Harbour Energy Plc · LSE:HBR

Harbour Energy — Premier Oil — H1 2020 Earnings Presentation

26 slides from Harbour Energy's earnings presentation, August 2020

  1. Slide 1: Half-Year Results Presentation August 2020

    2020 Half-Year Results Presentation August 2020

  2. Slide 2: Agenda

    Contents Agenda 1. Opening remarks …..……………….………………..…… Tony Durrant 2. Financial results, Refinancing ……………………..… Richard Rose 3. Operational performance …..………………….… Stuart Wheaton 4. Exploration pipeline ……………………………….……… Dean Griffin 5. Look forward ……………………………………………….. Tony Durrant August 2020 P

  3. Slide 3: Executive summary

    Highlights Executive summary 2020 1H – response to COVID-19 Long term refinancing  Heads of Terms agreed Free cash flow positive; expenditure minimised with subset of creditors Near-term production growth – All debt facilities to be refinanced with non Future potential preserved amortising faciliti

  4. Slide 4: BP Acquisitions

    Highlights BP Acquisitions Step change for Premier, materially accretive to value and credit metrics  Proposed acquisition of BP’s interests in the Andrew Area and Shearwater field Proforma 2P+2C (UK only)2 STATUS VALUE-ACCRETIVE mmboe as at 1.1.20  Terms revised and approved  Strengthens UK busi

  5. Slide 5: 2020 1H Financials

    Finance 2020 1H Financials 2020 1H 2019 1H Hedging Oil hedging Production (kboepd) 67.3 84.1 Q3 2020 Q4 2020 Operating cost/boe 11.4 10.3 % of production 25 19 Lease cost/boe 7.1 6.3 Average price ($/bbl) 63 50 Cash flow ($m) Operating cash flow (post tax) 349 550 UK gas hedging3 Net lease payments

  6. Slide 6: Cost control, expenditure minimised

    Finance Cost control, expenditure minimised Ability to flex expenditure to ensure free cash flow positive through the cycle  Maintained tight control of opex and 2020 Field opex $/boe continued cost discipline Budget Forecast 15  COP brought forward from loss making fields 10  Ability to flex and

  7. Slide 7: A long term refinancing

    Finance A long term refinancing Resets the Group’s capital structure and improves financial position  All existing facilities to be refinanced, including LCs and crystallisation of cross Comprehensive, currency swaps refinancing  Non-amortising  Maturities extended from May 2021 to March 2025 Cov

  8. Slide 8: Production and operations overview

    Production Production and operations overview UK North Sea Group production1 SE Asia UK BP assets 2020 1H kboepd (net)  2020 1H: 67.3 kboepd  High operating efficiency with 50 COVID-19 impact managed  Successful well interventions and infill drilling campaigns 0  Low, stable cost base 2019 2020

  9. Slide 9: Catcher at oil plateau rates

    Production Catcher at oil plateau rates Satellite 4D 4x infill Gas 2020 1H fields seismic wells injection  28.4 kboepd, 80% OE  >$2/bbl premium to Brent  Low field opex (<$7/boe)  Low GHG intensity: 7 kgCO2e/bbl  Varadero well drilled  Trial gas re-injection project; positive results to date O

  10. Slide 10: Solan P3: near-term production growth

    Production Solan P3: near-term production growth  Pilot well drilled Q2 2020  Successful horizontal well – 2,340 feet of net sand encountered vs 2,150 feet forecast – Positive signs of connectivity to water injector pressure support – Reservoir properties at higher end of expectations  Well opera

  11. Slide 11: Andrew Area: a planned operated hub

    Production Andrew Area1: a planned operated hub Delivers near-term production with future development opportunities 2020 1H  16 kboepd (net), ahead of expectations driven by high operating efficiency at 87%  Low opex of US$17/boe  Low emissions <13 kgCO2e/boe (forecast for 2020)  Transition plan

  12. Slide 12: UK long-life gas-condensate production

    Production UK long-life gas-condensate production Elgin-Franklin: one of the world’s largest HPHT developments and the UK’s largest producing field  Total operated, Premier 5.2%  2020 1H: 7.3 kboepd (net), very high OE of 99%  2020 1H: opex of c.$7/boe  Ongoing infill drilling, well intervention

  13. Slide 13: Growth projects with material upside potential

    Development Growth projects with material upside potential  Large, operated equity stakes in high quality projects, providing growth optionality  Participation optimised via farm downs  Ability to flex and control capex as operator  Significant value in development portfolio Producing Tolmount T

  14. Slide 14: Zama, Mexico: a world-class asset

    Development Zama, Mexico: a world-class asset A world-class development asset  810 mmboe (P50, gross), shallow water  Light 28° API, large, high quality reservoir  Planned plateau 150 kbopd (gross)  Unit capex <$5/bbl  Low GHG intensity: <8 kgCO2e/bbl (plateau)  Robust PSC driven economics at

  15. Slide 15: Tolmount Main, UK: a robust project

    Development Tolmount Main, UK: a robust project Partnership with Kellas Tariff structure Low Carbon by Design  Dana and HGSL will pay kboepd (net) for the platform, pipeline Carbon Neutral by Commitment and terminal upgrades  Tolmount gas will use the facilities in return for a  Premier 50% opera

  16. Slide 16: Tolmount pipeline installation complete

    Development Tolmount pipeline installation complete View down shaft to tunnel start – 20.5m depth View along tunnel from shaft base to beach – 144m long Castor-Sei pipeline lay barge – completed operations late July Cofferdam complete on the beach at Easington – June August 2020 P15

  17. Slide 17: Tolmount platform loaded out

    Development Tolmount platform loaded out Jacket and topsides loadout – early August Topsides transportation to barge Pile offloading on to transport barge Manifold and separator August 2020 P16

  18. Slide 18: Tolmount East development

    Development Tolmount East development HGS TOLMOUNT PLATFORM TOLMOUNT EAST TOLMOUNT EAST  160 Bcf P50 gross resource (including Mongour) Tolmount production profile  Subsea tie-back; FID kboepd (net, Premier 50 per cent) Tolmount Main Tolmount East GTA upside 2020 2H 25  Designed for electric powe

  19. Slide 19: Greater Tolmount Area

    Exploration Greater Tolmount Area  Final products from 2019 3D seismic acquisition Prospect map NE across Greater Tolmount Area received Mongour  High value, infrastructure-led exploration inventory being matured on new 3D data, including Tolmount Tolmount East Tolmount Far East Far East and prosp

  20. Slide 20: Andaman, Indonesia: LNG scale gas resource

    Exploration Andaman, Indonesia: LNG scale gas resource Andaman II (Premier 40%, op) 2014  Partners: Mubadala 30%, BP 30% Acquired operatorship of Andaman II JSA  Prospective resource: >6 TCF + 200 mmbbls condensate 2018  Two main prospective areas: Awarded Andaman II Timpan and Sangar clusters (2

  21. Slide 21: Andaman II, Indonesia: play opening programme

    Exploration Andaman II, Indonesia: play opening programme Timpan and Sangar Timpan Timpan Utara Halwa clusters 12 Ma  Large 4-way dip-closed Gas structures Chimney Timpan Utara  Strong AVO response Halwa  Flat spots conform to structure Bampo Timpan  Drilling1 targeted for 2022 Upper Parapat >6

  22. Slide 22: Mexico: new 3D seismic data confirms prospectivity

    Exploration Mexico: new 3D seismic data confirms prospectivity Block 30, Mexico: new 3D seismic data validates Wahoo potential  Premier 30%, WDEA (op. ) Wahoo Prospect P50-P10 gross resource  Water depth of 35-150m 77-116 mmbbls  New 3D data confirms Wahoo as a low risk prospect with a flat-spot

  23. Slide 23: Significant value to be realised from exploration

    Exploration Significant value to be realised from exploration  Focused portfolio targeting emerging plays and discontinuities in proven hydrocarbon basins  Significant position in the Andaman North Sumatran Basin; >12 TCF of amplitude supported gas identified  High value, infrastructure-led explo

  24. Slide 24: Activity: near term and future growth projects

    Summary Activity: near term and future growth projects 2020 2021 2022 2023 2024 2025 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 UK Catcher VP1 4D seismic Burgman x 2 Post 4D x2 FPSO lease reduction Catcher satellites CN & L (2 wells) B'ville Solan P3 W1 COP Elgin & Frank

  25. Slide 25: Outlook

    Summary Outlook Group production rates kboepd Resets Premier’s capital structure and improves financial position Strong near term production growth from a tax efficient, low opex, low emissions base; multiple opportunities for low cost investment in producing assets 2020 1H Solan BP Acqs. Tolmount a

  26. Slide 26: Q&A

    Q&A  If you are watching the presentation via the webcast, you may submit a question via the on-line facility  Alternatively, if you are listening to the presentation through the conference call facility, press * and then 1 on your telephone keypad to ask a question August 2020 P25

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