Australis Oil & Gas Ltd. · ASX:ATS
Australis Oil & Gas — Shareholder Meeting (May 2021)
35 slides from Australis Oil & Gas's shareholder meeting presentation, May 11, 2021
Slide 1: Chairman's Address and Company Presentation Material – 2021 AGM
ASX Announcement 11 May 2021 For Immediate Release For personal use only Chairman’s Address and Company Presentation Material 2021 Annual General Meeting Please find attached to this document a copy of the Chairman’s address and the presentation that will be provided by Australis Oil & Gas Limited t
Slide 2: Chairman's Address – 2021 Annual General Meeting
Chairman’s Address – 2021 Annual General Meeting For personal use only Thank you very much to those of you in attendance today at the AGM of Australis Oil & Gas and thank you to those listening and or watching online. I wish you all the best in these times of pandemic difficulties and disruption. Th
Slide 3: Chairman's Address (continued)
Our current low share price and refusal to alter strategy towards momentarily fashionable new business ideas and thought bubbles can lead to criticism. We will wear that. It can also lead to challenges from third parties For personal use only without the capacity to offer funded, logical deals that
Slide 4: Australis Oil & Gas Presentation – May 2021
ASX: ATS For personal use only 2021 AGM Presentation 11 May 2021
Slide 5: Important Notice and Disclaimers
Important Notice and Disclaimers This presentation has been prepared by Australis Oil & Gas Limited ABN 34 609 262 937 (ASX: ATS) (Australis). For personal use only Australis or ATS means Australis Oil & Gas Limited and, where appropriate, all subsidiaries as at the date of this presentation. Summar
Slide 6: Strategy and Timing
For personal use only Strategy and Timing NOT FOR DISTRIBUTION OR RELEASE IN THE US 3
Slide 7: Australis Strategy
Australis Strategy The corporate strategy has remained consistent since 2014. Only the timing has been influenced by global events. For personal use only 1. Secure a material position in a quality unconventional oil play • Reservoir quality - key to success • Low entry cost – keeping finding costs t
Slide 8: Tuscaloosa Marine Shale
For personal use only Tuscaloosa Marine Shale NOT FOR DISTRIBUTION OR RELEASE IN THE US 5
Slide 9: TMS Core - a unique opportunity
TMS Core - a unique opportunity For personal use only Proven core delineated by drilling and production data, has allowed targeted and low risk accumulation of the acreage position Liquid rich at premium oil pricing (95% oil @ $5.60/bbl premium to WTI average 2019) Proven Base case well econom
Slide 10: TMS Core - Australis in a unique position
TMS Core - Australis in a unique position Largest acreage holder in the ‘core’ of the TMS > 100,000 contiguous net acres For personal use only 400 net future well locations with conservative spacing assumptions Largest production operator in play – 38 operated wells, 17 non operated wells, 1,3
Slide 11: TMS Asset: Land, Productivity, Operating Performance, Reserves
TMS Asset For personal use only Land Productivity Operating Performance Reserves NOT FOR DISTRIBUTION OR RELEASE IN THE US 8
Slide 12: TMS Core – Substantial acreage position provides scale and control
TMS Core – Substantial acreage position provides scale and control TMS Project Asset Profile Acreage Expiry Profile For personal use only Mississippi and Louisiana, USA Large contiguous land position in the TMS Core with >100,000 net acres (none on ~107,000 Net Acres federal lands) (37,700 HBP) 37
Slide 13: TMS Core – Tier Basin Productivity
TMS Core – Tier 1 Basin Productivity TMS Type Curve well productivity and decline profile outperforms many of the best counties within the four major For personal use only oil producing basins: the Permian, Eagle Ford, Williston (Bakken) and DJ - Niobrara 24 month cum. Oil Production (‘000 bbls) Ave
Slide 14: 2020 Operational Performance
2020 Operational Performance Australis managed production operations and utilised its strong hedge book to maximise cashflows during the oil price turmoil of 2020 For personal use only Production curtailed during April, May and June 2020. Hedge revenue continued whilst only fixed operating costs i
Slide 15: 2020 Operating & Financial Results
2020 Operating & Financial Results Disciplined capital management and robust TMS asset performance meant positive cash earnings despite challenging market conditions For personal use only ATS 2020 Quarterly Results Strong Field NetbackA of $24/bbl (NRI and excluding hedging) provided solid financi
Slide 16: TMS Core - Significant oil reserve and resource
TMS Core - Significant oil reserve and resource Material mid case recoverable estimate of 170 million bbls independently verified (Ryder Scott LP)1 For personal use only Australis TMS Reserves and Resources – as at 31 December 2020 Australis Net Oil 4 Reserve and Resource category (MMbbls) Reserves1
Slide 17: Industry Update
Industry Update For personal use only NOT FOR DISTRIBUTION OR RELEASE IN THE US 14
Slide 18: Evolution and impact of the US Shale Industry
Evolution and impact of the US Shale Industry US unconventional growth has heavily influenced global oil markets since 2007 For personal use only US oil production grew rapidly during this period to make them the largest producer in the world at over 14 million bbls per day and shale alone as the
Slide 19: Life Cycle of a Shale Play
Life Cycle of a Shale Play Eagle Ford Shale – Delineation, Improvement, Growth then Plateau For personal use only Eagle Ford Shale Production Plateau 3,000 Next 12,000 new wells 2,500 MBOE/Day 2,000 1,500 1,000 500 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Oil (mbbl/d)
Slide 20: Consolidation Occurring in the Permian
Consolidation Occurring in the Permian Permian Basin – Still plenty of Tier 1 inventory but industry consolidation limits entry opportunities for those companies without exposure For personal use only Six material corporate deals in the Permian from mid 2H 2020 – over 1.2 million acres acquired fo
Slide 21: Industry oil supply discipline
Industry oil supply discipline Industry discipline has seen oil price recovery but not a resultant increase in activity, capex and return to production growth out of the US. For personal use only Sourced Goldman Sachs – GSAM market review & outlook – April 2021 Prior to COVID-19, the US shale rig
Slide 22: Impact of supply discipline
Impact of supply discipline Upstream Operators are maintaining conservative investment programs despite rising commodity prices For personal use only Bullish Brent Crude Price Expectations Q2 2021 Q3 2021 Q4 2021 FY 2020 FY 2022 Goldman Sachs (GIR) $75 $80 $75 $73 $75 Citigroup $70 $74 $70 $69 $59 J
Slide 23: Australis Strategy and Timing
Australis Strategy and Timing Valuation is always a product of asset quality and scarcity…….empirical data supports TMS Core quality and the US For personal use only Shale evolution is now driving the latter. Prior to COVID-19, the US shale industry was going through a structural shift with dimini
Slide 24: Summary
Summary Experienced team and strategy will ultimately drive shareholder returns. For personal use only TMS Asset Quality Strategic Advantages of TMS Comparable productivity to best areas in Large resource of oil the USA. Long production history from Proximity to infrastructure 85 wells removes
Slide 25: Additional Information
For personal use only Additional Information NOT FOR DISTRIBUTION OR RELEASE IN THE US 22
Slide 26: Australis Corporate Snapshot
Australis Corporate Snapshot Well positioned after 2020 with experienced and invested Management Team For personal use only Key ATS Financial Statistics for FY 2020 & Q1 2021 Board & Management – Ex Aurora Founders & Management Average Sales (WI) ~1,380 bbl/day Jon Stewart Non-Executive Chairman Ave
Slide 27: Why TMS remains an undeveloped Tier oil shale play
Why TMS remains an undeveloped Tier 1 oil shale play Current status of TMS core a result of the sequence of local activity and reservoir quality + global oil markets For personal use only TMS is on trend with the Eagle Ford Basin in Texas and in 2010 it’s exploration was the logical next step for
Slide 28: Single Well TMS Type Curve
Single Well TMS Type Curve TMS Type Curve is a simple history match to averaged data from 15 ATS operated wells drilled in 2014 For personal use only TMS Type Curve – Assumptions TMS Core Type Curve v TMS Production Oil EUR – 610 Mbbls 250,000 Gas EUR – 159 MMscf 200,000 Oil Production (bbl) N
Slide 29: Large Well Inventory with Attractive Economics
Large Well Inventory with Attractive Economics Each of the ~400 net well locations has a conservative base-case NPV(10) of $5.0 million @ WTI $55/bbl For personal use only Single Well Economics NPV10A,B (US$MM) $3.4 $11.9 ATS-drilled Stewart well (2018) actual production performance $0.5 $8.5 $3.0 $
Slide 30: Strong Field Netbacks in TMS Core Driven by Multiple Factors
Strong Field Netbacks in TMS Core Driven by Multiple Factors Decline curve based on history match to average of the 15 2014 ATS wells Tier 1 oil well productivity in the TMS Core For personal use only − TMS Type Curve based on average of 2014 ATS well performance and consistent with Ryder Scott 2P
Slide 31: TMS Production Cost Reductions
TMS Production Cost Reductions ATS has lowered production costs in all three categories: fixed, variable, and workover For personal use only • Operating costs in the TMS are an integral contributor to the value proposition • Over the last 3 years ATS has reduced production costs through several init
Slide 32: Well Intervention Reduction
Well Intervention Reduction The Company has focused on reducing workover frequency, which is a major contributor to production costs For personal use only Australis has improved completion life and reduced workover costs since becoming operator in 2017, achieving a 66% reduction in workover freque
Slide 33: Case Study – Delaware Basin vs TMS
Case Study – Delaware Basin vs TMS Two recent ‘Tier 1’ transactions highlight the comparative value of the TMS 6,7 For personal use only WPX acquires Felix Energy for US$2.5 B (cash & stock) – December 2019 58,500 net acres, 60,000 boe/d production (70% oil), 190 wells drilled, 1,500 gross locatio
Slide 34: Footnotes
Footnotes For personal use only 1. All estimates and risk factors taken from Ryder Scott, report prepared as at 31 December 2020 and generated for the Australis concessions to SPE standards. See ASX announcement released on 5 February 2021 titled “Reserves and Resources Update Year End 2020”. Austra
Slide 35: Glossary
Glossary Unit Measure Unit Measure B Prefix - Billions bbl Barrel of oil For personal use only MM or mm Prefix - Millions boe Barrel of oil equivalent (1bbl = 6 mscf) M or m Prefix - Thousands scf Standard cubic foot of gas /d Suffix - per day Bcf Billion standard cubic foot of gas Abbreviation Desc