Gulf Keystone Petroleum Limited · LSE:GKP

Gulf Keystone Petroleum — FY2017 Earnings Presentation

21 slides from Gulf Keystone Petroleum's earnings presentation, Apr 11, 2018

  1. Slide 1: Gulf Keystone Petroleum Full Year 2017 Results

    Gulf Keystone Petroleum 11 April, 2018 Full Year 2017 Results

  2. Slide 2: Disclaimer

    2 Disclaimer These Presentation Materials are for information purposes only and must not be used or relied upon for the purpose of making any investment decision or engaging in any investment activity and should not be construed as, an offer for sale or subscription of, or solicitation of any offer

  3. Slide 3: 2017 Highlights: Jón Ferrier, CEO

    2017 Highlights: Jón Ferrier, CEO

  4. Slide 4: Highlights

    4 Highlights  Shaikan Crude Oil Sales Agreement  Key milestone – moving away from flat payments  Strong operational performance  Gross production at 35,298 bopd despite limited investment  34,794 bopd in 2016  Robust financial position and material cash generation  $104m EBITDA – moving into

  5. Slide 5: Corporate Governance

    5 Corporate Governance  Appointment of a new Non-Executive Chairman  Jaap Huijskes – joined Board in November 2017  Further Board appointments expected in 2018  Improved KPIs introduced in 2017  Further aligning organisation with shareholders

  6. Slide 6: Operational Review: Stuart Catterall, COO

    Operational Review: Stuart Catterall, COO

  7. Slide 7: Operational Highlights

    7 Operational Highlights  No lost time incidents; now over 3 million man hours without LTI  99% plant uptime  Average daily gross production of 35,298 bopd  Versus guidance of 32,000-38,000 bopd  Cumulative production from Shaikan of c.48 MMstb  Reservoir understanding enhanced  Opex per bbl

  8. Slide 8: The Shaikan Asset

    8 The Shaikan Asset  November 2007: Shaikan licence awarded  April 2009: Discovery well SH-1 drilled  June 2013: FDP approved  Two production facilities each with 20,000 bopd nameplate capacity  December 2014: 40,000 bopd PF-2 production first achieved SH-2 SH-5 SH-10 SH-11  Majority of crude

  9. Slide 9: Discovered and Producing Reservoirs: Jurassic

    9 Discovered and Producing Reservoirs: Jurassic  Production is currently from the Jurassic reservoirs Areal extent of the Jurassic is 135 sq. km  Substantial oil column – c.1,000m – gravity ranging from 18° API at the top to 11° API at the bottom  48 MMstb produced to date with no gas or water br

  10. Slide 10: Upside from Other Reservoirs: Triassic & Cretaceous

    10 Upside from Other Reservoirs: Triassic & Cretaceous  Oil has been discovered in the Cretaceous:  Heavy oil, 2P 3 MMstb / 2C 53 MMstb(1)  And the Triassic:  Light oil with 38 - 43 ° API and gas condensate  2P 44 MMstb / 2C 106 MMstb(1) (1) Source: ERC Equipoise. Gross volume estimates as at 3

  11. Slide 11: Development Outlook

    11 Development Outlook  Phased approach de-risks and progressively unlocks value  Significant work in the last 12 months to optimise the field development plan – ongoing  Debottlenecking to 75,000 bopd will allow accelerated ramp-up of production from existing production sites 100,000 bopd Object

  12. Slide 12: Financial Review: Sami Zouari, CFO

    Financial Review: Sami Zouari, CFO

  13. Slide 13: Crude Oil Sales Agreement

    13 Crude Oil Sales Agreement  Shaikan Crude Oil Sales Agreement signed in January 2018  A key milestone aligning GKP with peer producers  Transparent invoicing linked to Brent price and actual production  Moving away from a fixed $15m gross monthly payment  Oil sold at Brent minus c.$22/bbl dis

  14. Slide 14: Increased Monthly Payments

    14 Increased Monthly Payments  Significantly higher payments since February 2018 Note: February payment comprised October & November 2017 oil sales Payment from KRG – Net to GKP ($m) $35.0 $30.4 $30.0 $25.0 $20.0 $17.0 $15.0 $12.0 $12.0 $12.0 $12.0 $12.0 $12.0 $12.0 $12.0 $12.0 $12.0 $12.0 $12.0 $1

  15. Slide 15: Financial Highlights

    15 Financial Highlights  Robust operating performance in 2017 delivered further improvements of key metrics and trends Strong Upward Trends Steady Downward Trends (2017 vs 2016) (2017 vs 2016)  Cash Balance: +73%  Oil Production Costs: –25% $160m (vs $93m at 31 Dec 2016)  Shaikan Field Opex per

  16. Slide 16: Upward Trends: Revenue and Cash Receipts

    16 Upward Trends: Revenue and Cash Receipts Revenue Change in Cash  $157m of revenue based on cash received  2017 positive cash flow driven by steady (by 31 March 2018) operating activities, payments from KRG and limited investment  $15m of payables to the MNR offset against revenue arrears  $67

  17. Slide 17: Downward Trends: Continued Cost Optimisation

    17 Downward Trends: Continued Cost Optimisation  Focus on prudent resource management and cost saving initiatives leading to additional costs reduction against stable production in 2017  Costs reductions driven by:  Renegotiating key contracts  Rationalising organisational structure Operating Ex

  18. Slide 18: EBITDA and Profit After Tax

    18 EBITDA and Profit After Tax EBITDA Profit/(Loss) After Tax  EBITDA relatively stable despite $22m  Posting profit after tax in 2017 for the first revenue reduction time since entry to Kurdistan  $104m EBITDA  Two coupon payments ($5m each) made in April and October 2017  $24m Profit from Ope

  19. Slide 19: Conclusion

    Conclusion

  20. Slide 20: 2018 Focus – Shareholder Value

    20 2018 Focus – Shareholder Value  Operational Excellence  Safe operations and meet guidance (27,000-32,000 bopd gross)  Deliver on project milestones  Continuous cost optimisation  Commercial Clarity  Build on the Crude Oil Sales Agreement  Clarify commercial arrangements  Capital structure

  21. Slide 21: Thank you

    Thank you More resources are available at: www.gulfkeystone.com

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