Gulf Keystone Petroleum Limited · LSE:GKP
Gulf Keystone Petroleum — FY2019 Earnings Presentation
21 slides from Gulf Keystone Petroleum's earnings presentation, Apr 23, 2020
Slide 1: 2019 Full Year Results
i . BU GULF KEYSTONE PETROLEUM = ~ 2019 Full Year Results 23 April 2020
Slide 2: Disclaimer
Disclaimer This proprietary presentation (the “Presentation’) has been prepared by Gulf Keystone Petroleum Limited (the Company’) Under no circumstances may this presentation be deemed to be an offer to sell, a solicitation to buy or a solicitation of an offer to buy securities of any kind in any ju
Slide 3: 2019 Highlights
2019 Highlights
Slide 4: 2019 highlights
2019 highlights Strong operational performance with significant distributions to shareholders = Average gross production in 2019 of 32,883 bopd - in line with guidance =" Robust safety performance during a period of increased operational activity = Progress on 55,000 bopd expansion - restart of dril
Slide 5: The story of 2020 so far
The story of 2020 so far Decisive actions to preserve liquidity and protect value * Unprecedented volatility and uncertainty * COVID-19 pandemic and macro-economic deterioration * Brent oil price down over 70% since start of year, reaching sub USS$20/bbI * Delay in payments from KRG " Concrete steps
Slide 6: Operational Review
Operational Review
Slide 7: 2019 activity at Shaikan
2019 activity at Shaikan Atrush pipeline| SH-1&3 SH-4 SH-7 SH8 PF-1 pipeline SH-12 Debottlenecking activities nearly completed at PF-1 and PF-2 =" Completion of PF-1 pipeline - marking the end of export by trucking * Tubing workovers on SH-1 and SH-3 wells resulted in material production uplifts " S
Slide 8: Shaikan production
Shaikan production Continued production with strong focus on cost reductions » Average gross production in 2019 of 32,883 bopd, in line with guidance * Despite the challenges imposed by COVID-19, production operations continue * Reduced development and maintenance activity has impacted recent produc
Slide 9: Vision to develop Shaikan
Vision to develop Shaikan Phased approach provides flexibility to time capital investment = No further expansion investment until outlook improves = Gas management plan revised following results of SH-9 well = Revised FDP to be submitted in due course for MNR approval Triassic pilot Jurassic expansi
Slide 10: Strong focus on ESG
Strong focus on ESG Securing the long-term future for all stakeholders Environment Sustainability / Societal Governance 10 Plan to eliminate routine flaring and emissions by mid-2025 Effective waste management programme with cradle-to-grave traceability Remediation of inactive drilling sites Road co
Slide 11: Financial Review
Financial Review
Slide 12: 2019 financials
2019 financials Solid operational performance offset by oil price decline = Despite growth in production, key financials down y-o-y as Brent oil prices averaged USS64/bbl in 2019 (vs. US$71/bbI in 2018) Revenue EBITDA Profit /(Loss) after tax ussSm ussm ussm 300 160 $150m 100 $251m 140 20 seom 250 $
Slide 13: Continued focus on costs
Continued focus on costs 2019 Opex and G&A at low end of guidance =" Well placed to navigate through these challenging macro-economic conditions " 2020 costs reduction initiatives targeting Opex and G&A savings of at least 20% and reduction of expatriate workforce by c.60% Operating expenses") Gener
Slide 14: Strong balance sheet
Strong balance sheet Continued focus on maintaining a strong financial position = Limited capital commitments and low-cost structure = No repayment of US$100m bond until July 2023; significant covenant headroom * Cash balance of USS164 million”) Cash balance Equity ratio ussm % 350 90 $296m 300 80 7
Slide 15: Crude oil payments
Crude oil payments US$156m net to GKP received in 2019; US$50m received so far in 2020 = KRG commitment to pay for production by 15 day of following month = Dialogue with the KRG to collect outstanding invoices for November 2019 to February 2020 (total US$73 million net to GKP) $40 penne eeeneeeees
Slide 16: Outlook
Outlook
Slide 17: Outlook
Outlook Preserving liquidity and positioning to exploit long-term Shaikan value = Robust financial position * Cash balance of US$164 million” * Targeting major costs reductions to preserve liquidity * c.50% y-o-y reduction in 2020 net Capex of US$40-48 million " Opex and G&A savings of at least 20%
Slide 18: Appendix
APPENDIX Ewe
Slide 19: GKP at a glance...
GKP at a glance... =" Pure-play Kurdistan E&P with operatorship * 80% WI in Shaikan Field = Current expansion programme to 55,000 bopd suspended * Until improvement in economic conditions and resolution of outstanding payments = Vision to grow production to 110,000 bopd = Financial strength - conser
Slide 20: Full year financials
Full year financials 2019 2018 2017 2016 Gross production (bopd) 32,883 31,563 35,298 34,794 Brent") (USS/bbl) 64.5 713 54.1 43.6 Discount (USS$/bbl) 21.7 22.3 20.3 20.2 Realised price (USS/bbl) 42.9 49.0 346 23.8 Revenue (US$m) 206.7 250.6 172.4 194.4 EBITDA (USSm) 122.2 150.1 104.3 108.2 Profit af
Slide 21: Thank you
21 Thank you More resources are available at: www.gulfkeystone.com Ewe
Gulf Keystone Petroleum — FY2019 Earnings Presentation on 6ix