Gulf Keystone Petroleum Limited · LSE:GKP
Gulf Keystone Petroleum — Investor Presentation (May 2019)
26 slides from Gulf Keystone Petroleum's investor presentation, May 2019
Slide 1: Gulf Keystone Petroleum Corporate Presentation May 2019
Gulf Keystone Petroleum Corporate Presentation May 2019
Slide 2: Disclaimer
Disclaimer This proprietary presentation (the “Presentation”) has been prepared by Gulf Keystone Petroleum Limited (the “Company”). Under no circumstances may this presentation be deemed to be an offer to sell, a solicitation to buy or a solicitation of an offer to buy securities of any kind in any
Slide 3: GKP at a glance… and in numbers
GKP at a glance… ..and in numbers bopd 2018 • Pure-play Kurdistan E&P with operatorship 31,563 Gross Production – 80% WI in Shaikan Field MMstb Gross 591 2P Reserves(1) • Vision to grow production 3.5x to 110,000 bopd – FDP submitted in October 2018; not accepted by MNR US$/bbl 2018 3.2 Opex per Bar
Slide 4: Shaikan Overview & Development Vision; Financial Strategy; Outlook
1 Shaikan Overview & Development Vision 2 Financial Strategy 3 Outlook
Slide 5: Shaikan – A giant field with proven production track record
Shaikan – A giant field with proven production track record Field overview Key information (gross figures) • Located c.60km north-west of Erbil at the • Gulf Keystone interest: 80% north-west end of the Zagros Fold-belt • Partner: MOL 20% • One of the largest fields in Kurdistan by • Discovered: Aug
Slide 6: Understanding the scale…
Understanding the scale… SH-6 SH-4 6
Slide 7: Shaikan today – Infrastructure overview
Shaikan today – Infrastructure overview Atrush pipeline SH-4 SH-10 SH-11 SH-5 PF-1 SH-1 SH-3 SH-6 SH-7 SH-2 SH-8 PF-1 PF-1 pipeline under PF-2 SH-1&3 SH-4 SH-7 SH-8 construction PF-2 SH-2 SH-5 SH-10 SH-11 2.5 km • Two production facilities, each with a nameplate capacity of 20,000 bopd • Nine produc
Slide 8: Shaikan Gross Production ('000 bopd)
Steady production • Predictable performance from Jurassic reservoir – Black oil, no signs of water or gas breakthrough • 2019 gross production guidance – 32,000-38,000 bopd Pressure gauge End of Export Start SH-1 SH-1 workover retrieval domestic pipeline workover & other completed & 40 campaign sale
Slide 9: Exports
Exports Turkey Iran Syria Iraq • MNR currently controls marketing and exports • Nearly all Shaikan production exported directly via tie-in at PF-2 into Kurdistan export pipeline as part of the Kurdish blend – Only c.3,000 bopd trucked c.120km to Fishkhabour • PF-1 pipeline construction underway by K
Slide 10: Subsurface schematic
Subsurface schematic Cretaceous Very heavy or bituminous oil 2P: 3 MMstb / 2C: 53 MMstb Jurassic Heavy oil with 14 - 20° API 2P: 544 MMstb / 2C: 80 MMstb 3 Shards Unusually high hydrocarbon column – c.950m Triassic Light oil with 38-43° API and gas condensate 2P 44 MMstb 2C 106 MMstb Dark Green = Oi
Slide 11: Reserves and Resources
Reserves and Resources • In support of the FDP submitted in (1) Gross Shaikan Reserves (Dec-2018) 2018, GKP completed: 1000 920 – New petrophysical and geological interpretations and a comprehensive 800 fracture network modelling study 591 (MMstb) 600 – Review of updated well and facilities performa
Slide 12: Shaikan Field Development Plan
Shaikan Field Development Plan • Staged approach further de-risks long-term potential • Revised FDP submitted for approval to the MNR in October 2018 • FDP not accepted by the MNR due to insufficient assurances on the elimination of flaring Subject to FDP approval 120 Phase 2: 110,000 bopd Shaikan P
Slide 13: 55,000 bopd expansion underway
55,000 bopd expansion underway • On track with facilities upgrade completion in 2019; well capacity in Q1 2020 – Workover rig scheduled to complete SH-3 tubing workover then to start the ESP programme – Jurassic well (SH-H) – first in the drilling sequence Atrush pipeline New Jurassic well (4x) SH-4
Slide 14: GKP fully funded for entire development
GKP fully funded for entire development Phase 1 Phase 2 Low cost base(1): 110,000 bopd Accelerated recovery of petroleum costs pool (c.US$500m gross) Opex (US$3/bbl) (Triassic expansion & & continuous recovery of future expenditures Focus on G&A Cretaceous pilot) 85,000 bopd (Triassic pilot) 75,000
Slide 15: Shaikan Overview & Development Vision; Financial Strategy; Outlook
1 Shaikan Overview & Development Vision 2 Financial Strategy 3 Outlook
Slide 16: Record 2018 figures
Record 2018 figures • Driven by predictable production, robust oil price and focus on costs • Continuous payments – positive impact of crude oil sales agreement Revenue EBITDA Profit/(Loss) After Tax • Cash receipts on entitlement basis • Prudent resource management and • US$10m gains arising from t
Slide 17: Sustained cost optimisation
Sustained cost optimisation • Prudent resource management, cost saving initiatives and supply chain optimisation leading to sustainable cost reductions • Operating expenses up in 2018 due to one-off maintenance projects and preparation for production ramp-up • Corporate G&A down 37% / Recoverable Ku
Slide 18: Commercial status
Commercial status • Enhanced predictability with crude oil sales agreement Crude • Majority of crude directly exported via pipeline at PF-2 Marketing • Trucking to be eliminated this summer & Export • c.US$1/bbl reduction to discount to Brent (c.US$22/bbl trucks to c.US$21/bbl pipeline) • GKP hopefu
Slide 19: Financial strategy
Financial strategy 1 2 3 Clean Staged Cash Flow Balance Sheet Development Generation • US$296m cash • Onshore development • Regular payments • Effective cash • Optimal reservoir • Strong revenue generation management management • Also, c.US$500m petroleum cost pool (gross) available for • US$100m bo
Slide 20: First dividend
First dividend • GKP is pleased to announce its dividend policy – An annual ordinary dividend of no less than US$25m per financial year – In periods of strong cash flow generation, the Board may complement the ordinary dividend with further dividends while preserving its ability to grow the business
Slide 21: Shaikan Overview & Development Vision; Financial Strategy; Outlook
1 Shaikan Overview & Development Vision 2 Financial Strategy 3 Outlook
Slide 22: Strategic objectives for next 3-5 years
Strategic objectives for next 3-5 years 1 Platform for growth 2 Sustained financial health 3 Return capital to shareholders 22
Slide 23: 2019 outlook
2019 outlook Operational Excellence –Safe operations –Delivery of project milestones –Continued cost control discipline Growth –Deliver the 55,000 bopd expansion project –Meet 2019 gross production guidance of 32,000-38,000 bopd –Investing to define next phases: 75,000 bopd and beyond Shareholder Re
Slide 24: Thank you
Thank you More resources are available at: www.gulfkeystone.com
Slide 25: Board of directors
Board of directors Jaap Huijskes Jón Ferrier Sami Zouari Martin Angle Garrett Soden David Thomas Kimberley Wood Non-Executive Chief Executive Chief Financial Senior Independent Non-Executive Non-Executive Non-Executive Chairman Officer Officer Director Director Director Director Joined in Nov 2017 J
Slide 26: Continuous payments strengthening balance sheet
Continuous payments strengthening balance sheet • US$225m net to GKP received in 2018; US$62m received so far in 2019 – Positive impact of crude oil sales agreement (renewed in February 2019 for 24 months) $35 $30m Reduction driven $30 by oil price and start of SH-1 US$m (net) $25 $23m workover $21m
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