) PDP Carbon Ca
Slide 6: Performance and Valuation Remain Disconnected
Performance and Valuation Remain Disconnected Talos is generating record margins with a solid balance sheet, but valuation continues to lag the peer group EBITDA Margins (Unhedged) Leverage Solid credit amongst $50.00 Talos Record margins Talos 3.0x peers, despite industry Selected Peer E&Ps demonst
Slide 7: Gulf of Mexico Technical & Commercial Differentiators
Gulf of Mexico Technical & Commercial Differentiators The Gulf of Mexico has remained a prolific basin for decades, yet continues to offer new frontiers Continued Large Basin Large Geological Column Prospect with World Generation Class Rock Properties Huge Resource Potential Ample Infrastructu
Slide 8: An Emissions Leader In An Emissions-Leading Basin
An Emissions Leader In An Emissions-Leading Basin GOM emissions intensity is among the lowest worldwide, and Talos is committed to lowering operated emissions GHG Intensity by Region Talos GHG Intensity (MT CO2 Equivalent/MBoe) (Gross Operated Production, MT CO2 Equivalent/MBoe) 25.0 80.0 21.8 70.0
Slide 9: Talos Strategic Approach to Full Lifecycle Management
Talos Strategic Approach to Full Lifecycle Management Success driven by ability to invest across the asset lifecycle and consistently improve opportunity set Advanced Seismic Reprocessing M&A Entry Asset Management In-Field Drilling Exploitation Exploration Low entry-cost Invest in recompletions
Slide 10: Full-Cycle Regional Case Study – Green Canyon
Full-Cycle Regional Case Study – Green Canyon Technical expertise unlocks resource opportunity; leveraging infrastructure provides strong full-cycle value creation 1 2 3 3 1 In-Field Drilling: Green Canyon 18 2 Exploitation: Phoenix Complex 3 High Impact Exploration: Puma West Acquired GC-18 for <
Slide 11: Catalysts: Puma West Discovery
Catalysts: Puma West Discovery Pompano Ram Powell Project Overview Amberjack High-impact test of sub-salt Miocene exploration targets Delta House Located on Talos-controlled acreage; farmed-in bp and Chevron in 2019 GC 18 HP-1 Middle and Lower Miocene objectives in close proximity to bp’s Mad
Slide 12: Development & Exploration Pipeline
Catalysts Driving Future Value Creation Development & Exploration Pipeline Puma West discovery; appraisal pending Zama represents material value Demonstrated ability to explore with success Highly active business development to access new projects Unprecedented M&A Opportunity Access to majo
Slide 13: Catalysts: High-Impact Exploration
Catalysts: High-Impact Exploration Talos possesses the capability, acreage and prospects to generate significant value through future drilling Gulf of Mexico Geologic Ages Well-Positioned to Execute Norphlet Talos holds a strategic position in every major Venice geological trend in the basin: Polyph
Slide 14: Catalysts: Zama
Catalysts: Zama Zama carries significant point-forward value in any case is not reflected in the current valuation Mexico Accomplishments Unitization Updates First and only successful entrant in initial 2015 bid Zama unitization agreement and development plan are round main gating items to FID,
Slide 15: Catalysts: Global M&A Opportunity
Catalysts: Global M&A Opportunity Opportunity Set North Unprecedented consolidation opportunity driven by: Sea ― Record near-term divestment targets ― Long-dated private investments ― Push for scale and cost-efficiency ― Limited universe of capable, well-positioned consolidators Gulf of Talos is
Slide 16: Macro Rationale for Carbon Capture and Storage
Carbon Capture Makes Sense Today Macro Rationale for Carbon Capture and Storage Logical decarbonization avenue that complements the world’s existing energy mix Leverages commercial / legal frameworks and operator capabilities that already exist from decades of energy expertise Actually removes
Slide 17: Talos Rationale for Carbon Capture and Storage
…and is a Natural Fit for Talos Talos Rationale for Carbon Capture and Storage Talos is building a large-scale decarbonization solutions business Talos’s core skills naturally complement a fully-integrated carbon capture and storage business The Company’s technical and operational capability,
Slide 18: CCS Market Opportunity Along the Gulf Coast
CCS Market Opportunity Along the Gulf Coast Industrial emitters are concentrated along the Gulf Coast, adjacent to huge storage capacity and infrastructure GLO Acreage Award America’s Industrial Epicenter Critical power gen., industrial and petrochemical corridor 100+ facilities emitting >1,000,
Slide 19: Carbon Capture and Storage Value Chain
Carbon Capture and Storage Value Chain CCS leverages Talos’s transferrable skills to mature project opportunities along the decarbonization value chain Cluster of 3rd Party Midstream Central Industrial CO2 Sources Transport Collection Hub Offshore CCS Value Chain 3 1 Capture & Consolidate Emitters u
Slide 20: A Win-Win Partnership with a Critical U.S. Region
A Win-Win Partnership with a Critical U.S. Region Talos is positioned to be a vital partner to the country’s industrial epicenter as both an upstream energy supplier and a long-term emissions solutions provider US Gulf Coast Industrial Complex Essential U.S. Hydrocarbon Producer Unique Decarbonizati
Slide 21: Texas GLO Carbon Storage Site
Texas GLO Carbon Storage Site Talos will operate the first major offshore carbon storage site in the United States Beaumont Key Highlights Selected from 12 bids as sole winning bidder partnership with Carbonvert; minimal initial payments Talos identified prime geological conditions for CO2 stora
Slide 22: Talos Carbon Capture and Storage Vision
Talos Carbon Capture and Storage Vision Talos aims to build a multi-project, full-scale CCS business along the US Gulf Coast Today Next 12 Months Next 5 Years Established Gulf Coast-wide joint venture Targeting 3-4 identified storage sites Numerous storage sites spanning with Storegga across t
Slide 23: 2021 Operational & Financial Guidance
2021 Operational & Financial Guidance Production 2020A 2021E As of March 10, 2021 Expect 2H production above 1H production levels, assuming weather- related deferrals remain low Oil (MMBbl) 13.7 15.7 – 16.6 Includes 1H impacts of Praline tie-in and platform rig construction at Pompano as well as
Slide 24: Solid Capital Structure
Solid Capital Structure Talos maintains high liquidity, low leverage and no major maturities for ~3.5 years Recent Actions Key Credit Statistics Extended credit facility maturity to November 2024 ― Thirteen leading commercial banks in new credit facility ― Aiming to fill excess borrowing base capa
Slide 25: Talos Investment Case Highlights
Talos Investment Case Highlights MANAGEMENT TRACK RECORD OF SUCCESS STRONG, OIL-LINKED MARGINS AND CONSISTENT FREE CASH FLOW GENERATION HEALTHY CREDIT PROFILE SOLID, DIVERSE INVENTORY OF ATTRACTIVE INVESTMENT OPPORTUNITIES SKILL SETS TO DIVERSIFY AS CARBON CAPTURE AND STORAGE LEADER CATALYSTS TO DRI
Slide 26: Appendix
APPENDIX 26
Slide 27: ESG Leadership & Safety Focus
ESG Leadership & Safety Focus >50% reduction in TRIR from 2018 ‒ One recordable incident by Talos offshore and shore based employees in 2020 ‒ Ten total recordable incidents across >3,600,000 offshore hours SAFETY ‒ Highly competitive incident rate across all economic sectors; below GOM averages F
Slide 28: Sensitivity of PV-10 At Various Oil Prices
Sensitivity of PV-10 At Various Oil Prices $/Bbl WTI SEC $55.00 $60.00 $65.00 $70.00 $75.00 PDP $2,097 $2,445 $2,724 $3,012 $3,293 $3,571 PDNP $495 $616 $704 $791 $881 $969 Total Proved Developed $2,592 $3,061 $3,428 $3,803 $4,174 $4,539 Proved Undeveloped $128 $190 $234 $281 $324 $371 Total Proved
Slide 29: Inventory Overview – Generic Project Categorization
Inventory Overview – Generic Project Categorization In-Field Drilling Exploitation Exploration & Development Description Low risk, incremental recovery Field or play extensions Emerging trends Impact Potential Resource Size (MMBoe) 1.0 - 5.0 5.0 - 15.0 15.0+ (Gross, Per Well) Potential Production Ra
Slide 30: High-Impact Exploration – Key Geological Plays
High-Impact Exploration – Key Geological Plays Miocene & Pliocene Key Points Mature play with opportunities infrastructure-led opportunities along the prolific Mississippi & Green Canyon fairway Venice Ram Powell Amplitude driven prospects that are receptive to high-end seismic processing, Pompa
Slide 31: High-Impact Exploration – Key Geological Plays
High-Impact Exploration – Key Geological Plays Subsalt Miocene Key Points Maturing play that requires extensive seismic processing to resolve and de-risk structural and stratigraphic uncertainties Ram Powell Amplitude support is becoming more understood with the latest seismic volumes and Pompan
Slide 32: High-Impact Exploration – Key Geological Plays
High-Impact Exploration – Key Geological Plays Cretaceous & Norphlet Key Points Aircraft Carrier Norphlet Emerging plays being explored by the majors Chevron Silverback prospect currently testing Cretaceous, analogous to Ram Powell Polyphemus Pompano Polyphemus Cretaceous Large volumes in plac
Slide 33: High-Impact Exploration – Key Geological Plays
High-Impact Exploration – Key Geological Plays Wilcox Key Points Maturing play garnering attention from IOCs and Majors Requires extensive seismic processing to resolve and de-risk structural and stratigraphic uncertainties Large volumes in place with variable reservoir and fluid properties
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