Beach Energy Limited · ASX:BPT
Beach Energy — Macquarie Australia Conference 2010
28 slides from Beach Energy's conference presentation, May 7, 2010
Slide 1: Expanding the Cooper Basin Base Business
Beach Energy Limited For personal use only Expanding the Cooper Basin Base Business Macquarie Australia Conference Sydney, 7 May 2010 Neil Gibbins General Manager – Exploration and Development 1
Slide 2: Compliance statements
Compliance statements For personal use only Disclaimer • This presentation contains forward looking statements that are subject to risk factors associated with oil, gas, geothermal and related businesses. It is believed that the expectations reflected in these statements are reasonable but they may
Slide 3: Today's presentation
Today’s presentation For personal use only Overview of Beach Energy Limited Cooper Basin shale gas: • Technical attributes • Resource potential • What’s happened in the US • Why Beach is positioned for success Other long term growth opportunities 3
Slide 4: Beach Energy Limited: A compelling value proposition
Beach Energy Limited (ASX : BPT): A compelling value proposition For personal use only • 2P reserves of 66 MMboe Strong base • Sustainable long-term oil and gas production business • FY 2010 production guidance now 7.4 MMboe • $140 million cash and zero debt* • Huge Cooper Basin shale gas resource p
Slide 5: Reserves & resources snapshot: June 2009
Reserves & resources snapshot: 30 June 2009 For personal use only 2P Reserves: 2P Reserves & Contingent 66 MMboe Resources: 359 MMboe 2P Reserves are a fraction of the total resource base Cooper / Eromanga Gippsland Egypt Cooper / Eromanga 2P Gippsland Other A solid and enviable base from which to g
Slide 6: Reserves and production
Reserves and production For personal use only Production 2P Reserves 10 160 9 140 8 120 7 100 6 MMboe MMboe 5 80 4 60 3 40 2 20 1 0 0 FY 2007 FY2008 FY 2009 FY 2010 FY 2006 FY2007 FY 2008 FY 2009 est. Gas & Gas Liquids Oil Gas & Gas Liquids Oil • Consistent production performance: • Solid reserves g
Slide 7: Corporate framework
Corporate framework For personal use only • Consistent, targeted growth: – Long-term cash flow, production and reserves – Value driven investments • Thinking ahead of the pack: – Early entry, low risk, high return – Participation in emerging technologies and opportunities • Balanced portfolio: – 60:
Slide 8: The 'base business': Cooper Basin production, development & exploration
The ‘base business’: Cooper Basin production, development & exploration For personal use only • Cooper Basin is a key supplier of onshore oil and gas to eastern Australian markets: – Diversified asset, product and market mix – Quality customers • Beach participates in approximately 300 exploration a
Slide 9: The 'base business': Conventional Cooper Basin oil & gas
The ‘base business’: Conventional Cooper Basin oil & gas For personal use only Cooper Basin Oil Cooper Basin Gas 2P reserves 14.3 MMbbl 2P reserves 228 PJ & 7.4 MMboe • Comprised of three key areas: • Gas & ethane contracts with major – Western flank (Beach operated) retailers and end consumers – Ce
Slide 10: Expanding the Cooper Basin 'base business': Positioning for long-term Australian gas supply
Expanding the Cooper Basin ‘base business’: Positioning for long-term Australian gas supply For personal use only • Beach is seeking to grow its base gas business in eastern Australian markets from the Cooper Basin • Good long-term growth opportunities for eastern Australian gas resources: – Strong
Slide 11: Schematic geology of natural gas resources
Schematic geology of natural gas resources For personal use only 11 Source: Energy Information Administration (EIA), US Department of Energy
Slide 12: Hydraulic fracturing
Hydraulic fracturing For personal use only STEEL CASING SHALE FRACTURES 12 Source: Modified from Chesapeake Energy
Slide 13: Cooper Basin: Significant shale gas potential
Cooper Basin: Significant shale gas potential For personal use only • Early identification of Cooper Basin shale gas potential • Captured prospective acreage with high equity participation • Huge resource potential: – Comparable to combined NSW and Queensland coal seam gas volume • Access to multipl
Slide 14: Nappamerri Trough: Potential gas in place greater than Tcf
Nappamerri Trough: Potential gas in place greater than 200 Tcf For personal use only • Extensive and thick shale packages • Similar properties to the best US shale plays • Nappamerri Trough total area ~ 10,000 km2 • Potential gas in place 20 – 100 Bcf/km2 • Beach has high equity participation in key
Slide 15: Why the Nappamerri Trough?
Why the Nappamerri Trough? For personal use only Geological properties Thick shale sequence 150m thick over 10,000 km2 Organically rich 5% Total Organic Carbon (TOC) Gas prone Proven Thermally mature Proven Overpressure Proven Tight gas sands Potential upside Mechanical properties Suitability for fr
Slide 16: The initial tests: Holdfast-1 & Encounter-1 exploration wells
The initial tests: Holdfast-1 & Encounter-1 exploration wells For personal use only • First well (Holdfast-1) spud planned for July 2010 • Vertical exploration wells • Gas in place (GIP) measurement a key objective: – Extensive coring – Evaluate gas content of shale – Determine porosity and free gas
Slide 17: Nappamerri Trough: Geographical context vs US basins
Nappamerri Trough: Geographical context vs US basins For personal use only Cooper Basin Nappamerri Trough 17
Slide 18: Cooper Basin shale gas: Similar to best US plays
Cooper Basin shale gas: Similar to best US plays For personal use only Parameter Cooper Basin Barnett Haynesville Nappamerri (Texas) (Louisiana) Trough Depth (ft) 9500 - 11500’ 5400 - 9600’ 10000 -13000’ Thickness (ft) 400 - 500’ 250 - 500’ 200 – 300’ Petrology Siliceous Siliceous Argillaceous Mudst
Slide 19: US technology improvements drive down costs: e.g. Bakken Shale
US technology improvements drive down costs: e.g. - Bakken Shale For personal use only • Technology advancements in Bakken Shale (oil), North Dakota multi – stage frac completions is driving efficiencies in US oil 40 & gas developments 35 30 • Key advancements are particularly associated with 25 lon
Slide 20: Australian industry dynamics lag the US on a number of fronts
Australian industry dynamics lag the US on a number of fronts For personal use only Some recent US shale gas transactions Deal Location Date Acres Value Mitsui - Anadarko Marcellus Feb 10 100,000 US$1.4b Total - Chesapeake Barnett Jan 10 270,000 US$2.25b ExxonMobil – XTO Various basins Dec 09 Includ
Slide 21: US shale gas production forecasts highlight its importance and global industry relevance
US shale gas production forecasts highlight its importance and global industry relevance For personal use only “…production from gas shale plays in 2030 is 50 percent higher in the AEO2010 reference case, than in the updated AEO2009 reference case.” - EIA 2010 Annual Energy Early Outlook, Dec 2009 2
Slide 22: Multiple long-term shale gas market options
Multiple long-term shale gas market options For personal use only • Good prospects to increase Existing Cooper Basin supply over time customers – extension contracts • New domestic gas supply Existing opportunities include: customers – – Power generation Export LNG incremental contracts – Feedstock
Slide 23: Cooper Basin shale gas: Indicative shale gas development timeline
Cooper Basin shale gas: Indicative shale gas development timeline For personal use only Pilot BOOK FIRST GAS Holdfast-1 production Pilot SALES & Design pilot BOOK GAS GAS well development Encounter-1 production RESOURCE RESERVE vertical well Q2 exploration Drill Q2 2011 wells Q4 2010/ Commence Q2 20
Slide 24: Some other long-term growth opportunities: 'Big oil' and 'big gas'
Some other long-term growth opportunities: ‘Big oil’ and ‘big gas’ For personal use only Papua New Guinea Tanzania Australia New Zealand 24
Slide 25: Tanzania - East African Rift: An emerging 'big oil' province
Tanzania - East African Rift: An emerging ‘big oil’ province For personal use only • Beach 100% • Under - explored, high potential region • Significant success in nearby analogous areas (Uganda) • Recent M&A activity in Uganda highlights regional potential • Potential for large (> 200+ MMbbl) discov
Slide 26: Offshore 'big gas' opportunities
Offshore ‘big gas’ opportunities For personal use only Browse Basin Gulf of Papua Canterbury Basin • LNG supply potential from existing portfolio: – Burnside (multi-Tcf discovery made in 2009, Beach 7.34%) – Pandora (mean gas resource approx. 0.8 Tcf, Beach 6.36%) – Barque gas prospect (multi-Tcf po
Slide 27: Beach Energy
Beach Energy For personal use only • Sustainable underlying base business: – Long-life reserves – Long-term production and cash-flow – Asset, product and market diversity • At the forefront of developing an Australian shale gas industry • Tangible growth potential targeting regionally specific oppor
Slide 28: Expanding the Cooper Basin Base Business
Beach Energy Limited For personal use only Expanding the Cooper Basin Base Business Macquarie Australia Conference Sydney, 7 May 2010 Neil Gibbins General Manager – Exploration and Development 28