BW Offshore Limited · OSL:BWO
BW Offshore — Q1 2019 Earnings Presentation
39 slides from BW Offshore's earnings presentation, May 23, 2019
Slide 1: BW Offshore Q1 2019
BW OFFSHORE Q1 2019 CEO Carl K. Arnet CFO Knut R. Sæthre 23 May 2019 SMARTER TOGETHER
Slide 2: Disclaimer
DISCLAIMER This Presentation has been produced by BW Offshore Limited exclusively for information purposes. This presentation may not be redistributed, in whole or in part, to any other person. This document contains certain forward-looking statements relating to the business, financial performance
Slide 3: Highlights
HIGHLIGHTS RECENT HIGHLIGHTS Production on Dussafu averaged 12,500 bbls in the first quarter EBITDA of USD 186.8 million Completed two liftings of 1.2 million bbls net to BW Energy Acquisition of the Maromba field Farm-in agreement with Gabon Oil Company (GOC) Extension of BW Cidade de São Vicente N
Slide 4: HSE Performance
HSE PERFORMANCE HSE record (LTI) Lost time injuries per million man-hours 2. 1.5 1. 0.5 0. 2019 Q1 4
Slide 5: Fleet Status
FLEET STATUS 5
Slide 6: Fleet Performance
FLEET PERFORMANCE Fleet uptime 100% 95% 90% 85% 80% 75% 70% Strong performance with 99% average uptime over last 5 years 2019 Q1
Slide 7: Fleet Contractual View
FLEET CONTRACTUAL VIEW Unit Type Contract 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Sendje Berge FPSO Lease & Operate Addax/Sinopec, Nigeria: 2005-2021 (2023) Yúum K’ak’ Náab FPSO Lease & Operate Pemex, Mexico: 2007-2022 (2025) BW Cidade de São Vicente FPSO Lease & Operat
Slide 8: 2019 Extensions
2019 EXTENSIONS BW Cidade de FPSO Polvo ✓ BW Pioneer Umuroa Abo FPSO São Vicente ✓ 1 year extension until Murphy Oil assumed Discussions for further Discussions for further Q3 2020 operatorship 1 April and 3-year extension 1-year extension 1 year extension until evaluating long-term ongoing ongoing
Slide 9: Unit Update
UNIT UPDATE BW Catcher BW Adolo Average daily production ~ 65,000 bopd Production stable at ~ 12,500 bopd Uptime ~ 100% Uptime ~ 100% Additional positive effects from excess production Commenced offshore modification work for phase 2 tie-in 2019 Q1 9
Slide 10: E&P Status
E&P STATUS
Slide 11: Production Status
PRODUCTION STATUS Excellent HSE performance Tortue production 1.1 million bbls (gross) with field uptime of 99% Average gross production stable at ~12,500 bopd ‒ No show of water or wax Two liftings: ‒ February ~ 650k bbls (gross) at USD 59 ‒ March ~ 650k bbls (gross) at USD 66 ‒ Net BWE ~ 1.2 milli
Slide 12: GOC Transaction Closed
GOC TRANSACTION CLOSED LICENCE OWNERSHIP Farm-in by Gabon Oil Company (GOC) in the Dussafu Shareholders license agreed in March BW Energy 73.5% Cash consideration of USD 28 million received in April Panoro Energy 7.5% ‒ Ownership effective from First Oil ‒ Next GOC lifting expected in Q3 Gabon Oil C
Slide 13: Dussafu Production Curve
DUSSAFU PRODUCTION CURVE Daily production ambition (thousand bbls/day) 45 40 2019 full year production forecast revised to 3.9 – 4.2 million bbls 35 Future prospects 30 25 Hibiscus Future prospects Walt Whitman 20 Phase 3 - Expected Prospect A/B sanctioned Q4 2019 Additional discovered 15 commercial
Slide 14: Tortue Phase 2 Progressing as Planned
TORTUE PHASE 2 PROGRESSING AS PLANNED Drilling program scheduled to start July First Hibiscus (Updip) exploration well to Hibiscus North identify additional resources in the greater Espadon Ruche area Secondly four new production wells to be Hibiscus tied back to BW Adolo (2 by 2) with first oil tar
Slide 15: Production Costs
PRODUCTION COSTS Production cost (USD/bbl) 30 Q1 average production cost/bbl USD 25 20.8 ‒ Field opex/bbl USD 6.8 ‒ FPSO opex/bbl USD 14.0 20 Tortue Phase 2 will contribute to lower 15 Sanctioned only unit costs from 2020 10 Tortue Tortue Phase 1 & 2 and Ruche Ruche expected to contribute to lower P
Slide 16: Maromba Acquisition
MAROMBA ACQUISITION Polvo Located near Polvo, Peregrino and Papa Terra where BWO has extensive operating experience Campos Basin @ ~160m water debt ‒ 100-150 million barrels potential recoverable reserves from Maastrichtian sand, Jubarte analogue field ‒ 8 of 9 exploration and appraisal wells drille
Slide 17: Finance
FINANCE
Slide 18: Q1 Financials
Q1 FINANCIALS EBITDA USD million 200 Reported Reported ex one-offs EBITDA of USD 186.8 million 180 Contribution from E&P segment of USD 49.8 million 160 Contribution from FPSO segment of USD 137.0 million 140 120 100 80 60 40 20 0 Net debt and equity ratio USD million and percentage Net debt (USD mi
Slide 19: Income Statement
INCOME STATEMENT USD million Q1 2019 Q4 2018 2018 Operating Revenues 296.4 255.4 870.4 Operating Expenses (110.1) (107.0) (382.6) Share Of Profit From Associates 0.5 0.5 1.4 EBITDA 186.8 148.9 489.2 Depreciation (103.4) (91.1) (336.5) Amortisation (0.7) (0.6) (2.1) Impairment 0.0 0.0 (0.1) Gain/(los
Slide 20: Statement of Financial Position
STATEMENT OF FINANCIAL POSITION USD million Q1 2019 Q4 2018 Total Non-current Assets 2,905.8 85.2% 2,951.7 86.4% Total Current Assets 505.3 14.8% 464.8 13.6% Total Assets 3,411.1 100.0% 3,416.5 100.0% Total Equity 1,350.1 39.6% 1,320.9 38.7% Total Non-current Liabilities 1,192.7 1,499.0 Total Curren
Slide 21: Cash Flow Q1 19
CASH FLOW Q1 19 400 350 300 105 17 152 31 250 155 200 22 3 150 280.1 249.1 249.1 100 202.1 180.1 177.1 177 142.1 142.1 50 0 Cash Q4'18 Operating cash Investments Other New debt Debt Net interest paid Non-controlling Cash Q1'19 flow Dussafu investments instalments interest 2019 Q1
Slide 22: Debt and Instalment Profile
DEBT AND INSTALMENT PROFILE Available liquidity including corporate facilities of Close to appointing lead banks to arrange RBL USD 370.9 million financing with target closing Q3 2019 Closed new corporate facility of USD 672.5 million Strong liquidity position and maturities from March with an uncom
Slide 23: Proven Access to Capital
PROVEN ACCESS TO CAPITAL USD 672.5 million corporate facility refinancing demonstrates strong support from a sizable bank group Raised ~ USD 1.1 billion from 16 banks (facility 60% oversubscribed) Significant achievement in a challenging bank financing market for offshore assets ‒ Banks gravitating
Slide 24: Revenue Visibility
REVENUE VISIBILITY FPSO segment E&P segment Probable orderbook of USD 6.0 billion Probable gross reserves of 35.1 million barrels Gross reserves1 Gross 1P = 25.9 million bbls Firm 49% 51% Gross 2P = 35.1 million bbls Option Gross 3P = 48.3 million bbls Net reserves to BW Energy2 4% Net 1P = 19.2 mil
Slide 25: Outlook
OUTLOOK
Slide 26: Steady Course
STEADY COURSE The higher oil price will continue providing extension opportunities Improving market outlook driven by increased offshore spending Continue selective bidding on new projects Focus on value generation through redeployments for field developments 2019 Q1 26
Slide 27: Event Guidance
EVENT GUIDANCE H2 2018 H1 2019 H2 2019 - Ruche NE appraisal well ✓ - FPSO Polvo extension ✓ - First exploration well - Dussafu First Oil ✓ - BW Cidade de São - Four production wells - BW Catcher Final Vicente extension✓ - Upgrades to BW Adolo Acceptance ✓ - Start Tortue Phase 2 - Petróleo Nautipa ex
Slide 28: Structural and Organisational Change
STRUCTURAL AND ORGANISATIONAL CHANGE
Slide 29: BW Energy
BW ENERGY All upstream assets of BW OFFSHORE and BW GROUP will be organised in the new separate entity BW ENERGY set up for growth in an A presentation of the new entity and its business plans will be given soon exciting market undergoing change A listing of the company on the Oslo Stock Exchange is
Slide 30: BW Offshore Organisational Change
BW OFFSHORE ORGANISATIONAL CHANGE Carl K. Arnet Knut R. Sæthre Marco Beenen Ståle Andreassen Carl K. Arnet to Knut R. Sæthre to Marco Beenen Ståle Andreassen step down as CEO step down as CFO appointed CEO appointed CFO from 30 June 2019, from 30 June 2019, from 1 July 2019 from 1 July 2019 appointe
Slide 31: BW Energy Board of Directors
BW ENERGY BOARD OF DIRECTORS - Chairman of BW Energy - Director and CEO of BW - Director of BW Energy - Chairman of BW Group, Energy - CEO of BW Offshore BW Offshore, BW LPG, - Director of BW Offshore, - Former COO of BWO. Singapore Maritime Maritime and Port - Prior to BWO, held Foundation and Hafn
Slide 32: BW Offshore Board of Directors
BW OFFSHORE BOARD OF DIRECTORS - Chairman of BW Group, - Extensive management - Experienced non- BW LPG Ltd. experience from CGG executive director, - Chairman of the Veritas, Coflexip, including positions in Singapore Maritime Schlumberger and Tullow Oil and EnQuest Foundation Exxon - M. Phil Econo
Slide 33: Q&A
Q&A
Slide 34: For further information please contact ir@bwoffshore.com
For further information please contact ir@bwoffshore.com
Slide 35: Income Statement
INCOME STATEMENT Q1 2017 Q2 2017 Q3 2017 Q4 2017 FY 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 FY 2018 Q1 2019 Operating revenue 159.6 163.4 152.7 150.3 626.0 192.5 200.2 222.3 255.4 870.4 296.4 Operating expenses (97.6) (45.3) (70.5) (77.3) (290.7) (84.5) (95.1) (96.0) (107.0) (382.6) (110.1) Share of pr
Slide 36: Balance Sheet
BALANCE SHEET ASSETS Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Vessels and vessels under construction 2,637.4 2,618.0 2,734.3 2,808.4 2,778.2 2,743.1 2,681.2 2,614.6 2,555.5 Property and other equipment 10.4 9.3 9.4 10.1 10.2 10.6 12.0 13.3 13.3 Right-of-use assets * -
Slide 37: Cashflow
CASHFLOW Q1 2017 Q2 2017 Q3 2017 Q4 2017 FY 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 FY 2018 Q1 2019 Profit/(loss) before taxes (6.0) 14.8 21.5 13.2 43.5 27.6 - 24.8 24.4 76.8 53.0 Unrealised currency exchange loss/(gain) 8.9 13.3 16.9 (11.1) 28.0 14.1 (12.3) 0.6 (15.7) (13.3) 0.6 Depreciation and amort
Slide 38: Key Figures
KEY FIGURES Q1 2017 Q2 2017 Q3 2017 Q4 2017 FY 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 FY 2018 Q1 2019 EBITDA-margin 38.8 % 72.6 % 53.8 % 48.9 % 53.7 % 56.4 % 52.6 % 56.9 % 58.3 % 56.2 % 63.0 % Equity ratio 27.3 % 29.7 % 28.9 % 36.8 % 36.8 % 37.4 % 37.2 % 37.2 % 38.7 % 38.7 % 39.6 % Return on equity -6
Slide 39: Segments
SEGMENTS Q1 2017 Q2 2017 Q3 2017 Q4 2017 FY 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 FY 2018 Q1 2019 FPSO 159.6 164.4 153.6 151.4 629.0 194.2 202.7 218.7 245.9 861.5 230.5 E&P - - - - - - - 8.7 30.5 39.2 84.0 Eliminations - (1.0) (0.9) (1.1) (3.0) (1.7) (2.5) (5.1) (21.0) (30.3) (18.1) Revenue 159.6 163