Ecopetrol Sa · BVC:ECOPETROL
Ecopetrol Sa — Q4 2013 Earnings Presentation
27 slides from Ecopetrol Sa's earnings presentation, Feb 27, 2014
Slide 1: Financial & Operational Results 4th Quarter 2013
FINANCIAL & OPERATIONAL RESULTS 4th Quarter 2013 February 27 of 2014 Caño Sur Field Meta Province, Colombia
Slide 2: Disclaimer
Disclaimer This document was prepared by Ecopetrol S.A. with the purpose of providing the market and interested parties certain financial and other information of the Company. This document may include strategy discussions and forward-looking statements regarding the probable development of Ecopetro
Slide 3: Management Participants
Management Participants Javier Gutierrez Humberto Fuenzalida CEO Interim VP of Exploration Ecopetrol Ecopetrol Rafael Guzman Hector Manosalva VP of E&P’s Technical and Executive VP of E&P Development Ecopetrol Ecopetrol Pedro Rosales Alberto Vargas Executive VP of Downstream Financial Comptroller Ec
Slide 4: Agenda
Agenda 1. Highlights of 2013 2. Operational Update 2013 3. Outlook for 2014 4
Slide 5: Highlights of 2013
Highlights of 2013 2013 was a good year for Ecopetrol. Both reserves and production grew, and we maintained strong financial results within a challenging environment for our operations • Reserves replacement ratio of 139% • Production of 788 mboed (+4.5% vs 2012) Upstream • Declaration of commercial
Slide 6: 2013 Financial Results
2013 Financial Results Ecopetrol remains a financially strong company, with high margins (EBITDA, operating and net) in comparison to other oil companies. Its indebtedness continues to be low and its cash generation is strong 4Q 2012 4Q 2013 % 2012 2013 % Prices (USD/bl) Crude 99.6 96.5 -3.1% 103.3
Slide 7: Drivers of Income Statement 2012 VS 2013
Drivers of Income Statement 2012 VS 2013 Δ 2012-2013 1.5 0.5 62.5 59.5 -1.0 2.0 Revenues +$3.0 (+) (COP$ tn) 2012 Precio Price Volumen Volume T.F/X Cambio Otros Other 2013 Variable Costs 26.0 1.6 29.9 -1.1 2.6 0.9 (COP$ tn) +$3.9 (-) 2012 Precio Price Costo Transport Volumen Volume Otros Other 2013
Slide 8: Key Financial Results
Key Financial Results Δ 2012-2013 28.6 28.5 Ebitda (COP$ tn) -$0.1 2012 2013 30% 34% 21.5 20.4 Pre Tax Income (COP$ tn) -$1.1 2012 2013 Income Tax 7.0 6.6 (COP$ tn) +$0.4 2012 2013 Net Income 15.0 13.4 (COP$ tn) -$1.6 2012 2013 Effective income tax rate 8
Slide 9: Agenda
Agenda 1. Highlights of 2013 2. Operational Update 2013 3. Outlook for 2014 9
Slide 10: Capex 2013
Capex 2013 Capex (US$ million) Segment Key projects 8,501 Exploration & • Exploratory wells drilled: 22 1,133 Production (64%) • Surface facilities and development 1,942 Transport • Bicentenario pipeline (11%) • Mid-Mag system • San Fernando - Monterrey 5,426 • Reficar modernization project Downstre
Slide 11: Production Increase
Production 1 Increase Recovery Factor 2 Exploration 3 Unconventional Production*: Ecopetrol + net interests** (thousand barrels of oil equivalent / day) Crude and water treatment facility in Castilla field 779 4.5% 788 762 754 49 48 Production growth 52 46 (thousand barrels of oil equivalent / day)
Slide 12: Primary recovery
Primary recovery 1 Increase Recovery Factor 2 Exploration 3 Unconventional MAIN FIELDS* BASIN PRODUCTION (MBOED) MILESTONES 2013 PRODUCTION (MBOED) Operated EC Partnership 13% • Castilla (113) • 367 Development wells 466 504 445 Llanos • Chichimene (53) • 119 Workovers 262 278 • Apiay (23) • Facilit
Slide 13: Non thermal recovery
1 Increase Non thermal recovery Recovery Factor 2 Exploration 3 Unconventional BASIN MAIN FIELDS* MILESTONES 2013 1Q 2Q 3Q 4Q Mid • Bonanza (Pilot WF) Magdalena • Nutria (Pilot WF) • San Francisco (pilot CEOR) • Dina Cretáceo (pilot CEOR) South • Tello (pilot CEOR) • Toldado (Pilot WF) •
Slide 14: Thermal recovery: developments of 2013
Thermal recovery: developments of 2013 1 Increase Recovery Factor 2 Exploration 3 Unconventional Pilots Ecopetrol Technology: ECO - GSAI Chichimene air injection test: • Basic & Detailed engineering facilities : 100% • Facilities Equipment Acquisition: 100% • Equipment for production wells: 100% • F
Slide 15: Exploration (1/2)
Exploration (1/2) 1 Increase Recovery Factor 2 Exploration 3 Unconventional A3 Exploratory activity Nunda well – Tello Ecopetrol + net interests (Huila - Southern region) (Number of wells) Drilled Successful In Evaluation Dry 4th quarter Ecopetrol 6 2 1 3 Hocol 5 0 0 5 EC America 2 0 0 2 Savia 1 0 1
Slide 16: Exploration (2/2)
1 Increase Exploration (2/2) 2 3 Recovery Factor Exploration Unconventional Conventionals Unconventionals Emerging basins • 2 strats drilled in Mid-Magdalena Llanos & Catatumbo • Drilling: • 1 well drilled in Catatumbo (in Oripaya) o 14 Wild Wells: 10 Ecopetrol, 4 Hocol o 7 New Discoveries • Progres
Slide 17: Proven Reserves
Proven Reserves 1P* Reserves Balance: 2012 - 2013 Sources of Addition: 2013 (million of BOE) Extensions 1,877 1,972 and 245 340 538 discoveries 506 Gas 22% 1,370 1,434 Oil Acq. / 340 Revisions Divest. 3% mmboe 67% 2012 Production*** Addition 2013 RRR**: 109% Improved RRR**: 139% recovery 8% 1P* Rese
Slide 18: Transport
Transport Bicentenario pipe rack Transported volumes by Cenit pipelines* Transported volumes by trucks (thousand barrels per day) (thousand barrels per day)** 1,152 1,188 234 237 918 950 104 99 2 4 40 26 57 73 2012 2013 2012 2013 Products Crude Refined Naphta Crude Highlights • Start Up of the opera
Slide 19: Refining & Petrochemicals
Refining & Petrochemicals Refinery runs Cartagena refinery modernization (thousand barrels of crude per day) (December 2013) 219 215 75 66 B/bermeja Cartagena Gross refining margin (US$ per barrel) 10.9 10.9 5.4 3.1 B/bermeja Cartagena 2012 2013 Highlights • Refinery Modernizations: C/gena 86%; B/me
Slide 20: Sales & Marketing
Sales & Marketing Tanker in Coveñas port Sales Volume Crude export destinations* (thousand barrels equiv./day) (% total exported volumes) 923 7% 5% 880 5% 2012 59% 21% 8% 521 540 6% 2% 79 70 2013 46% 37% 9% 280 313 2012 2013 U.S. Asia Central America Europe Other Local Free trade zone Exports * Does
Slide 21: Agenda
Agenda 1. Highlights of 2013 2. Operational Update 2013 3. Outlook for 2014 21
Slide 22: 2014 Capex
2014 Capex Key goals and projects Breakdown of Capex • 31 exploratory wells •Colombia: 26 2% • International: 5 Exploration •6 appraisals wells 13% •8 stratigraphic wells Production • 8,460 Kms of seismic Exploration • Average Production: 819 mboed 20% US$10.6 48% • Ecopetrol: 770 mboed Production b
Slide 23: 2014 Capex: Allocation and Sources
2014 Capex: Allocation and Sources Capex (US$mn) EC's projects 6,463 EC's inv. in subsidiaries 1,908 Sources for Ecopetrol´s 2014 Capex of US$ 8.4 bn Total Capex EC 8,371 1. Internal cash generation 2. 2013 financing 3. Divestment of non-strategic assets 4. 2014 financing Subsidiaries* 2,224 Total C
Slide 24: Highlights 2007-2013
Highlights 2007-2013 Upstream Midstream Downstream • 97% growth in production • New model in transport & • Improved fuel quality logistics • 63% growth in 1P • Market diversification reserves and average RRR • 58% increase in capacity of of 152% oil and products’ pipelines • Refineries’ modernizatio
Slide 25: Closing Remarks
Closing Remarks • Colombia is a country with big opportunities for the O&G industry. • During the last six years Ecopetrol has delivered positive growth rates and strong financial results compared to other O&G companies. • 2013 was a good year for Ecopetrol. Both reserves and production grew, and we
Slide 26: Investor Relations
Investor Relations • Phone (+ 571) 234 5190 • Email investors@ecopetrol.com.co • Website www.ecopetrol.com.co 26 26
Slide 27: Ecopetrol S.A. All rights reserved. The re production of this presentation is forbidden without
Ecopetrol S.A. All rights reserved. The re production of this presentation is forbidden without the written authorization of Ecopetrol S.A.