Horizon Oil Limited · ASX:HZN
Horizon Oil — FY2020 Earnings Presentation
25 slides from Horizon Oil's earnings presentation, Aug 27, 2020
Slide 1: FY20 Results Presentation
FY20 RESULTS PRESENTATION 27 AUGUST 2020 HORIZON OIL LIMITED | ABN 51 009799 455
Slide 2: FY20 Full Year Highlights
FY20 FULL YEAR HIGHLIGHTS Production Volume Sales Revenue EBITDAX 1,475,562 bbls US$84.0 million US$50.6 million Net Cash Underlying Profit before Tax Cash on Hand US$0.5 million US$15.0 million US$25.9 million
Slide 3: FY20 Executive Summary
FY20 EXECUTIVE SUMMARY STRONG PRODUCTION AND CASHFLOW PROVIDING PATHWAY TO GROWTH Strong Production & Cashflow Drive Growth Continued strong high margin production from Maariand Beibu Cash operating costs averaged below US$20/bbl Progressive debt reduction with return to net cash position Drilling s
Slide 4: Financial Results
FINANCIAL RESULTS
Slide 5: FY20 Financial Results
FY20 FINANCIAL RESULTS 30 JUN 20 30 JUN 19 Horizon 2020 Result Production at the upper end of guidance with US$’000 US$'000 million barrels produced during the 2020 Nncial ye; Oil and gas sales bbls 1,427,521 1,866,581 [24%] Oil and gas production bbis 1,475,562 1,604,578 (8%) Oil sales, revenue, EB
Slide 6: Strong Cashflow Driving Down Debt
STRONG CASHFLOW DRIVING DOWN DEBT US$ MILLION 24.2 36.7 Ae =238 15 25.9 Opening cash Crude oilsales Hedging Operating Corporate & Interest Net cash Debt Investment in Exploration Closing cash and cash settlements costs [excl. tax inflows from repayment& oil&gasand expenditure and cash equivalents at
Slide 7: Reduced Opex Offsets Lower Oil Price
REDUCED OPEX OFFSETS LOWER OIL PRICE 14.0 -19.1 -8.5 37.3 -10.8 -0:9 79 44 . -0.4 15.0 Underlying Profit Operating costs Cost recovery Production Net realised oil G&A Other Exploration and Financing costs Underlying Profit before tax for FY volumes. volume price. Inclusive income/costs development b
Slide 8: Sales/Revenue Steady in Face of Oil Price Volatility
SALES/REVENUE STEADY IN FACE OF OIL PRICE VOLATILITY OIL SALES [(mmbbls) REVENUE! (US$m] 130 0.29 100 1.37 mmbbls ia 0.83 2 60 laq/$sn 0.90 0.47 0.58 0.80 20 31.2 42.3 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 eibu cost recovery Hil seibu Ml Maari Beibu cost rec
Slide 9: Low Cost Production Delivers Profitability
LOW COST PRODUCTION DELIVERS PROFITABILITY EBITDAX AND COST PER BBL uSssm. 100.0 90.0 80.0 70.0 60.0 50.0 40.0 30.0 20.0 10.0 0.0 FY 2018 FY 2019 excl. cost recovery] ——2Cost recovery ex/bbl G&A and other costs/bbl Us$/bbl 20.0 18.0 16.0 14.0 12.0 10.0 8.0 6.0 4.0 2.0 0.0 FY 2020 FY 2016 FY 2017 UND
Slide 10: Free Cashflow & Net Cash Position
FREE CASHFLOW & NET CASH POSITION PROVIDES PATHWAY TO GROWTH FREE CASH FLOW (US$m] mmm Operating CF investing CF FCF =@=FCF (excl. cost recovery] “LT 10.2 “8.1 aati 37. FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 * Free Cash Flow represents cash flows from operating activities less investing cash flows
Slide 11: Outlook & Asset Updates
OUTLOOK & ASSET UPDATES
Slide 12: Operations Overview of Portfolio
OPERATIONS C1 CHINA BEIBU GULF OVERVIEW OF PORTFOLIO Block 22/12 [BeibuGulf] 26.95% / 55% C1 PAPUA NEW GUINEA WESTERN PROVINCE Asia Pacific fo PDL 10 (Stanley) 30% Material joint venture interests PRL 21 (Elevala/Ketu) 30.15% PRL 28 {Ubuntu} 30% High margin, long life oil production PRL 40 (Puk Puk/
Slide 13: ~50% 2P Reserves Replacement Ratio
~50% 2P RESERVES REPLACEMENT RATIO Proved plus Probable Reserves [(2P] of oil is AT 30 JUNE 2020 sn 8.1MMbbl, compared with 8.8 MMbbl last year. : * Consistent performance from producing oil 9.0 8.8 8.1 : nae : = : assets of 1.5 MMbbl, similar to prior year. : an = : NZ EN 13 0.8 NZ : + Net increase
Slide 14: China
CHINA @ oitFieta O _ Discovered oil Field Oil Pipeline BEIBU GULF — GasPipeline © Production Area wze-1en Block 22/12 S WEIZHOU 6-12 PRODUCTION AREA 2P Reserves: 4.3 mmbbls 2C Resources: 1.1mmbbls As at 30 June 2020 WZ 6-12S A SKM WZ 12-3 oO MAP AREA WZ12-10-1 Block 22/12 ll WZ 12-8E Block 22/12 WZ
Slide 15: Average Daily Gross Production
2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 - Mar-2013 Sep-2013 Mar-2014 Sep-2014 Mar-2015 Sep-2015 Mar-2016 Sep-2016 Mar-2017 Sep-2017 Mar-2018 Sep-2018 Historical average FY 2020 Production Mar-2019 Sep-2019 Average Daily Gross Production Mar-2020 Sep-2020 • • •
Slide 16: Infill & Appraisal Opportunities
INFILL & APPRAISAL OPPORTUNITIES CHINA - BLOCK 22/12 + Production from the Group's interest in the Beibu Gulf fields was uninterrupted by COVID-19, with 907,886 barrels of oil produced. Crude oil sales were 833,071 barrels with cost recovery volumes of 2,474 barrels at a net realised price of US$50
Slide 17: New Development
NEW DEVELOPMENT CK 22/12 CHINA - BL WZ 12-8E Project + Basic engineering for the development has been completed, with CNOOC expert review endorsing the project. Provides a hub for the development of the remaining discovered resources in Block 22/12 - including WZ12-8E, 12-3 and 12-10-1 fields, and a
Slide 18: New Zealand
NEW ZEALAND wee G Tul A-NGAERE @ oilFiei G, OAONUI © GasField 2 — GesPipeline KAPUNI @ Horizon Petroleum Licence NEW ZEALAND 2P Reserves: 3.8 mmbbls 2C Resources: 5.3 mmbbls MAUI As at 30 June 2020 RIMU TASMAN SEA rae KUPE MAP AREA [1] g MAARI MANAIA g PMP 38160 i 20KM 500KM FY20 RESULTS PRESENTATIO
Slide 19: Stable, Long-Life Production
STABLE, LONG-LIFE PRODUCTION NEW ZEALAND — MAARI/MANAIA MAARI/MANAIA PRODUCTION HISTORY & OUTLOOK 12,000 Annual Gross Production mmbbls 10,000 FY 2018 2.60 FY 2019 2.32 8,000 Workover activities FY 2020 2.18 6,000 bopd Average 4,000 oI ——Average daily gross production 2,000 FY 2020 Production ° sete
Slide 20: Production/Cost Optimisation
PRODUCTION/COST OPTIMISATION NEW ZEALAND — MAARI/MANAIA + Production from the Group's interest in Maari and Manaia fields was 567,676 barrels of oil. Temporary shut-ins of 3 production wells late in the year impacted production, with the Operator advancing plans to workover these wells over the comi
Slide 21: P'nyang
P'NYANG > PAPUA Oil Field STANLEY Gas Field PRL21, TINGU. Oil Pipeline Proposed Oil Pipeline Gas Pipeline Proposed Gas Pipeline SS EL Horizon Development/Retention Licences 4 Horizon Prospecting Licences JUHA = MURUK: NORTH ,. DISCOVERY Se -» HIDES JUHA’ : ANGORE Proposed Pinang gasand condensate pi
Slide 22: PNG Update
PNG UPDATE + — In Papua New Guinea, Horizon continued planning for the commercialisation of the gross appraised resource of 2,200 PJ of sales gas and 64 million barrels of associated condensate in four petroleum licences in the foreland basin of Western Province. + Arran Energy acquired Repsol’s int
Slide 23: Outlook
OUTLOOK RESILIENT IN A LOW OIL PRICE ENVIRONMENT — A PLATFORM FOR ORGANIC AND INORGANIC GROWTH Strong Operating Cashflow Drive Growth Restore and enhance production at Maari and Beibu fields through workovers and infill drilling Oil price recovery - free cashflow increases at a rate of approximately
Slide 24: Compliance Statements
COMPLIANCE STATEMENTS Disclaimer Statements contained in this material, particularly those regarding the possible or assumed future performance, costs, dividends, returns, production levels or rates, prices, reserves, potential growth of Horizon Oil Limited, industry growth or other trend projection
Slide 25: Authorisation
Authorisation This ASX announcement is approved and authorised for release by the Horizon board. FOR MORE INFORMATION PLEASE CONTACT US CHRIS HODGE Horizon Oil Limited P +61 2 9332 5000 Level 6, 134 William Street info@horizonoil.com.au Woolloomooloo NSW 2011 Australia horizonoil.com.au