Ypf Sa Class D · BCBA:YPFD
Ypf Sa Class D — Investor Presentation (November 2018)
33 slides from Ypf Sa Class D's investor presentation, November 2018
Slide 1: Investor Presentation
INVESTOR PRESENTATION November 2018 1
Slide 2: Important Notice
IMPORTANT NOTICE Safe harbor statement under the US Private Securities Litigation Reform Act of 1995. This document contains statements that YPF believes constitute forward-looking statements within the meaning of the US Private Securities Litigation Reform Act of 1995. These forward-looking stateme
Slide 3: Contents
CONTENTS COMPANY DESCRIPTION BUSINESS PLAN 2019-2023 3
Slide 4: YPF Today
YPF TODAY A 95-year- Publicly The largest World-class The leading downstream player YPF Luz fifth- old traded O&G producer shale producer in Argentina largest power company corporation in Argentina generator in • 3 refineries: 50% of Argentina´s since 1993 on capacity. Over 320 kbbl/day Argentina: t
Slide 5: Leading Argentine O&G Company
LEADING ARGENTINE O&G COMPANY UPSTREAM DOWNSTREAM MARKET SHARE BREAKDOWN (%) MARKET SHARE BREAKDOWN (%) Oil Others Crude Processing 1 No. of Gas Stations 2 Production 1 20% Others Others 2% 45% 3% 4% 2% 27% 4% 16% 35% 61% 5% 6% 21% 17% 6% 12% 14% Others Gas Gasoline 1 Diesel 1 19% 38% Production 1 O
Slide 6: Integrated Across Value Chain
INTEGRATED ACROSS VALUE CHAIN Oil Domestic Purchases Domestic market business market 83% Domestic prices (gasoline, diesel) 90% 17% International prices (bunker, jet fuel, petrochemicals, lubricants, LPG and others) Production Refining Exports 228 Kbbl/d 285 Kbbl/d International prices 10% (naphtha,
Slide 7: Upstream: Significant Potential with Leading Market Position
UPSTREAM: SIGNIFICANT POTENTIAL WITH LEADING MARKET POSITION Cuyana YPF has 112 concessions in the most productive Argentine Proved reserves: 29 mm boe basins (total reserves 1P: 929 mm boe) and 23 exploration % liquids: 99% blocks in the country % gas: 1% Production: 7.1 mm boe 2017 Neuquina Proved
Slide 8: Proved Reserves Essentially Flat
PROVED RESERVES ESSENTIALLY FLAT TOTAL HYDROCARBON RESERVES (MBOE) 1.212 1.226 1.132 1.083 1.113 1.014 982 1.005 979 929 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 8
Slide 9: Downstream: Solid Market Leadership
DOWNSTREAM: SOLID MARKET LEADERSHIP Monthly Diesel Sales (Km3) 800 Luján Proved de Cuyo reserves: refinery 85 M boe +8.7% A % liquids: 98 D 750 2018 Capacity: % gas: 2 105.5 kbbl/d Production: 8.8 M boe 700 2017 650 La Plata refinery BProved reserves: % liquids: 98 85 M boe Capacity: % gas: 2 189 kb
Slide 10: Fuel Prices Already in Line with Import Parity
FUEL PRICES ALREADY IN LINE WITH IMPORT PARITY AFTER GRADUAL ADJUSTMENTS FUELS BLENDED PRICE VS IMPORT PARITY(1) (% VARIATION) Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Import Parity Fuels Blended Price (1) Import parity includes international
Slide 11: Transformation Strategy
SIMPLIFYING CURRENT PROCESSES 2018 MAIN INITIATIVES TRANSFORMATION STRATEGY Well construction optimization Upstream operational efficiency Logistic optimization 15 +1,000 Energy efficiency Key People people with fully dedicated transformation Downstream operational efficiency objectives 130 66 compa
Slide 12: Management by Objectives
MANAGEMENT BY OBJECTIVES INCENTIVE-BASED COMPENSATION Company-wide objectives cover Approximately Sustainability, Efficiency, Capital 82% 1,000 Discipline, Financial Discipline of employees receive short-term cash bonus employees and Transformation based on objectives receive long-term and performan
Slide 13: Our Cash Position Is Enough to Cover Next Months Debt Maturities
OUR CASH POSITION IS ENOUGH TO COVER NEXT 12 MONTHS DEBT MATURITIES FINANCIAL DEBT AMORTIZATION SCHEDULE (1) (2) USD denominated debt DETAILS (In Millions of USD) Peso denominated debt 1,759 1,767 89.8% denominated in USD and 10.2% 1,461 1,491 in Argentine Pesos 1,306 Average interest rates of 7.34%
Slide 14: Contents
CONTENTS COMPANY DESCRIPTION BUSINESS PLAN 2019-2023 14
Slide 15: Our Strategy
OUR STRATEGY Operational Profitable excellence and growth sustainability STRATEGIC Financial PLAN Innovation discipline and technology Transformation Integrated of our operations energy company and culture
Slide 16: Safety and Sustainability as Core Values
SAFETY AND SUSTAINABILITY AS CORE VALUES TOTAL IFR # of people injured for each million hours worked 2012 - 2018 (1) 1.89 YPF IFR ARPEL TIDLP ESG TARGETS BY 2022 1.05 1.05 0.91 0.91 0.74 10% CO2 emissions reduction 0.84 0.76 0.80 0.73 0.60 70% ofbefuels produced will low-sulphur content 0.51 #1 Rene
Slide 17: Our Targets: 5-Year Business Plan 2019-2023
OUR TARGETS 5-YEAR BUSINESS PLAN / 2019-2023 (2) PRODUCTION RESERVE Adj. EBITDA CAPEX NET DEBT CAGR R.R (1) CAGR PER YEAR TO EBITDA 2019 - 2023 2019 - 2023 2019 - 2023 2019 - 2023 2023 5-7% >1x 10% 4-5 BUSD <1.5x (1) Reserve Replacement Ratio. (2) Adj. EBITDA = Operating income + Depreciation and im
Slide 18: Planning for Outstanding Production Growth
PLANNING FOR OUTSTANDING PRODUCTION GROWTH Building on our strength as unconventional leader outside USA PRODUCTION (KBOE/DAY) Oil NGL Gas 2018-2023 5-7% CAGR +20% Favoring High return & Short cycle developments 3 FIDs before end 2018 +55% Supported by strong portfolio with low break even price 2018
Slide 19: Production Growth Driven by Unconventional Projects
PRODUCTION GROWTH DRIVEN BY UNCONVENTIONAL PROJECTS TOTAL PRODUCTION (KBOE/DAY) Unconventional CAPEX Unconventional 2018-2023 Conventional 2019-2023 Conventional 5-7% CAGR ~70% 31% 33% ~3.6 BUSD per year 69% 67% ~30% 2018 2019 2020 2021 2022 2023
Slide 20: Actively Managing the Decline of Our Conventional Fields
WHILE ACTIVELY MANAGING THE DECLINE OF OUR CONVENTIONAL FIELDS CONVENTIONAL PRODUCTION (KBOE/DAY) Secondary Natural gas 2018-2023 Primary Tertiary Base curve -14% -5% Per year Per year Smoothing the decline rate by accelerating implementation of IOR/EOR Deploy technology to optimize in real time and
Slide 21: Expanding Unconventional Output from Vaca Muerta
EXPANDING UNCONVENTIONAL OUTPUT FROM VACA MUERTA UNCONVENTIONAL PRODUCTION (KBOE/DAY) 2018-2023 Tight gas La Amarga Chica Rincón del Mangrullo Other Shale Projects Base curve Loma Campana Bandurría Sur A. De la Arena +150% VACA MUERTA 2019-2023 ~18 Average operated rigs ~1,700 shale wells 2018 2019
Slide 22: Major Shale Projects
MAJOR SHALE PROJECTS GAS OIL 2019 Rincón del Mangrullo Loma Campana Ph2 La Ribera La Amarga Chica Bandurria Sur 2020 Aguada de la Arena San Roque La Calera Bajada de Añelo A. Pichana Oeste Pampa de las Yeguas I 2021 Bajo del Toro LLL West Chihuido de la SN 2022 LLL Sur Operated Operated Non operated
Slide 23: Loma Campana Continuously Increasing Well Productivity
LOMA CAMPANA CONTINUOUSLY INCREASING WELL PRODUCTIVITY AVERAGE CUMULATIVE OIL PRODUCTION (KBOE) 200 Cum. Production 150 + 40% (2016 - 2018) 100 Avg 2018 (27 stg) 22 wells - EUR 900 kboe 50 Avg 2017 (21 stg) 30 wells - EUR 720 kboe + 35% 40% increase in IP 270 Avg 2016 (17 stg) 56 wells - EUR 660 kbo
Slide 24: Reducing Development Cost and Opex
AND REDUCING DEVELOPMENT COST AND OPEX DEVELOPMENT COST (USD/BOE) OPEX (USD/BOE) 29 16 -62% -56% -14% -27% ~7 ~11 ~6 ~8 2015 Q3 18 2023 2015 2018 2023
Slide 25: Shale Gas Development Drives a New Paradigm in Gas Market
SHALE GAS DEVELOPMENT DRIVES A NEW PARADIGM IN GAS MARKET Similar to USA, Argentina is shifting from gas importer to gas exporter 240 Domestic base demand Potential production Mm3/d Mm3/d 220 200 180 160 140 120 100
Slide 26: Opportunities Along the Integrated Gas Value Chain
OPPORTUNITIES ALONG THE INTEGRATED GAS VALUE CHAIN UPSTREAM MIDSTREAM EXPORTS POWER GENERATION PETROCHEMICALS # 1 acreage holder MEGA: Potential 2019 Expect 3 to 4 GW Under study: outside USA expansion under study Exporting gas to Chile of new thermal - Urea Small scale LNG installed capacity in - M
Slide 27: Tango FLNG Barge-Based Floating Liquefaction Unit
TANGO FLNG BARGE-BASED FLOATING LIQUEFACTION UNIT First step towards positioning Argentina as an LNG export player Arriving Q1 -2019 – LNG production Q2 2019 Expected sales around USD 200 million per year LOCATED LIQUEFACTION CAPACITY STORAGE CAPACITY CONTRACT SUPPLIER Bahía Blanca 500,000 ton/year,
Slide 28: Downstream Building on Our Leading Position to Deliver Value
DOWNSTREAM BUILDING ON OUR LEADING POSITION TO DELIVER VALUE OPTIMIZING PURSUING LOGISTIC OUR OPERATIONS EFFICIENCY 100% Crude oil self sufficiency by 2021 Oil pipelines expansion +15% Crude processing Road trains improvement +20% Diesel and gasoline production Export infrastructure development -5%
Slide 29: Reshaping Our Business to Profit from Shale Growth and New Technology
RESHAPING OUR BUSINESS TO PROFIT FROM SHALE GROWTH AND NEW TECHNOLOGY A CLEANER PLATFORM DIGITAL TRANSFORMATION IMO 2020 full compliance Analytics to optimize our processes, asset integrity and predictive maintenance Low sulphur fuel specs Satellite monitoring Low carbon project integration of pipel
Slide 30: YPF Luz Expected Power-Generation Capacity Increase
WE EXPECT YPF LUZ TO INCREASE ITS POWER-GENERATION CAPACITY 7 YPF POWER GENERATION CAPACITY 900 2018-2023 800 6 Pipeline + M&A Current capacity + awarded / under construction 700 5 Pipeline and 600 M&A opportunities 4 500 3 400 2.4 GW 300 2 1.9 GW 1.7 GW 200 Renewable energy 1 representing 20% 100 o
Slide 31: Investing with Focus on Profitable Growth
INVESTING WITH FOCUS ON PROFITABLE GROWTH (1) ADJUSTED EBITDA CAPEX BREAKDOWN 2019-2023 CAGR +10% 5% 19% ~4.5 BUSD per year 76% Upstream Downstream Other segments 2018 2019 2020 2021 2022 2023 (1) Adjusted EBITDA = Operating income + Depreciation and impairment of property, plant and equipment and i
Slide 32: Increasing Free Cash Flow
INCREASING FREE CASH FLOW Net debt/ EBITDA at 1.5x CFFO Net debt/ CAPEX Dividends CASH BUILD-UP (BUSD) EBITDA + interest 2019-2023 + taxes 1.5x 1.5x Up to (1) Additional cash 1.4x 4.2 BUSD for investments 0.7x Cumulative 1.5 BUSD free cash flow 2019 2020 2021 2022 2023 (1) Considers the maximum pote
Slide 33: Investor Presentation
INVESTOR PRESENTATION November 2018 33