Slide 1: 2016 Annual Results
2016 Annual Results 9 March 2017
Slide 2: Forward-looking statements
Forward-looking statements This presentation may contain forward-looking statements and information that both represents management's current expectations or beliefs concerning future events and are subject to known and unknown risks and uncertainties. A number of factors could cause actual results,
Slide 3: Agenda
Agenda 2016 highlights Tony Durrant Financial results Richard Rose Refinancing update Richard Rose Production update Tony Durrant Portfolio potential Robin Allan Outlook Tony Durrant March 2017 | P2
Slide 4: 2016 highlights
2016 highlights Strong production 71.4 kboepd, above guidance, driven by high operating efficiency performance across the portfolio $15.8/boe opex, 10% under budget; Reduction in cost base Other savings in capex and G&A costs Re-focussing the Value accretive E.ON acquisition completed; portfolio Dis
Slide 5: Financial results
Financial results Richard Rose
Slide 6: Financial highlights and outlook
Financial highlights and outlook Exploration & appraisal Capex ($m) Development 2016 highlights Abandonment & payments into escrow 800 • Profitable and positive operating cash flow 600 • Low and stable operating costs of $15.8/boe • Reduced capex commitments 400 • Net debt down from peak in Q3 2016
Slide 7: Positive operating cash flow
Positive operating cash flow 12 months 12 months Capital expenditure ($m) to 31 Dec to 31 Dec 2016 $m 2015 $m 2016 2017F Working Interest production (kboepd) 71.4 57.6 Exploration $102 $50 Entitlement production (kboepd) 66.1 53.4 Development $550 $290 Realised oil price (US$/bbl) – post hedge 52.2
Slide 8: Return to profit 2016
Return to profit 2016 12 months to 12 months to 31 Dec 2016 $m 31 Dec 2015 $m Sales and other operating revenues 983 1,099 Cost of Sales (773) (661) Impairments (556) (1,024) Gross profit/(loss) (345) (586) Exploration/New Business (58) (109) Reduction in decommissioning estimate 76 - General and ad
Slide 9: Refinancing
@ PremierOil Refinancing Richard Rose
Slide 10: Refinancing – timetable to implementation
Refinancing – timetable to implementation 3 Feb – LFTS 1 Mar – CB terms 9 Mar – FY Results & majority Target completion announced announced of lenders locked up by end of May Private Lenders Agree Long Form Credit Committee approvals & Term Sheet (LFTS) lock up agreements signed Scheme of Arrangemen
Slide 11: Refinancing terms
Refinancing terms Debt type Key amended terms Facilities confirmed 1 $4.0 bn Private lenders • Total facilities confirmed Cash & $3.4 bn Undrawn ($3.3bn) • Alignment of maturity dates to 31 May 2021 • RCF & LC: $2.5bn • Amendment of financial covenants • Term Loans1: $314m • Enhanced economics • USP
Slide 12: Producing portfolio
Producing portfolio Tony Durrant
Slide 13: Production overview
Production overview Largest 5 fields account for c. 70% of production March 2017 | P12
Slide 14: Chim Sáo, Vietnam (53.125%, operator)
Chim Sáo, Vietnam (53.125%, operator) 2016 highlights • Operating efficiency of 94% • $8.7/boe operating cost • Strong reservoir performance • Reduction in FPSO lease rate • Reserves increase of 13 mmboe Outlook • 2 infill wells planned in 2017 • Field life extended to 2028 55 mmboe at sanction Impr
Slide 15: Natuna Sea Block A, Indonesia (28.67%, operator)
Natuna Sea Block A, Indonesia (28.67%, operator) 2016 highlights BIGP • Singapore demand above take or pay • 44% of GSA vs 41% contractual share • Record deliveries under GSA2 • Operating efficiency >90% • Opex of $8.3/boe 93 Bcf Outlook $340m • Singapore demand stable gross capex • GSA1 market shar
Slide 16: Huntington, Central North Sea (100%, operator)
Huntington, Central North Sea (100%, operator) 2016 highlights • Increased equity to 100% • Production significantly increased − High operating efficiency − Strong reservoir performance Outlook • FPSO lease extension discussions underway Currently producing ~15 kboepd March 2017 | P15
Slide 17: Solan, West of Shetlands (100%, operator)
Solan, West of Shetlands (100%, operator) 2016 highlights • First oil achieved • Operational concept working well • Central reservoir on prognosis Outlook • Eastern area of field under-performing • Secured Transocean Spitzbergen rig at competitive rate to install 2 ESPs in P1 Top Solan Sand Depth Ma
Slide 18: Elgin-Franklin, Central North Sea (5.2%)
Elgin-Franklin, Central North Sea (5.2%) 2016 highlights • 105 kboepd for 8 months to 31 December 2016 • Strong winter gas demand • Low opex of $6.3/boe Outlook • Long field life; production forecast to continue until 2037 • 350 mmboe remaining reserves • Ongoing infill drilling, well intervention p
Slide 19: Portfolio potential
Portfolio potential Robin Allan
Slide 20: Portfolio potential
Portfolio potential Catcher Tolmount 700 mmboe of discovered but Cash flows prioritised towards debt reduction and selective reinvestment undeveloped reserves & resources Sea Lion Exploration March 2017 | P19
Slide 21: Catcher – under budget, start up 2017 2H
Catcher – under budget, start up 2017 2H 2016 Highlights US$mm 2,400 • Subsea installation programme 2,200 successfully completed below budget 2,000 • 9 wells completed to date with excellent 1,800 1,600 operational performance 1,400 • Fabrication of FPSO hull completed and 1,200 1,000 all topside m
Slide 22: Catcher FPSO progress since 2015
Catcher FPSO progress since 2015 March June March 2015 2016 2017 March 2017 | P21
Slide 23: Catcher outlook
Catcher outlook Yard-based pre-commissioning FPSO sailaway and FPSO hook up & Improved production profile and commissioning of FPSO transit to North Sea final commissioning anticipated Today 2017 First oil 2018 Drilling at Varadero Drilling at Burgman Drilling at Catcher Drilling at Burgman • 1 well
Slide 24: Tolmount – next phase of growth
Tolmount – next phase of growth Timetable to sanction • Most significant discovery in SNS since 1997 • Concept selected Q1 – Standalone, normally unmanned – 4 platform wells – 48km x 20” gas export to onshore • Offshore FEED contract awarded; engineering commenced • Potential 3rd party infrastructur
Slide 25: Tolmount – project timeline
Tolmount – project timeline 2017 2018 2019 2020 2021 2022 JV Project Sanction FEED & EPC tendering Platform Design and Fabrication Topsides HUC Gas Export Pipeline Design and Fabrication Offshore pipelay Onshore pipeline, shaft Landfall Construction & tunnel construction Cofferdam & nearshore Host M
Slide 26: Tolmount – future phases planned
Tolmount – future phases planned Tolmount East • Subsea tie-back or small platform Tolmount Tolmount Far East area Mongour Tolmount • Subsea tie-back or small platform ~ 1 Tcf Far East to Tolmount or Tolmount East Mongour Tolmount East • Subsea tie-back or extended reach well from Tolmount East 3rd
Slide 27: Southern Gas Basin: portfolio of opportunities
Southern Gas Basin: portfolio of opportunities Tolmount Main (50% op) Tolmount Area (50% op) Ravenspurn North Deep • On path to sanction • Future phases in planning (5% carried interest) • Play-opening carboniferous well currently drilling Babbage (47% op) • Infill opportunities Portfolio of opportu
Slide 28: Sea Lion
Sea Lion Highlights • FEED substantially completed • Breakeven reduced to $45/bbl – Capex to first oil reduced to $1.5bn – Field opex reduced to $15/bbl – Indicative FPSO cost of $10/bbl (LOF) Outlook • Positive commercial and fiscal engagement with FIG • Positive engagement with contractor 160 Phas
Slide 29: Exploration update – Mexico
Exploration update – Mexico W Zama-1 Well E • Exercised option to increase to 25% in Block 7, Mexico full stack reprocessed • 100-500 mmbbl prospect in 165m of water seismic data in depth • Drilling Q2 2017, rig contracted Flat Spot 3D view of the Zama Prospect showing top structure map and Zama-1 W
Slide 30: Portfolio potential
Portfolio potential March 2017 | P29
Slide 31: Outlook
@ PremierOil Outlook Tony Durrant
Slide 32: 2017 – Targets
2017 – Targets Maintain operating efficiency levels; Production Meet guidance of 75 kboepd (excluding Catcher) Cost Base Targeting further reductions in opex and G&A costs Non-core disposals Realise >$100m from non-core disposals Deliver first oil in 2017; build on development drilling programme Cat
Slide 33: Looking forward
Looking forward • Optimise quality producing assets in UK, Vietnam, Indonesia Strategy • Falklands, Mexico, Brazil offer transforming upside • Continuing programme of disposals 19.7 Opex $/boe 18.5 • De-leveraging from free cash flow 15.5 15.8 15.9 Financial • Covenant and liquidity headroom flexibi
Slide 34: Premier Oil Plc contact details
March 2017 www.premier-oil.com Premier Oil Plc 23 Lower Belgrave Street London SW1W 0NR Tel: +44 (0)20 7730 1111 Fax: +44 (0)20 7730 4696 Email: premier@premier-oil.com