BW Offshore Limited · OSL:BWO
BW Offshore — DNB Markets High Yield Conference 2019
39 slides from BW Offshore's conference presentation, Oct 10, 2019
Slide 1: BW Offshore – DNB Markets High Yield Conference
BW OFFSHORE DNB Markets High Yield Conference CFO Ståle Andreassen 10 October 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: Credit investment highlights
Credit investment highlights n 1 Leading global FPSO operator with track record of over 35 years and 40 projects 2 USD 6 billion backlog, strong cash generation and modest gearing with a Net Debt/EBITDA of 1.6x 3 High operational stability and selective approach to new investments 4 Differentiated s
Slide 4: Company overview
1 Company overview 2 BW Energy 3 Financials 4 Summary 5 Appendix
Slide 5: Specialist in offshore field development and production
Specialist in offshore field development and production Significant experience from almost every oil producing FPSO Units region globally Fields BW Catcher | UK | Premier Oil Offices Delivered 40 projects worldwide since 1983 BW Athena | lay-up Crew centers 12 FPSOs in operation producing ~600,000 b
Slide 6: Supportive main owner with a long-term perspective
Supportive main owner with a long-term perspective BW Offshore BW Energy FPSO Units E&P 49.9% ownership 30.5% BW Group / 68.6% BWO 15 BW LPG DHT Epic Gas BW Group is a global maritime company engaged LPG carriers Crude carriers LPG and chemical carriers 47.6% ownership 35% ownership 83.3% ownership
Slide 7: Experienced management and board with proven track record
Experienced management and board with proven track record Board of Directors Andreas Christophe Clare Maarten R. René Kofod-Olsen Carl K. Arnet Sohmen-Pao Pettenati-Auzière Spottiswoode Scholten Director Director Chairman Vice Chairman Director Director Management Marco Beenen Ståle Andreassen Rune
Slide 8: FPSOs are a critical component of O&G field infrastructure
FPSOs are a critical component of O&G field infrastructure Exploration – more sensitive to oil prices Production – less sensitive to oil prices Exploration Seismic / Drilling Subsea Production Storage Transportation Terminals 1 2 3 4 5 Construction Business Engineering installation Production Re-dep
Slide 9: Proven reservoir + FPSO redeployment = value creation
Proven reservoir + FPSO redeployment = value creation Key field investment criteria The BWE model solves the traditional E&P challenge Access to attractive projects ‒ Major divestment efforts of offshore assets by large players ‒ Developments not prioritised by established E&P companies due to their
Slide 10: Understanding field risk and reward is key
Understanding field risk and reward is key E&P competence adds visibility to options likely to be exercised Strengthened position in negotiations for life-of-field extensions beyond firm and option periods Enabler for FPSO redeployment strategy Improved commercial assessment for new projects Sources
Slide 11: Combined strategy unlocks value in existing fleet
Combined strategy unlocks value in existing fleet Four out of six 2019 extensions confirmed BW Cidade de FPSO Polvo Abo FPSO Petróleo Nautipa Umuroa BW Pioneer São Vicente Discussing further Extended until Q2 2020 Extended until Q3 2020 Extended until end 2019 Extended until Q3 2021 Ongoing discussi
Slide 12: Significant value beyond firm period from options and redeployments
Significant value beyond firm period from options and redeployments First oil 2017 BW Catcher Firm period Probable options Possible options New contract 5x1 13 x 1 7 years Redeployment 12-month options 12-month options First oil 2006 First oil 2022 Berge Helene Firm period Options declared Open / co
Slide 13: FPSO business providing strong long-term cash generation
FPSO business providing strong long-term cash generation Unit 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 BW Adolo* BW Energy, Gabon: 2018-2028 (2038) BW Catcher Premier Oil, UK: 2018-2025 (2043) Yúum K’ak’ Náab Pemex, Mexico: 2007-2022 (2025) BW Joko Tole Kangean, Indonesi
Slide 14: Selective investment approach enhancing financial performance
Selective investment approach enhancing financial performance BW Catcher confirming ability to deliver USD new high-value FPSO projects 156 FPSO | 43 E&P EBITDA million BW Adolo redeployment triggered by clearly defined E&P strategy 180 43 55 155 Successful launch of BW Energy and 15 Dussafu investm
Slide 15: Strong fleet performance and HSE focus
Strong fleet performance and HSE focus Fleet uptime HSE record (LTI1) 99.8 % 98.4 % 99.6 % 100.0 % 99.5 % 99.4 % 99.7 % 95.6 % 98.4 % 5.0 4.0 3.0 2.0 1.0 0.0 The FPSO fleet has delivered 99% average uptime over the BWO prioritises safety first in all its operations and strives last five years toward
Slide 16: Focused on industry and company specific ESG issues
Focused on industry and company specific ESG issues BW Offshore is committed to contributing towards the United Continuously evolving Environmental Social and Nations’ Sustainable Development Goals Governance (‘ESG’) strategy and reporting ▪ Provide safe and meaningful jobs to a substantially local
Slide 17: BW Energy
1 Company introduction 3 BW Energy 3 Financials 4 Summary 5 Appendix
Slide 18: This is BW Energy
This is BW Energy Business model proven by first oil from Dussafu in Gabon 18 months Arnet Energy (CEO Carl K. Arnet) after acquisition 68.6% 30.5% 0.9% Completion of the Maromba acquisition in Brazil will more than double estimated net reserves and resources to 214 mmbbl On track to increase Dussaf
Slide 19: Combined strategy enables fast-track FPSO redeployment
Combined strategy enables fast-track FPSO redeployment Dussafu pre-BWE acquisition Creating the opportunity Dussafu current status* (gross) Fastest-ever FPSO development Extensive The right local FPSO knowledge 18 Sharing months to first risk/ Phased oil reward approach Minimising capex Two successf
Slide 20: Balanced risk reward and arm's length FPSO contracting
Balanced risk reward and arm’s length FPSO contracting More flexible FPSO contracts possible due to integrated approach Balanced risk reward enables longer durations and phased development Ensure competitive and arm’s length contracting to meet various stakeholder requirements Parameters BWE approac
Slide 21: BW Energy will be largely self financed
BW Energy will be largely self financed Multiple funding sources available 1 Operational cash flow from E&P segment 2019 to 2025 capex Average annual capex 2 BWE cash on hand USD 1.4 billion fully discretionary net capex budgeted for BWE1 ~ USD 230 million 3 4 USD 300 million RBL on Dussafu (includi
Slide 22: Financials
1 Company introduction 2 BW Energy 3 Financials 4 Summary 5 Appendix
Slide 23: Strong FPSO backlog and increasing E&P reserve base
Strong FPSO backlog and increasing E&P reserve base USD 6bn FPSO revenue backlog to a diverse set of clients E&P assets will be financed on a stand-alone basis 14% 9% Dussafu - Tortue Firm 214 Dussafu - Ruche 50% 50% Dussafu - Other discoveries Option mmbbl 13% Maromba 65% Note: Options considered l
Slide 24: Transparent corporate and capital structure
Transparent corporate and capital structure Simplified group structure for BW Offshore All FPSO owning SPVs and management / operational Public shareholders (free float – OSE) 1 companies owned 100% directly or indirectly by BWO 49.9% 50.1% All bank debt is secured and issued at the asset owning 2 l
Slide 25: Strong liquidity and balanced long-term instalment profile
Strong liquidity and balanced long-term instalment profile Long-term growth in FPSO EBITDA1 Well positioned to address upcoming bond maturities 600 600 Corporate facility 2 BW Catcher facility 3 547 Petróleo Nautipa facility Bonds 496 500 500 468 408 400 372 400 343 302 300 300 257 247 143 212 200 2
Slide 26: Strong balance sheet and credit metrics
Strong balance sheet and credit metrics 1 Net debt and leverage development EBITDA development Net debt NIBD/EBITDA (reported) Reported (FPSO) Reported (E&P) 187 192 2,400 5.0x 198.0 3.9x 3.9x 3.6x 3.6x 3.8x 165 2,200 3.2x 3.3x 3.2x 3.3x 4.0x 3.0x 3.0x 149 2,000 2.5x 3.0x 2.0x 148.0 126 1.6x 119 1,8
Slide 27: Proven access to capital and prudent risk management
Proven access to capital and prudent risk management Leveraging existing BW capital sources and relationships 2016 recapitalisation provided a balanced solution ~40 BW relationship banks of which ~20 are lenders to BWO BWO approached all stakeholders at an early stage as a proactive measure in a cha
Slide 28: Summary
1 Company introduction 2 BW Energy overview 3 Financials 4 Summary 5 Appendix
Slide 29: Key credit considerations
Key credit considerations Combined FPSO and field development strategy provides predictable debt service capacity through the cycles FPSO segment has proven resilient while combined business model and Differentiated strategy 1 selective investment approach enhances financial performance Healthy back
Slide 30: Appendix
1 Company introduction 2 BW Energy 3 Financials 4 Summary 5 Appendix
Slide 31: Income statement highlights per segment Q2 19
Income statement highlights per segment Q2 19 Operating revenues EBITDA EBIT 251 FPSO | 56 E&P USD million USD 156 FPSO million | 43 E&P USD million 69USD FPSO | 22 E&P million USD million 110 275 180 90 155 225 130 70 175 105 50 125 80 55 30 75 30 25 10 5 -25 -20 -10 Q3 17 Q4 17 Q1 18 Q2 18 Q3 18 Q
Slide 32: Income statement
Income statement USD million H1 2019 2018 2017 2016 Operating revenues 582.4 870.4 626.0 844.7 Operating expenses (204.9) (382.6) (290.7) (421.9) Share of profit from associates 0.9 1.4 0.9 0.6 EBITDA 378.4 489.2 336.2 423.4 Depreciation (204.0) (336.5) (225.9) (224.6) Amortisation (1.2) (2.1) (2.7)
Slide 33: Statement of financial position
Statement of financial position USD million H1 2019 2018 2017 2016 Total non-current assets 2,837.2 2,951.7 2,999.0 2,771.3 Total current assets 552.8 464.8 423.8 596.6 Total assets 3,390.0 3,416.5 3,422.8 3,367.9 Total equity 1,373.4 1,320.9 1,259.4 919.9 Total non-current liabilities 1,499.0 1,499
Slide 34: Cash flow statement
Cash flow statement USD million H1 2019 2018 2017 2016 Net cash flow from operating activities 302.3 435.9 659.5 387.5 Net cash flow from investing activities (62.0) (354.8) (476.6) (399.7) Net cash flow from financing activities (117.2) (84.5) (144.3) (2.7) Net change in cash and cash equivalents 1
Slide 35: Bank debt facilities overview per Q2 2019
Bank debt facilities overview per Q2 2019 Facility Corporate credit facility BW Catcher Petroleo Nautipa Borrower: BW Offshore Shipholding Pte Ltd BW Catcher Limited BW Offshore Nautipa AS BW Offshore Limited parent Yes Yes Yes guarantee: USD 672.5 million (USD 340 million Amount (drawn): USD 657.1
Slide 36: Bond debt overview per Q2 2019
Bond debt overview per Q2 2019 Bond BWO01 BWO02 BWO03 BWO04 Total Borrower: BW Offshore Limited BW Offshore Limited BW Offshore Limited BW Offshore Limited BW Offshore Limited Amount outstanding NOK 360 million NOK 500 million NOK 750 million NOK 900 million NOK2,510 million Nominal USD amount USD 4
Slide 37: Clear path to BWE production growth
Clear path to BWE production growth 2019 2020 2021 2022 Hibiscus Further exploration wells updip Dussafu Tortue phase 2 field development Phase 2 1st oil Ruche Ruche studies / FEED Ruche field development 1st oil ANP approval Maromba FDP Phase 1 study / FEED approval Phase 1 Phase 1 field developmen
Slide 38: Previously reported gross BWE capex
Previously reported gross BWE capex Capex Total gross project cost from 2017 inception (USD million) Tortue phase 1 175 Tortue phase 2 240 Ruche phase 1 375 Dussafu exploration cost 88 Maromba phase 1 250 Maromba acquisition cost 115 Maromba phase 2 Not disclosed 38
Slide 39: For further information please contact ir@bwoffshore.com
For further information please contact ir@bwoffshore.com