Great Eastern Shipping Co. Ltd. · NSE:GESHIP
Great Eastern Shipping — Greatship (India) — Investor Presentation (February 2007)
71 slides from Great Eastern Shipping's investor presentation, Feb 15, 2007
Slide 1: Presentation on the Offshore Industry
PRESENTATION ON THE OFFSHORE INDUSTRY Venkatraman Sheshashayee Chief Operating Officer GREATSHIP (INDIA) LIMITED 15th February 2007 Greatship (India) Limited Where passion fuels performance…
Slide 2: A brief introduction – G E Shipping
A brief introduction The Great Eastern Shipping Company Limited (G E Shipping) • India's premier shipping company • Over five decades of experience • Currently owns and operates a fleet of 40 vessels comprising of 31 tankers (14 crude oil carriers, 15 product carriers, and 2 LPG carriers) and 9 dry-
Slide 3: A brief introduction – Greatship (India) Limited
A brief introduction Greatship (India) Limited (GIL) • A wholly owned subsidiary of G E Shipping • Establishing itself as a premier service provider to operators in the offshore energy exploration and production domain globally • Eventually, GIL’s scope will extend to full participation in the E & P
Slide 4: A brief introduction – Venkatraman Sheshashayee
A brief introduction Venkatraman Sheshashayee (Shesh) • Indian, 44 years, married, two children • B E (Marine) – DMET Calcutta • PGDM – IIM Bangalore • A wholly owned subsidiary of Radhika • Has worked in Engineering, Operations, Commercial, Marketing, Sales, Human Resources and Finance • Indulges i
Slide 5: Scope
Scope • Defining the “offshore” business • The offshore market – segments & assets • The offshore market – business drivers • The offshore market – today • The offshore market – the coming years • The offshore market in India Greatship (India) Limited 5 Where passion fuels performance…
Slide 6: Defining the Offshore Business
DEFINING THE OFFSHORE BUSINESS Greatship (India) Limited 6 Where passion fuels performance…
Slide 7: The offshore business
The offshore business The offshore oil field business consists of the following activities - • Survey • Exploration • Construction • Production • Maintenance & Upgradation Each of these activities is distinct by virtue of life cycle, technology, assets required and expertise Greatship (India) Limite
Slide 8: The offshore business – Survey
The offshore business Survey • Seismic services • Geo-technical services • Data interpretation and analysis Greatship (India) Limited 8 Where passion fuels performance…
Slide 9: The offshore business – Exploration
The offshore business Exploration • Well engineering and well design • Drilling (vertical and directional) • Drilling services - Mud engineering and logging services - Cementing - Well logging - Perforation - Well testing and completion - Coring and fishing • Logistics services – sea, air and land G
Slide 10: The offshore business – Construction
The offshore business Construction • Platform - Platform design, fabrication & installation - Sub sea well engineering - Sub sea piping - Riser installation • Pipe laying • Logistics services – air, sea and land Greatship (India) Limited 10 Where passion fuels performance…
Slide 11: The offshore business – Production
The offshore business Production • Logistics services – air, sea & land • FPSOs / FSOs • Field & Marginal Field Development - Drilling - Drilling services - Horizontal drilling / Side tracking - Well stimulation Greatship (India) Limited 11 Where passion fuels performance…
Slide 12: The offshore business – Maintenance & Upgradation
The offshore business Maintenance & Upgradation • Additional well drilling • Additional risers / clamp ons • Pigging services • Sub sea maintenance and inspection • Logistics services – air, sea & land • De-commissioning Greatship (India) Limited 12 Where passion fuels performance…
Slide 13: The offshore business – industry summary
The offshore business To sum it up, the offshore oil/gas exploration and production services industry now consists of about 450 operators and contractors, providing a diverse range of services including but not limited to – Survey – provision and operation of seismic survey vessels, geological analy
Slide 14: The offshore business – construction and production
The offshore business Construction and development – provision of design, fabrication and installation services for jackets, platforms, pipelines, risers; provision and operation of pipelaying barges, accommodation and hook-up barges, Diving Support Vessels (DSVs), Remote Operated Vehicles (ROVs), e
Slide 15: The offshore business – marine logistics and support
The offshore business Marine logistics – provision and operation of marine assets such as Anchor Handling Tugs (AHTs), Anchor Handling Tug Supply Vessels (AHTSVs), Platform Supply Vessels (PSVs), Multi Support Vessels (MSVs), standby vessels, crew vessels, etc., that support drilling unit and platfo
Slide 16: Some characteristics of the offshore market
The offshore business Some characteristics of the offshore market - Regional markets - Varied transaction processes - Thus, ability to differentiate - High regulatory barriers of entry – cabotage, country-specific security policies, etc. - Akin to manufacturing - Technology is a critical driver Grea
Slide 17: The Offshore Market – Segments & Assets
THE OFFSHORE MARKET SEGMENTS & ASSETS Greatship (India) Limited 17 Where passion fuels performance…
Slide 18: The offshore market segments
The offshore market The offshore oil field market is broadly classified into the following four segments - • Drilling & allied services • Sea logistics & special services • Offshore construction & projects • Air logistics Most service providers tend to specialise in one of the above market segments.
Slide 19: Drilling & allied services
The offshore market – Drilling & allied services DRILLING ULTRA DEEP WATER DEEP WATER SHALLOW WATER DRILL BARGES DRILL SHIPS DRILL SHIPS JACK UP RIGS SEMI SUBMERSIBLES TENDERS SEMI TENDERS - 1,500 M + - 150 - 1,500 M - < 150 M - DP2 - Moored or DP - Pinned / moored - 15,000 psi - 10 - 15,000 psi - 1
Slide 20: Common drilling unit categories
The offshore market – Drilling & allied services Common drilling unit categories – • Jack Up Rig • Semi submersible • Drillship Greatship (India) Limited 20 Where passion fuels performance…
Slide 21: Jack Up Rig
The offshore market – Drilling & allied services Common drilling unit categories – Jack Up Rig Greatship (India) Limited 21 Where passion fuels performance…
Slide 22: Semi-submersible
The offshore market – Drilling & allied services Common drilling unit categories – Semi-submersible Greatship (India) Limited 22 Where passion fuels performance…
Slide 23: Drillship
The offshore market – Drilling & allied services Common drilling unit categories – Drillship Greatship (India) Limited 23 Where passion fuels performance…
Slide 24: Sea Logistics
The offshore market – Sea Logistics, etc. SEA LOGISTICS SEARCH EXPLORATION PRODUCTION SERVICE SURVEY RIG POSITIONING VESSELS VESSELS VESSELS RIG POSITIONING SERVICE VESSELS VESSELS SUPPLY VESSELS RESCUE VESSELS SEARCH EXPLORATION PRODUCTION Scanning the seabed Test drilling Supply Well construction
Slide 25: Sea Logistics – offshore support duties
The offshore market – Sea Logistics, etc. OFFSHORE SUPPORT DUTIES SUB SEA SUPPLY RIG PLACEMENT PROTECTION OPERATIONS Personnel Ice breaking Inspections Fire fighting Equipments Laying Anchors Construction Rescue Consumables Positioning Maintenance Survivors Waste Towing Pipe/Cable lay Oil recovery S
Slide 26: Common vessel categories
The offshore market – Sea Logistics, etc. Common vessel categories – • PSV : Platform Supply Vessel • AHTSV : Anchor Handling Tug Supply Vessel • AHT : Anchor Handling Tug • STBY : Standby Rescue Vessel • CONSTR : Construction/Subsea Vessel Greatship (India) Limited 26 Where passion fuels performanc
Slide 27: Common vessel categories – PSV
The offshore market – Sea Logistics, etc. Common vessel categories - PSV Greatship (India) Limited 27 Where passion fuels performance…
Slide 28: Common vessel categories – AHT
The offshore market – Sea Logistics, etc. Common vessel categories - AHT Greatship (India) Limited 28 Where passion fuels performance…
Slide 29: Common vessel categories – AHTSV
The offshore market – Sea Logistics, etc. Common vessel categories - AHTSV Greatship (India) Limited 29 Where passion fuels performance…
Slide 30: Common vessel categories – MSV
The offshore market – Sea Logistics, etc. Common vessel categories - MSV Greatship (India) Limited 30 Where passion fuels performance…
Slide 31: Construction services
The offshore market – Construction services CONSTRUCTION PIPE LAY PLATFORMS SUB SEA WELL ENGINEERING PIPE LAY & MAINTENANCE INSTALLATION WELL INSPECTION REPAIR & MAINTENANCE RISERS MAINTENANCE Greatship (India) Limited 31 Where passion fuels performance…
Slide 32: Construction services – Platforms
The offshore market – Construction services Platforms Greatship (India) Limited 32 Where passion fuels performance…
Slide 33: Construction services – Accommodation Barge
The offshore market – Construction services Accommodation Barge Greatship (India) Limited 33 Where passion fuels performance…
Slide 34: Construction services – Diving Support Vessel
The offshore market – Construction services Diving Support Vessel Greatship (India) Limited 34 Where passion fuels performance…
Slide 35: Air Logistics – Helicopters
The offshore market – Air Logistics Helicopters Greatship (India) Limited 35 Where passion fuels performance…
Slide 36: Matching drilling units to vessels
The offshore market Matching drilling units to vessels JACK-UP 2ND GEN 3RD GEN 4TH GEN 5TH GEN DP DP DRILLSHIP 100M Water Depth 500M 1000M 2000M 3000M PSV (DWT) PSV (DWT) PSV (DWT) PSV (DWT) PSV (DWT) PSV (DWT) 2000-4000 2000-4000 2000-4500 2000-4000 2000-5000 2000-5000 AHTS (BHP) AHTS (BHP) AHTS (B
Slide 37: Matching platforms to vessels
The offshore market Matching platforms to vessels FIXED FPSO/SEMI TLP SPAR PLATFORM Water Depth 500 m 2000 m 2500 m 3000 m PSV (DWT) PSV (DWT) PSV (DWT) PSV (DWT) 2500-4000 2000-4000 2000-3000 2500-4500 AHTS (BHP) AHTS (BHP) 6000-12.000 8000-12.000 Winch Winch 150 Tonnes 200 Tonnes Greatship (India)
Slide 38: The Offshore Market – Business Drivers
THE OFFSHORE MARKET BUSINESS DRIVERS Greatship (India) Limited 38 Where passion fuels performance…
Slide 39: A brief history
The offshore market – a brief history The offshore oil/gas exploration and production services industry is relatively quite nascent. - the first offshore exploration venture took place in the Mississippi delta in 1929 - the first submersible drill barge, Mr. Charlie, was launched in 1954 - the first
Slide 40: A brief history – three upheavals
The offshore market – a brief history Three upheavals drove the world to offshore exploration - - The discovery of huge oil reserves in the North Sea in the sixties - The OPEC oil shock in the early seventies - USA reaching peak onshore oil production in the late seventies Greatship (India) Limited
Slide 41: Drivers & influencers
The offshore market – drivers & influencers Direct drivers : • World economy • Oil (and Gas) prices • Asset supply/demand equations Influencers : • Oil consumption patterns and growth rates • Production/ reserve replacement ratio • OPEC policies • Global and regional politics • Oil futures speculati
Slide 42: Drivers & influencers – boosters and threats
The offshore market – drivers & influencers Boosters : • Surveying, exploration & drilling technology • National energy security policies • Manufacturing growth • Increase in automobile usage Threats : • Alternative energy measures / subsidies • Energy efficiency measures Greatship (India) Limited 4
Slide 43: Global oil consumption
The offshore market – drivers & influencers Global consumption (past 30 years) : Year 1975 1980 1985 1990 1995 2000 2005 Oil Consumption ('000 Bpd) 54,962 61,678 59,015 66,390 69,506 75,779 82,459 EIA expects oil demand to grow at a CAGR of 1.8% over 2006-10. The anticipation of increased oil demand
Slide 44: Global demand forecasts
The offshore market – drivers & influencers Global demand forecasts (next four years) : (Expected to reach 118 mbd by 2030) Greatship (India) Limited 44 Where passion fuels performance…
Slide 45: Proved reserves (life in years)
The offshore market – drivers & influencers Proved Reserves (Life in years) : (At current rate, expected to reach 31 years by 2015) Greatship (India) Limited 45 Where passion fuels performance…
Slide 46: Global upstream capital spending
The offshore market – drivers & influencers Global Upstream Capital Spending (2001 - 2005) : (Average spend between 1990 – 2000 = US$ 65 billion) Greatship (India) Limited 46 Where passion fuels performance…
Slide 47: Comparative consumption figures by region
The offshore market – drivers & influencers Comparative consumption figures : Regional Oil 2000 2005 CAGR Consumption USA 23,522 24,875 1.12% Europe 15,942 16,415 0.59% Asia Pac 20,839 23,957 2.83% China 4,772 6,988 7.93% Japan 5,577 5,360 -0.79% (Non-OECD Asia expected to grow at 3.5%) Greatship (I
Slide 48: Per capita annual oil consumption
The offshore market – drivers & influencers Comparative consumption figures : Country Per capita annual oil cons. USA 25 bbls Japan 16 bbls China 02 bbls India 01 bbl (Urban = 2; Rural = 0.5) (Expected growth : China = 4.5% pa; India = 3.2% pa) Greatship (India) Limited 48 Where passion fuels perfor
Slide 49: What has been driving the price of oil
The offshore market – drivers & influencers What has been driving the price of oil in the recent past? While the eighties oil price spike was largely due to supply side crises, the current steady rally over the past two and a half years is believed to be due to : • Robust consumption growth / antici
Slide 50: Inadequate investment in offshore
The offshore market – drivers & influencers What has been driving the price of oil in the recent past? Inadequate investment in offshore – 1975-84 1985-94 1995-2004 Wells drilled 18,400 11,240 7,800 Rigs built 483 72 83 OSVs built 2,971 780 1,869 Greatship (India) Limited 50 Where passion fuels perf
Slide 51: The Offshore Market – Today
THE OFFSHORE MARKET TODAY Greatship (India) Limited 51 Where passion fuels performance…
Slide 52: Overview of today
The offshore market – overview of today The Oil & Gas Industry is currently defined by high oil prices and low spare capacities. The primary reason for low spare capacities – low investments in E&P activities during 1980s and 1990s. Oil/Gas E&P industry growing rapidly due to need for energy self-su
Slide 53: Overview of today – EIA estimates
The offshore market – overview of today EIA estimates that global oil consumption will rise from 85 mbd in 2006 to 118 mbd in 2030. Oil prices are estimated to remain within a band of US$ 45 – US$ 60 (2004 prices) between now and 2030. Maximum Oil/Gas consumption growth projected in non- OECD Asian
Slide 54: Overview of today – ageing assets
The offshore market – overview of today Offshore Oil/Gas E&P services industry growing rapidly in terms of size, spread & value due to increased E&P activities. Offshore industry suffers from outdated and antiquated assets (more than 50% of fleet > 20 years old) Industry requires larger, more capabl
Slide 55: Overview of today – order books and rates
The offshore market – overview of today Increasing requirement of tailor made & specialized assets for regional and multipurpose operations. Shipyards’ order books are full till 2009 in general, and till 2010 for certain vessel classes. Rig building yards’ order books are full till 2009 for JURs, an
Slide 56: Indicative charter rates
The offshore market – overview of today Some indicative charter rates (US$ per day) - 2002 2006 Jack Up Rig (300’) 45,000 150,000 PSV (3,000 DWT) 8,500 17,000 AHTSV (150 TBP) 14,500 25,000 Semi sub (1,500 m) 175,000 400,000 MSV 35,000 75,000 Greatship (India) Limited 56 Where passion fuels performan
Slide 57: Indicative asset prices
The offshore market – overview of today Some indicative asset prices (US$ million) - 2002 2006 Jack Up Rig (300’) 90 160 PSV (3,000 DWT) 16 22 AHTSV (150 TBP) 18 31 Semi sub (1,500 m) 200 375 MSV 35 55 Greatship (India) Limited 57 Where passion fuels performance…
Slide 58: The Offshore Market – The Coming Years
THE OFFSHORE MARKET THE COMING YEARS Greatship (India) Limited 58 Where passion fuels performance…
Slide 59: The coming years – burning question
The offshore market – the coming years The burning question - • How long is this booming market situation going to last? The concomitant concerns – • Will the oil price remain high? • What about petroleum substitutes? How will they affect the future? • Isn’t the industry overbuilding assets? Won’t t
Slide 60: The coming years – EIA and IEA outlook
The offshore market – the coming years The EIA (Energy Information Administration) and the IEA (International Energy Agency) have both reported - • The price of oil is expected to range between US$ 45 – US$ 60 over the next 25 years. • This price band is based on business-as-usual. Any disruption (w
Slide 61: The coming years – Oil & Gas Journal report
The offshore market – the coming years The Oil & Gas Journal 2006 report states - • Worldwide crude and condensate production rose a mere 0.18%, from 72.26 million b/d to 72.39 million b/d. • Depletion continues to overwhelm new production in the North Sea (-9.6%). • Most regions were flat (Asia-Pac
Slide 62: The coming years – alternatives to oil
The offshore market – the coming years Some facts - • Today, there is no economically scalable alternative to oil. • Existing alternatives suffer from – - lack of energy density and inability to scale - energy intermittency - inappropriateness as transportation fuels - most alternatives need oil to
Slide 63: The coming years – fleet age and depths
The offshore market – the coming years Some facts - • 55% of the world’s offshore vessel fleet is more than 20 years old. • 42% of the world’s offshore drilling unit fleet is more than 30 years old. • The average depth of offshore oil well drilled in 1985 was 2,800 feet. The average water depth was
Slide 64: The coming years – order books and decommissioning
The offshore market – the coming years Some facts - • The total world order book for offshore vessels adds up to 16.5% of the existing fleet. • The total world order book of offshore drilling units adds up to 17.2% of the existing fleet. • 120 platforms need to be de-commissioned in the North Sea. E
Slide 65: The Offshore Market – India
THE OFFSHORE MARKET INDIA Greatship (India) Limited 65 Where passion fuels performance…
Slide 66: India – offshore facts
The offshore market – India Some facts - • Only 18% of India’s total offshore area has been explored. • 58 offshore wells were drilled between 2000–2004; NELP envisages 498 wells to be drilled between 2006-2012. • India imports 73% of its crude oil requirements. In 2006, the crude import bill crosse
Slide 67: India – foreign vs Indian assets
The offshore market – India Some facts - • Of the 87 vessels chartered by operators for the Indian offshore, only 47 are Indian. The rest come from Europe, Middle East and Far East. • Of the 31 drilling units chartered by operators for the Indian offshore, only 8 are Indian. The rest come from USA a
Slide 68: Mainstream Indian companies and fleets
The offshore market – India Some facts - Mainstream Indian companies working in India (and their fleets) Vessels Drilling units Great Offshore 37 2 SCI 10 0 Varun Shipping 3 0 Garware Offshore 6 0 Tag Sea Logistics 6 0 Aban Offshore 0 9 Jindal Drilling 0 2 Greatship (India) Limited 68 Where passion
Slide 69: Mainstream foreign companies and fleets
The offshore market – India Some facts - Mainstream Foreign companies working in India (and their fleets) Vessels Drilling units Transocean 0 88 ENSCO 0 49 Noble Drilling 0 63 Pride Offshore 0 64 Tidewater 457 0 Solstad 31 0 Swire Pacific 46 0 Gulf Offshore 48 0 Schlumberger Baker Hughes Clough Offs
Slide 70: Thank You
THANK YOU Greatship (India) Limited Where passion fuels performance…
Slide 71: Bibliography
Bibliography • IEA (International Energy Agency) • EIA (Energy Information Administration) • BP Energy Review (www.bp.com) • CIA World Factbook • Bloomberg • DOE (USA - Department of Energy) • ODS Petrodata • Directorate General Of Hydrocarbon (www.dgh.org) • Rigzone (www.rigzone.com) Greatship (Ind
Greatship (India) — Investor Presentation (February 2007) on 6ix